After H-1B, US to take closer look at L-1 visa applications

Visa applications by India's software services firms that get roughly half their revenue from work done at client sites overseas are likely to come under greater scrutiny this year in their biggest market, as the United States looks to tighten these rules. Infosys, Tata Consultancy Services and other Indian IT firms will have to deal with site inspections by the US Citizenship and Immigration Services (USCIS) that now include holders of L-1 visas, the second most popular visas for Indian IT firms.

Indian companies already face greater scrutiny of their H-1B visas, the most widely used short-term work permits by the $108 billion outsourcing industry, to outplace staff at client sites. Over the past two months, the USCIS has said it will inspect L-1 holders as well. For the IT firms, "it could open a Pandora's box", said Sheela Murthy, founder and president of Maryland-based Murthy Law, which specialises in immigration.

"When they expand this programme, it could affect all employers, making it very hard for IT companies to send staff on L-1 visas," Murthy added. The USCIS has expanded the administrative inspections after a detailed report in August by the US Department of Homeland Security that made several recommendations on the L-1 programme. The report also pointed out that the top Indian IT companies, including USbased Cognizant Technology Solutions, and the Indian unit of IBM, the world's largest technology services provider, were among the top 10 L-1 beneficiaries from 2002 to 2011.

Indian IT firms are also among the top beneficiaries of the H-1B short-term work visa programme and US immigration lawyers expect the current cap of 65,000 to be reached in a matter of days once the application window opens on April 1. Last year, the cap was reached in five days.

"This year India's top software firms are expected to apply for a higher number of L-1 and H-1B visas ... there is higher competition," said a lawyer who didn't want to be named. The Indian companies' use of these visas is already on the radar of US lawmakers, some of whom have proposed a ban on outplacement of H-1B visa holders, as part of a wider US immigration overhaul.

In recent years, especially during the recent extended period of economic uncertainty, Indian companies have had to deal with more rejections as well as delays on their visa applications.

Last year, Infosys paid $34 million to settle a US Grand Jury investigation into the Bangalore-based No 2 IT provider's past use of B1 business visas. USCIS' move to expand inspections could result in a higher number of L-1 visa rejections over the coming months, software industry and immigration lawyers said.

"The number of L-1 visa rejections have increased in the past few years," said Rakesh Prabhu, a partner at Bangalorebased law firm ALMT. "These audits are a result of heightened scrutiny by the US," said Ameet Nivsarkar, vice president at Nasscom, the Indian outsourcing industry lobby. "Even the Senate version of the immigration bill calls for more audits and verifications," Nivsarkar said.

The bill will likely be debated this year by the US House of Representatives, where lawmakers have said they will take a more piecemeal approach, looking at individual proposals. TCS, Infosys and Wipro, India's top three IT firms, declined to comment. The work-site inspection programme is aimed at making L-1 visa applications fraud-proof and includes a visit by a visa officer to verify the information submitted by the employer and H-1B visas ... there is higher competition," said a lawyer who didn't want to be named.

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