The United States maintains bilateral treaties with select nations, granting certain privileges to citizens of countries such as Canada and Mexico. These treaties enable eligible citizens to make substantial investments in U.S. businesses, ultimately allowing them to obtain E-2 Treaty Investor visas. To qualify, the investment must confer control of the business upon the investor.
The E-2 visa regulations do not explicitly define the term ‘substantial’ in monetary terms. Instead, they employ a ‘proportionality test,’ which takes various factors into account. For example, the adequacy of the investment is assessed in relation to the nature of the business. Businesses that require substantial equipment and inventory typically necessitate larger investments than service-oriented businesses that do not rely heavily on such resources.
If a significant proportion of shareholders in a foreign corporation are citizens of a treaty-qualifying country, that foreign corporation, based in an E-2 visa-eligible country, can send its citizens to the United States on E-2 visas. A citizen of an E-2 treaty country need only possess a 50% stake in the U.S. corporation for the purpose of directing and developing it. This level of control, whether exercised positively or negatively, grants the E-2 visa holder the authority to veto key decisions.
Moreover, the investment made must not be ‘marginal.’ The business must demonstrate the capability to generate more than a minimal income for the investor, both presently and in the future. Additionally, the primary purpose of the business must not solely be to provide a comfortable living for the investor. The evaluation of business marginality revolves around two factors: its potential to create jobs for U.S. workers and its ability to generate income significantly beyond a basic living wage.
The term ‘at-risk’ refers to funds that are no longer under the investor’s direct control. Thus, the invested capital must remain ‘at risk.’ It is insufficient to merely deposit a substantial sum in the corporation’s bank account. However, it is permissible to purchase a business, place the funds in an escrow account, with the understanding that the money will only be released to the seller upon approval of the E-2 visa.
It is noteworthy that monetary investments are not the sole form of permissible investment. Inventory and equipment may also be imported and considered as valid investments.
Furthermore, the spouse and children under the age of 21 of an E-2 visa holder are also eligible to receive E-2 visas, even if they are citizens of non-treaty countries. The E-2 visa holder’s spouse is eligible for work authorization and can seek employment with any employer.
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