How to Get an E-2 Investor Visa
Starting a Company in the United States
Maybe you are a business owner or an executive in a company that is ready to create a subsidiary in the United States. Or maybe you are a consultant with clients in the United States and you have concerns about whether you can continue to do your work with your business visa or ESTA. This is definitely something you should be thinking about.
This post discusses the immigration law aspects of investing in the United States through an E-2 visa.
What is an E-2 visa?
An E-2 visa allows individuals from countries with which the United States has a treaty of friendship, commerce and navigation to travel to the United States to develop and direct the operations of an enterprise in which the visa holder has invested – or which he is in the process of investing – a substantial amount of capital. E-2 visas are advantageous because there is no minimum capital requirement (more on that below) and the visa is adjudicated at an embassy or consulate (in the case of Germany, the U.S. consulate in Frankfurt handles all E visas). This means the process is often quicker and simpler than filing a petition with USCIS in the United States.
What are the Requirements for an E-2 Visa?
Nationality: The investor/employer must have the nationality of the treaty country. A company sponsoring an E-2 visa must be at least 50% owned by nationals of a country with which the United States has a treaty of friendship, commerce and navigation. Or, if the investor is an individual, the investor must have the nationality of a treaty country. The process is slightly more complicated for publicly traded companies but there is a presumption that their nationality is the same as the country where their stock is principally listed and traded.
Investment: The investor or enterprise must have invested or be in the process of investing a substantial sum in the U.S. enterprise. Investment implies risk, so the funds must be irrevocably committed to the business and subject to loss if the business venture does not work out. Unsecured and personal business capital, as well as capital secured by the personal assets of the investor demonstrate necessary risk, whereas an investment secured by the assets of the business in which the person is investing would not. One way Hughes Immigration can help you mitigate the risk of investing before you have a visa is by setting up an escrow account, which will hold some of your funds pending the issuance of your visa and return them to you if the visa is denied.
Real and Active: The business must be real, producing some actual service or commodity. And, if it is a new business, the investor must demonstrate that the business will produce a service or commodity in the immediate future. Idle investments, for example passive investments in land or stocks, are not sufficient.
Substantial Investment: The purpose of this requirement is to ensure that the investor is firmly committed to a business that they believe is likely to succeed. There is no set amount of minimum investment but the required percentage of capital to be invested that is generally viewed as acceptable is inversely proportional to the total amount of capital required to start the business. In other words, investing 100% of a total investment of $100,000 would likely be considered substantial; as would investing $10 million into a business that requires $100 million to get started.
Marginality: The investment cannot be “marginal,” in other words, it must realistically be expected to generate more than what would be required to simply support a family; and this level of income should be expected to be achieved within five years or less. A good business plan is very important here.
Develop and Direct: The investor must “develop and direct” the business. In other words, they must control the business through either an ownership stake of 50% or greater, a managerial position in the company (e.g. CEO), or the sort of operational control that some investors exercise despite holding less than a majority interest in the company’s shares.
What roles can be filled using an E-2 visa?
E-2 visas are only issued to individuals who will fill roles as executives or supervisors or to people who possess special qualifications that are essential to the operation of the enterprise in the United States. The executive/supervisory roles are strictly defined and construed, so that a successful applicant will exercise primarily (almost exclusively) executive authority or supervise an important aspect of the business (think senior managers). Special qualifications, on the other hand, are often the sort of skills that an employee develops over the course of a career, for instance the skills possessed by an engineer who is intimately familiar with the quirks of a complicated, proprietary manufacturing process. Foreign language skills are nice to have but, on their own, are not enough to qualify someone for this visa.
As you can see, the E-2 visa significantly lowers the barriers to investment for nationals of treaty countries but it has a lot of fairly complicated requirements that must be met. I usually counsel my clients that the business plan should be their first consideration and the visa piece should support that plan, not vice versa. So, if you are thinking about investing in the USA and the E-2 visa sounds like a good fit, let’s talk about the details. And if this doesn’t sound like your plan, let’s talk about the alternatives!
This general information is not intended as legal advice. Everyone’s situation is different, so please get in touch for advice that is specific to you.