E2 Visa Requirements for Investors
Before discussing the E2 visa requirements, it important to provide an overview of the visa itself.
The E2 visa is nonimmigrant visa that allows citizens of a treaty country to start a business in the United States.
To qualify for an E2 visa, investors can start a business in the US, purchase a business or franchise or invest in an existing US business. Investors can also bring employees from their home country to work in a supervisory, executive or specialized skill capacity.
Generally, E2 visas are valid for many years, can be renewed indefinitely, and allow you to travel frequently outside the United States.
So, what are the E2 visa requirements for investors? The E2 visa requirements are:
- You are a citizen of an E2 treaty country
- You have invested or are in the process of investing in a US business
- Your investment is substantial
- Business is real and active
- Business is not marginal
- You are in a position to develop and direct the business
- You intend to depart the United States when the E2 status ends
1. You are a citizen of an E2 treaty country
The most important E2 visa requirement is that you are a national of a treaty country. To have the nationality of a treaty country means that you are a citizen of a treaty country and possess a valid passport. However, you do not need to reside in your treaty country to qualify, and it does not matter if you acquired your E2 citizenship through birth or naturalization. Simply put, as long as you have a passport from an E2 treaty country you can qualify for E2 visa.
Citizenship of a treaty country is an essential requirement because it is a prerequisite for an E2 visa. If you do not have a passport from an E2 treaty country, you cannot qualify for E2 visa because you do not meet the E2 visa requirements.
There are currently about 80 E2 treaty countries. Portugal is the latest country to be added to the list. Please visit E2 treaty countries list for an updated list of countries that qualify for an E-2 Visa. You can also visit the U.S. Department of State Treaty Countries list.
Permanent residence of E-2 country
Permanent residents of E-2 treaty countries are ineligible for E2 visas because citizenship is required. If you are a permanent resident of an E2 treaty country but you are not a citizen of that country, then you do not qualify for an E2 visa. Under these circumstances, you must first obtain citizenship of the treaty country to qualify for E2 visa.
For example, if you are a Brazilian citizen with permanent residency in Italy, you do not qualify for E2 visa because Brazil is not a treaty country, even though Italy is. So, despite the fact that Italy is an E-2 treaty country, you cannot apply for E2 visa because you do not have Italian citizenship.
Dual citizen of E-2 countries
Moreover, individuals with dual or multiple citizenships of E-2 treaty countries may apply for an E-2 visa under any of their citizenships. If you are a dual citizen of E-2 treaty countries, then you must decide which passport to use before applying for the E2 visa.
However, when choosing which citizenship to apply under, dual citizens should consider the terms of each E-2 treaty and the citizenship of their prospective employees.
Different treaty countries have different agreements in place, and the terms of the E-2 treaty with a specific country will dictate the terms of the E-2 visa, including the E-2 validity period, number of entries into the United States, reciprocity fee and others.
Countries such as Canada, Germany, UK, Australia, Pakistan, Singapore, South Korea, Mexico, Japan, Taiwan, Kazakhstan, Argentina, Netherlands, Romania, Bulgaria, Slovenia, Serbia, Colombia, Chile and others have favorable E-2 terms with long validity period and multiple entries. These E-2 visas are valid for many years with multiple entries, meaning you can travel outside the United States as many times as needed.
Other countries, such as Ukraine, Egypt and Jordan have very restrictive E-2 terms with short validity and few entries. These E-2 visas are valid for 3 months and only allow one or two entries in the United States during the validity of the visa.
No E-2 country citizenship: Citizenship by Investment
If you are not a citizen of an E-2 treaty country, then you may consider obtaining citizenship of a treaty country through investment. Turkey and Grenada are popular options among investors who wish to become citizens of an E2 visa country and relocate to the United States.
However, it is important to note that as of December 15, 2022, US law changed the E-2 visa requirements for individuals who acquired their citizenship through investment (CBI). According to the new law, individuals who have acquired citizenship through financial investment must have been domiciled in the country whose citizenship they obtained for a continuous period of at least 3 years before applying for an E-2 visa or E-1 visa for the United States. To learn more, visit CBI Domicile Requirement for E-2 visa.
2. You have invested or are in the process of investing in a US business
To qualify for E2 visa, you must have made a substantial investment, or be actively investing, in a US business. Your investment must be at risk in the commercial sense, meaning that there is a possibility you could lose your money if the business fails, or you could have significant financial gains if the business succeeds. In addition, to meet this E2 visa requirement, your investment must be irrevocably committed, and the funds must come from lawful sources and not be the result of illegal activities.
Source of E-2 investment
Your investment must come from lawful sources and not be obtained through criminal activities. You must be in possession and have control over the funds. You must be able to show how you have obtained the funds. The investment funds can come a source within the United States.
Sources of E-2 investments include:
- Salary and wages
- Sale of real estate (example, house, apartment, land)
- Sale of a business, asset sale or stock sale
- Sale of intellectual property
- Loans under certain conditions
- Gifts and donations
- Capital gains on investments
In sum, the E-2 visa investment can come from various legitimate sources, including personal savings, business profits, inheritance, and loans under specific conditions.
Type of investment
It is important to note that the E-2 investment does not have to be cash. While investment of cash is most common for E-2 visa, you can also contribute tangible and intangible assets, including:
- Intellectual Property (IP)
- Real estate
- Crypto, Bitcoin, Ethereum and other digital assets
Moreover, the funds or assets invested must be irrevocably committed to the E-2 business. This means that the investment has been made and the business is either already operating or is very close to starting business operations. In other words, your funds are not irrevocably committed, and you do not qualify for an E-2 visa if money is simply sitting in a bank account and company exists only on paper.
If you are purchasing a business in the United States, you can make the E-2 investment irrevocable by structuring the transaction so as to hold the assets in escrow until the E-2 visa is approved. To ensure compliance with E-2 visa requirements, it is important to work with an experienced business immigration lawyer. Our experienced E-2 visa lawyers in Miami, Florida USA have a proven track record of helping clients purchase businesses or franchises for E-2 visas. We can guide you through every step of the process, from structuring the transaction to filing the E-2 visa application.
If you are starting a business for E-2 visa, the funds spent qualify as irrevocable investment if they go towards establishing and operating the business. In other words only business expenses qualify as investment for E-2 visa. Examples of investment to start an E-2 business include:
- Purchasing or leasing an office, warehouse, or other premise
- Technology expenses
- Equipment purchases
- Marketing expenses
- Inventory purchase
- Professional service fees, including attorney fees, accountants and others
However, not every financial arrangement constitutes an E-2 investment. Personal expenses do not count towards E-2 investment, even if they were incurred in the process of setting up the business. Simply put, your travel expenses to establish the E-2 business, such as hotels, airline tickets, car rentals, and others, do not count towards your E-2 investment.
Loan for E-2 visa
Loans are an acceptable investment for E-2 visa but must meet specific requirements.
Only personal loans can be used. These personal loans can be secured by personal assets, such as a second mortgage, or they can be unsecured loans, which are typically obtained from family, friends, or business partners.
However, loans secured by the assets of the E-2 business, such as mortgage debt or commercial loans, cannot be counted towards the E-2 investment. When business assets are used as collateral, any funds obtained through loans or mortgages cannot be used for E-2 visa, even if personal assets are also used as collateral.
In certain cases funds and assets can be held in escrow, contingent on approval of the E-2 visa. This arrangement allows the investor to demonstrate their commitment to the investment while ensuring that the funds are not released until the E-2 visa is approved.
Inheriting a business
If you inherit a business or shares in a US business, you do not qualify for an E-2 visa. This is because in the case of an inheritance or donation there is no investment being made or funds at risk. Therefore, inheriting a business without further investment cannot qualify for E-2 visa.
However, you may still have other options to obtain an E-2 visa. For example, you could sell the inherited business and use the proceeds to start a new business, or invest additional capital in its expansion, or others. If you have inherited a US business, you should contact an experienced immigration lawyer to explore your options for E-2 visa.
3. Your investment is substantial
There is no minimum investment amount to qualify for E-2 visa. The E-2 investment depends on the nature of the business you invest in. Generally, it is recommended that you invest about $100,000 for an E-2 visa, but you can also invest a lower amount. Our lawyers have had successful E-2 visa applications with investments as low as $50,000.
Please note that while $100,000 may be considered a substantial investment in certain cases, it is neither a mandatory requirement nor a guarantee of E-2 visa approval.
So, when is the E-2 investment substantial? An investment is substantial when it is sufficient to ensure the success of the business. To determine if the E-2 investment is substantial, immigration officers apply a proportionality test by weighing how much you invested in the business versus the cost of the business.
If you purchase a business, the cost of the business is its purchase price, which is generally the fair market value. If you start a business, the cost of the business is the actual cost of establishing the business to the point of being operational.
For example, for businesses with higher start-up costs, such as a hotel in Miami, Florida, an investment of $100,000 is not considered substantial because the cost of developing a hotel far exceeds $100,000. However, for businesses with lower start-up costs, such as an online business, a consulting firm in Texas or an e-commerce business in South Carolina, a $50,000 investment could be deemed substantial.
E-2 visas are not granted for non-profit organizations or passive investments.
To qualify for an E-2 visa, you must invest in a real and active business that engages in commercial activity and produces and sells goods or services. The business must have the potential to generate income, even if it is a pre-revenue startup or is not yet profitable. However, the E-2 business cannot be a paper organization or one that purchases land or assets to hold for capital appreciation.
Startups with no income are eligible for E-2 visas as long as they have secured all necessary business permits and are ready to start operating upon approval of the visa. This means having equipment, inventory, a supply chain, and marketing strategies in place to begin generating revenue once the business opens its doors to the public.
Any business can qualify for E-2 visa as long as it is not a nonprofit or a passive investment. Examples of passive investments include investing in land, stocks and bonds. Investments in real estate businesses such as a real estate management or property management company, including short-term vacation rental, may qualify for E-2 visa under certain circumstances. However, generally, investments in real estate without more do not meet the E2 visa requirements.
Examples of E-2 businesses include:
- Online business
- Software development
- IT consulting
- AI consulting
- Yoga, pilates studio
- Hair salon
- Marketing agency
- Car and limousine services
- Travel agency
- Construction company
Your business must be more than marginal. The E-2 visa regulations define a marginal business as a business that does not have the present or future capacity to generate enough income to provide more than a minimal living for the E2 investor and their family.
Moreover, even if the business does not have the capacity to generate enough income if it has a present or future capacity to make a significant economic contribution, then it is not a marginal.
This means that your E2 business should be capable of generating enough income to support you and your family beyond basic necessities. The E-2 business must be more than just a means of self-support. It must have the potential to generate a substantial income that ensures a comfortable living for you and your family and hire employees.
An E-2 business can demonstrate that it has the potential to reach such an income though a business plan. A business plan with financial projections that indicate the potential to generate enough revenue within five years can effectively demonstrate that the E-2 business is not marginal.
6. You are in a position to develop and direct the business
To qualify for E-2 visa, the investor must prove:
- Ownership. Nationals of an E-2 treaty country own at least 50% of the E-2 business.
- Direct and develop. E-2 investor develops and directs the business through ownership, management or possesses operation control through business corporate devices or other means.
At least 50% ownership
Generally, as an investor, you must own at least 50% of the business to qualify for E-2 visa.
Develop and direct
In addition, the owner of the E2 business must show that they are developing and directing the business.
If you own the E2 business as an individual investor, then you must show how you are personally developing and directing the business.
If your foreign company owns the E2 business, then the application must show how your foreign company develops and directs the business.
If you and your business partner each own 50 percent of a business, or you are an equal shareholder in a joint venture or partnership, then you must each retain full management rights and responsibilities to qualify for E-2 visa. This means that you each have the authority to make binding decisions that affect the other.
This is typically established through business formation documents, corporate records or job descriptions.
If you are involved in a business or joint venture with equal ownership, you should consult with an experienced E-2 visa lawyer who specializes in business corporate law. Our experienced E-2 visa lawyers can provide comprehensive guidance in structuring the business and corporate documents and work closely with your corporate attorney to ensure that each partner or shareholder meets the E-2 visa requirements.
Control by management
Investors who are minority owners of E-2 businesses may still qualify if they can demonstrate control over the business through management positions or other businesses structures. These cases are less common and require careful presentation to the embassy due to their complexity. To successfully navigate these cases, it is essential for the owner to present convincing evidence that the investor is developing and directing the E-2 business.
7. You intend to depart the United States when the E2 status ends
You must intend to leave the United States when the E2 status ends and not stay illegally in the United States after the expiration your authorized stay. In fact, the E-2 regulations state that you can even sell your house and all your possessions in your home country and still meet the E2 visa requirements.
However, maintaining an intent to depart the United States does not prohibit you from renewing your E-2 visa or applying for a green card.
In the case of a pending green card petition, the “E-2 intent to return” refers to your willingness to obtain the green card through consular processing at a US Consulate abroad rather than adjustment of status at U.S. Citizenship and Immigration Services (USCIS). In practice this distinction is important, and you should carefully consider your options with an immigration lawyer to determine the best way to obtain your green card.
The E-2 visa can be converted to the various green card options including:
- EB-5 Immigrant Investor Program
- EB-1C Multinational Manager or Executive
- EB-2 National Interest Waiver
- EB-1A Extraordinary Ability in Sciences, Arts, Education, Business or Athletics
- PERM EB-2 or EB-3
- Marriage and family immigration
- Diversity visa lottery
Malescu Law can assist
Our experienced business and immigration lawyers in Miami, Florida USA can provide comprehensive assistance with your E2 visa application to ensure you meet all E-2 visa requirements. To learn more about the E2 visa requirements and to evaluate your case and E-2 eligibility, contact our experienced E-2 visa lawyers or schedule a consultation.
Malescu Law P.A. – Business & Immigration Lawyers