They can be affiliates if the same individuals own and control both in approximately the same proportions. The relationship is proven with share registers and filings; being owned by relatives is not itself enough.
Same people, same proportions, both controlled: check all three
Hypothetical example: the two siblings each hold fifty percent of the Edenwold retailer, but in the U.S. company one sibling holds seventy percent and a U.S. investor holds thirty. The same individuals do not own approximately the same proportion of each entity, and the U.S. investor breaks the pattern, so affiliation is doubtful. Solutions exist, such as restructuring so the Canadian company owns a majority of the U.S. company, creating a parent-subsidiary relationship, but any restructuring must be complete and documented before filing, not promised. Control matters as much as ownership: if a shareholder agreement gives the U.S. investor veto rights over management, control by the sibling group is weakened. Have a corporate lawyer map the current structure, then decide whether the facts already satisfy the affiliate definition or whether a change is needed. The transferee's year abroad and the managerial role are separate requirements that a perfect corporate chart does not replace.
Hypothetical example: a Canadian museum-exhibit fabricator wants to transfer its production director after she worked abroad for fourteen months, but nine of those months fall more than three years before the planned filing. Payroll dates and job descriptions, not a senior title, settle whether she completed one continuous qualifying year within the three years immediately before filing or admission. Confirm that point before changing ownership. If approved, L-1A time is limited to seven years, so the executive plan must fit the available period.