1. the employee to be principally under the control / supervision of the unaffiliated worksite employer; or
    

2. the offsite placement work duties to consist of essentially labor for hire, rather than placement connected with the specialized knowledge concerning the petitioning company's product or service. (L1Bs are supposed to be performing duties that require specialized knowledge regarding the company, its product or service.)

Safe Harbor if L1B Works Only at L1B-Sponsoring Employer's Worksite
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The Memo recognizes that the ineligibility provisions relate only to those workers engaged in offsite employment. They do not apply if the L1B beneficiary will be working at the sponsoring employer's physical location. For example, if Company A is physically located at 123 Anywhere Lane, Chicago, Illinois, and Company A has indicated that the L1B beneficiary will only work at 123 Anywhere Lane, Chicago, Illinois, the L1B petition cannot be denied under the restriction on offsite work.
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What Happens if Work is Divided at Petitioner's Worksite and Client Worksite?
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If Company A indicates that the L1B beneficiary also will be working at 456 Somewhere Else Lane, Dallas, Texas, then the analysis under the L-1 Visa Reform Act must begin. First, USCIS will look to see whether the L1B beneficiary will primarily work at the employer's physical location or offsite at an unaffiliated employer's location. If the majority of the services / work will be performed at the L-1 petitioning employer's location, then the restriction would still not apply. The restriction is only for those L1B individuals performing the majority of their work-related activities at a worksite other than the petitioner or affiliate. If the majority of the work will be done at 456 Somewhere Else Lane, then the USCIS would further explore whether the restriction applies. This is not, however, simply a matter of adding up hours spent at each location.
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The Memo notes that the USCIS will examine what the L1B beneficiary does when s/he is at each location to determine where the work is primarily performed. It is possible for the L1B beneficiary to spend more time at 123 Anywhere Lane than 456 Somewhere Else Lane and still potentially be subject to the restriction. This would occur if the USCIS determines, overall, that the L1B beneficiary spends less time doing the work described in the L1B petition at 123 Anywhere Lane. Therefore, simply training or spending downtime at 123 Anywhere Lane for more than half of the time would likely not be enough to end the review of whether the restriction may apply, since the work described in the petition would primarily occur at 456 Somewhere Else Lane.
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As explained above, however, performing the majority of the L1B duties off site triggers a review and analysis, but is not an automatic disqualification for the L1B. Disqualification only occurs if one of the two other requirements is met. The analysis of each of these is explained below.
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Principal Control and Supervision of the Beneficiary
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In the example, if the USCIS determines that the L1B beneficiary will primarily work at 456 Somewhere Else Lane, then the USCIS will look to see who would principally control and supervise the L1B beneficiary. The Memo confirms that "principally" means first and foremost. If someone employed by the company located at 456 Somewhere Else Lane is supervising and controlling the work, then the L1B petition will not be approved. If, however, someone employed by Company A is controlling and supervising the work, this restriction would not apply. The USCIS recognizes that someone at the company located at 456 Somewhere Else Lane may provide input, feedback, or guidance regarding the company's needs and goals, but directing the L1B employee's tasks and activities should fall to an employee of the L1B sponsoring employer.
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Work Must Require Specialized Knowledge of Company or its Products / Services
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Even if the L1B beneficiary is supervised by a person from the L1B-sponsoring employer, the restriction still may apply if the L1B beneficiary is not doing work that requires specialized knowledge. For example, if Company A primarily contracts out employees to various projects that do not require the specialized knowledge possessed by the L1B beneficiary, the L1B petition will not be approved. Thus, the L1B is not always available as an alternative to the H1B. These restrictions are, in part, designed to eliminate the practice of characterizing workers as L1B specialized-knowledge workers when their work could have been performed by workers without any particular experience or familiarity with the company or its products.
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Effective Date of June 6, 2005 for all L1Bs includes L1B Extensions
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These provisions have applied to all L1B cases, effective as of June 6, 2005. They do not only apply to new, first-time petitions. Any application for an L1B, including an L1B extension, will be reviewed under these provisions. This means, in some cases, that persons who were previously approved for L1B petitions may not be able to obtain extensions, due to their offsite work combined either with a lack of direct employer supervision or performance of work that does not require specialized knowledge. Those companies uncertain about the ability to extend the status of their L1B employees should obtain proper immigration law advice.

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