April 26, 2011 | 10:32 am

E-2 Visa:  Treaty Investor

Posted by Cedric M. Shen

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The E-2 visa allows foreign nationals of a country that has a treaty with the United States, to make an investment in a business enterprise.  Generally, the investment must be ‘substantial,’ ‘at risk,’ and the investor must oversee and direct the day-to-day operations.  The visa is valid for three years, and is renewal indefinitely so long as the business continues to operate.

What is a ‘substantial investment’?

Unlike the EB-5 green card, which expressly states a $500,000.00 or $1 million investment, the term “substantial” for an E-2 visa is not so clear cut.  Generally, the investment should be approximately $250,000 USD if the business/enterprise is new.  There may be some cases where the investment is as low as $50,000.00.  However, these cases usually involve businesses which act as a subsidiary to a parent company in the foreign national’s home country.

What does ‘at risk’ mean?

This means that the investment must be at risk of being lost of the business is unsuccessful.  Otherwise, there would be a glutton of people applying for E-2 visas - knowing that there is no risk in losing their investment.

Pros and Cons

The E-2 visa is a great vehicle for foreign nationals and their families to live in the United States while operating a business.  One advantage is that the application can be processed within three weeks under Premium Processing.  Another advantage is that the visa is valid for three years, and renewable indefinitely so long as the business continues to operate.  The downside is that the investment can be significant, and you risk losing all the money and being forced to return to your home country if the business is unsuccessful.  There is also no direct path to permanent residency on an E-2 visa.  While an E-2 visa holder may obtain a green card through employment or marriage, the E-2 visa itself does not make one eligible for permanent residency.