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E2 Visa: In-Depth Analysis of the Investor Visa

What is an E2 visa?

The E2 visa, also called Investor Visa, allows foreign nationals to live in the U.S. with their spouse and children under 21. To qualify, you must be from a country with an E2 treaty with the U.S., plan to start or buy a business, create jobs, and run the business. This visa is typically valid for up to 60 months, but may vary by your home country. Spouses and children under 21 can also live in the U.S. on this visa. You can apply for the E2 visa at the U.S. Embassy in your home country. You will need to submit a complete application, often prepared by an immigration lawyer. A detailed business plan is a crucial part of this application. As a former E2 visa holder myself, a business plan writer and a business broker specializing in E2 visa foreign buyers, I have written this article to guide you through the process of applying for an E2 visa. 

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E2 visa

How to get an E2 investor visa? What are the E2 visa requirements?

To obtain this visa, the applicant must:

01.

Be a citizen of a country that has signed a treaty allowing for the issuance of E2 visas.

02.

Have invested, or be actively in the process of investing, a substantial amount of capital in a bona fide business in the United States. It can be a new startup business or the purchase of an existing business. It cannot be a passive investment such as rental property.

03.

Intend to come to the United States solely to develop and manage this business. The applicant must own at least 50% of the company’s shares and have a management role in the business.

04.

Ensure that the business is not marginal, meaning it has the ability to generate more than a minimum standard of living for the applicant and their family, and it must have the necessary licenses or authorization for its market.

05.

Apply for an E2 visa at a U.S. Embassy, ideally with the assistance of an immigration attorney.

The funds that are invested in the business must be “at risk”, with the goal of making a profit, but with the understanding that they may be lost if the business fails. The applicant must also prove that the funds were obtained lawfully. Note: “Invested” funds means “spent” funds, not just deposited in a U.S. account.

A substantial investment means:

  • Substantial in relation to the total cost of the transaction, whether it is a business start-up or buyout.
  • Sufficient to confirm that the applicant is doing everything possible to make the business successful.
  • Sufficient to ensure that the business has a chance of success depending on its field of activity (not all activities require the same initial investment).

A “bona fide” business refers to a legitimate enterprise that operates regularly to provide goods or services with the intention of generating profit. It must be more than an “empty shell” and the business’s activities must be legal. The company must also possess the appropriate licenses and permissions for its market. It is important to thoroughly verify the required licenses for the business’s operations in the state in which it plans to establish itself.

Additionally, the business must not be considered marginal. According to the U.S. Citizenship and Immigration Services (USCIS), a marginal business is one that lacks or will lack the ability to provide more than the minimum standard of living for the applicant and their family. For start-ups, it may be challenging in the first few years, but this level should be achieved within five years of obtaining the visa. The number of employees in the business may also be a factor in determining if it is marginal. For businesses that have been in operation for a long time and have never had any employees, it will be more challenging to demonstrate that you will hire staff. In our opinion, it is advisable to avoid presenting a business buyout with fewer than two employees.

Finally, the applicant must have a significant role in the company, leading and ensuring its development. This does not necessarily require constant presence, but it does require evidence that the applicant is responsible for making important, strategic, and operational decisions.

A key question regarding the E2 visa is whether the applicant will be able to develop and run the business. There have been instances where the applicant’s level of English has led to a negative response and the denial of the visa. In these cases, the consular officers determined that the applicant’s English proficiency would not allow them to effectively manage a company in the United States. While the conditions for obtaining an E2 visa have not changed, the officer has complete discretion in interpreting them. It is important to note that the embassy has the final say in granting the visa.

E2 visa treaty countries

E2 Treaties: A List of Countries with Agreements with the United States

There are 78 countries that have an E2 visa treaty with the United States. The complete list can be found on our website “E2 visa treaty countries full list” or on the website of the US Department of State’s Bureau of Consular Affairs. Some countries, such as Portugal and Israel, have recently obtained this agreement, although the duration granted to visa applicants from Portugal is not yet known. It is worth noting that the duration of the visa can vary for different countries.

How long is the Investor Visa valid for?

The duration of the E2 visa varies based on the principal applicant’s citizenship. For example, a French or a Swiss citizen may receive a maximum duration of 4 years, while a Belgian citizen may receive 5 years, and a Canadian citizen may receive 5 years. It is important to note that individuals with multiple citizenship should apply for the visa of the citizenship that provides the longest duration. A list of durations by country can be found here: Reciprocity Visa E2.

What is the ideal amount of investment?

There is no set amount of investment that is considered ideal for obtaining an E2 visa.

It is important to note that there is no specific investment amount specified in the guidelines. The only requirement is that the investment must be substantial and in proportion to the project. Different projects may require varying amounts of investment. For example, starting an accounting business may only require computers and furniture, while a construction business may require expensive machinery.

However, it has been observed that investments with low amounts are less likely to be successful. An investment of $100,000 is commonly considered as the minimum investment level to increase the chances of visa approval.

Pros of the E2 Visa

  • The E2 visa allows nationals from 75 countries to reside and make money in the United States.
  • There is no strict minimum investment requirement, although applications for less than $80,000.00 have a low likelihood of success and an investment of at least $150,000.00 is preferred to increase the chances of approval.
  • The spouse of the E2 visa holder will be granted an “E2 dependent” visa, which allows them to obtain work authorization in the United States (I94S).
  • The E2 visa holder’s children will also be granted an E2 dependent visa and will be able to attend school until age 21. In some states, they may be eligible for the more favorable “in-state” rate at the university rather than the foreign rate.
  • The E2 visa holder has the flexibility to travel and re-enter the country as long as the visa is valid, with a new 2-year I94 residence permit issued each time they pass through customs.
  • The E2 visa provides access to health insurance under Obamacare and the tax credit, making it more affordable.

Cons of the E2 Visa

  • If the company that justified the E2 visa is not successful, the chances of renewal are low (see renewal information below).
  • The holder of the visa can only work for the company that sponsored the visa.
  • If the company disappears or changes ownership (through bankruptcy or resale), the E2 visa holder must leave the country. However, they may request an extension of their E2 status from the U.S. Citizenship and Immigration Services (USCIS) if they take over another business.
  • The children of the applicant, upon reaching 21 years of age, must obtain their own visa or leave the country and are not allowed to work in the United States while on their parents’ E2 visa.
  • The E2 visa is only a key to unlock your American dream. The E2 visa does not lead to a green card and alternative methods, such as EB1, EB2 NIW, EB5, the lottery, or marriage, must be pursued to obtain permanent residence. It is a nonimmigrant visa.
  • The investment must be made entirely in cash. While it is theoretically possible to use a partial bank loan, it is uncommon for American banks to grant professional loans to visa applicants.

New rule E2 visa spouse and dependent.

Significant changes to the E2 visa for spouses and dependents were implemented in May 2023, as outlined in the Foreign Affairs Manual (9 FAM 402.9-9). These changes affect the regulations governing the visas of spouses and children of E visa holders. Specifically, the validity period of E2 visas for family members now depends on their nationality. If the spouse and children of an E visa principal applicant have the same nationality as the principal, they receive visas valid for the maximum period allowed by the reciprocity schedule of their country. However, if the spouse or children are nationals of a different treaty country, their E2 visa validity will be determined by the reciprocity schedule of their own nationality, not the principal applicant’s.

This presents a unique situation where family members may have different visa validity periods. For example, if a principal applicant is a Mexican national and receives a 4-year E2 visa, but their spouse and child are French nationals, the spouse and child would only receive a 2-year visa, in line with France’s E2 visa validity period. Conversely, family members from non-treaty countries will align with the principal applicant’s E2 visa validity period.

Differences between E1 and E2 visa

The E1, or treaty trader visa, is crafted for foreign nationals engaged in substantial and continuous trade activities between their home country and the U.S., necessitating that a significant portion of their company’s trade happens with the U.S. In contrast, the E2 visa is designed for foreign investors planning to live and work in the U.S. by investing a substantial amount in a U.S. business. While the E1 focuses on international trade, the E2 emphasizes investment in a U.S. business. Both visas permit a stay of up to five years with the possibility of renewal. However, the E2 visa has a broader qualifying criterion, not mandating actual trading between countries, unlike the E1 visa. The treaty trader visa requires applicants to prove they are key personnel in a company with substantial international trade activities.

E2 visa and franchise

The E2 visa and franchise combination offers a powerful opportunity for foreign investors to establish and manage successful businesses in the United States. The E2 visa is designed for foreign nationals investing in a US business, while the franchise model provides a proven business system, brand recognition, and ongoing support. Examples of successful E2 visa owners include those who have invested in Kilwins in Jupiter, FL, Huntington Learning Center in Melbourne, FL, and Pakmail in Fort Myers, FL. These investors have successfully managed their businesses by leveraging the established brand names and continuous support from their franchisors. In conclusion, the E2 visa and franchise connection presents a compelling option for foreign investors to maximize their chances of success in their entrepreneurial endeavors in the US.

The Investor Visa: A Nonimmigrant Visa

It is important to note that the E2 visa is a nonimmigrant visa. This means that it allows you to live in the United States, run a business, and raise your children, but it does not allow you to permanently immigrate to the US. An E2 visa has a start and end date and can be renewed indefinitely, but it will never allow you to obtain a green card or citizenship. To do so, you will need to switch to a different status.

There are many incorrect claims made by websites that I would describe as “dream sellers,” suggesting that obtaining American citizenship after arriving on an E2 visa is easy. While it is possible to switch to another status, it is, in my opinion, difficult. In my experience, based on what I have seen and read as it is impossible to find official figures, it is my belief that less than 25% of people who come to the US on an E2 visa ultimately succeed in obtaining permanent residency or citizenship.

The Visa Application

The E2 visa application should be made at a U.S. embassy, preferably in the applicant’s home country, although it may be possible to apply at an embassy in a different country if the applicant resides there.

The application for an E2 visa is made in writing, based on a complete file that includes justification for the investment, a summary letter, and a business plan. It can be completed by the applicant or a lawyer. It is highly recommended to use a lawyer for this process. Some individuals may refer to themselves as “immigration consultants,” but according to the law, their role is limited to assisting with form completion and translation for a small fee. They are not permitted to provide legal advice, as they are not lawyers.

After submitting your application to the embassy (in electronic PDF form), it typically takes 2 to 10 weeks for the embassy to process your application and schedule an interview. The average processing time in every embassy can be seen check here: Visa Appointments Wait Times

The interview usually lasts 10 to 30 minutes and is generally a simple formality if your file has been properly prepared in advance. The consular officers will ask you questions about your project and personal questions to determine if your project is realistic and meets the requirements for obtaining a visa. At the end of the interview, you will receive your E2 visa and the adventure can begin.

It is important to note that the E2 visa is only the key to entry and does not guarantee the success of your project. Your preparation, dynamism, adaptation to the market, mental capacity, stress management skills, and ability to question and think critically are all important assets to ensure the success of your project.

 

The Consular Process, step by step

The E2 visa consular process involves several steps and forms:

01.

Determine if you qualify for the E2 visa by meeting specific eligibility criteria.

02.

Complete the DS-160, Online Nonimmigrant Visa Application, and print the confirmation page.

03.

Pay the non-refundable visa application fee.

04.

Gather required documents, such as the DS-160 confirmation pageForm I-129 (if applicable), a comprehensive E2 visa business plan, and other essential documents.

05.

Prepare a well-organized visa packet with all required documentation and forms.

06.

Schedule your consular appointment using the DS-160 confirmation number.

07.

Attend the consular interview with your completed E2 visa packet.

08.

Wait for the consular officer’s decision on your application. If approved, your passport will be stamped with the E2 visa.

09.

Consider working with an experienced immigration lawyer to streamline the process, provide guidance, and increase your chances of success.

Visa from a consulate or Status from the USCIS: What is the Difference?

Instead of applying for an E2 visa at an embassy, some individuals who are already in the U.S. with another status (such as a B1/B2 visa or student visa) apply for an adjustment of nonimmigrant status directly with the U.S. Citizenship and Immigration Services (USCIS). This adjustment is granted for a maximum of two years. In our opinion, it has one major disadvantage: it does not allow the individual to leave the U.S. (as it is not a visa), so they are restricted to U.S. territory. In this case, we refer to “E2 status” rather than an “E2 visa.” This is also referred to as E2 Visa Consular Processing versus Change of Status.

E2 Essential Employee Visa: Bringing in Staff

In some cases, it is also possible to apply for a visa for employees. There are two recognized cases:

  • The employee is to be an executive of the company and will actually manage a team of people. In this case, the employee must have “executive or supervisory character.”
  • The employee has specific qualifications that are difficult to find in the U.S. (or even impossible to find), making them indispensable. In this case, we refer to “special qualifications” or “essential skills.”

This E2 “essential employee” visa is issued for the same duration as the E2 investor visa.

We have seen this visa granted in the restaurant, bakery, and hairdressing industries for “essential skills” and in the computer industry for “executive characters.”

In recent months, we have noticed a tightening of requirements for essential skills visas, similar to those for investor visas. It is important to clearly demonstrate any special skills or qualifications you have that surpass those of personnel available in the US, and to not take the notion of essential employee lightly. The level of education also seems to be significant. For individuals who will be managers, higher degrees (such as a Bachelor’s or Master’s) and experience appear to be essential.

One benefit for the company (and a clear disadvantage for the employee) is that the holder of an E2 essential employee visa is tied to the company holding the E2 investor visa and cannot work for the competition. It is important to not abuse this advantage, but it remains a benefit for the employer in a context where employees frequently change jobs.

Renewal of the visa

The renewal of the E2 visa is requested at the end of the initial period. In order to be granted, the company must meet the initial conditions for obtaining the visa:

  • Provide more than the minimum required to live for the holder and his family (example on this site of living income by family size and state). Note: For a better understanding by the officer, it is advisable to pay oneself as much as possible in wages rather than dividends. While the LLC does not allow this as standard, it is possible with the S-Corp tax status.
  • Have a significant impact on the local economy, i.e. generate employment. There is a lot of information available on this topic. It is suggested that a minimum of 3 full-time employees is necessary. The salary level may also be taken into consideration, so it is advisable to avoid paying the legal minimum.

As long as the business meets the requirements of profitability and impact on the local economy, and still meets the initial requirements, the E2 visa can be renewed an unlimited number of times. When these criteria are met, the lawyer will proceed with the renewal request based on existing accounting documentation (such as tax returns, profit and loss statements, balance sheets, and employee payroll). A new business plan is not usually required, but one can be helpful if the business is short to meeting certain criteria.

Can the E2 visa be denied?

Yes, an E2 visa application can be denied. Common reasons for denial of an E2 visa include insufficient investment, investment not at risk, non-bona fide enterprise, marginal enterprise, and non-treaty country nationality. After denial, options include reapplying with stronger documentation, requesting an advisory opinion, or consulting an immigration attorney to address issues and improve the chances of success in future applications.

Our personal view of the E2 visa

The E2 visa is a subject that we are very familiar with for several reasons.

First and foremost, it was through an E2 visa that we were able to settle in the United States with my family (in my specific case, I received an E1 visa, which is similar to the E2 but for import and export activities).

Additionally, we have been writing business plans for law firms since 2009 and have personally assisted numerous clients from France, Quebec, Switzerland, Belgium, and Mexico in obtaining E2 visas.

Furthermore, as a business broker affiliated with Business Brokers of Florida and certified as a “Certified Business Intermediary” by the IBBA, I help foreign clients purchase Florida businesses that meet strict criteria (such as profitability, lease characteristics, and the presence of proper accounting documentation) so that they can be eligible for E2 visas. The agency that we created, Integrity International Brokers, assists clients throughout the entire process of purchasing a company and obtaining a visa.

In our opinion, the E2 visa is a gateway to the United States. If a project is viable, the applicant is a professional, and they are investing their own funds, obtaining this visa is generally not an issue.

Questions and Answers about the E2 visa

One of the most common questions we get asked is whether the E2 visa allows the holder to work in the United States. The short answer is yes, but there are some important caveats to understand.

The E2 investor visa is designed for foreign nationals who wish to invest and develop a U.S. business. The primary E2 visa holder is permitted to work only for their own business that they have created or purchased. They cannot be employed in a regular job by another company on the E2 visa.

However, the E2 visa does provide work authorization for the spouse of the primary E2 visa holder. As of November 2021, spouses of E2 visa holders are automatically granted work authorization without needing to apply for a separate Employment Authorization Document (EAD) as was previously required. This makes it much easier for E2 spouses to take employment with any employer in the United States.

It's important to note that the E2 is considered a non-immigrant visa category and is not an employment-based visa like the EB1, EB2, or EB3 categories. The E2 visa holder's main intent must be to develop and direct the operations of their U.S. business, not to take employment in the traditional sense.

In summary, the E2 investor visa does allow the primary visa holder to work, but only in the business they have invested in. Their spouse can work for any employer thanks to the automatic work authorization.

Answer: Yes, you can apply for an E2 visa if you are already in the U.S. on another visa. This is known as an adjustment of status, which is granted for a maximum of two years. However, it does not allow you to leave the U.S., so you are restricted to U.S. territory. In this case, it is referred to as "E2 status" rather than an "E2 visa."

Answer: Neither of them is "better." One can get a visa in either situation. One of the advantages of buying an existing business is that you can have a contingency clause included in the business purchase contract. In that case, the business price is isolated in an escrow account and, should the visa be denied, you would get your money back.

Answer: Yes, it is possible to apply for a visa for employees under certain conditions. The employee must either be an executive of the company and will actually manage a team of people, or the employee has specific qualifications that are difficult to find in the U.S., making them indispensable.

Answer: If the company that justified the E2 visa is not successful, the chances of renewal are low. If the company disappears or changes ownership, the E2 visa holder must leave the country. However, they may request an extension of their E2 status from the U.S. Citizenship and Immigration Services (USCIS) if they take over another business.

Answer: The E2 visa does not lead to a green card. It is a nonimmigrant visa, which means it allows you to live in the United States, run a business, and raise your children, but it does not allow you to permanently immigrate to the U.S. To obtain a green card or citizenship, you will need to switch to a different status.

Answer: The children of the applicant, upon reaching 21 years of age, must obtain their own visa or leave the country. They are not allowed to work in the United States while on their parents' E2 visa.

Answer: No, the holder of the visa can only work for the company that sponsored the visa. If the company disappears or changes ownership, the E2 visa holder must leave the country.

E2 Visa Statistics

From 2014 to 2018, the U.S. State Department and USCIS processed an average of about 54,000 E-2 visa applications or petitions annually. The State Department, accounting for over 80% of these adjudications, issued approximately 90% of the E-2 visa applications it received. USCIS, on the other hand, approved about 83% of the E-2 petitions it handled.

During this period, the State Department adjudicated around 45,000 E-2 visas each year. The approval rate for these visas was about 90%. The applicants comprised 44% dependents and 53% principals (14% investors, 20% managers, and 19% essential employees).

The refusal rate for E-2 visas was generally lower than for other nonimmigrant visas. From 2014 to 2017, the average refusal rate for E-2 visas was about 8%, compared to a rise from 15% to 22% for all nonimmigrant visas. This lower rate may be due to the extensive paperwork required for E-2 visas, which could deter unqualified applicants.

Breaking down the refusal rates by applicant type, the highest average refusal rates were for investors (24%), followed by dependents (12%), managers (9%), and essential employees (6%). The higher refusal rate for investors is likely because they are usually the first from their company to apply for an E-2 visa. If the investor is denied, other applicants (like managers or essential employees) might have to wait for approval or find another investor.

About 10% of E-2 visa adjudications from 2014 to 2017 were refused. The majority of these refusals (75%) occurred because applicants did not meet the eligibility requirements. Another common reason for refusal (22%) was inadequate documentation under INA § 221(g). Less than 4% of E-2 visa refusals during this period were due to other reasons like security, criminal-related ineligibilities, fraud, or immigration violations.

USCIS adjudicated an average of about 9,400 E-2 petitions annually from 2014 through 2018, with an 83% approval rate. Around 5,900 of these were petitions to extend E-2 status, predominantly for dependents (60%), and about 3,500 were petitions to change to E-2 status from another nonimmigrant category, with 47% being E-2 principal beneficiaries. The average denial rate for E-2 petitions was about 17%, with higher denial rates for changing status to E-2 (27%) compared to extending E-2 status (11%).

  • The US issued nearly 54,000 E2 Treaty Investor Visas in 2023, a 20% increase from the previous year, setting a new record.
  • Notable increases in visas were seen among Chileans and Colombians, with Chileans receiving nearly six times more visas and Colombians nearly four times more compared to the previous year.
  • The largest number of visas were issued to nationals from Japan, Germany, Canada, France, and Great Britain and Northern Ireland.
  • The US is considering treaty country status for India, which would open new E1 and E2 visa options for Indians.

Other notable countries included Italy, Spain, South Korea, and Mexico. These countries, along with the aforementioned, constituted the majority of E-2 visa applicants during this period.

Conclusion

In conclusion, the E-2 visa is a valuable option for individuals looking to move to the United States. It offers several benefits, including the ability to live and work in the country for an extended period of time, and the potential for the visa to be renewed indefinitely. However, the process of obtaining an E-2 visa can be complex, and it’s important to understand the eligibility requirements and application process before applying. E2 Visa Consulting can provide expert guidance and support throughout the entire process to ensure a successful outcome

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