Business Immigration

EB-5 and E-2 Investing in the United States

By better understanding E-2 and EB-5 visas and what investment requirements must be met by the applicants to qualify, franchises can begin attracting and appealing to a new market of franchisees.

The E-2 Treaty Investor visa grants nationals of a qualifying country temporary stay in the United States in exchange for investment in a U.S. business. To qualify for the visa, investors must:

E-2 and EB-5 visas are a great way for foreign investors to establish themselves and their families in the United States through business ownership and franchise opportunities.

Types of Business to Invest in the US

Despite news to the contrary that business immigration is being frowned upon by the current administration, business immigration and opportunities are booming with direct investment into the United States. There is bipartisan support for business immigration.

Direct investment is looked upon more favorably than investing in Regional Centers due to the ongoing fraud and unscrupulous business methods of many, but not all, Regional Centers. Direct investment into a US business also gives the investor control over the investment and compliance, including job creation, to satisfy the requirements of EB-5.

Here are some examples of businesses that are very attractive for EB-5 and E2 approval:

  • Franchises
    • Fast Food
    • Gast Stations/Convenience Stores
    • Health Care
    • Daycare Centers and Charter Schools
    • Day Spas
    • Hotel Chains
  • Commercial Real Estate Investment
  • Construction
  • Restaurants

Direct investment for the EB-5 program has increased substantially since the financial crisis of 2008 and continues to be an attractive way to receive permanent residency in the United States for the investor and family for the foreseeable future.

This is a great time to invest in the United States.

Prior to applying for an E-2 investor visa, the formal requirements should be complied with, such as registering the business, opening a corporate bank account, leasing an office space, wire transfer of funds to a US bank account, etc.

Before determining whether an E-2 investor visa can be granted by using real property, we must closely review the requirements of the law and the applicable regulations.

For example, a real estate investment whereby the investor simply holds title to a real estate property or simply buys properties for rent, his activities will usually not qualify for an E-2 visa, since it will not be regarded as an active business or a bona fide enterprise as required by the regulations. Rather, this would appear to be more of a passive investment which would likely not require the investor to “direct” or “develop” the commercial enterprise.

On the other hand, if the real estate enterprise requires ongoing activity by the investor on a full-time basis, such as a business which involves purchasing and selling multiple real properties, renovating multiple real properties on a regular basis, or managing multiple rental properties, it may qualify as a bona fide enterprise.

A combination of seasonal rentals may be regarded as a bona fide enterprise since it requires ongoing activity during the entire year. As may a business of buying, renovating, and selling houses. By actively searching for the renovations throughout the year, buying the properties and selling them, the person is actively involved in the business and is actively engaged in directing and developing the commercial enterprise according to his discretion. He is also adding value to the US economy since he must hire people who will be involved in the process of renovating and selling the properties, hence, his activities are more likely to qualify for an E-2 visa.

To summarize, a passive real estate investment such as merely owning a rental property, is not likely to qualify for an E-2 investors visa. However, if an investor owns multiple units of property which are being maintained on a regular basis, renovated and rented from time to time, then this investment is more likely to fulfill the E-2 requirements.

Of course, each applicant must be judged and viewed by the totality of the circumstances test, and should consult with an immigration attorney to more accurately assess their chances of success in the E-2 visa process.

As franchises struggle to find buyers who can secure financing, a handful are turning to a group of budding owners with cash in hand: wealthy immigrants looking for a green card.

In 2017, 6,343 foreign nationals applied to the EB-5 program, up from 6,040 in 2012, and just 470 in 2006, according to the latest data from U.S. Citizenship and Immigration Services. The agency estimates that as of September 2013, the program has raised more than $8.6 billion and has created some 57,300 jobs.

E-2 visas are the more common strategy used in the franchise industry. This is partly because the investment requirement is only $100,000 to $150,000 and the number of E-2 visas distributed each year is not restricted. The investment cannot be marginal, must create jobs and show a future capacity to generate income within five years of operation.

E-2 visa processing time is faster than the EB-5 route. Unlike green cards, the visas must be renewed every two years.

An E-2 investor must identify the franchise opportunity and be actively working on the business before the visa application can be submitted; this includes securing a lease and signing the franchise documents. Then, an immigration attorney can prepare the visa application package and submit it to the U.S. consular office in the applicant’s home country.

Once the petition has been submitted, receiving the visa takes approximately 30 to 90 days. The E-2 visa can be indefinitely renewed for as long as the qualified investment continues.

Unlike the E-2 visa, the Immigrant Investor Program, more commonly referred to as the EB-5 Program, is a pathway to permanent residency in the United States and eventual U.S. citizenship.

Overseen by U.S. Citizenship and Immigration Services, the EB-5 Program was created in 1990 to stimulate the U.S. economy through job creation and capital investment by foreign investors. There are 10,000 EB-5 green cards available each year, with 3,000 reserved for those who would prefer to invest through a Regional Center.

Generally, the EB-5 Program requires a capital investment of $1 million in a new commercial enterprise, $500,000 if the business is in a Targeted Employment Area. An EB-5 applicant must also create or preserve at least 10 full-time jobs within two years.

Applying for an EB-5 green card is a highly documented process that includes extensive vetting procedures. Similar to the E-2, the business opportunity and investment must be fully developed before moving forward with the application. In other words, the foreign investor must have a franchise agreement, lease agreement and sophisticated business plan to demonstrate the validity of the business.

Through the application process, the investor is granted a conditional permanent residence for a two-year period. The condition is lifted when the investor submits a petition for removal 90 days prior to the two-year anniversary of receiving the conditional status. Once approved, the restrictions are removed and the EB-5 investor receives a permanent green card.

What we offer

  1. Case Evaluation

    We will assess your eligibility for the E2/EB-5 visa and evaluate:

    • Treaty country citizenship
    • Type of business desired
    • Your short, medium and long-term business goals
    • Amount and source of funds
    • Professional experience
    • Role you will play in the E2 visa company
    • Other visa types that would better suit your profile, needs or goal

  2. Ongoing Weekly Check-Ins

    We will check in weekly throughout the E2/EB-5 Visa process. We will keep you updated on developments, and collect any information if and when it becomes necessary.

  3. Reviews of Business Plans

    Your business plan goes through many iterations. We offer feedback throughout. Early on, we review your plan and its financial projections. Later, we perform a final review before submission to the USCIS or US Consulate.

  4. E2 Visa Application Preparation

    The E2 visa application process includes:

    • Detailed review of nature and structure of the E2 Visa company
    • Development of organizational chart
    • Reviewing client’s educational and professional background
    • Reviewing requested documents
    • Preparing all required immigration forms
    • Piecing together the E2 application
    • Reviewing and refining the application
    • Opportunity for client to review the application before submission

  5. Visa Filing and Schedule of Consular Interview

    We file the E2 Visa application and schedule an interview with the U.S. Consulate (if you are already in the US you may file with the USCIS).

  6. Monitoring and Troubleshooting

    We monitor your application status and prepare replies to any Requests For Information (RFI).

  7. Preparation to E2 Visa Consular Interview

    During a Skype or phone consultation, we prepare you for the E2 visa consular interview.