E status is based on three elements: The first element is a foreign "presence." There must be either an individual or a business in a country other than the U.S. that will engage in trade or investment in the U.S. This is called the Treaty Trader or Investor.The second element is the U.S. "presence." The individual or entity with the foreign presence must be seeking to establish a presence in the U.S. by engaging in either trade with, or investment in, the U.S. This might be accomplished through the establishment of a U.S. business (an active investment, called the "U.S. Enterprise") or merely through engaging in trade between the "Treaty Country" and the U.S. (such as in the case of trade).The third element is a foreign national who is personally seeking admission to the U.S. This might be the individual Trader or Investor, or it might be an employee of the Trader or Investor. This is the foreign applicant.
E 2 status is available when (1) a foreign business or individual (the "Treaty Investor") is or will be making a substantial and irrevocable investment in the U.S. in an enterprise that creates jobs, and (2) the Investor's home country has a "treaty of commerce and navigation" or a "bilateral investment treaty" with the U.S. The foreign national and the Treaty Investor must have the same nationality.
E-2 Treaty Investors
To qualify for E 2 status, the Investor must evidence the following
-The Enterprise Is Bona Fide: The investment must be in a real, active, and operating enterprise or entrepreneurial activity that is a "for-profit" commercial effort to generate funds. Nonprofit activities are inappropriate for E status.The enterprise cannot be a paper or passive investment that increases in value through appreciation of stocks or other intangible assets.
If the enterprise does not yet exist, evidence must be provided that clearly explains, in detail, the proposed activities of the enterprise and demonstrates that it will be a viable commercial business. The Investor must have progressed past the investigatory stages of establishing the business enterprise and must be ready, immediately upon admission to the U.S. in E status, to begin commercial activities.
-The Investor Is the Source of the Funds: The Investor must have had possession and control of the funds that were, or will be, invested in the enterprise. The ultimate source of the funds should be identified, insofar as is possible, such as deriving from a gift, through business, or through savings.
-The Investment Must Be at Risk: The funds being invested must be at risk for loss should the business suffer a financial setback. The funds may be the Investor's own unsecured funds, or may be funds arising from indebtedness assumed by the Investor; in either case, the Investor must face personal loss should the business fail. Funds that arise from indebtedness assumed by the enterprise itself-such as a mortgage of business assets-may not be part of the qualifying investment.10 Id.
-The Investment Must Be Committed: The funds must be committed to the investment, and the investment must be real and irrevocable. If the investment is prospective, and not in place at the time of the E application or petition, then executory contracts or escrow accounts may be used so that the investment is committed only upon the occurrence of certain conditions, such as the grant of E status. Other mechanisms that allow the withdrawal of part or all of the investment funds from the enterprise are not acceptable.
-The Investment Must Be Substantial: The investment in the U.S. must be "substantial," which is: (1) capable of being considered "substantial" in the context of the enterprise as a whole; (2) normally considered necessary to establish a viable enterprise of the type contemplated; or (3) large enough that the Investor will likely successfully direct and develop the investment.
The size of the investment will be compared to the total value of the business enterprise. The smaller the total value of the enterprise, the larger the proportion of the actual investment. For example, an Investor should invest 100% of the capital for an enterprise that is valued at only $50,000, whereas an Investor might need to provide only 30% of the capital for an enterprise that is valued at $5 million. The DOS opines that Investors must provide 100% of the funds required for businesses valued at or less than $100,000, whereas businesses valued at or in excess of $10 million might qualify without significant direct investment.
Funds invested in purchasing property, equipment, and inventory for the business enterprise, for the monthly. The total value of leased or rented equipment is not relevant. lease or rental of property or equipment, or for the acquisition of intangible or intellectual property rights (such as trademarks) may be considered in calculating the Investment, in addition to funds used to acquire the business itself.
The value of an established business is generally its purchase price, which is normally the fair market value. If the Investor is establishing the business, then its value is the actual cost needed to make the business operational.21 Id. The overall value is dependent on the nature of the business, since certain businesses are inherently more expensive to operate.
The amount of the investment will be considered indicative of the investor's personal commitment to the enterprise.
Marginal investments are prohibited. A marginal investment is one that has the present and future capability of merely supporting the Investor and his or her family. If, however, the enterprise has a potential to generate-within no more than approximately five years-significantly more income than that needed to support the Investor and any family, then it is not "marginal." Significant documentation of this potential must be provided.
-The Investor Will Direct or Develop the Enterprise: Investors must demonstrate that national(s) of the treaty country will direct and develop the business enterprise. They must show, first, that these nationals have sufficient ownership or control of the enterprise for such direction and development to be feasible. Ownership of an enterprise can be evidenced through ownership of the majority of the enterprise itself (more than 50%). Alternatively, "operational control" may be demonstrated as a consequence of, for example, the Investor's position within the enterprise, ownership of voting rights, execution of voting agreements, or the use of management agreements. Hence, in joint ventures or partnerships of only two parties, "control" may still be shown through formal agreements that each partner retain full management rights and responsibilities and have the authority to enter into agreements or make decisions that bind the other.
If the business enterprise is owned by too many parties (businesses or individuals) for any one treaty country national to demonstrate the ability to direct and develop the enterprise, then the owners collectively must show that (1) 50% or more of the enterprise is owned by treaty country nationals, and (2) the treaty country nationals collectively have the ability to direct and develop the enterprise. In these cases, only treaty country nationals seeking admission to become employees of the U.S. business enterprise in qualifying positions will be eligible for E status.
Visa Validity versus Authorized Stays
E applicants who apply for E visas directly with U.S. consulates in their home country receive E visas, the validity of which will depend on the reciprocity rules between that home country and the U.S. For example, an Argentinean applicant would receive an E visa that is valid for five years, and an Australian applicant's E visa would be valid for four years. Each such applicant would then be admitted by the CBP at a port of entry to the U.S. for two years, regardless of the duration of each person's visa. Although this might be irritating at the beginning of an assignment in the U.S.-when the underlying visa is good for several more years than the authorized stay-it has advantages toward the end. This is because the CBP issues authorized stays of two years, even if fewer than two years remain on the visa.
E applicants who petition the USCIS to change from another lawful status in the U.S. to E status receive an authorized stay of two years, regardless of their nationality.
Similarly, foreign nationals who petition the USCIS to extend E status will receive extensions in two-year increments. Applicants who apply to a U.S. consulate for new E visas will receive validity periods in accordance with referenced reciprocity rules, regardless of the duration of validity of stay granted by the USCIS.
If the E applicant and the Foreign Treaty Trader/Investor are not the same person, then they must hold the same nationality.1 Nationality is not the same as residence. Permanent residence is insufficient for E purposes. Nationality is determined in accordance with the laws of the country whose nationality is claimed.
The nationality of a business is determined by its owners; the place of incorporation has no bearing on its nationality. Businesses involved in Treaty Trader or Investment situations must demonstrate that at least 50% of the firm is owned by nationals of the Treaty Country
Enterprise: The U.S. commercial (for-profit) business in which the Investor invests its funds.
Treaty Country: The home country of the Treaty Trader or Investor, and the foreign applicant for the E visa or status (if they are different). It is the country with which the U.S. must have a qualifying treaty.
Treaty Country National: An owner or employee who claims to be a national of the country with the relevant treaty with the U.S., under which E status will be sought. The Treaty Country National might be the Trader or Investor, an owner of a business that engages in qualifying trade or investment with the U.S., or an employee of a qualifying Treaty Organization or Enterprise.
Treaty Organization: A business that claims the nationality of the country with the relevant treaty with the U.S., under which E status will be sought. If a Treaty Organization is involved in a given E application, it is the business in the U.S. or abroad that engages in the investment or trade.
Treaty Investor: The person or entity that owns the substantial investment in the U.S.
Treaty Trader: The person or entity that engages in substantial trade between the U.S. and the Treaty Country.
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Jagat Kooner, Esq. Admitted to Minnesota Bar. Authorized to Practice Immigration and Nationality Law in All 50 States and US Territories Pursuant to 8 USC 1292.1. Law practice in California limited exclusively to immigration law. Our office does not provide legal advice on California or any other state law.