E-2 treaty visas

I recently blogged about investor visas, which is a path to citizenship and requires a large investment. What if you don’t want to permanently move to the United States or don’t have a large sum of money to invest? The United States has a nonimmigrant investor visa that allows foreigners to invest in smaller businesses and allows them to stay in the United States as a nonimmigrant. The US has negotiated treaties with several countries that allow a citizen of the treaty country to invest in businesses in the US and bring their family to live and work in the US.

So how does a E-2 treaty visa work? The alien must place “capitol, including funds and other assets, at risk in the commercial sense with the objective of generating a profit. Your investment may be for the purpose of establishing a new business venture, or purchasing a pre-existing business. In either scenario, you must demonstrate that the capital you are investing is substantial.[1]” What a sterile definition.  Let me break it down into a few simple rules listed in the definition. 

1.     The business: The alien must invest capitol in a commercial business. The business cannot be marginal; meaning that it cannot merely make a minimal living for the alien and their family, it must produce a profit. An alien can demonstrate that by producing a detailed business plan, payroll summaries (W-2s, etc.), financial statements, and tax returns. The business must also be a bona fide venture. Meaning it cannot be some cover to launder money, sorry to all the would be felons who were hoping to get around the immigration laws. To be a bona fide venture “is a real, active commercial, or entrepreneurial undertaking which produces services or goods for profit.[2]” A bona fide venture may not be an idle investment in land or stocks which the investor does not intend to direct.

2.     Capitol: The investor must be in possession of the funds to be used in the investment. The investor must also prove that he has committed those funds to the development of the enterprise. The amount of the investment is not specifically defined in the statute, but it does need to be substantial in relation to the total amount spent in acquiring the business or building a new one. One can prove that the investment was substantial by providing the bill of sale, valuation of the business assets, purchase agreement for business assets, etc.

3.     Funding: the funding for the investment must come from a legitimate source. A paper trail of the funds must be provided when applying for the visa. An alien must demonstrate that all sources are not gained by criminal or illegal means.

4.     Develop and Direct: The last requirement is that the alien intends to come to the US to develop and direct the company that the alien intends to invest in. Why else would one be applying for a visa if they do not intend to be in the US to develop and direct the company that he invests in?

There you have it. Four steps to gaining a nonimmigrant investor visa without investing $1 million dollars. If you have other questions about an E-2 visa or other type of employment based visa, please contact me or leave a comment.

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[1] http://www.uscis.gov/eir/visa-guide/e-2-treaty-investor/understanding-e-2-requirements

[2] http://www.uscis.gov/eir/visa-guide/e-2-treaty-investor/understanding-e-2-requirements 

Investor Visas

Listing off the requirements of obtaining an EB-5 visa is fairly easy. The immigrant must invest capital of $1,000,000 (or in certain areas $500,000); create 10 full time jobs through their investment; and create a new commercial enterprise where they have a managerial role in the business. Seems simple enough right, have the money and the idea and hey the US will let you have a green card? Each criteria has several little requirements that make it a bit tougher to obtain a green card.

The first criteria is pretty simple. Got a million bucks? Good you can invest where ever you want. However, the USCIS allows for a lesser investment of $500,000 in targeted employment areas or rural areas. A targeted employment area (TEA) is an area that is experiencing unemployment of at least 150 percent of the national unemployment average.  As investors choose where to invest their money they have to be aware of where possible TEAs are because a TEA can be in the middle of the city or on the outskirts of a city or out in the rural country. Most states have an agency that keeps track of the TEAs and you can ask if a certain plot of land is within a TEA.

The investment can be in the form of assets that total the amount needed ($1 million or $500,000 depending where the entrepreneur wants to build his investment).  All assets will be valued according to the fair market value in United States dollars.  All funding must come from legal sources, if any of the funding for the investment came by unlawful means it will not be counted toward the amount for the investment.  Money obtained from a bank robbery will not help you get a green card in the US.  All money used for EB-5 purposes needs to have a paper trail of where it came from in order to prove its legitimacy.

The second criteria needed for an EB-5 visa is the enterprise must create or preserve 10 full-time jobs.  The jobs created or preserved are to be filled by a qualified employee which is someone who is a US citizen, legal permanent resident, or foreigner on a work visa; anyone who is authorized to work in the US is a qualified employee.  If the investor is saving a troubled business they can count the preserved jobs towards the job creation requirement, however if the enterprise has more than ten jobs then all the jobs need to be saved in order to qualify for the investor visa.  A troubled business is one that has been existence for at least two years and has suffered a net loss for the last 12 to 24 months.  

The third criteria that investors need in order to gain an EB-5 visa is to create a new commercial enterprise.  “Commercial enterprise” means any for-profit activity formed for the ongoing conduct of lawful business.  “New” means after November 29, 1990.  An investor can also save a troubled business that was created before November 29, 1990 as long as it is restructured in a way that creates a new commercial enterprise or that it is expanded so that there is a 40 percent increase in net worth.  A commercial enterprise can be in the form of a sole proprietorship, partnership, holding company, joint venture, corporation, business trust, or other business entity privately or publicly held.  As an investor, the alien must have a managerial role in the company and have some control over the investment.  The commercial enterprise cannot be a passive investment for the purposes of an EB-5 visa.  (More information can be found at: http://www.uscis.gov/working-united-states/permanent-workers/employment-based-immigration-fifth-preference-eb-5/eb-5-immigrant-investor.)

There you have it, the three steps to getting a green card through investment. If you have any questions about the process please contact me directly.