Expert Guidance on E-1 and E-2 Visas

The E-1 (Treaty Trader) and E-2 (Treaty Investor) visas are convenient and flexible nonimmigrant visa classifications for those who qualify to enter the United States and work more or less indefinitely for as long as the basis for the E visa continues to exist. Both visas require the appropriate treaty between the United States and the applicant’s home country.

The E-1 is for individuals who will engage in substantial international trade of goods, services or technology principally between the U.S. and the treaty country. The E-2 is for individuals who will direct and develop an investment enterprise in the U.S. Both visas allow the recipient to live and work in the U.S. and travel freely in and out.

Spouses and dependent children acquire the same status, regardless of their nationality, and spouses are eligible to apply for work authorization in the U.S.

The E-2 visa application must be accompanied with proof that:

– The requisite treaty exists between the U.S. and the treaty country;

– The business is at least 51% owned and controlled by a national of the treaty country;

– The business is a real and operating commercial enterprise;

– The visa applicant has invested or is actively in the process of investing;

– The visa applicant’s investment is “substantial;”

– The investment is more than a marginal one expected to earn a living;

– The visa applicant is in a position to develop and direct the enterprise;

– The visa applicant intends to depart the United States upon termination of the E-2 status.

Note that there is no bright line for what constitutes a “substantial” investment. Some feel that the investment in the business should be at least $100,000 to qualify; however, there is no rule to this effect in policy, regulations or statute that requires this. The essential factors are whether (1) the business is expected to generate more than a marginal return (more than a “mere living”); and

(2) whether the investor’s contribution of capital is proportional to the entire required investment. Thus, a business of a lower overall value, such as a $100,000 restaurant, would require a higher proportion of the total value to be contributed by the investor, such as $80,000 (for example); whereas a business valued at $100,000,000 would require a proportionally lower initial cash contribution by the visa applicant (for example, $1,000,000) because of the sheer scale of the investment.

An E-2 visa applicant should be prepared to produce all organizational documents for the business; corporate filings, SS-4 form (with EIN number); bank records dating back at least three years; payroll records; documents proving that the business is active; proof that the visa applicant’s investment funds have been deployed into the business for purchase of inventory or other purposes (as opposed to having been simply deposited into a company account which the investor controls); proof that the investor’s funds are personal and were lawfully acquired; and proof of the actual path of the investment funds from the visa applicant to the business.

The visa application will also require a credible and carefully drafted business plan with five years of financial pro forma.

The E-2 visa application must be accompanied with proof that:

-For an investor who is purchasing a going concern, this requirement may be satisfied by showing the funds have been irrevocably committed to the account of the seller’s agent, with the only contingency being approval of the E-visa classification.

CONCLUSION

The E visa (whether it be Treaty Trader or Treaty Investor) is a very flexible and versatile form of nonimmigrant visa that confers great liberty upon the applicant and his or her family to remain, work, and freely enter into and exit from the United States during the validity of the visa. In addition, while it does not have a stated validity period, it can be renewed indefinitely for as long as the applicant continues the permitted business activities.