Coming to the U.S. with the e-2 visa

• What is an E-2 Visa?
• Terms of the E-2 Visa
• General Requirements
• Investors or Employees may qualify
• Benefits for Immediate Relatives
• Investment Must Be Substantial
• Income from Business Must be More than Marginal
• Nature of Investment
• Intent to Depart
• Can the E-2 Visa lead to a “Greencard”?

What is an E-2 Visa?

The E-2 Visa is a non-immigrant visa that allows foreign nationals to come to the U.S. by investing in a business enterprise. There are no cap limits on E-2 Visas, and they are renewable as long as business is active and ongoing. Those qualified for E-2 Visas can pursue long-term business objectives.

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Terms of the E-2 Visa

The terms of the E-2 Visa can vary, depending on the nationality of the Investor.

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General Requirements

• Applicant has invested or is actively in the process of investing.
  The amount investment is substantial.
• The income from the enterprise is more than marginal -- not solely for earning a living for the Applicant.
• Applicant is in a position to direct and develop the enterprise.
• Applicant, if an E-2 Employee, is destined to an Executive or Managerial position or possesses skills essential to the firm’s operations.
• Applicant intends to depart the U.S. if the business is no longer active.

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Investors or Employees may qualify

The Applicant can be an Investor or an Employee of a business entity that is investing. If it is a business entity, then its employees may qualify for the E-2 Visa. For an Employee to qualify, the nationality of the business entity must be the same as the nationality of the employee. The nationality of a business entity is determined by the nationality of the individual owners of that business.

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Benefits for Immediate Relatives

• The Spouse of the E-2 Investor or E-2 Employee, as well any unmarried children under the age of 21, are also eligible for the E-2 Visa.

Investment Must Be Substantial

• There is no bright line dollar figure test as to what amount is substantial.
• The amount invested must be sufficient to ensure the Investor’s financial. commitment to a successful business and the likelihood that the Investor will successfully develop and direct the enterprise.
• The business investment must be active and not speculative. For example, an idle or passive investment in real estate or land is not acceptable.
• The amount invested should be compared to the cost of the business by assessing the percentage of the investment in relation to the cost of the business -- the lower the cost, the higher the percentage of investment required.
• Although there is no bright line dollar figure test, in most successful cases, the amount invested has been $100,000 or more.

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Income from Business Must be More than Marginal

• Income from the investment must exceed what is necessary to support the Investor and family.
• Also to be considered is the economic impact of the business, including the likelihood of job opportunities for U.S. Workers.

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Nature of Investment

• The investment can be made either for the establishment of a new business, or the acquisition of a new business.
• The investment can be made as a joint-venture of an existing business, either the purchase of its existing shares, or as an additional share contribution.

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Source of Investment Funds

• Must demonstrate possession and control of legitimate funds.
• Inheritance of a business does not constitute an investment.
• Source of the funds does not have to be from outside the U.S.A.

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Investment must be at risk

• The investment funds must be placed at risk. The funds and/or assets must be subject to partial or total loss if business fortunes reverse.
• A loan secured by the assets of the invested business cannot count toward the invested funds.
• A loan secured the Investor’s personal assets or on the Investor’s personal signature may be counted as investment funds.

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Funds must be committed to the Investment

• To be “in the process of investing,” the funds or assets must be committed to the investment, and the commitment must be real and irrevocable.
• The sale of a business may be conditioned through an escrow upon the issuance of the E-2 visa. This would constitute a solid commitment as long as all other conditions in the escrow have been met at the time of a visa application.
• The investor must be close to the start of actual business operations. Mere intent to invest, or possession of uncommitted funds in bank account does not qualify.

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The Investor must be in a position to Direct and Develop the Enterprise and have Controlling Interest

• The Investor, through ownership or by other means, must develop and direct the enterprise. If an Investor has control of the business through managerial control, the requirement is met.
• If ownership is too diffuse to permit one individual to demonstrate the ability to direct and develop the business, the owners must show together they own 50% and must demonstrate that collectively, they have the ability to develop and direct. Under this circumstance, they may not be classified as Investors but rather, can be classified as Employees.

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Requirements to qualify as E-2 Employee

• The employer (the business investment in the U.S.) must have the qualification as an E-2 company.
• The Employee must have the same nationality of the employer.
• Employees must have the qualifications to fill the offered position, and the position must be either an Executive position, a Managerial position, or one requiring skills which are “Essential” to the Employer.

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Executive and Managerial Employees

• To qualify as an Executive or Managerial Employee, the position must have a principal and primary function, and not incidental or collateral to the business.

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“Essential” Employees

• To qualify as an Employee who has skills which are “Essential” to the efficient operation of the business, the following factors may be considered:
• degree of proven expertise in the related area
• uniqueness of the specific skills and training
• the function of the job
• salary level and the availability of U.S. workers

Intent to Depart

• The Applicant needs to express an intent to depart when the E-2 Status ends – that is, if or when the business is no longer active.
• The Applicant does not need to demonstrate having a residence abroad.

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Can the E-2 Visa lead to a “Greencard”?

There is no direct path toward obtaining permanent resident status (commonly known as getting a “Greencard”) with E-2 Visa. In other words, there is no law that provides that a person who maintains E-2 status for a certain period of time automatically becomes eligible for a Greencard.

However, indirect paths toward permanent residence may be available for certain E-2 Visa holders. In most cases where someone obtains a Greencard, there is a petitioner (commonly known as a “sponsor”) involved. The sponsor is either a family member or an employer. For an employer to sponsor an employee, in the majority of cases, the employer has to go through a process known as Labor Certification. To successfully complete this process, the employer has to show that he has attempted to find U.S. workers to fill the job opening, and that he is only hiring the particular foreign worker because he could not find any qualified U.S. workers to.

It is not possible to successfully complete Labor Certification for an E-2 Investor. That is because, in such a case, the employer and employer are one and the same -- since the E-2 Investor must be the owner of the business in order to qualify for the E-2 Visa. And the law is such that the employee may not exert any influence over the Labor Certification process – as that is a conflict of interest.

There are more indirect approaches, however, that may enable the E-2 Investor to bypass this obstacle. One strategy that has been employed by certain E-2 Investors in the past is as follows. The E-2 Investor sells the business to some one else. The new owner then hires the E-2 Investor as an employee. Thereby, Labor Certification becomes possible.

Obtaining a green card, however, can be easier for E-2 Employees, as opposed to E-2 Investors, if the E-2 Employee does not have any ownership interest in the company. In such a case, there is no such conflict of interest since the employer and employee are not one and the same. However, successful completion of labor certification will require the employer to show that no qualified U.S. workers were available. In addition, the employer needs to pay the employee a salary that is consistent with prevailing salaries in the local job market.

For certain types of employees, Labor Certification may be waived. This is in the case of employees who are employed by a multinational company in a managerial or executive capacity, and who have been recently transferred to the U.S. branch of that company from a foreign branch. The criteria required for eligibility for an employee to apply for a green card based on a waiver of labor certification is very similar to the one required for an individual to qualify for the L-1 Visa. The L-1 Visa is another non-immigrant visa, like the E-2 Visa. If you think that you may qualify for the L-1 Visa and are interested in learning more, please see our informative brochure entitled, “Coming the U.S. with the L-1 Visa.”

Being an Investor, however, can lead directly to Immigration in certain cases. An Investor who invests at least $ 1,000,000 in an enterprise in the U.S. may be able to directly apply for a greencard. (In certain cases, the minimum amount required may be $500,000.) Such an individual is an Immigrant Investor. If you think that you may qualify and are interested in learning more, please see our informative brochure entitled, “Coming to the U.S. as an Immigrant Investor.”

It is possible for an E-2 Investor to change status and become an Immigrant Investor. This can be done by investing an additional investment that would meet the minimum requirements. The amount invested in the past that enabled the individual to qualify for the E-2 Visa may be counted toward the minimum amount required to qualify as an Immigrant Investor.

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