The treaty investor visa, or "E-2" visa, is a nonimmigrant visa category in which adjudication can seem subjective depending on the governmental office where the application is made. While there are hard and fast rules, the E-2 treaty investor visa engenders inconsistant governmental action by consulate offices abroad and by the USCIS. This article addresses the common problem areas and offers "real world" practical advice on securing an approval of an E-2 treaty investor visa.
There MUST Be a Treaty
The E-2 treaty investor visa is based on a qualifying trade treaty between the United States and various other countries of the world. The treaty must exist between the alien's country of nationality and the United States. If the requisite treaty does not exist, the alien will not be eligible for the treaty investor visa, irrespective of where the individual resides. A comprehensive list of treaty countries may be found on the U.S. Department of State website. For example, while the United States has made diplomatic and political strides in securing a friendly relationship with Russia, there is currently no treaty between the U.S. and Russia with respect to the E-2 treaty investor visa. Therefore, a foreign national with Russian citizenship will not be eligible for the E-2 treaty investor visa regardless of where the alien currently resides. The first step in identifying your eligibility under the E-2 visa category is to ensure the treaty exists between the foreign country and the U.S.
The next step is to know the law for qualifications under the E-2 treaty investor visa. Once you have established the requisite treaty and that you meet the legal criteria, a thorough analysis of the consulate precedent and procedures must be conducted as every consulate adjudicates E-2 treaty investors differently.
Each Consulate Has Its Own Procedure: You MUST Comply!
Knowing the foreign national's Treaty Visa Office's Consulate procedure and precedent is necessary to obtaining the visa. For many Treaty Visa Offices, there are extremely detailed and specific procedures for both registering an enterprise and filing for visa issuance once an enterprise has been registered. Each embassy or consulate website contains specific instructions that must be followed for each E-2 treaty investor visa applicant.
For example, the U.S. Embassy in Toronto, Canada has one of the most detailed procedures for obtaining the E-2 visa. The embassy requires that E-2 visa petitions be bound and organized into sections. The sections must contain dividers with numbered tabs that stick out from the edges. If the dividers are submitted without tabs, the submission will be rejected. These procedures can be found on the embassy website. Failing to abide by the specific requirements can result in dire consequences. Not following the procedural requirements can result in rejection or issuance of an evidentiary request, which can move the application to the back of the line and cause significant delay. Careful attention to consulate procedures ensures that consulate officers will adjudicate the case based on the merits.
In regards to precedent, the most common distinction made at the consulates is what is considered a "substantial investment." The law states that there is no minimum investment amount required. The investment must simply "be sufficient to ensure the success of the desired investment, and more than what is necessary to simply provide a living for the applicant." However standardized this requirement appears, standards differ from consulate to consulate on how it views what a "substantial investment" actually may be. An alien should rely on the experience of a lawyer to know these differing standards. For example, experience shows that a Canadian applicant was successful in obtaining an E-2 visa for a $36,000 investment for a 65% stake in a Wendy's franchise, while an Argentine national's 100% purchase of a 32 room hotel in Miami, Florida for around $700,000 was deemed as not meeting the substantial investment threshold. These are only examples and serve as a precaution for E-2 treaty investor visa applicants to understand that while the law is uniform, each consulate's adjudication under the law is not.
Trace the Investment: Show Me the Money!
One of the most important aspects of the E-2 visa involves analyzing where the applicant's investment came from, how it is invested, and whether the investment is irrevocable or at risk. Many E-2 visa applications have failed due to not properly proving these investment elements to the consulate officer.
Where did the investment come from? The dollars invested must be controlled by the applicant, and they must be real dollars available chosen for investment. The enterprise cannot be a gift to the applicant, while the money invested can be. To prove control, consulates often want to see a track record of the funds being used by the applicant (i.e., bank statement dating back several months) or documentation about the transaction that brought about the funds, such as the sale of property or savings accounts. Irrevocable inheritances of money from loved ones often serve as investment capital. As long as the inheritance is properly traced, the gift will be considered "controlled" by the applicant.
How is the money invested? Consulate officers want to see money spent on tangible items that will be used in the business to grow the business. These dollars can be spent on equipment, inventory, property (sale or lease) or even salaries or contracts for services. Placing the funds in an account for future use will be insufficient. A major aspect of the E-2 treaty investor visa is the notion that investment capital must be irrevocably committed to ensure the success of the enterprise.
The investment must be subject to risk of loss. Part of investing is the reality that the business may not turn a profit and may eventually fail. The money invested must be subject to this risk or else there is not a true investment for E-2 purposes. The money must be placed at risk and vested irrevocably in the business. Using personal funds or funds secured by the investor's personal assets will satisfy the requirement.
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