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BUSINESS BASICS CHANNELS  |
Starting
a Business in the USA
When You're Not a United States Citizen: Investor Visas See our related article about Immigrating to the USA We are often asked for information on how to start a U.S. business if you are not a U.S. citizen or resident. The most common, "short term" visa granted is the B-1, or temporary business visa. It is good for short-term stays. Another excellent immigration avenue is the E-2, or "Treaty Investor", visa. Generally, the E2 visa, once granted, will allow for a substantial length stay (usually 2 years) in the United States. Business people and international employees from the many countries with whom the United States has a Treaty of Friendship, Commerce and Navigation or a Bi-lateral Investment Treaty use the E-2, according to the State Department. Its purpose is to facilitate international business relations, and foster investment in the United States by foreign nationals and corporations. These are the three conditions that must be met in order to obtain an E-2 visa: nationality, substantiality and marginality. Nationality. The investor, whether a corporation or an individual, must be a national of a treaty country. If the business is a corporation, more than 50% of the ownership of the company must be nationals of the treaty country. If an individual, birth records and passports can provide enough proof for the U.S. consuls and the Immigration and Nationalization Service to admit them to the U.S. under an E2 visa. Substantiality. The U.S. government tests whether the investor intends to succeed by the amount of the investment that is put at risk. They try to determine whether the investment is enough that the for-profit business is likely to succeed. There must be clear and convincing evidence that there is enough money available for equipment and operating expenses. If it is a new business venture, a "reasonable" five-year business plan can show that the investors are planning to succeed. Any money invested in the business must be actively at risk, not in a bank account, not as security for a mortgage loan. The investor must have his or her funds directly at risk in the project. The U.S. government tests substantiality by whether or not the investor has placed at risk approximately the same amount of funds that a U.S. entrepreneur would commit to the venture. The purchase price an existing business by unrelated parties would show a fair market value commitment by the investor. The principal must own 50% or more of the business, with the percentage of ownership required to meet the government's "substantiality test" increasing if the investment's cost is low. "Substantiality" is an area where U.S. Consular officers have a great deal of discretion in making a decision on whether or not to grant an E-2 visa. Marginality. The U.S. government does not want to admit investors into the USA when the sole purpose of the investment is to provide a living for the alien investor and/or their family. The business plan or existing business is tested to see if others will be employed by the business and if the profits of the business will substantially exceed the amount of money the investor family needs. One test is whether the business will be making a profit within five years of the investment. The government is looking for evidence that the business will improve the local economy. Additionally, an investor with substantial income outside of the investment will also receive strong consideration with regard to marginality. Key Employees. Key employees of corporate or individual treaty investors have no maximum length of stay for their E-2 Visas. Law does not regulate the total length of stay and each admission to the U.S. general receives a two-year admission. Transferred workers can include managers, supervisors and people with difficult-to-obtain skills that are needed by the corporation. Executives and higher-level supervisors are not required to have a specialized skill. Residence. Aliens in the U.S. are usually required to keep a residence in their home country during their posting in the U.S. Applicants must state to the consular officers that they will leave the U.S. at the end of their term of admission. Spouses and Dependents. Spouses and dependents are not allowed to work in the U.S. unless they develop a basis to receive their own visa allowing employment. General Requirements for Temporary Visitors [editor's note: This information is directly from the INS Website] A nonimmigrant is a foreign national seeking to enter the United States (U.S.) temporarily for a specific purpose. Nonimmigrants enter the U.S. for a temporary period of time, and once in the U.S. are restricted to the activity or reason for which their visa was issued. They may have more than one type of nonimmigrant visa but are admitted in only one status. General requirements for foreign nationals seeking temporary admission include, but are not limited to, the following:
Interesting side note: The fees for U.S. visas are based on the price charged by the other country for a U.S. citizen to enter under their most similar visa program. Web
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