An Overview of the E-1 Visa and E-2 Visa

As a cross-border immigration lawyer based in Windsor, Ontario, Christina Loebach helps Canadian businesses and individuals obtain work permits in the United States. This blog post considers the E-1 (Treaty Trader) and E-2 (Treaty Investor) visas, which are often a great option for Canadian entrepreneurs and investors seeking to do business in the United States.

The E-1 Treaty Trader Visa

The E-1 treaty trader visa is a non-immigrant visa which allows a national of a treaty country to be admitted to the United States solely to engage in international trade on his or her own behalf. A treaty country is a country with which the United States maintains a treaty of commerce and navigation, or which the United States maintains a qualifying international agreement, or which has been deemed a qualifying country by legislation. Canada qualifies as a treaty country, and therefore Canadian citizens are eligible to apply for E-1 visas.

To be eligible for an E-1 treaty trader visa, the following requirements must be met:

• Requisite treaty exists;

• Individual and/or business possesses the nationality of the treaty country;

• Activities constitute trade within the meaning of INA § 101(a)(15)(E);

• Trade is substantial;

• Trade is principally between the United States and the treaty country;

• Applicant, if an employee, is destined to an executive/supervisory position or possesses the skills essential to the firm’s operations in the United States; and

• Applicant intends to depart the United States when the E-1 status terminates.

As mentioned above, the work the applicant is conducting must constitute trade. To constitute trade, an exchange of goods or services for consideration must flow between the two treaty countries and must be traceable or identifiable. This is frequently done through invoices, purchase orders, wire transfers, or other financial documentation.

The trade must also be “substantial”. Substantial means that it has involved a continual flow of numerous transactions over time. Consular offices may also look at the monetary value of the trades. It is often very difficult for new start-up companies to qualify for the E-1 visa as they often do not have enough of a track record of trade to meet the definition of “substantial”. 

50% or more of the trade must be principally between the United States and the treaty country, and documentation supporting this must be provided as part of the application. The remainder of the individual or business’s trade may be domestic, or international between other countries.

The E-2 Treaty Investor Visa

The E-2 treaty investor visa is a non-immigrant visa which allows a national of a treaty country to go to the United States to develop and direct the operations of an enterprise in which they have invested or are actively in the process of investing a substantial amount. Similar to the E-1 visa, Canada is considered a treaty country and therefore Canadian citizens are eligible to apply for E-2 visas.

To be eligible for an E-2 treaty investor visa, the following requirements must be met:

• Requisite treaty exists;

• Individual and/or business possesses the nationality of the treaty country;

• Applicant has invested or is actively in the process of investing;

• Enterprise is a real and operating commercial enterprise;

• Applicant’s investment is substantial;

• Investment is more than a marginal one solely for earning a living;

• Applicant is in a position to “develop and direct” the enterprise;

• Applicant, if an employee, if destined to an executive/supervisory position or possesses skills essential to the firm’s operations in the United States; and

• Applicant intends to depart the United States when the E-2 status terminates.

The funds or assets invested in the United States must be “at risk”, meaning that if the business failed, the investment would be proportionately lost. The funds must also be irrevocably committed, meaning that the business is either already using the investment or is very close to the start of business operations, at which point the investment will be used. 

In assessing E-2 visa applications, consular officers will look closely to determine whether the business is a real and active commercial enterprise that will produce a service or a commodity. The “active” requirement serves as the justification for the investor’s presence in the United States, i.e. they are required on location to develop and direct the enterprise. This requirement is evaluated by USCIS on a case-by-case basis. Passive or paper investments will not qualify, and therefore merely investing in land or holding ownership of an asset won’t be enough to qualify for an E-2 visa. 

The investment must be “substantial” as determined through the application of a proportionality test. Generally speaking, if the cost of the business is lower, a higher percentage of investment is required. Conversely, a highly expensive business requires a lower percentage of qualifying investment. In all cases, the amount of investment must be sufficient to ensure the treaty investor’s financial commitment to the successful operation of the business.

Especially in the Windsor-Detroit area, there are many Canadian businesses and entrepreneurs that may benefit from an E-1 or E-2 visa. If you would like Christina to provide legal advice tailored to your situation, please schedule a consultation.