E-2 Treaty Investors
The E-2 nonimmigrant classification allows a national of a treaty country (a country with which the United States maintains a treaty of commerce and navigation, such as the UK and most of Europe and many countries in Asia, but not India or China) to be admitted to the United States when investing a substantial amount of capital in a U.S. business. Certain employees of such a person or of a qualifying organization may also be eligible for this classification. (For dependent family members, see “Family of E-2 Treaty Investors and Employees” below.)
Contact us for a current list of countries with which the United States maintains a treaty of commerce and navigation.
Who May File for Change of Status to E-2 Classification
If the treaty investor is currently in the United States in a lawful nonimmigrant status, he or she may file the application on Form I-129/129E Supplement to request a change of status to E-2 classification. If the desired employee is currently in the United States in a lawful nonimmigrant status, the qualifying employer may file application Form I-129 on the employee’s behalf.
How to Obtain E-2 Classification if Outside the United States
A request for E-2 classification may not be made on Form I-129 if the person being filed for is physically outside the United States. Interested parties should refer to the U.S. Department of State website (www.travel.state.gov) for further information about applying for an E-2 nonimmigrant visa abroad. The current Form is DS-156E. Upon issuance of a visa at the U.S. consulate the person may then apply to a DHS immigration officer at a U.S. port of entry for admission as an E-2 nonimmigrant.
General Qualifications of a Treaty Investor
To qualify for E-2 classification, the treaty investor must:
- Be a national of a country with which the United States maintains a treaty of commerce and navigation
- Have invested, or be actively in the process of investing, a substantial amount of capital in a bona fide enterprise in the United States
- Be seeking to enter the United States solely to develop and direct the investment enterprise. This is established by showing at least 50% ownership of the enterprise or possession of operational control through a managerial position or other corporate device.
An investment is the treaty investor’s placing of capital, including funds and/or other assets, at risk in the commercial sense with the objective of generating a profit. The capital must be subject to partial or total loss if the investment fails. The treaty investor must show that the funds have not been obtained, directly or indirectly, from criminal activity. See 8 CFR 214.2(e)(12) for more information.
A substantial amount of capital is:
- Substantial in relationship to the total cost of either purchasing an established enterprise or establishing a new one ($250,000 has been viewed as substantial, but amounts less than $250,000 have been approved yet amounts over $250,000 have been denied)
- Sufficient to ensure the treaty investor’s financial commitment to the successful operation of the enterprise
- Of a magnitude to support the likelihood that the treaty investor will successfully develop and direct the enterprise. The lower the cost of the enterprise, the higher, proportionately, the investment must be to be considered substantial.
A bona fide enterprise refers to a real, active and operating commercial or entrepreneurial undertaking which produces services or goods for profit. It must meet applicable legal requirements for doing business within its jurisdiction.
The investment enterprise may not be marginal. A marginal enterprise is one that does not have the present or future capacity to generate more than enough income to provide a minimal living for the treaty investor and his or her family. Depending on the facts, a new enterprise might not be considered marginal even if it lacks the current capacity to generate such income. In such cases, however, the enterprise should have the capacity to generate such income within five years from the date that the treaty investor’s E-2 classification begins. See 8 CFR 214.2(e)(15).
General Qualifications of the Employee of a Treaty Investor
To qualify for E-2 classification, the employee of a treaty investor must:
- Be the same nationality of the principal alien employer (who must have the nationality of the treaty country)
- Meet the definition of “employee” under relevant law
- Either be engaging in duties of an executive or supervisory character, or if employed in a lesser capacity, have special qualifications.
If the principal alien employer is not an individual, it must be an enterprise or organization at least 50% owned by persons in the United States who have the nationality of the treaty country. These owners must be maintaining nonimmigrant treaty investor status. If the owners are not in the United States, they must be, if they were to seek admission to this country, classifiable as nonimmigrant treaty investors. See 8 CFR 214.2(e)(3)(ii).
Duties which are of an executive or supervisory character are those which primarily provide the employee ultimate control and responsibility for the organization’s overall operation, or a major component of it. See 8 CFR 214.2(e)(17) for a more complete definition.
Special qualifications are skills which make the employee’s services essential to the efficient operation of the business. There are several qualities or circumstances which could, depending on the facts, meet this requirement. These include, but are not limited to:
- The degree of proven expertise in the employee’s area of operations
- Whether others possess the employee’s specific skills
- The salary that the special qualifications can command
- Whether the skills and qualifications are readily available in the United States.
Knowledge of a foreign language and culture does not, by itself, meet this requirement. Note that in some cases a skill that is essential at one point in time may become commonplace, and therefore no longer qualifying, at a later date. See 8 CFR 214.2(e)(18) for a more complete definition.
Period of Stay
Qualified treaty investors and employees will be allowed a maximum initial stay of two years. Requests for extension of stay may be granted in increments of up to two years each. There is no maximum limit to the number of extensions an E-2 nonimmigrant may be granted. All E-2 nonimmigrants, however, must maintain an intention to depart the United States when their status expires or is terminated.
An E-2 nonimmigrant who travels abroad may generally be granted an automatic two-year period of readmission when returning to the United States. It is generally not necessary to file a new Form I-129 with USCIS in this situation.
Terms and Conditions of E-2 Status
A treaty investor or employee may only work in the activity for which he or she was approved at the time the classification was granted. An E-2 employee, however, may also work for the treaty organization’s parent company or one of its subsidiaries as long as the:
- Relationship between the organizations is established
- Subsidiary employment requires executive, supervisory, or essential skills
- Terms and conditions of employment have not otherwise changed.
Family of E-2 Treaty Investors and Employees
Treaty investors and employees may be accompanied or followed by spouses and unmarried children who are under 21 years of age. Their nationalities need not be the same as the treaty investor or employee. These family members may seek E-2 nonimmigrant classification as dependents and, if approved, generally will be granted the same period of stay as the employee. Spouses of E-2 workers may apply for work authorization by filing Form I-765 with fee. If approved, there is no specific restriction as to where the E-2 spouse may work.
As discussed above, the E-2 treaty investor or employee may travel abroad and will generally be granted an automatic two-year period of readmission when returning to the United States. Unless the family members are accompanying the E-2 treaty investor or employee at the time the latter seeks readmission to the United States, the new readmission period will not apply to the family members. To remain lawfully in the United States, family members must carefully note the period of stay they have been granted in E-2 status, and apply for an extension of stay before their own validity expires.
Here is a listing of typical items that an E-2 visa application requires:
__/ Evidence of Investment in the U.S.: E-2 application only
- Substantiation of value of the enterprise. (Documentation of such includes the purchase price of the invested business or purchase orders for equipment to start a new business.)
- Evidence of ownership of the funds invested. (Bank records; tax returns.)
- Evidence of actual investment of funds in the enterprise, e.g., bank transfers, bank statements, escrow agreements.
- Copies of mortgages, loan agreements, promissory notes. (If any.)
- Documentation of ownership of other company assets, e.g., equipment, inventory.
__/ Evidence of Real and Operating Enterprise in the U.S. (E-2 application only)
- Copies of most recent U.S. income tax return.
- Copies of most recent audited financial report of balance sheet.
- Business Plan.
__/ Evidence Enterprise is More than Marginal (E-2 application only)
- Copies of most recent personal and business U.S. income tax returns.
- Copies of W-2 forms for employees.
- Documentation of income from outside sources. (Show the viability of the take-away business in the UK.)
__/ Additional Documentation for E-1/E-2 Employee Visas
- Detailed job description, including job title, responsibilities, supervisory authority. (The investor could bring his or her key employee(s), assuming that person is a national of a treaty country. See below.)
- Organizational Chart reflecting the position and clearly delineating lines of authority.
- Company letter indicating other E-1/E-2 visa holders in the U.S. and their positions in the company and the number of U.S. nationals in the firm and their positions in the company.
- Curriculum vitae or resume of the employee.
E-1 TREATY TRADER VISA
In order to qualify for a treaty trader visa, the alien must be coming to the U.S.A. to carry on substantial international trade between the U.S. and the foreign country of which the applicant is a national.
Trade is defined as the international exchange of items of trade between the U.S. and the Treaty country. This includes purchase or sale of goods and/or merchandise having intrinsic value. Services are economic activities whose outputs are other than tangible goods. Such service activities include, but are not limited to, banking, insurance, transportation, communications and data processing, advertising, accounting, design and engineering, management consulting, tourism, and technology transfer.
The trade must be substantial. It would be possible to qualify even if there were many transactions and each of those transactions were small in value. The term substantial is not defined as a monetary amount at this time.
The alien must be working in an executive, managerial or supervisory capacity or a person who makes their services essential to the efficient operation of the enterprise.
The trade must be in existence at the time of filing the E-1 application. The E-1 will not be issued to someone who is in the process of setting up international trade between his country and the U.S.A.
A student is someone admitted to the U.S. temporarily to study. People who are coming to the United States to pursue full-time academic or vocational studies are usually admitted in one of two nonimmigrant categories. The F-1 category includes academic students in colleges, universities, seminaries, conservatories, academic high schools, or other academic institutions, and language training. The M-1 category includes vocational students.
A person must show that they will be working in a “specialty occupation”.
A Specialty Occupation
“Specialty occupation” is defined in the statute as ” An occupation that requires:
A. Theoretical and practical application of a body of highly specialized knowledge, and
B. Attainment of a bachelor’s or higher degree in the specific specialty (or its equivalent) as a minimum for entry into the occupation in the United States”.
To meet the requirements of a specialty occupation, the alien will need:
- Full state licensure, if that is required to perform that job in the state;
- Completion of a “bachelor’s degree required for the position; or
- “Experience in the specialty equivalent to the completion of such degree, andrecognition of expertise in the specialty through progressively responsible positions relating to the specialty.
A “specialty occupation” includes the definition of “professional”. The position offered must require a professional to perform the duties. The job would require knowledge, which is almost always acquired through studies at an institution of higher learning.
A person who has a combination of education and experience may qualify as a professional.
Experience alone must combine both theoretical and practical application of specialized knowledge.
This is a temporary visa.
The employer must first obtain certification of a Labor Condition Application (LCA: this is different than a labor certification) from the Department of Labor before filing the petition for the H-1B classification with the INS.
The LCA ensures that the U.S. employer hiring a foreign worker will not adversely affect the U.S. workers.
If the foreign worker changes employers, it will be necessary to apply for another H-1B visa. The visa is non-transferable. It is possible to work part-time for multiple employers but each employer must file separate petitions.
INTRACOMPANY TRANSFEREE-L-1 VISA
This is an extremely important visa. It is through this visa that small or large businesses from foreign countries can start a business in the U.S.A.
Unlike the E-2 visa, this visa is not limited to certain countries, and there is no requirement that the investment be substantial.
Through this visa, foreign businesses can transfer managers, executives or people with specialized skills to a new business in the U.S.A. for periods of up to seven years.
When we deal with the L-1 visa, we have the concept of “dual intent.” The company transferring the executive may not be 100% certain whether the alien will leave the U.S.A. at the end of the visa or whether they will want the executive or manager to stay on in the United States permanently. The Immigration Service allows this dual intent for L-1 visas.
Accordingly, the L-1 visa can lead to permanent residence, for managers and executives without having to request a Labor Certification from the Department of Labor. (Refer to Multi-National under Permanent Residence).
It is possible to “convert” the L-1 visa, which has a limit of seven years to permanent residence without having to prove that there are no American citizens who can do the job of that executive or manager.
SPECIAL NOTES ON THE L-1 VISA
1. There is no minimum dollar amount investment required to obtain this visa.
2. There is no need to be involved in international trade.
3. The foreign and U.S. businesses do not have to be in the same type of business.
More on the L-1 Visa
A business entity (corporation, partnership or sole proprietor) in a foreign country can transfer an executive, manager or someone with specialized knowledge to the U.S.-based branch, subsidiary or affiliate.
The Labor Certification Process: PERM
This applies to most occupations.
It is necessary for an employer to prove that there are not sufficient U.S. workers who are able, willing, qualified and available at the time and at the place where the alien worker is to be employed.
Also, the employment of such alien will not adversely affect the wages and working conditions of workers in the United States similarly employed. e.g., an employer cannot pay an alien less than it would pay a U.S. citizen for the same job, nor can an employer require the alien to work longer hours than a U.S. worker would have to work.
The labor certification process is technical and specific.
An application is filed with the Labor authorities (not the Immigration and Naturalization Service), describing the job being offered and the qualifications of the alien. The offer of employment must contain a complete description of the job to be performed and the minimum education, and experience required to satisfactorily perform the job. These minimum requirements are often less than those possessed by the alien. So if the alien has 20 years experience on the job but someone with 3 years experience could perform the job, the employer can only require someone in the U.S. workforce to have 3 years experience.
The requirements may not be unduly restrictive e.g. a foreign language, more experience or education than is necessary to perform the job, combining two jobs into one that is normally performed by more than one worker, or knowledge or skills that cannot be obtained in the United States.
A stipulation for a requirement, such as one of the above, may be essential to an employer’s business operation and is acceptable as long as the employer adequately explains and documents the business necessity for such requirement.
The employer should post a notice at the place of employment setting out the job offer. This is aimed at qualified employees within the organization, as well as to non-employees who may learn of the job from employees.
In addition, the employer must attempt to recruit U.S. workers through sources which are likely to produce workers and are customary to the occupation e.g. advertise in newspaper or magazine advertisements, unions, etc.
U.S. workers may not be rejected for a job opportunity offered to an alien except for lawful job-related reasons e.g. an applicant does not have the education, training or experience, bad references or lack of proficiency in English. Personal situations such as someone’s marital status, religious affiliation or factors which can only be determined from actual job performance like initiative or interest in work are not job related reasons for rejecting the U.S. worker.
If the Labor Certification is approved by the Department of Labor, a petition is then filed with the Immigration and Naturalization Service to have the person categorized in one of the preferences.
It is not necessary to attempt to recruit a U.S. worker prior to filing an application for Labor Certification.
However, previous unsuccessful recruitment efforts could enable an employer to request a Reduction of Recruitment, which is a “fast track” system for obtaining a Labor Certification.
The Labor Certification application is extraordinarily slow and whenever possible, the Reduction of Recruitment process should be used.
THE PEOPLE OF EXCEPTIONAL ABILITY AND THE NATIONAL INTEREST WAIVER
The Immigration Act of 1990 created a new category for obtaining green cards.
If someone has exceptional ability in the arts, sciences or business AND those skills would be in the national interest, it is not necessary to have a labor certification.
It is necessary to discuss two concepts:
Exceptional Ability AND National Interest.
A. EXCEPTIONAL ABILITY
It is an ability that “will substantially benefit prospectively the national economy, cultural or educational interests or welfare” of the country. The ability must be a degree of expertise significantly above that ordinarily encountered in the sciences, arts or business. In order to be regarded as someone with exceptional ability it is necessary for the alien to show at least three of the following requirements:
- A degree or similar award from a college or other institution of learning relating
to the area of exceptional ability;
- Evidence that the alien has at least ten years of full-time experience in the occupation for which he or she is being sought;
- A license or certification to practice the particular occupation;
- Evidence that the alien has commanded remuneration for services, which demonstrate exceptional ability;
- Evidence of membership in professional associations;
- Evidence of recognition for achievements and significant contributions to the industry or field by peers, government entities, or professional or business organizations; or
- Comparable evidence to establish eligibility if the foregoing standards do not readily apply to the alien’s occupation.
B. NATIONAL INTEREST
In addition to proving exceptional ability, aliens must prove that their skills would be in the “national interest”.
When this category for permanent residence was created in 1990, the words “national interest” were not defined within the Immigration Act or in the Regulations.
The first case to be decided by the Administrative Appeals Unit (AAU) was a case involving a self-petitioning businessman. In this case, a “national interest test” was developed comprising seven factors that could be considered in determining whether a waiver of a job offer (and labor certification) is in the national interest. Although the test was specifically limited to aliens of exceptional ability in thebusiness field, this test has been used in cases involving the sciences, arts, and professions. The AAU has declined to recommend that its first decision, theMississippi Phosphate Case be regarded as a precedent decision. In March 1993 the Director of the AAU stated that it was not his inclination to recommend that the decision be designated a precedent. He felt that since standards were still evolving, he wanted the test to remain as flexible as possible and not bound by precedent. Despite the above comments, the “business test” was an extremely important guideline to the Immigration Service in considering all occupations.
This was the approach adopted by the INS until August 1998 when the INS decided the case of Matter of New York State Department of Transportation.
The full implications of this decision are still unknown. It is clear, however, that the INS wishes to restrict the test laid down in the Mississippi Phosphate case.
This article will first deal with the test developed by the AAU in the Mississippi Phosphate case and then discuss the New York State Department of Transportation case.
MISSISSIPPI PHOSPHORATE CASE
The AAU provided seven factors that could be considered in deciding whether a person’s presence in the U.S.A. would be in the national interest. Only one factor had to be satisfied to prove national interest.
The test was:
- Improving the U.S. economy; or
- Improving wages and working conditions of U.S. workers; or
- Improving education and training programs for U.S. children and under-qualified workers; or
- Improving health care; or
- Providing more affordable housing for young and older, poorer U.S. residents; or
- Improving the environment of the United States and making productive use of natural resources; or
- A request from an interested U.S. Government agency.
The Mississippi Phosphate Case showed a direct saving and creation of jobs and infusion of millions of dollars in revenues into a depressed area.
In August 1998, the INS set new standards for National Interest Waivers in the case of New York State Department of Transportation.
In summary, there are three main issues that must be proved:
A. Will the employment be in an area of substantial intrinsic merit?
B. The benefit to the US National Interest has to be “national in scope.” Accordingly, employment that would merely benefit a local or regional community would no longer be viewed as benefiting the national interest.
C. An alien seeking exemption from the Labor Certification process must present a national benefit so great as to outweigh the national interest inherent in the Labor Certification process.
The inherent national interest protected by the requirements of the labor certification process is to ensure that U.S. workers would not lose job opportunities to foreign workers.
Accordingly, it would be necessary to show that the national interest would be adversely affected if the alien had to apply for a labor certification.
These new requirements are certainly more onerous than those stated in the Mississippi Phosphate case.
Until clarity is obtained, people considering petitions in the Exceptional Ability category would be well advised also to apply for Labor Certifications. The Department of Labor is extremely slow in processing these certifications and a person in H-1B status could utilize all the time available to himself/herself under that visa before being granted Permanent Residence.
It is also essential to consider whether a worker would qualify in any other immigration categories.
ALIENS WITH EXTRAORDINARY ABILITY IN THE SCIENCES, ARTS, EDUCATION, BUSINESS OR ATHLETICS;
1. An alien with extraordinary ability in science, art, education, business or athletics which has been demonstrated by sustained national or international acclaim and whose achievements have been recognized in the field through extensive documentation; and
2. The alien seeks entry to continue to work in this area of extraordinary ability.
This category is intended for “the small percentage of individuals who have risen to the very top of their field of endeavor.”
PROOF OF EXTRAORDINARY ABILITY:
The receipt of a major international award, e.g. a Nobel Prize would be convincing proof.
An alternative to such an award would be documentation establishing three of any of the following categories:
(1) Receipt of lesser nationally or internationally recognized prizes or awards.
(2) Membership in an association in the field for which classification is sought, which requires outstanding achievement of their members, or judged by recognized national or international experts.
(3) Published material about the person in professional or major trade publications or other major media.
(4) Participation as a judge of the work of others.
(5) Evidence of original scientific, scholastic, artistic, athletic or business-related contributions of major significance.
(6) Authorship of scholarly articles in the field.
(7) Artistic exhibitions or showcases.
(8) Performance in a leading or cultural role for organizations or establishments that have a distinguished reputation.
(9) High salary or remuneration in relation to others in the field.
(10) Commercial success in the performing arts.
If the above standards do not apply to a specific occupation, it is possible to submit “comparable evidence.”
OUTSTANDING PROFESSORS AND RESEARCHERS (no Labor Certification Required)
The alien must be internationally recognized in a special area and must have 3 years of experience in teaching or research in the academic area.
The position sought must be a tenure (or tenure track) teaching position or comparable position. A comparable position with a private employer to conduct research is also permitted in certain circumstances.
CERTAIN MULTINATIONAL EXECUTIVES AND MANAGERS
More on this concept can be viewed in “Intracompany Transferee – L-1 Visa.”
It is a very important category for qualifying executives and managers of multinational corporations for a green card, because you do not need a Labor Certification. In other words, you need not show that there is a shortage of U.S. executives or managers who can do that job.
Naturalization is the process by which a foreign person becomes a U.S. citizen. Almost everyone who goes through naturalization must first have held a green card for several years. A naturalized U.S. citizen holds virtually the same rights as a native-born American citizen.
The general requirements for administrative naturalization include:
- A period of continuous residence and physical presence in the United States
- Residence in a particular USCIS District prior to filing
- An ability to read, write and speak English
- A knowledge and understanding of U.S. history and government
- Good moral character
- Attachment to the principles of the U.S. Constitution, and
- Favorable disposition toward the United States.
The other naturalization requirements may be modified or waived for certain applicants, such as spouses of U.S. citizens.
If an individual is in another country, he or she may apply for a visa or green card in the U.S. embassy of his or her home country. Bankruptcy Attorney John Wu is able to facilitate all of the paperwork and applications and contact the consular officers to facilitate approval of the application.
Criminal Deportation/Removal Defense:
Immigrants in the United States who have been charged or convicted of a crime including fraud and misrepresentation can be subsequently placed in deportation or removal proceedings. Since September 30, 1996, with the passage of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, the rights of aliens in the United States have been severely curtailed when past criminal conduct is a factor. Crimes that previously did not cause immigration consequences can now trigger deportation proceedings against an alien. Crimes as serious as murder, and as minor as shoplifting, can result in deportation.
Waivers of Inadmissibility:
An Application for a Waiver of Inadmissibility is an application for legal entry to the United States made by an individual who is otherwise inadmissible on one or more grounds. The application is submitted to U.S. Citizenship and Immigration Services (USCIS), a Bureau of the U.S. Department of Homeland Security (DHS).
Family Based Visas/ Fiancé Visas:
Fathers, daughters, mothers, sons, fiancés and other relatives can enter the United States with either an immigrant or non-immigrant visa. There are many options that are available. Parents, spouses and unmarried children under 21 years of age of U.S. Citizens are considered immediate relatives and are not placed under a quota system. The others are placed into preference order which determines who is given priority entry into the United States:
- First Preference: Unmarried, adult (21 years of age or older) sons and daughters of U.S. citizens.
- Second Preference: Spouses of lawful permanent residents and the unmarried sons and daughters of lawful permanent residents.
- Third Preference: Married sons and daughters of U.S. citizens.
- Fourth Preference: Brothers and sisters of adult U.S. citizens.
This process can take a very long time (several years) depending upon the preference ranking. The most current online visa bulletin will give those who are waiting an idea of how long they must wait for their immigration application or green card to be granted.
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