E2 Investment Visas*
Here are some frequently asked questions with respect to an E2 investment visa. If you have any other questions, you may contact me for a free telephone consultation by logging onto www.naimasaid.com and clicking on the “Call Firm Now" button on the left of your screen. Alternatively, you may email me at [email protected].
Who is eligible for an E2 visa? Certain nationals from countries that have signed a treaty with the United States to promote friendship, commerce and navigation may apply for an E2 visa.
What is an E2 visa? It is a visa given to a person solely for the purpose to develop and direct the operations of an enterprise in which the alien has invested, or is actively in the process of investing, a substantial amount of capital in a bonafide enterprise.
Who qualifies for an E2 visa? Key employees who will be coming to the US to perform Executive or Supervisory positions; or perform services which are “essential to the efficient operation of the enterprise." The applicant must be a principal employer with nationality of treaty country whether in or outside the United States; or an enterprise or organization that is 50% or more owned by treaty nationals; or a dependant of one of the above referenced persons.
How long can I stay in E status? Visas may be issued for 5 years. Admissions are given for 2 years with 2-year extensions no matter the duration of the visa.
Must I have the entire amount of the investment in my bank account? The funds must be in your possession or control. They must be personal funds, unsecured loans or collateral from personal assets. This means you cannot use the business you wish to operate in the US as collateral but your may mortgage your house or take out a second mortgage or use other assets as collateral to get a loan for your investment. You may use inherited funds. The source of funds may be in or outside the US. Funds in your bank account for operations of the investment business may count as investment funds. Some clients see the E2 visa as the chicken or the egg problem. How do they put funds in an investment before they get the visa and how do they get the visa without first putting down funds on the investment? The solution is to put the money in an escrow account pending approval of an E2 visa with a legal mechanism that irrevocably commits the funds but also protects investor if application is denied. Funds must be from legal sources. Some E2 visa adjudicators have recommended that the funds should clearly be tracked to legal sources going back at least three years.
How do I value the investment? All funds that go toward the investment are included in the valuation of the investment including rent paid on equipment or property. If you will transfer goods or equipment to be used in the business, the value of those goods or equipment will be considered toward the value of the investment. The business must be active so purchase of stocks or undeveloped land will not be considered toward the value of your investment. The business must be a commercial for profit enterprise and entrepreneurial in nature.
How much should I invest? The investment must meet the substantial test so the answer will depend on the cost of the enterprise. The applicant has the burden of proving that the invested funds are sufficient. If you choose to go with a lower cost enterprise that is say, about $85,000, you will be required to put up the entire amount. If the cost of the enterprise is say $500,000, a lesser but more proportionate amount will meet the substantial test.
How much should the business generate? The enterprise must have the capacity to generate more than minimal living for the investor and his/her family. Projected future capacity should be realized in 5 years so a 5-year business plan is recommended. The enterprise must generate income sufficient to support a staff that its size normally supports. It must show an ability to expand job opportunities, generate other sources of income, generate more than living expenses for the investor and his family.
What kind of participation do I have in the day to day running of my business? The investor must develop , manage, supervise and direct the business but cannot compete directly as a skilled laborer.
How do I establish control in the business? The investor must have a controlling interest in the business. Control may be established if the investor has 50% controlling interest, (no vetoes); operational control through managerial position or other means. In a small corporation, stock ownership is proof of control but it is also important to show management of the enterprise.
The principal duties of an executives or supervisor must have ultimate control and responsibility for the enterprise’s overall operation or a major component of it. The following criteria will be considered to determine control and responsibility – whether the position provides great authority to determine policy and direction; provides supervisory function over low level employees for a greater portion of the duties; whether the person has executive or supervisory skills and experience; whether salary and title are commensurate with the executive/supervisory position; relationship of the position to the organizational structure; amount of discretionary decisions to be made by the executive or supervisory position; directing and managing business operations and supervising other processional and supervisory personnel. It is acceptable if the position requires routine staff work of an incidental nature.
What if I want to bring non-executive employees to help me in the enterprise? Nonsupervisory employees must have special qualifications and must be essential. Factors to be considered are: proven expertise in the area of operations; uniqueness (or indispensability) of specific skills, function of the job; salary that such expertise can command and availability of US workers.
If a person knows my language and culture, is that considered a specialized skill? Yes, only if these skills are essential to the position and enterprise.
What other factors would negatively affect my E status that I should know about? Where the enterprise undergoes a merger, acquisition, or sale, a new application must be filed as these are substantive changes. A new visa may also be required. Non-substantive changes do not require a new application. You may not be hired by the enterprise in E-2 and then be outsourced to work for another US employer.
Can I work for a branch of my company in E-2 status? A person may work for a subsidiary or parent company if the subsidiary independently qualifies for E status and the work to be performed is consistent with E status.
How many E-2 workers can I bring? A company may hire multiple E employees as long as employment is consistent with terms and conditions.
Can I bring my family and will they be allowed to work? Family members of E2s may accompany or follow to join principal. They do not have to have the same nationality as the principal. Your spouse can get a work permit. Children are not authorized employment but may attend school without changing status.
· For a list of treaty countries, see http://travel.state.gov/visa/fees/fees\_3726.html