So, you’re thinking about taking your investment opportunities abroad? Great idea! One excellent way to do this is through the E2 Visa. But what exactly is an E2 Visa, and why is it so important for investors?
What is an E-2 Visa?
The E-2 Visa is a nonimmigrant visa designed for investors from treaty countries who wish to run a business in the United States. A treaty country is a nation that:
- Has a treaty of commerce and navigation with the United States.
- It is part of a qualifying international agreement.
- It is designated as a qualifying country by U.S. law.
The E-2 Visa is available to citizens of treaty countries such as the United Kingdom, Australia, Japan, Argentina, and Ethiopia. However, it is only available to nationals from countries with a treaty with the U.S. for the E-2 Visa, including India, China, Vietnam, Kenya, and Dubai.
What are Non-Marginal Enterprises?
A non-marginal enterprise is a business that generates sufficient income to provide more than just a minimal living for the visa holder’s entire family. For start-ups, this requirement means the company should be capable of generating such income within five years.
What is the Period of Stay under the E-2 Classification?
Qualified treaty investors can initially stay in the U.S. for up to two years. Extensions can be granted in two-year increments with no maximum limit on the number of extensions. However, all E-2 visa holders must intend to leave the United States when their visa status expires or is terminated. There is a different classification specifically for Commonwealth of the Northern Mariana Islands (CNMI) investors.
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Understanding the E2 Visa
Eligibility Criteria
To qualify for an E2 Visa, you need to be a national of a country with which the United States maintains a treaty of commerce and navigation. This visa is specifically for investors ready to invest substantially in a U.S. business.
Investment Requirements
The investment must be significant enough to ensure the successful operation of the enterprise. While there’s no official minimum, generally, investments below $100,000 are scrutinized more closely.
Business Ownership and Control
You must own at least 50% of the business and have operational control through a managerial position or other corporate device.
E-2 Treaty Investor Requirements
While there is no set minimum investment amount, the investment must be appropriate for the type of business. For instance, starting an IT company might require $1,050,000, whereas a franchise might only need $250,000. A variety of startup costs can be included in the investment.
The investment must be “at-risk,” meaning loss or gain is possible, and the money cannot be guaranteed. The business must be an actual, active enterprise.
The investor must have a controlling interest, generally owning at least 50% of the U.S. business, and must direct and develop the business. The enterprise should be something other than a side business but a primary operation employing U.S. workers now or in the future. There is no legal requirement to use a specific number of U.S. citizens or residents, but planning to hire a few employees in the coming years is advisable.
A comprehensive business plan is essential, detailing goals, milestones, and U.S. operations, including staff hiring plans. The investor and prospective E-2 visa staff must provide their skills, qualifications, and experience.
As the E-2 visa is a non-immigrant category, the principal investor and any E-2 staff must be willing to leave the U.S. upon visa termination. However, the E-2 visa can be extended indefinitely if specific criteria are met.
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What Documents Are Required for an E-2 Visa?
You need to prepare and submit the following documents with your E-2 Visa application:
- Form DS-160.
- Nonimmigrant Treaty Trader / Investor Application.
- A photocopy of your passport valid for at least six months beyond your intended stay in the U.S. with at least one blank page.
- A color passport-style photo with a light background showing your entire face, without any head coverings.
- Your curriculum vitae.
- A business plan detailing the future investment scheme.
- Proof of an executive or supervisory position or specialized skills necessary for the firm’s operation.
- Proof of possession and control of investment capital (e.g., financial statements, bank records, loans, promissory notes).
- Proof of remittance to the U.S. (e.g., transfer permits, bank drafts).
- Proof of business creation in the U.S. (e.g., partnership agreements, articles of incorporation, contracts).
- Proof of the investor’s citizenship (e.g., passport, stock exchange listings).
- Proof of U.S. investment (e.g., titles, contracts, bank statements).
- Proof of business operations (e.g., financial statements, U.S. tax returns).
- Proof of the business’s potential and contribution to the U.S. economy (e.g., IRS Form 941, payroll records).
- Proof that the business is genuine and operational (e.g., annual reports, sales literature, news articles).
Top Countries for E2 Visa
United Kingdom
If you are applying from the United Kingdom, your E-2 visa may be valid for up to five years, allowing multiple entries into the US during that time. However, this treaty does not cover members of the Commonwealth other than the United Kingdom.
Canada
Canadian applicants can receive an E-2 visa valid for up to five years, with multiple entries allowed during this period.
Mexico
For applicants from Mexico, the E-2 visa is valid for up to one year and permits multiple entries into the United States. Due to the shorter validity period, the application process can be more demanding, often requiring assistance from an experienced immigration lawyer. Mexican investors must own more than 50% of the company’s shares, actively manage the business, and demonstrate the business’s ability to create new jobs in the U.S.
Germany
Germany has long been a leading source of E-2 visas. German applicants can obtain an E-2 visa that is valid for up to five years and allows multiple entries into the United States.
Colombia
Colombian investors can choose between E1 and E2 investor visas. The E-2 visa for Colombians is valid for five years and can be renewed as long as the business remains successful, and all requirements are met.
Australia
Australia is the only country in Oceania with an E-2 treaty with the United States and has a strategic economic relationship with it. Australian applicants can receive an E-2 visa valid for up to four years, with multiple entries allowed.
Japan
Japanese applicants can obtain an E-2 visa valid for up to five years, allowing multiple entries into the United States.
Egypt
For Egyptian applicants, the E-2 visa is valid for three months and allows only one entry into the U.S. Once inside the U.S., the stay is authorized for up to two years.
Jordan
Jordanian applicants can receive an E-2 visa valid for three months. The visa also allows only a single entry into the United States. Once in the U.S., the authorized stay is for two years.
Spain
Spanish citizens can apply for an E-2 visa valid for five years, with multiple entries permitted during this time, provided all investment requirements are met.
Italy
Italian applicants can receive an E-2 visa valid for up to five years, with multiple entries allowed into the United States. Each entry permits a stay of up to two years.
Non-Treaty Countries List
Citizens of countries that do not have a treaty with the United States for the E-2 visa can still qualify through one of two methods. They can either acquire citizenship or a passport from a treaty country or qualify derivatively, such as through marriage to a citizen of a treaty country.
List of Countries with No Treaty for US E-2 Visa:
- India: India does not have an E-2 treaty with the United States, making Indian citizens ineligible to apply directly for an E-2 visa.
- China: Chinese citizens cannot apply for an E-2 visa directly due to the absence of a treaty between China and the United States.
- Vietnam: Vietnam does not have an E-2 treaty with the U.S., restricting Vietnamese citizens from applying for the E-2 visa independently.
- Dubai: As part of the United Arab Emirates (UAE), Dubai lacks an E-2 treaty with the U.S., excluding its citizens from E-2 visa eligibility.
- Qatar: Qatari citizens cannot apply for the E-2 visa as Qatar has no treaty agreement with the United States.
- Kuwait: Kuwait does not have an E-2 treaty, preventing its citizens from directly applying for the E-2 visa.
- Nepal: Nepalese citizens do not have access to the E-2 visa due to the absence of a treaty between Nepal and the United States.
- Kenya: Kenya does not have an E-2 treaty, making Kenyan citizens ineligible to apply for the E-2 visa.
- Nigeria: Nigerian citizens cannot apply for the E-2 visa directly as Nigeria has no treaty with the United States for this visa category.
- Saudi Arabia: Saudi Arabia lacks an E-2 treaty with the U.S., preventing Saudi citizens from qualifying for the E-2 visa.
- Riyadh: Riyadh, the capital of Saudi Arabia, shares the same lack of treaty status with the U.S.; thus, its citizens are also ineligible for the E-2 visa.
- Bahrain: Bahrain does not have an E-2 treaty, restricting its citizens from independently applying for the E-2 visa.
Differences Between the E-2 Visa and the EB-5 Visa
Both the E-2 Visa and the EB-5 Visa allow foreign nationals to invest in U.S. businesses, but they have distinct differences:
E-2 Visa
- Requires citizenship from a country with a trade and navigation treaty with the United States.
- Requires a substantial investment in a legitimate U.S. enterprise or in making such an investment.
- Does not mandate the creation of a minimum number of jobs.
EB-5 Visa
- Does not have a nationality requirement; applicants from any country can apply.
- Requires a minimum investment of $800,000 in a new business in a targeted employment area.
- Create at least ten full-time jobs for qualified American workers in the new business entity.
Differences Between the E-2 Visa and the H-1B Visa
The E-2 Visa and the H-1B Visa serve different purposes and have specific eligibility criteria:
E-2 Visa
- Requires citizenship from a country with a treaty agreement with the United States.
- Requires a substantial investment or in the process of investing significant capital in a legal U.S. business.
- Intended for individuals seeking entry into the U.S. to establish and manage an investment enterprise.
H-1B Visa
- Requires a job offer from a U.S. employer for a position that requires specialized skills.
- The applicant must have at least a Bachelor’s degree or equivalent qualification.
- Needs sponsorship from a U.S. employer to apply for the visa.
In conclusion, the E-2 Visa offers foreign investors from treaty countries the opportunity to establish and manage businesses in the United States, provided they make a substantial investment in a legitimate enterprise. This visa does not mandate a minimum job creation requirement, making it accessible for entrepreneurial ventures across various industries. However, citizens of non-treaty countries face limitations unless they acquire citizenship from a treaty country or qualify through marriage to a treaty country citizen.
On the other hand, the EB-5 Visa is an immigrant visa available to investors worldwide. It requires a minimum investment of $800,000 in a targeted employment area and the creation of at least ten full-time jobs for U.S. workers. Unlike the E-2 Visa, it does not restrict eligibility based on nationality but focuses more on substantial investment and job creation.
Furthermore, distinguishing between the E-2 Visa and the H-1B Visa highlights their different purposes: the E-2 Visa is for investors seeking to establish and oversee their business operations in the U.S. At the same time, the H-1B Visa caters to foreign workers with specialized skills hired by U.S. employers.
Understanding these distinctions is crucial for individuals considering investment opportunities in the U.S. Each visa type serves specific purposes and comes with distinct eligibility criteria, emphasizing the importance of choosing the right visa category based on individual circumstances and goals.