The U.S. has special treaties related to commerce with a number of countries.  These treaties allow individuals from such countries who need to travel to the U.S. for substantial trade and business- related activities to obtain Treaty Trader (E-1) or Treaty Investor (E-2) visas.

E Visas for Treaty Investors and Treaty Traders are useful for business owners, managers, and employees who have the same nationality as the foreign parent company and who are either engaging in trade with the United States or setting up a business on US soil. E Visas allow people to remain in the United States for extended periods of time in order to effectively run operations requiring a corporate presence, beyond the permissive limitations of B-1 business visitor visa status.  

The E nonimmigrant category is available in general only if a “treaty of commerce and navigation” or a “bilateral investment treaty” providing for nonimmigrant entries is in existence between the United States and the foreign state (except in the case of Sweden and Australia, which are covered even without a treaty). The list of all states with treaties in place allowing nationals of those countries to use E-1 and/or E-2 status can be found here: https://travel.state.gov/content/travel/en/us-visas/visa-information-resources/fees/treaty.html 

E-1 Treaty Trader

Summary Requirements for the E-1 Treaty Trader Visa
The purpose of this visa is to develop international commercial trade between the United States and the treaty country. Individuals from qualifying treaty countries who want to apply for an E-1 Treaty Trader Visa must meet certain requirements, such as:

  1. The company which is seeking to conduct trade with the U.S. must be based in the same treaty country of the individual.
  2. There must be a significant amount of international trade between the U.S. and the treaty country.
  3. The individual must have specialized skills and be in a management position of the company which is conducting trade.

The bulk of information after this section focusses on the E-2 visa for Investors but similar concepts apply to the E-1 visa for Treaty Traders.  For an E-1 Treaty Trader visa, the company/enterprise must be engaged in trade between the United States and a foreign state. “Engaged in trade” is a concept that focuses on the actual meaningful exchange of goods of services with traceable and identifiable transactions, for consideration as per contract law. The size or the volume of the traded goods is reviewed to ensure that title to the traded item is passing from one treaty party to another. Essentially, you must have one or the other — high net worth or volume of traded goods. Two examples are (1) an art company whereby 6 expensive paintings are regularly being traded into the US by the foreign national’s US-owned business enterprise – this is trade but there will US government analysis about whether sufficient money is flowing to other US workers or US entities besides the E-1 individual’s family to clearly benefit the US economy, OR (2) where thousands of pounds of nuts are being sold on US soil very cheaply, in which case, the breadth of dispersal will weigh more heavily.  Difficult cases like these require an experienced lawyer to examine the ripple effects of the proposed trade to see if a case can be made to withstand government scrutiny and win.  

E-2 Treaty Investor Status for Individuals, versus Larger Foreign-owned Companies

Summary Requirements for the E-2 Treaty Investor Visa. Individuals from qualifying treaty countries who want to apply for an E-2 Treaty Investor Visa must meet certain requirements, such as:

  1. There must be sufficient amount of investment to ensure the success of the underlying business.  It should also have a significant economic impact in the U.S.
  2. The investment must be for an active, operating business and not a passive or speculative investment.
  3. If the individual applying for the visa is the investor, he or she must be in a management position at the company making the investment.

The lengthier explanation of the E-2 Visa follows here.  The E-2 Treaty Investor visa is available for an individual who has invested or is actively in the process of investing in a business in the United States. The investment must be active, that is, the investor must make an irrevocable commitment of funds that represents an actual, active investment. The investment must be substantial, taking into account only those financial transactions in which the investor’s own resources are at risk. The investment cannot be marginal in nature, that is, one which will only support the investor and his or her family; in most cases it should create job opportunities for U.S. workers. The person for whom treaty-investor status is sought must fill a key role with the company, either as the investor who will develop and direct the investment, or as a qualified manager or specially trained and highly qualified employee necessary for the development of the investment.

“Invested in” or “Actively in the Process of Investing” – The treaty investor must have invested in or be actively in the process of investing substantial capital into the company. “Actively in the process” of investing means the funds have been irrevocably committed to the enterprise. The investor must be close to the actual start of business, not just signing contracts or scouting for a location. Mere intent to invest is not enough. 

Substantial Investment – “Investment” means the “placing of capital, including funds and other assets, at risk in the commercial sense with the objective of generating a profit.” No set dollar amount is defined in the statute or regulations to determine how great an investment must be to be considered “substantial.” Instead, the government uses a relative/proportionality test: the less money a business requires to be operating, the more USCIS expects to see initially invested. If more money is required to start or acquire a business, a lesser percentage is needed to invest.  Proportionality depends upon the nature of the business. For example, a consulting business or a casting agency that may require office space, computer equipment, phone, furniture, stationery, some advertising, and supplies may only require $35,000 to operate. Therefore, the investor needs to invest most of that $35,000 from the start. But a $50 million skyscraper construction company may only require a fraction to show a bona fide investment at risk. 

An earlier version of the US Department of State’s Foreign Affairs Manual (FAM) gave various percentage examples, but those have been removed to avoid a bright-line test. Despite the statute and regulations not having a specific dollar amount necessary to invest, in practice some consulates do informally use a “rule of thumb” amount. An example in the FAM suggests that anything costing $100,000 or less to start or buy requires investment of somewhere over 70%. 

Smaller investments can often be substantiated with documentation evidencing the premises, purchases of equipment and/or inventory, payroll, bank statements, invoices for goods or services, and a good business plan showing what is reasonable for the type of business, along with projected operating costs and revenues over a one- to five-year period. 

Qualifying “Capital” – “Capital” includes cash, equipment, and inventory, as well as intangible property. Loans are permissible provided the assets of the business do not secure them. The investor’s unsecured personal capital or loans secured by the investor’s personal assets are permissible. Capital includes payment for leases or rents for equipment or property up to one month only, unless the rents or leases are prepaid in advance, since it is presumed that rents will normally be paid out of earnings. Equipment and inventory invested can be valued by the amounts spent to purchase them, as may the value of goods transferred to the United States, provided the goods or machinery will be put to business use. Contributed intangible property must be valued. 

Capital at Risk and Irrevocably Committed – The invested funds must be at risk and irrevocably committed for use in the business, subject to loss if the investment is not successful.  They cannot sit in a personal account and be uncommitted or be for prospective use. The funds need not be outside the United States but must belong to the investor and not a third party. Qualifying investment vehicles may include funds in escrow requiring irrevocable payment of investment funds upon issuance of the visa; commitment of enough capital for operations to show the applicant intends to follow through with the entire investment once the visa is approved; retained earnings, provided the investor personally receives them, pays tax on his or her income, and then reinvests them into the company; intellectual or intangible property that can be valued; and unsecured promissory notes. 

Lawfully Gained Capital – The capital must be lawfully obtained. Unlike in the EB-5 program, which places extra emphasis on this requirement, consuls generally tend not to require extensive proof on this issue unless the applicant is from a country with currency exchange restrictions, that fosters terrorism or narcotics smuggling, or has a pattern of weak tax filings and poor business record keeping practices. 

Possession and Control of Funds Invested – The investor must have possession and control of the funds invested. Inheriting a treaty business will not count as a qualifying investment. The funds can be gifted or loaned so long as the business assets do not secure loans. Investments can be pooled provided the company meets the treaty nationality requirement. This can be accomplished through the creation of a holding company, which acts as the principal investor, with the shareholders seeking E-2 status as key employees.

“Marginality” – The investment must not be “marginal.” This means that (1) it cannot be the investor’s sole source of income, or (2) the company must generate jobs for U.S. workers or otherwise demonstrate an economic benefit. The revenues of the business should exceed what is needed to support the investor and his or her family, or the business must make an economic contribution. Questionable capacity to succeed may require a five-year business plan. 

Commercially Active Enterprise – The enterprise must be commercially active and not a passive, idle, or speculative investment. Therefore, it must be a for-profit business concern. The enterprise must consist of more than a mere interest in land or property; it should require development of the land or property in question where applicable.

The process of Obtaining E Visa Status. To obtain entry to the US using E status, all foreign nationals must obtain an E visa stamp from a US consulate abroad to reenter the US; but can merely change status to E visa status from another status while on US soil if/until they travel abroad (if the E visa case is ripe for submission). At the consular, applicants must submit a myriad of documents and forms, make sure the enterprise is approved, and then be invited to appear for a personal interview.  Upon appearing at a US Port of Entry with the E visa stamp in the passport, the length of stay on a particular trip will be granted by CIS for two years. The visa can be renewed indefinitely, and as such, the period of authorized stay can technically go on indefinitely, provided that the elements of E visa status continue to be satisfied.

Spouses and children may accompany the E-2 or E-1 principal beneficiary using E-2 status. Since 2002, spouses of E visa holders have been allowed to work in the United States, and this work status is now recognized as simply “incident to status” since 2021 so that an EAD (work permit) does not need to be obtained first.

Our firm is adept at assisting individuals involved in trade or investment navigate the complex process and to prepare the necessary paperwork required for such visas. Please call 1.703.531.0790 or email info@langwallace.com if you need help.

E-2 Investment Visas

The U.S. has special treaties related to commerce with a number of countries.  These treaties allow individuals from such countries who need to travel to the U.S. for substantial trade and business- related activities to obtain Treaty Trader (E-1) or Treaty Investor (E-2) visas.

E Visas for Treaty Investors and Treaty Traders are useful for business owners, managers, and employees who have the same nationality as the foreign parent company and who are either engaging in trade with the United States or setting up a business on US soil. E Visas allow people to remain in the United States for extended periods of time in order to effectively run operations requiring a corporate presence, beyond the permissive limitations of B-1 business visitor visa status.  

The E nonimmigrant category is available in general only if a “treaty of commerce and navigation” or a “bilateral investment treaty” providing for nonimmigrant entries is in existence between the United States and the foreign state (except in the case of Sweden and Australia, which are covered even without a treaty). The list of all states with treaties in place allowing nationals of those countries to use E-1 and/or E-2 status can be found here: https://travel.state.gov/content/travel/en/us-visas/visa-information-resources/fees/treaty.html 

E-1 Treaty Trader

Summary Requirements for the E-1 Treaty Trader Visa
The purpose of this visa is to develop international commercial trade between the United States and the treaty country. Individuals from qualifying treaty countries who want to apply for an E-1 Treaty Trader Visa must meet certain requirements, such as:

  1. The company which is seeking to conduct trade with the U.S. must be based in the same treaty country of the individual.
  2. There must be a significant amount of international trade between the U.S. and the treaty country.
  3. The individual must have specialized skills and be in a management position of the company which is conducting trade.

The bulk of information after this section focusses on the E-2 visa for Investors but similar concepts apply to the E-1 visa for Treaty Traders.  For an E-1 Treaty Trader visa, the company/enterprise must be engaged in trade between the United States and a foreign state. “Engaged in trade” is a concept that focuses on the actual meaningful exchange of goods of services with traceable and identifiable transactions, for consideration as per contract law. The size or the volume of the traded goods is reviewed to ensure that title to the traded item is passing from one treaty party to another. Essentially, you must have one or the other — high net worth or volume of traded goods. Two examples are (1) an art company whereby 6 expensive paintings are regularly being traded into the US by the foreign national’s US-owned business enterprise – this is trade but there will US government analysis about whether sufficient money is flowing to other US workers or US entities besides the E-1 individual’s family to clearly benefit the US economy, OR (2) where thousands of pounds of nuts are being sold on US soil very cheaply, in which case, the breadth of dispersal will weigh more heavily.  Difficult cases like these require an experienced lawyer to examine the ripple effects of the proposed trade to see if a case can be made to withstand government scrutiny and win.  

E-2 Treaty Investor Status for Individuals, versus Larger Foreign-owned Companies

Summary Requirements for the E-2 Treaty Investor Visa. Individuals from qualifying treaty countries who want to apply for an E-2 Treaty Investor Visa must meet certain requirements, such as:

  1. There must be sufficient amount of investment to ensure the success of the underlying business.  It should also have a significant economic impact in the U.S.
  2. The investment must be for an active, operating business and not a passive or speculative investment.
  3. If the individual applying for the visa is the investor, he or she must be in a management position at the company making the investment.

The lengthier explanation of the E-2 Visa follows here.  The E-2 Treaty Investor visa is available for an individual who has invested or is actively in the process of investing in a business in the United States. The investment must be active, that is, the investor must make an irrevocable commitment of funds that represents an actual, active investment. The investment must be substantial, taking into account only those financial transactions in which the investor’s own resources are at risk. The investment cannot be marginal in nature, that is, one which will only support the investor and his or her family; in most cases it should create job opportunities for U.S. workers. The person for whom treaty-investor status is sought must fill a key role with the company, either as the investor who will develop and direct the investment, or as a qualified manager or specially trained and highly qualified employee necessary for the development of the investment.

“Invested in” or “Actively in the Process of Investing” – The treaty investor must have invested in or be actively in the process of investing substantial capital into the company. “Actively in the process” of investing means the funds have been irrevocably committed to the enterprise. The investor must be close to the actual start of business, not just signing contracts or scouting for a location. Mere intent to invest is not enough. 

Substantial Investment – “Investment” means the “placing of capital, including funds and other assets, at risk in the commercial sense with the objective of generating a profit.” No set dollar amount is defined in the statute or regulations to determine how great an investment must be to be considered “substantial.” Instead, the government uses a relative/proportionality test: the less money a business requires to be operating, the more USCIS expects to see initially invested. If more money is required to start or acquire a business, a lesser percentage is needed to invest.  Proportionality depends upon the nature of the business. For example, a consulting business or a casting agency that may require office space, computer equipment, phone, furniture, stationery, some advertising, and supplies may only require $35,000 to operate. Therefore, the investor needs to invest most of that $35,000 from the start. But a $50 million skyscraper construction company may only require a fraction to show a bona fide investment at risk. 

An earlier version of the US Department of State’s Foreign Affairs Manual (FAM) gave various percentage examples, but those have been removed to avoid a bright-line test. Despite the statute and regulations not having a specific dollar amount necessary to invest, in practice some consulates do informally use a “rule of thumb” amount. An example in the FAM suggests that anything costing $100,000 or less to start or buy requires investment of somewhere over 70%. 

Smaller investments can often be substantiated with documentation evidencing the premises, purchases of equipment and/or inventory, payroll, bank statements, invoices for goods or services, and a good business plan showing what is reasonable for the type of business, along with projected operating costs and revenues over a one- to five-year period. 

Qualifying “Capital” – “Capital” includes cash, equipment, and inventory, as well as intangible property. Loans are permissible provided the assets of the business do not secure them. The investor’s unsecured personal capital or loans secured by the investor’s personal assets are permissible. Capital includes payment for leases or rents for equipment or property up to one month only, unless the rents or leases are prepaid in advance, since it is presumed that rents will normally be paid out of earnings. Equipment and inventory invested can be valued by the amounts spent to purchase them, as may the value of goods transferred to the United States, provided the goods or machinery will be put to business use. Contributed intangible property must be valued. 

Capital at Risk and Irrevocably Committed – The invested funds must be at risk and irrevocably committed for use in the business, subject to loss if the investment is not successful.  They cannot sit in a personal account and be uncommitted or be for prospective use. The funds need not be outside the United States but must belong to the investor and not a third party. Qualifying investment vehicles may include funds in escrow requiring irrevocable payment of investment funds upon issuance of the visa; commitment of enough capital for operations to show the applicant intends to follow through with the entire investment once the visa is approved; retained earnings, provided the investor personally receives them, pays tax on his or her income, and then reinvests them into the company; intellectual or intangible property that can be valued; and unsecured promissory notes. 

Lawfully Gained Capital – The capital must be lawfully obtained. Unlike in the EB-5 program, which places extra emphasis on this requirement, consuls generally tend not to require extensive proof on this issue unless the applicant is from a country with currency exchange restrictions, that fosters terrorism or narcotics smuggling, or has a pattern of weak tax filings and poor business record keeping practices. 

Possession and Control of Funds Invested – The investor must have possession and control of the funds invested. Inheriting a treaty business will not count as a qualifying investment. The funds can be gifted or loaned so long as the business assets do not secure loans. Investments can be pooled provided the company meets the treaty nationality requirement. This can be accomplished through the creation of a holding company, which acts as the principal investor, with the shareholders seeking E-2 status as key employees.

“Marginality” – The investment must not be “marginal.” This means that (1) it cannot be the investor’s sole source of income, or (2) the company must generate jobs for U.S. workers or otherwise demonstrate an economic benefit. The revenues of the business should exceed what is needed to support the investor and his or her family, or the business must make an economic contribution. Questionable capacity to succeed may require a five-year business plan. 

Commercially Active Enterprise – The enterprise must be commercially active and not a passive, idle, or speculative investment. Therefore, it must be a for-profit business concern. The enterprise must consist of more than a mere interest in land or property; it should require development of the land or property in question where applicable.

The process of Obtaining E Visa Status. To obtain entry to the US using E status, all foreign nationals must obtain an E visa stamp from a US consulate abroad to reenter the US; but can merely change status to E visa status from another status while on US soil if/until they travel abroad (if the E visa case is ripe for submission). At the consular, applicants must submit a myriad of documents and forms, make sure the enterprise is approved, and then be invited to appear for a personal interview.  Upon appearing at a US Port of Entry with the E visa stamp in the passport, the length of stay on a particular trip will be granted by CIS for two years. The visa can be renewed indefinitely, and as such, the period of authorized stay can technically go on indefinitely, provided that the elements of E visa status continue to be satisfied.

Spouses and children may accompany the E-2 or E-1 principal beneficiary using E-2 status. Since 2002, spouses of E visa holders have been allowed to work in the United States, and this work status is now recognized as simply “incident to status” since 2021 so that an EAD (work permit) does not need to be obtained first.

Our firm is adept at assisting individuals involved in trade or investment navigate the complex process and to prepare the necessary paperwork required for such visas. Please call 1.703.531.0790 or email info@langwallace.com if you need help.

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