E-2 “Treaty Investor” Visa

The United States is one of the most sought after destinations for business investors. The E2 Visa is the most popular option for foreign nationals who want to come to the U.S. to invest in an existing business or start their own business. In practice, any legal activity qualifies for purposes of E-2 Visa classification.

Under INA 101(a)(15)(E)(ii), the E-2 Visa is reserved to foreign investors that are citizens of a country with which the United States has entered into a Treaty of Commerce and Navigation, that are coming to America to direct the operations of a active, operating enterprise that has the present or future capacity to generate a substantial economic contribution for the U.S. economy.

The U.S. Department of State maintains a list of countries that qualifies for E2 Visa. The E-2 Treaty Investor Visa is a nonimmigrant classification and allows a national of a Treaty Country to be admitted to the United States when investing a substantial amount of capital in a U.S. business. Certain employees of such a person or of a qualifying organization may also be eligible for this classification. The United States signed the Treaty with 78 countries, allowing foreign investors to obtain E-1 (Treaty Trader) or E-2 (Treaty Investor) visas. Applicants that have dual citizenship are also eligible to apply if they are citizens of at least one treaty country.

E-2 “Treaty Investor” Visa
E-2 “Treaty Investor” Visa

First, to qualify for E-2 Visa, the investment must be in an active business. This means that real estate investments are generally considered a passive investment, although it is possible to structure the investment in a way to comply with Department of State regulations.

Substantial investment

Second, the investment must be substantial. The law does not set an absolute minimum, and U.S. Consular officer adjudicating E2 Visa applications are supposed to apply what is called the “proportionality test”. The U.S. Department of State provides an informative and helpful memorandum to help understanding the proportionality test.

Normally, a minimum investment of  $100,000 is necessary. However, the E2 Visa regulations do not establish an absolute minimum figure. An E2 Visa application can be approved even with lower investments, and may be renewed without limitation, as long as the business is active and did not become a marginal enterprise. In any event, getting an E2 Visa application approved with an investments below $50,000 would be nearly impossible.

An E2 Visa investor must invest a large amount of money in a company in the US that he intends to control and develop. Investment in a non-profit enterprise does not meet this requirement. The substantial investment test is met if the total investment is equal or slightly lower that the cost of purchasing or establishing the enterprise; also, the investment must be sufficient to ensure the company’s successful operations. The business should also employ American workers and not only benefit the investor and his family members.

Marginal enterprise

Even if an investment is considered substantial, an E2 Visa applicant will still have to show that the business in which he or she has invested will not become a marginal enterprise. To grant an E2 Visa, the Consular Officer will have to be satisfied that the business will generate substantial revenues within 5 years of the beginning of the operations.

It is important to note that the E2 Visa is generally granted for an initial period of 5 years, but there is no limit to the number of extensions that can be granted to an E2 Visa holder.

E2 Visa and dual intent

The E2 Visa is nonimmigrant, meaning that an E2 Visa holder is not allowed (at least officially) to seek lawful permanent residency (Green Card) while in E2 Visa status. However, federal regulations provide for a limited form of “dual intent”.

In fact, an E2 Visa application cannot be denied solely on the basis of a pending or approved immigrant petition. Finally, USCIS seem to recognize the E2 Visa as allowing dual intent, so that prospective investors should try to get E2 Visa status through a change of status.

E2 Visa and U.S. Citizenship

The E-2 is a non-immigrant Visa and does not create a path to U.S. Citizenship, unless the business grows considerably as to qualify for the EB-5 classification. Anyway, a limited form of “dual intent” is recognized for E2 Visa holders. It is generally granted for an initial period of admission of 5 years (2 years in case of a change of status obtained in the U.S.). There is no limit to the number of extensions that an E-2 Visa holder may be granted.

Family of E-2 Visa Holders

Treaty investors and employees may be accompanied by their dependents (spouse and unmarried children under 21 years of age). Their nationalities need not be the same as the treaty investor or employee. They generally will be granted the same period of stay as the employee. The spouse may be also authorized to work without restrictions. Unmarried children under the age of 21 are not allowed to work.

Contact us for more information on the Treaty Investor Visa.