Be Wise Obtaining a E-2 Treaty Investor Visa

1 - What is an E-2 Visa?

• An E-2 treaty investor visa permits a foreign entrepreneur and his or her qualifying employees to work and live in the U.S. with non-immigrant status.
• The E-2 Investor must invest in the U.S. by establishing a new business or purchasing an existing company, and must be actively involved in directing the enterprise.

2 - For how long is the E-2 Nonimmigrant Visa valid?

• As a general rule, the E-2 visa is issued for five years, however some Consular Officers may issue the first visa only for a two year period only.
• There is no limit on the number of times the Treaty Investor visa may be renewed so long as the E-2 qualifications are maintained and the investment continues.

3 - Key Requirements to Qualify for an E-2 Visa:

• Investor visas are available only to nationals of countries having a treaty of Friendship, Commerce, or Navigation with the U.S.
• In corporate structures one looks to the nationality of the owners of the stock.
• The E-2 Investor must provide the capital and must show ownership of at least 50 percent of the enterprise.
• The E-2 Investor must be coming to the U.S. to direct and control the operations of the enterprise in which he or she has invested.
• Alternatively, if the applicant is not the principal investor he or she must be employed in an executive or supervisory capacity or hold highly specialized skills that is crucial to the functioning of the company.

4 - Funding requirements for the E-2 Investment:

• Investment must be "substantial" with no minimum requirement. The percentage of “substantiality” of investment needed is inversely proportional to the overall cost of the business (i.e. what’s needed to purchase the company at a fair market price, or if it is a startup, the overall cost of the company being operational.)
• If the company is a startup company, the investor should already have made purchases for at least some of the necessary assets, and thus should be able to provide cost figures or additional assets needed to run the business.
• Typically, if one invests 100% of the funding for a business of $100,000 or less, it is likely to qualify for E-2 though a split involving two equal partners or joint ventures may prove qualifying as well.
• The lower the cost of the business the higher the percentage needed to qualify.
• At the other spectrum, an investment of $10 million in a $100 million business would likely qualify based on the sheer magnitude of the business itself.
• The investment must be substantial enough to ensure the treaty investor’s financial commitment to the successful operation of the enterprise.
• The investment must be at risk. In other words, the Investor risks loosing his or her investment should the project fail.

5 - Nature of Business Operations for E-2 Visa Qualification:

• The E-2 investor must "contribute" to the US economy. Setting up a small shop alone is not adequate.
• The business must be a real operating enterprise and speculative or passive investments do not qualify.
• The income generated by the business must not be "marginal" and it should adequately:
  • Support the Investor and the family of the Investor
  • Compensate USA Employees, and
  • Contribute to the U.S. economy.
• The minimum number of employees is not specified but should be at least four on a full time basis. The more employees the better.

6 - Which countries have E-2 Treaty Investor Status?

Albania, Argentina, Armenia, Australia, Austria, Azerbaijan, Bahrain, Bangladesh, Belgium, Bolivia, Bosnia & Herzegovina, Bulgaria, Cameroon, Canada, Chile, China (Taiwan), Colombia, Congo (Brazzaville), Congo (Kinshasa), Costa Rica, Croatia, Czech Republic, Ecuador, Egypt, Estonia, Ethiopia, Finland, France, Georgia, Germany, Grenada, Honduras, Iran, Ireland, Italy, Jamaica, Japan, Jordan, Kazakhstan, Kyrgyzstan, Latvia, Liberia, Lithuania, Luxembourg, Macedonia, Mexico, Moldova, Mongolia, Morocco, Netherlands, Norway, Oman, Pakistan, Panama, Paraguay, Philippines, Poland, Romania, Senegal, Singapore, Slovak Republic, Slovenia, South Korea, Spain, Sri Lanka, Suriname, Sweden, Switzerland, Thailand, Togo, Trinidad & Tobago, Tunisia, Turkey, Ukraine, United Kingdom and Yugoslavia.

7 - Applying for a E-2 Visa:

• The E-2 Visa does not require prior USCIS approval. Therefore, Investors may apply directly at the U.S. Embassy or Consulate with jurisdiction over their place of permanent residence.
• Each Embassy or Consulate around has their own unique reviewing procedures and processing timetables. However, as a general rule, Investors may expect to wait approximately four weeks for case review, which will be followed by a personal interview on the application.
• Some Investors present in the U.S. in legal nonimmigrant status may want to consider filing for a change of status with the USCIS. This is a strategy call to be discussed with the Investor’s legal representative.

8 - What Documents are required to apply for E-2 Visa?

• A detailed business plan demonstrating the nature of the business, the amount of the investment, the source and nature of the capital, jobs that will be created, and contribution to the USA economy.
• Copy of the company’s most recent financial statements if available.
• Detailed letter describing in detail the nature and function of the investment and the extent of the principal Investor’s participation in the investment.
• Documents evidencing legal source of funds.
• Statement of unequivocal intent that the Investor will depart the US when E-2 status ends.
• Non-immigrant Visa Application, Form DS-156 and DS-156E.
• Supplemental Non-immigrant Visa Application,
• A passport valid for travel to the US and valid at least six months beyond the visa application date (including Visa Office processing time).
• Visa application fees vary per Embassy.

9 - Other Useful Information about E-2 Investor Visas:

• Spouses and unmarried children under 21 years of age may receive derivative E-2 visas in order to accompany the principal alien.
• The spouse of an E-2 visa holder is eligible to apply for an employment authorization document.
• The main reasons for denial are:
  • Incomplete or unclear business plan.
  • Lack the supporting documentation to justify the viability of the business for E-2 approval.
  • Not being properly prepared for the E-2 Investment Visa interview at the Embassy.
• The Investor is restricted to work only for the specific employer or self-owned business that acted as your E-2 visa sponsor. Spouses may receive blanket work authority.

10 - Potential Pitfalls for the E-2 Investor:

• Beware of Sellers that may have manipulated the financial statements. Investors should conduct due diligence before finalizing their purchase.
• The E-2 Visa does not create a direct road to lawful permanent resident status (“green card.”) The Investor will have to identify other avenues that lead to the green card. This is an important strategy call to be made in conjunction with competent legal counsel.
• Investors should realize that running a business in the US may be different than in their home country. Again, Investors should look at the nature of the business as compared to their demonstrated experience to ensure the business is a right fit.
• Investors should be realistic about the projected revenue of their new investment and realize that if the business fails, their visa status is compromised.