Overview of the E-2 Visa and its Requirements
Updated: Mar 13, 2020
Series - Blog Post No. 1
For prospective foreign investors seeking to have their own American franchise in the United States, there are not many visa options to allow them to come to the United States and work in their own franchised businesses. From the few visa options, the E-2 Visa stands out as a flexible and quick option that accommodates businesses and franchises of all types and sizes.
The E-2 Visa allows eligible foreign investors to direct and develop a qualifying business that they have invested in.
The E-2 Visa is available to citizens of certain countries that maintain a treaty of commerce and navigation with the United States (full list here). The E-2 Visa allows eligible foreign investors to direct and develop a qualifying business that they have invested in. The E-2 Visa does not directly lead to a green card, but the E-2 Visa is indefinitely renewable, allowing a foreign investor and his spouse to live forever in the United States, but not their children once they age out past the age of 21. Thus, many foreign investors can consider the E-2 Visa as a “stepping stone” to more permanent immigration options in the future.
The E-2 Visa confers its holder's many benefits, including:
The E-2 Visa holder and his or her spouse can live forever in America through successful E-2 Visa or status renewals.
The E-2 Visa holder’s children can attend public schools for free and receive reduced in-state tuition discounts.
The E-2 Visa holder’s spouse can apply to work for any employer in America (except certain government jobs)
The E-2 Visa allows its holder's multiple entries, traveling freely in and out of the US.
The E-2 Visa can be obtained in a relatively short amount of time (3-4 months)
The requirements for the E-2 Visa are:
You must be a citizen of an E-2 Treaty Country. If you hold multiple nationalities, you may choose any one of your nationalities that is an E-2 Treaty Country. The nationalities of your spouse and any unmarried children under 21 do not affect their derivative E-2 visas.
You have already invested or are actively in the process of investing. Income, savings, gifts, asset sales, and loans secured by personal assets all qualify as part of your E-2 investment. You are not required to “spend away” all your E-2 investment funds with no chance of getting them back. Instead, the E-2 visa requires that your funds are irrevocably committed and at-risk, such as establishing an escrow account or having revoke-clauses in business transaction contracts on the sole release/condition of E-2 visa denial.
Your E-2 Enterprise is a real and operating commercial enterprise. Your E-2 Enterprise must be a real business producing goods and services rather than owning stocks in a brokerage account or buying a residential property to rent out.
Your investment in your E-2 Enterprise is substantial. There is no statutory minimum investment amount. The substantiality of your investment will be considered within the scope of your business and industry. So, a services-based business (e.g. consultancy) can have a lower investment to be substantial than a goods-based business (e.g. restaurant).
Your E-2 Enterprise is non-marginal and bonafide. Your business is expected to make more than just a minimum living wage for you and your family. This requirement is assessed on future profitability, but past performance will be significant if you are purchasing an extremely distressed existing small business.
You have the capacity to direct and develop your E-2 Enterprise. You must possess and exercise your rights as a controlling interest owner to direct and develop your business. It is not required that you are involved in the day-to-day operations of your business to meet this requirement. You can manage top-level policy and strategy for your business, but you cannot be completely passive.
You intend to depart the US once your E-2 status terminates. This is usually an easy requirement to meet since the E-2 visa is soft on this non-immigrant intent requirement, unlike some other visas. While it does not strengthen your application, it is permissible for an E-2 visa applicant to have an outstanding immigrant petition or sell his or her primary residence in his or her home country.
Due to its breadth and flexibility, the E-2 Visa has become an increasingly popular option for foreign investors from E-2 treaty countries; growing from approximately 25,000 visas issued in 2010 to consistently over 40,000 visas issued across the past five years.
Due to its breadth and flexibility, the E-2 Visa has become an increasingly popular option for foreign investors from E-2 treaty countries; growing from approximately 25,000 visas issued in 2010 to consistently over 40,000 visas issued across the past five years. Furthermore, new countries are being added onto the list of E-2 treaty countries, with Israel and New Zealand being the newest additions.
The American immigration system can be long and complicated, but the E-2 Visa offers itself as an alternative from the norm: a quick-stepping stone for foreign investors pursuing longer-term goals of green cards and naturalization.
Disclaimer: The information provided in this article does not nor intends to constitute legal advice. All content and information within this article are for general information only.
The author, Stephen Zheng, is the founder and principal of Wealthlet Advisory, LLC, a New York Registered Investment Adviser (CRD No. 282885) dedicated to providing E-2 Treaty Investors with a comprehensive, full-service advisory solution that covers the entire E-2 Visa process (www.wealthlet.com).
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