The employee must have worked physically outside the US for at least one year in the last three years for the transferring business, either as a manager or executive or specialized knowledge worker.  The requirements are quite strict these days.  If time has been spent in the US this will not count towards the one year requirement that you have worked for the business outside the US.  L1A visa management level people will usually need to show that they have managed a number of staff outside the US.  L1B visa specialized knowledge workers should have high levels of specialized knowledge in a particular area.