Strategic E-2 Visa Considerations

• The Investor Must Show That It Has Either Made a Substantial Investment or Is Actively in the Process of Making a Substantial Investment in the Enterprise: To be "in the process of investing" for E-2 purposes, the funds or assets to be invested must be committed to the investment, and the commitment must be real and irrevocable. For the alien to be "in the process of investing", the alien must be close to the start of actual business operations, not simply in the stage of signing contracts (which may be broken) or scouting for suitable locations and property. Merely intending to invest, or having possession of uncommitted funds in a bank account, or even prospective investment arrangements entailing no present commitment, will not qualify an applicant for E-2 status.

  A qualifying investment must be a real and active commercial or entrepreneurial undertaking, producing some commodity or service. The enterprise cannot be a paper organization or an idle speculative investment held for potential appreciation in value, such as undeveloped land or stocks held by an investor without the intent to direct the enterprise. Uncommitted funds in a bank account do not represent an active investment, unless other evidence of business activities exists to demonstrate that the funds are used in the routine operation of the business- i.e., reserve funds.

• The Applicant for the E-2 Visa Should Be In a Position to "Develop and Direct" the Enterprise Via His/Her Executive and Supervisory Duties: It must be shown that nationals of a treaty country own at least 50 percent of an enterprise. It must also be shown that a national (or nationals) of the treaty country, through ownership or by other means, develops and directs the activities of the enterprise. "Developing and directing" the enterprise activities generally refers to executive and supervisory responsibilities. Consequently, the following factors must be considered:
   
  1. The title of the position in which the applicant shall be employed, its place in the firm's organizational structure, the duties of the position, the degree to which the applicant will have ultimate control and responsibility for the firm's overall operations or a major component thereof, the number and skill levels of the employees the applicant will supervise, the level of pay, and whether the applicant possesses qualifying executive or supervisory experience;
  2. Whether the executive or supervisory element of the position is a principal and primary function and not an incidental or collateral function. If the position chiefly involves routine work and secondarily entails supervision of low-level employees, the position could not be termed executive or supervisory.
      
• The Foreign Investor Must Make A "Substantial" Investment: A "substantial" amount of capital for E-2 visa purposes constitutes that amount that is:
   
  1. Substantial in a proportional sense- i.e., in relationship to the total cost of either purchasing an established enterprise, or creating the type of enterprise under consideration;
  2. Sufficient to ensure the treaty investor's financial commitment to the successful operation of the enterprise; and
  3. Of a magnitude to support the likelihood that the treaty investor will successfully develop and direct the enterprise. No set dollar figure constitutes a minimum amount of investment to be considered "substantial" for E-2 visa purposes.
      

  The value (cost) of the business is clearly dependent on the nature of the enterprise. Generally, the cost of an established business is its purchase price, which is normally considered to be the fair market value.

• The Enterprise Must Be More Than Marginal: The foreign individual or company must not be investing in a marginal enterprise solely for the purpose of earning a living. An applicant is not entitled to E-2 status if the investment, even if substantial, will return only enough income to provide a living for the applicant and family. In determining whether an investment is marginal, two important factors are to be considered:
   
  1. Additional Funds That Are Not Intended For The Enterprise: If the investor can support himself/herself and family with funds that will not be used for the enterprise and/or if the income derived from the enterprise exceeds what is necessary to support the investor and his/her family, then the enterprise is not marginal.
  2. Economic Impact of the Business: The business must have the capacity, present or future, to make a significant economic contribution. The projected future capacity should generally be realizable within five years from the date the alien commences normal business articulates. It is recommended that applicants submit a reliable 5-year profitability business plan.
      
• An Individual or Company Must Demonstrate Possession and Control of the Capital Assets, Including Funds Invested: If the individual or corporate investor has received the funds by legitimate means, e.g., savings, gift, inheritance, contest, etc. and has control and possession over the funds, the proper employment of the funds may constitute an E-2 investment. (It should be noted, however, that inheritance of a business does not constitute an investment.) Moreover, the source of the funds need not originate from outside the United States.
• Initial E-2 Applications Where An Applicant Will Not Change His/Her Status in the U.S. to E-2 Will Require Consular Processing: Filing abroad at U.S. consulates abroad results in a totally new and independent adjudication by the consular offices; the standards used by consular offices abroad are often more demanding and difficult to meet.
• Change/Extension of E-2 Status Within the U.S. Might Be Favorable: for instance, changing to E-status may happen when a foreign national is entitled to enter the U.S. in B-1 business visitor status in order to take initial steps to conduct trade in this country. The individual may be in a position in which the trading activities move more quickly than expected and require his or her immediate and continued presence. Now, with the new Premium Processing Service fee of $1,000, E-1 visa petitions can be adjudicated in the U.S. within fifteen days. Moreover, generally, as long as the treaty-trader maintains the intention to leave the United States at the end of his or her lawful stay, his or her presence here for prolonged periods is permissible.
• The Spouse of an E-2 Visa Holder is Eligible for Employment Authorization.

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