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The E-2 Treaty Investor Visa Eligibility Requirements

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If you’re an investor from a foreign country wanting to move to the United States to start up or expand your business, you have a few options of investor visas to pursue. We are here to help you decide which visa is best for you.

The E-2 treaty investor visa is the most traditional visa for investors. It allows you to live and work in the United States for an indefinite period of time. Decades, even! As long as your company continues generating revenue — and it must generate more revenue than you need to support your family, but we’ll get into that later — you are allowed to apply for renewal of your E-2 treaty investor visa every few years. And unlike many other visas, there is no cap on the amount of times you may renew your E-2 visa. In addition, employees may be transferred to the U.S. as E2 Executive, Supervisory, or Essential employees of a treaty investor company.

There are four key requirements to meet to be eligible for an E-2 treaty investor visa. Let’s go through the requirements one by one:

1. You must be a national of a treaty country.
The E-2 treaty investor visa is only available to citizens of foreign countries that are considered “treaty countries.” This means the country has an international treaty of commerce and navigation with the United States. These countries include Mexico, Canada, Asia, Africa, Middle East, and many countries in Western Europe. For a full list of the treaty countries, click here.

2. You must have invested, or be actively in the process of investing, a substantial amount of capital in a bona fide enterprise.
The E-2 visa is for investors, which means you must have invested, or be actively investing, a substantial amount of money into a company in the United States. There is no specific amount of money, but a good rule of thumb is at least $100,000. Generally, the bigger your investment in the company, the stronger your case will be.

  1. Substantial investment: The substantiality of the investment is determined based on the relationship of the investment to the total cost of either purchasing an established enterprise or establishing a new business. The investment must ensure the treaty investor’s financial commitment to the successful operation of the enterprise, and be of a magnitude to support the likelihood that the investor will successfully develop and direct the enterprise (proportionality test). The lower the cost of the enterprise, the higher, proportionately, the investment must be to be considered substantial. A $100,000 investment into a business that requires startup costs of $100,000 qualifies as substantial because the investment constitutes 100 percent of the total cost.
  2. Source, Possession, and Control of funds for the Investment: The investor must be able to prove that the funds were obtained from a legitimate source and that the investor has possession and control over the funds. The source of funds can be capital assets or funds from savings, gifts, inheritance, winnings, collateralized loans secured by the investor’s personal assets, unsecured loans signed by the investor, equipment and/or inventory shipped to the US (must be able to provide current market value of the equipment and inventory). Possession and control over the funds normally is shown by providing evidence that the funds are obtained from the investor’s personal bank accounts, investment accounts, or wholly-owned foreign business accounts. An inheritance of a US enterprise does not constitute an investment for E2 purposes.
  3. Irrevocable Committed Funds: The funds or assets used towards the investment must be real and irrevocably committed. However, the purchase of an existing business can be completed through escrow with the condition of issuance of the E2 visa.
  4. Bona fide enterprise: The entrepreneurial enterprise must be a real, active, and operating commercial company that produces services or goods for profit. The enterprise must have all applicable state and local legal requirements in place to do (or commence doing) business.

3. The treaty investor must be seeking to enter the U.S. solely to develop and direct the business. This is established by showing at least 50% ownership of the enterprise or have operational control through a managerial position or other corporate device. Generally, the principal investor must own at least 50 percent of the business. For a smaller enterprise, stock ownership generally indicates control, though majority ownership is not enough if you are not also the manager of the company. You must play a major role as a manager or supervisor, actively directing and developing the business.

In cases where the majority owner (investor) of the US enterprise wishes to send an employee to the US (as an executive, supervisor, or essential employee), the majority owner must demonstrate that he or she personally develops and directs the enterprise. If the investor is a foreign entity, the foreign entity must demonstrate it develops and directs the US enterprise.

4. Marginality. The enterprise must generate a substantial amount of revenue.
The enterprise must be able to generate more than enough income to support the investor and his or her family. A new enterprise that does not have the current income generation might not be considered marginal if the enterprise can show that it has the present and future capacity to make a significant economic contribution. In such cases, the enterprise must have the capacity to generate such income within five years from the date that the treaty investor’s E-2 classification begins. Your goal should be to grow your business and create new jobs in the United States. So make sure you’re investing in an enterprise you will enjoy!

We always advise our clients to create a five-year plan for their business, to show it has the capacity to generate substantial revenue. The business plan should include a SWOT analysis, marketing and advertising plans, as well as a 3 or 5-year financial projection. We are happy to prepare a plan for you, or you may prepare one on your own and we will review it.

 

E-2 Employee Eligibility Requirements

There are three key requirements for bringing an employee to the United States in E2 visa status. The prospective employee must have the nationality of the treaty country, the employer and employee must have the same nationality, and the employer (if residing in the US) must be maintaining E status.

Executive and Supervisory Employee: The position offered must be that of an executive or supervisor. The company should take into consideration the following:

The title of the position offered. The hierarchy/position within the organizational structure. The duties of the position, including the degree to which the applicant will have ultimate control and responsibility for the firm’s overall operations or a major component/department thereof, the number and skill levels of the employees the applicant will supervise, the level of pay, and whether the applicant possesses qualifying executive or supervisory experience;

Whether the executive or supervisory element of the position is a principal and primary function and not an incidental or collateral function. For example, if the position principally requires management skills or entails key supervisory responsibility for a large portion of a firm’s operations and only incidentally involves routine substantive staff work, an E classification would generally be appropriate. Conversely, if the position chiefly involves routine (day to day activities) work and secondarily entails supervision of low-level employees (front-line supervisor), the position would not be termed executive or supervisory; and

The number of employees of the US enterprise. The weight to be accorded a given factor, which may vary from case to case. For example, the position title of “vice president” or “manager” might be of use in assessing the supervisory nature of a position if the applicant were coming to a major operation having numerous employees. However, if the applicant were coming to a small two-person office, such a title in and of itself would be of little significance.

Essential Employee: Essential employees can be transferred to the US in E2 status if he/she possesses special qualifications that make the service to be rendered in the US essential to the efficient operations of the enterprise. The employee must possess the specialized skills and the skills must be required by the enterprise. To determine whether an employee is essential and possesses specialized skills, the applicants must provide information to show:

• The experience and training necessary to achieve the specialized skill(s)
• The uniqueness of such skills;
• The availability of U.S. workers with such skills;
• The salary such special expertise can command;
• The degree of proven expertise of the alien in the area of specialization; and
• The function of the job to which the alien is destined.

A new business or an established business expanding into a new field in the United States might need employees who are ordinarily skilled workers for a short period of time. Such employees derive their essentiality from their familiarity with the overseas operations rather than the nature of their skills. The specialization of skills lies in the knowledge of the peculiarities of the operation of the employer’s enterprise rather than in the rote skill held by the applicant.

There is no requirement that an “essential” employee have previous employment with the foreign or US enterprise (except for ordinarily skilled workers who are relying on the familiarity with the overseas operation to qualify as specialized knowledge). The focus of essentiality is on the business needs for the essential skills and of the prospective employee’s possession of skills.

For E2 essential employees, the duration of employment must be determined at the time of application and any extensions. The duration of essentiality can be a long-term need on an on-going basis (for example for continuous development of product improvements) or short-term need of one or two years (for example, to start-up operations or training).

Have more questions, or ready to get started? Give us a call today for a consultation!

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