Episode 5 Afterthoughts: E-2 or EB-5? Finding the Right US Visa for Foreign Entrepreneurs

May 16, 2021

For foreign entrepreneurs planning to expand their business in the US or invest in a new one, an investor visa is one option to work in the US. In our podcast Hasta La Visa, Baby Episode 5, we explored two options for foreign investors to consider – the E-2 and E-B investor visas. These are both highly selective, but very different options and it’s important to understand how they work. As an entrepreneur, the type of business, amount you plan to invest and how long you plan to stay in the US – will help you determine which the best fit.

E-2: The Temporary Option

If you are looking to come to the US on a temporary basis or bring your employees to the US, the E-2 may be a good option to consider.

How does the E-2 work?
The E-2 visa allows foreign entrepreneurs to invest a substantial amount of money into a US business (affiliated company or startup) and then come to the US to run that business. Investors can be a person, partnership or corporate entity. The E-2 is based on treaties that the US has with specific foreign countries and to apply, the investor must be a national of a treaty country. Executives and other essential employees can also work in the US.

Who qualifies for an E-2 Visa?
This is a very selective visa process. To qualify, the investor must have the citizenship of a treaty country and invest a substantial amount of capital in the US enterprise. Investors must enter the US solely to develop and direct the enterprise and show at least 50% ownership, usually through a managerial position.

What investment is required for an E-2 Visa?
There are guidelines for how much money the individual or the corporation has to invest in the US company to ensure successful operation of the business. Different types of businesses and industries will require varying levels of investment. But generally, capital must be substantial compared to the total cost of either purchasing an established business or starting one, and enough to ensure the investor can successfully run the business.

Can somebody with an E-2 Visa stay in the US indefinitely?
The E-2 Visa is a temporary intent visa – this means all E-2 visa holders must maintain the intention to return to their home countries. The maximum initial stay is two years. Requests for extensions can be granted up to two years each, but there is no limit to the number of extensions.

EB-5: A Path to Citizenship

For foreign executives looking to stay in the US on a permanent basis, there is the E-B Investor Visa Program.

How does the E-B Work?
EB-5 is really the green card analog to the E-2 Investor visa. With the E-B program, a foreign national can invest a considerable amount of money into a US business, which then leads to a green card (lawful permanent resident status).

Who qualifies for the E-B program?
To qualify, investors must make an investment in a lawful commercial enterprise in the US, which is generally any for profit activity. But the E-B5 is more than just investing money – the goal is to create US jobs. With this option, the investor must also create at least 10 full time positions in the US.

What investment is required for an E-B5 Visa?
Unlike the E-2 visa, there is a minimum amount that has to be invested. Because it leads to a green card, the government wants to make sure that a substantial amount of money is actually being invested in a US business. The exact amount required depends on where you’re investing the money. There are geographic buckets called targeted employment areas or TEAs. These are generally a rural area or an area that experiences high unemployment. The minimum investment is $900,000 in a TEA and $1.8 million in other areas.

Is E-2 or E-B The Right Fit?

 

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E-2

  • Up to two years; renewable in two-year intervals
  • Must be a national of a treaty country
  • No minimum investment but must be a substantial amount in a US enterprise
  • Entering US solely to develop and direct the enterprise
  • Must only work in the activity for which the visa was approved

 

E-B

  • Permanent
  • All foreign nationals
  • Investment of capital from $900,000 to $1.8 million in a new commercial enterprise
  • Must create and maintain at least 10 jobs

Both visas provide a path to the US. How much you plan to invest and how long you are looking to remain in the US can help you decide which visa to consider.

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