E2 Visa Minimum Investment Rules
Central to your application for a US E2 visa is that you have invested a ‘substantial’ amount of money into a new or existing US business. Unlike the EB5 Investor Green Card, there is however no fixed or arbitrary E2 visa minimum investment threshold to work to. The minimum level of investment is subjective and assessed relative to the E-2 company.
While this approach creates a degree of flexibility that accommodates different types of business, it also creates significant uncertainty for applicants when attempting to build a robust, compelling and ultimately successful application. And since applicants must by the time of filing their petition have already made sufficient at-risk investment, the stakes become even higher to ensure you are working to a level of E2 visa minimum investment that will be deemed ‘substantial’.
A substantial investment is one that is sufficient to ensure the investor’s commitment to the successful operation and development of the enterprise by its proportion to the total cost of the business. The investment cannot be marginal, and must have the capacity to generate more than a minimal income.
Calculating your E2 visa minimum investment
When considering the level of investment, ensure you take into consideration all aspects of the company, its costs and operations.
There will naturally be considerable variation between different types of business, which is accounted for under the proportionality of the requirement. When formulating your investment threshold, the guidelines cite examples of manufacturing businesses requiring larger initial capital for machinery, premises etc compared to a consultancy practice needing far less initial set up costs.
Remember, this all has to be underpinned by the requirement on the investor(s) to demonstrate sufficient personal, financial risk. Small-scale businesses must also show sufficient degree of risk to confirm to the adjudicator that the investors will be motivated to really want to make the enterprise a success.
The specifics will be determined largely on the status of the company – if you are a start-up and require funds to set up and become operational, or whether you are purchasing an established company and are looking at purchase price as well as ongoing costs.
Consider costs such as premises, equipment purchase or hire, professional adviser fees, IP-related costs, admin costs such as incorporation and marketing and promotional activities. Take a forensic approach to identify and itemize your costs, ensuring the resulting level of investment is based on a 360 degree perspective of the company and what its financial needs are to become a viable and successful enterprise.
Percentage of investment
It will be important to ensure the percentage of investment per investor applicant is substantial in and of itself. A sliding scale will be applied in consideration of the investment amount in relation to the value/cost of the business. As an outline guide, the lower the investment amount being made by an E2 applicant, the higher the ownership percentage should be.
This will require a strategic assessment of all the investments where there are multiple E2 applicants to ensure each meets the requirement individually without impacting the eligibility of the other investors in the E2 company.
You must be in possession of the funds
Further to setting your level of investment, you must also ensure the E2 company is in possession of the investment funds and that the capital invested is irrevocably committed to the enterprise and subject to partial or total loss in the event that the entity fails.
The funds invested must primarily derive from corporate earnings. Additionally, the invested funds must be substantial in relationship to the total cost of either purchasing an established enterprise or creating the type of enterprise.
Proof of source of funds
The foreign company must be able to provide the source of funding with documentary evidence showing a clear and legitimate path regarding the source of capital it will be investing.
It is not just a matter of presenting the facts, you will also need to provide and present sufficient context and detail relating to your business, its operations, costs, market place and projections in order for the adjudicator to make a full and informed assessment of your eligibility and the viability of your business to go on and fulfil the E2 requirements.
NNU Immigration specialize in the US E2 visa. As London-based US immigration attorneys, we work with investors and entrepreneurs from across the globe to make the move into the US market through the E-2 visa route.
We can advise on suitability of the E-2 visa for your needs and circumstances, and guide you through the application process to ensure you present a robust and comprehensive submission to best represent you and your investment opportunity.
We can also support with applications for E-2 spouse and dependants.
Contact us for advice with your E-2 investor visa application.
This article does not constitute direct legal advice and is for informational purposes only.