Requirements for the E-2 Visa: Common Issues and Grounds for Denial

Posted: October 28, 2021

 

The application of the requirement for a "substantial" investment can vary widely between consular officers and United States Immigration Service (USCIS) immigration officers. The regulations do not impose a minimum investment, but it is important to note that the amount of the investment must be commensurate with the cost and nature of the business involved, and sufficient to ensure that it thrives. Most businesses that fail, fail because they are undercapitalized.

When evaluating whether the investment is substantial, the immigration officer will look to the amount of money required to make sure that your financial commitment will be sufficient to bring the company to success. Usually, they want to see that 100% of the purchase price is paid.  The officer will also take a close look at how you have spent your investment funds, such as prepayment of rent on your business premises, contracts you have entered and paid such as for marketing services, inventory, the purchase of materials and equipment, etc.

If the cost of an established business is less than $100,000, the investment should be as close as possible to 100% of that amount invested or committed. On the other hand, a highly expensive business would require a lower percentage of qualifying investment. There are no bright line percentages that exist for an investment to be considered substantial. However, also consider that the business cannot be marginal. It is considered marginal if it cannot provide jobs to US workers. If you are buying an existing business for less than $50,000.00 it likely does not financially support anyone but the owner. Nonetheless, our firm has successfully assisted E2 visa applicants whose investment was $50,000 or less on occasion. Generally, these will be service-oriented businesses that don’t need expensive equipment or inventory.

What are some common grounds for E2 visa denials?

1. Investment not substantial - investing an insufficient amount for the viability of the business. Though no minimum investment amount is indicated in the law, immigration lawyers generally recommend a minimum average investment of $75,000 to $100,000 for the most common cases. This range can be further increased depending on the nature of the business. The consular officer will apply a rule of proportionality of the initial investment to the overall investment.
   
   
2. Investment is Marginal- Indicating a projected turnover barely sufficient to support the business operations. Your investment is meant to generate profits, to contribute to the payment of taxes, and to provide jobs for U.S. workers, and it is from this perspective that you are granted a visa. In essence, that is what a "non-marginal investment" means, as it is referred to in the law. If your business barely generates enough to support you and your family, it won’t be expected to benefit the U.S. economy.
   
   
3. Business is not active- Hoping for the visa to be granted before starting to invest and hire. Your application should demonstrate that your business is close to operational. Though the Foreign Affairs Manual states it can be close to the start of business, that is misleading since some consulates may not grant you an E-2 visa until the business is operational. Your application should be documented with some of the following documentation: evidence of U.S. workers, supplier invoices, your commercial lease contract, work contracts, or letters of intent from prospective customers. Your investment must be committed. You must demonstrate that the risk of investing is assumed. After reading your business plan, the consular officer must be convinced that the issuance of this visa will have a real and rapid economic impact. The amount of money already committed must reflect your ability to step into your position to direct and develop your investment.
   
   
4. Business Acumen - You must own at least 50% of the company, and your business plan must show that you are the person who makes strategic decisions. Your understanding and your ability to speak basic English will be a consideration. Some activities require a license to be carried out.  The official evaluating your case may wonder how long it will take to acquire it and will someone else in the business already have the required license.
   
   
5. Lack of preparation for the visa interview - This is when the adventure begins... or not. This exchange takes place in English and in a setting that can be intimidating. Make sure you are familiar with your file and most importantly with the business plan which was submitted in support of your application which you may not have prepared yourself.

 

Frequently Asked Questions

My visa was denied for failing to meet the “develop and direct” the enterprise requirement, what does that mean? My E-2 visa was denied based on section 221(f) of the INA. Pending the lifting of the travel ban, will I have to resubmit my E-2 visa application and pay visa fees again? My E-2 visa has been refused based on section 212(g) of the INA, what does that mean? Can I expect to get an approval? Can I apply for an E-2 visa as a Third Country National at any US Consulate or US Embassy other than in my country of residence? Will I have to undergo the COVID-19 vaccination when I apply for the E-2 visa?

 

 

We frequently receive questions about the E2 visa, its requirements, and the E2 visa process. In an effort to help you obtain as much information needed as possible, we have compiled those that we think are the most common ones, so please feel free to visit our E2 Visa frequently asked questions page to find more information on this subject.

Vazquez & Poudat Immigration Law Firm and E2 Visa Applications

Contact our Immigration Board Certified Attorneys (Admitted and Accredited by the Florida Bar) to prepare your E2 visa application and ensure that the information required under the statutory criteria for a successful E2 application is met. Call us today at 407.674.6968, fill out our online form or send us an email at info@vpimmigration.com and we will contact you as soon as possible.