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E-2 “Treaty Investor” Visas – Immigration – USA

Nationals of certain countries, including Germany, may be classified as a nonimmigrant treaty investor if they have invested, or are actively in the process of investing, a substantial amount of capital in a bona fide enterprise in the United States which they intend to develop and direct.

The spouse and children (unmarried and under age 21) of a treaty investor are entitled to the same E-2 classification.  The nationality of a spouse or child of a treaty alien is not material to their classification as E-2.

The investor must show that he has either made or is actively in the process of making a substantial investment in the enterprise.  Where an enterprise is in the process of formation, it must be shown that the funds have been committed and are at risk.  The funds must be irrevocably committed to the business.

A qualifying investment must be an active investment. The business enterprise underlying the investment must represent a real operating enterprise producing some service or commodity.

Uncommitted funds in a bank account do not represent an active investment, unless other evidence of business activities exists to demonstrate that the funds are used in the routine operation of the business (e.g. the funds are reserve funds).

The requirement to “develop and direct” the operation of the enterprise requires the investor to have at least a 50% interest in the enterprise.

There is no minimum dollar figure established for meeting the requirement of “substantial” investment.  The substantiality of an investment depends on the nature of the enterprise and is therefore not necessarily determined by the actual amount of the investment.

The substantiality of an investment is determined by the application of the proportionality test according to which the amount invested is weighed against either (1) the total value of the particular enterprise in question or (2) the amount normally considered necessary to establish a viable enterprise of the nature contemplated.  In businesses requiring smaller amounts of total investment (i.e., service-oriented businesses), the treaty investor must contribute a very high percentage of the total investment, whereas in businesses requiring a larger total investment, the percentage may be much less.

An applicant is not entitled to E-2 classification if the investment, even if substantial, will return only enough income to provide a living for the applicant and his family.  Such an investment would be considered marginal.

If the income derived from the business exceeds what is necessary to support the investor and family, the investment is not considered to be marginal.  If the income does not exceed this minimum, one can look to the economic impact of the business.

An employee of a treaty investor may be classified E-2, if the employee will be engaged in duties of an executive or supervisory character or the employee has special qualifications that make the services to be rendered essential to the efficient operation of the enterprise.  An E-2 classified employee must have the same nationality as the E-2 investor.

The E-2 is a highly desirable visa as it can be indefinitely renewed, so long as the investor maintains eligibility.  E-2 spouses may obtain an employment authorization document.  E-2 children may attend school without a student visa.

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