Our CFO in Canada just got denied entry to the U.S. What do we do? This is a call that we seem to be getting more frequently from our Canadian corporate clients. We have seen a recent trend where Canadian companies with U.S. operations reorganize and appoint C-level positions and executive positions responsible for the U.S. and Canada as one region rather than having one person responsible for the U.S. and one person responsible for Canada. As operations become more global, the U.S. and Canada are being united into one region rather than two separate regions.
While this might make practical business sense, there are unintended visa consequences. When a business executive departs Canada to come to the U.S., he usually goes through U.S. Customs and Border Patrol (CBP) at the airport in Canada. When asked about the purposes of the trip, the executive will typically answer, “I am coming for business”. Sometimes this is sufficient and the executive is admitted into the U.S. and boards the plane. Other times, the CBP Officer may ask further questions that may include, “Do your responsibilities cover the U.S.?” or “Do you supervise employees in the U.S”? If the response is “yes”, then the CBP officer can deny the executive entry into the U.S. and advise that a work permit is needed. Or in a slightly better scenario, the executive is let in with a warning that the next time he will need a work visa.
While possible visa solutions exist for this scenario including E-2, L-1, or even O-1 visas, these take time to prepare. In the meantime, the executive cannot enter the U.S. for business. Therefore, if a Canadian and U.S. company are reorganizing and assigning North America (U.S. and Canada) as a region to be covered by one person, the company needs to seek immigration advice about whether or not a work visa is necessary for the country where the executive will be visiting on a routine basis. If the person is based in Canada and traveling to the U.S., then he will need to have a U.S. work visa for his travel to the U.S. Likewise, if the person is located in the U.S., then the person will likely need a work visa in Canada for his trips to Canada.
In a similar situation, Canadian individuals who are members of a Board of Directors for a U.S. company also need work visas to come to Board meetings in the U.S. if they are being paid for their services. We recently had a corporate client contact us saying that one of their Board members who is a Canadian citizen was recently denied entry into the U.S. because when questioned, she replied that she was coming to the U.S. for a Board meeting and that for this meeting she would be paid. Once she said that she would be paid, she was denied entry and told that she would need a work visa to enter the U.S. While there is a provision in the Foreign Affairs Manual of the U.S. Department of State that foreign nationals can enter the U.S. to attend Board of Director meetings as a business visitor, if that person is going to get paid to attend the meeting then a work visa is necessary.
As businesses become more global, companies assigning executives to cover the North American Region need to plan in advance to ensure that they have obtained the necessary visas so that these individuals can work in both Canada and the U.S.
Please contact Trow & Rahal if you need advice on visas for the U.S. or for Canada for your executives covering the North America region.
Posted by: Linda Rahal