You can receive an E-2 treaty investor visa only after your money has been irrevocably committed to the business
The first question people ask when they want to start a shop or company in the United States and obtain an E-2 visa is how much they should put in a bank account. The E-2 is the visa given to a national of a country that has a trade treaty with the United States who comes to put their own money into a U.S. business and run it directly, and Korea is among those countries. However, a bank balance alone is not recognized as an investment. The consular officer who reviews the visa application looks at whether the money has been irrevocably committed to the business. Because the money has to be committed before you know whether the visa will be issued, you can lose that money if the visa is denied.
There is no set minimum amount; the officer looks at the share of your own money in the cost of the business
"The State Department's Foreign Affairs Manual, the guidance consular officers follow, does not set a minimum amount that counts as an investment, and states that the less a business costs, the higher the proportion that must be invested."
The consular officer looks at what share of the total cost of opening the business is your own money. The purpose is to see whether the investor has put their own money firmly at stake for the success of the business, and whether the amount invested is large enough to run the business properly. The same reason explains why the money being invested must be mainly the investor's own money, or money borrowed by putting up the investor's own assets.
In an example given in the manual, if a business costs $100,000 to start up, a person who puts in all of that money is ordinarily regarded as meeting this standard. For a business that costs $100 million, $10 million can also be recognized. The smaller the shop, the larger the share of the money required that must be filled with your own money. There is no line saying that a certain percentage is enough.
For a newly started business, all the costs actually incurred until it can begin operating are counted. This is the price of what has already been bought, plus estimates for what still has to be bought. Invoices, contracts, and quotes for equipment and inventory are the evidence. For someone buying an existing shop, the purchase price is usually that cost.
How much money is needed differs by type of business. Building a factory takes millions of dollars, while a consulting company can be opened with little money. So a business that costs less must have a higher share of the investor's own money, but if the other requirements are all met, the manual states that a business is not rejected merely because its cost is low.
Money left in a bank account is not counted as an investment
"According to the State Department's guidance, having only an intention to invest, or holding in a bank account money that has not yet been committed anywhere, is not enough."
The requirement is that you must have already invested or be in the process of investing. To be recognized as being in the process of investing, the money must be irrevocably committed to that business, and the start of actual operations must be near. A stage of only looking for a shop location or merely signing a contract is not enough. A contract that has merely been signed can fall apart, so money must actually be at stake in that contract.
Money spent on equipment bought for the business and inventory you currently hold can be counted as an investment. It does not have to be cash. Machinery brought into the United States for use in the business, and patents and copyrights that can be valued, can also be counted.
Rent is usually counted for only one month. This is because rent to be paid in the future is regarded as money going out of the shop's income. If you have paid a year's rent in advance, that much can be counted.
Borrowed money depends on what was put up as collateral. Money borrowed by putting up your own home as collateral (agreeing to give up the home if you cannot repay), and money borrowed in your own name alone, are counted. Money borrowed with the shop as collateral is not counted. Even if both the shop and your own assets were put up as collateral together, it is not counted. Inheriting a shop is not an investment either.
The source of the money is also examined. It must be money that arose lawfully, such as savings, a gift, or an inheritance, and it does not have to be money brought in from outside the United States. The consular officer may ask for documents showing where the money came from, and the applicant must show that the money is their own and that they can use it as they wish.
If you have committed money in this way and the visa is denied, the money may not come back. The manual gives one example that is recognized even though a condition of visa issuance is attached. It is buying an existing business while placing the purchase price in escrow (an account in which a third party holds the money and hands it over once the conditions are met). Even though the arrangement was set up so that the price passes only after the visa is issued, the manual says it can be recognized as money irrevocably committed. Whether the same approach works for the lease or the equipment purchase of a shop being newly started is not stated in the manual.
An E-2 cannot be granted for a shop that only supports the owner's family
"The State Department's guidance does not accept a marginal business, meaning one that can earn only just enough to support the investor and family, and takes the view that the ability to earn more than that should ordinarily be in place within five years of the day operations begin."
The consular officer looks at whether this shop can earn money beyond what is needed to support the owner's family. It does not need to earn that much right now; it is enough to show that it can earn that much within five years. A person applying to USCIS counts these five years from the day the E-2 begins. Even if the income does not go beyond a living, a business that clearly contributes to the economy can be recognized. The manual contains no number for how many employees must be hired or how much must be earned.
The business must be a for-profit business that actually sells goods or services. A company that exists only on paper, or land or stock bought and held while waiting for the price to rise, is not recognized. A nonprofit organization is also not eligible. The business must also meet the legal requirements for operating in that locality.
If the business is a new one, the consular officer must be able to believe that it is a business that will actually open and operate once the visa is issued. Financial records built only from numbers the applicant wrote down, with no one's verification, are ordinarily not enough as evidence of what the business actually looks like.
The investor must be in a position to direct the business personally. This is usually shown by one's own share (ownership interest) of the business being 50% or more. A partnership split evenly between two people is also usually recognized if each of the two fully holds management authority. In a partnership divided equally among three or more people, no one is recognized as an investor on ownership interest alone. In that case, a partner must ordinarily show that he or she is coming to work for the company as an executive, supervisor, or essential employee in order to receive an E-2.
In any case, at least half of the business must belong to nationals of the same country as the investor. The share of a partner who is a U.S. permanent resident is not counted here.
An employee can also receive an E-2. The employee must be of the same nationality as the investor, and must be an executive or supervisor, or a person with skills that are essential to the business. Speaking a foreign language and knowing that country's circumstances is not by itself recognized as an essential skill.
You can keep extending in two-year periods, but the E-2 alone does not lead to a green card
"According to USCIS guidance, the period of stay in E-2 status is at most two years at first, each extension is also up to two years at a time, and there is no limit on the number of extensions."
A person outside the United States applies for the visa at a consulate. A person who is lawfully staying in the United States in another status can apply to USCIS to change to E-2, and the application form used for this is Form I-129.
Family can come along as well. This covers the spouse and unmarried children under 21, and the family members' nationality may differ. The spouse can work in the United States without applying separately for permission while his or her status as an E-2 family member is valid. Children cannot work.
What to be careful about is the family's period of stay. When a person in E-2 status travels abroad and returns, he or she is usually given a new two years upon passing inspection at entry. But the period of family members who remained in the United States is not extended along with it. Each family member must keep track of his or her own expiration date separately and apply for an extension before then.
The investor can work only in the business that was approved. If the business changes significantly, as when the company is merged with another company or sold, USCIS approval must be obtained again.
No matter how many times the E-2 is extended, it does not by itself lead to a green card, and you must maintain the intention to leave the United States when your status ends. You need not keep a home in your home country. A person for whom green card paperwork (an immigrant petition) has already been filed must separately convince the consular officer that he or she will leave when the stay ends.
Conclusion
There are three things to do before spending money. First, list the money needed to open, item by item, and attach quotes. How much of that is your own money is the starting point of the review. Second, trace where that money came from, connecting it through bank records and contracts. Third, before signing a contract under which a large sum goes out, such as a lease or an acquisition contract, check what happens to the money if the visa is denied, and whether a condition of visa issuance can be attached. Merely putting off the contract leaves the money uncommitted, and the visa will not be issued.
Frequently Asked Questions
Q. What is the minimum amount I must invest for an E-2 visa?
There is no set minimum amount. The consular officer looks at what share of the total cost of opening the business is your own money. In an example given in the State Department's guidance, if a business costs $100,000 to start up, a person who puts in all of that money is ordinarily regarded as meeting this standard. The smaller the shop, the larger the share of the money required that must be filled with your own money.
Q. Can I get an E-2 if I put my investment money in a bank account?
A bank balance alone is not recognized as an investment. The money must be irrevocably committed to the business, and the start of actual operations must be near. A stage of only looking for a shop location or merely signing a contract is not enough.
Q. Can my family come with me on an E-2 visa?
The spouse and unmarried children under 21 can come, and the family members' nationality may differ. The spouse can work in the United States without applying separately for permission while his or her status as an E-2 family member is valid. Children cannot work.
Disclaimer: This column provides general information and is not legal advice for a particular case. Individual immigration matters should be discussed with a qualified immigration attorney.
Law Office of Jin D. Cho, P.C.
NEW YORK OFFICE (Flushing) 35-24 154th Street, Flushing, NY 11354
(T) 718-353-2699 (F) 718-353-8132
NEW JERSEY OFFICE 560 Sylvan Avenue, 3Fl., Englewood Cliffs, NJ 07632
(T) 201-449-0009
choattorneys.com | Marriage green card online: greencard4spouse.com