Treaty Traders and Investors

Foreign nationals who wish to come to the U.S. to engage in international trade or to direct and operate a business investment may do so if they are citizens of a country that has entered into a qualifying Treaty of Friendship, Commerce, and Navigation or its equivalent with the United States using the E visa.  This is a temporary, non-immigrant visa that may be obtained from overseas at the U.S. Embassy or consulate through consular processing or from U.S. Citizenship & Immigration Services if the foreign national is filing from within the U.S. for an extension or a change of a status.

The list of qualifying treaty countries can be found on the U.S. Department’s website, which currently can be accessed here.  Eligible visaholders may enjoy their E visa status for two years at a time, to be renewed in two year increments for an indefinite number of times, provided they continue to meet the visa requirements.

E-1 Treaty Traders

E-1 Treaty Traders are either traders coming to the U.S. to carry on a trade of a substantial nature for him/herself, someone else, or for an organization engaged in trade, or as an alien employee of a treaty trader coming to the U.S. to assume an executive or a supervisory role or some essential function for the efficient operation of the trade enterprise. To qualify as an employee for E visa purposes the foreign national’s employer must be a national of a qualifying treaty country and must have at least 50% ownership in the business organization.

For the purposes of E-1 visa, trade means the existing international exchange of items of trade for consideration between the United States and the treaty country. Existing trade includes successfully negotiated contracts binding upon the parties that call for the immediate exchange of items of trade. This exchange must be traceable and identifiable. Title to the trade item must pass from one treaty party to the other. Items that qualify for trade include but are not limited to goods, services, technology, monies, international banking, insurance, transportation, tourism, communications, and some news gathering activities. 

For the trade to be substantial there must be continuous trading activities between the United States and the treaty country, regardless of the monetary value. Although the monetary value of the trade item being exchanged is a relevant consideration, greater weight is given to more numerous exchanges of larger value. In the case of smaller businesses, an income derived from the value of numerous transactions that is sufficient to support the treaty trader and his or her family constitutes a favorable factor in assessing the existence of substantial trade.

E-2 Treaty Investors

E-2 Treaty Investors are foreign nationals coming to the United States to invest or to be actively in the process of investing a substantial amount of capital in a bona fide enterprise in the United States for the sole purpose of developing and directing the enterprise.  E-2 status may also be granted to a qualifying employee of a treaty investor as long as the employer maintains his/her E-2 status and has at least 50% ownership of the organization.

A treaty investor must place personal capital (funds or other assets) at risk in the commercial sense with the objective of generating profit.  The treaty investor must be in possession of and have control over the capital invested or being invested. The capital must be subject to partial or total loss if investment fortunes reverse. Such investment capital must be the investor’s unsecured personal business capital or capital secured by personal assets. Capital in the process of being invested or that has been invested must be irrevocably committed to the enterprise. The invested funds may be placed in escrow pending visa issuance, that would not only irrevocably commit funds to the enterprise but that might also extend some personal liability protection to the treaty investor.

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Using the B-1 Visa in Lieu of the H-1B Visa: Pros and Cons

Normal H-1 requirements:

The H-1B visa is issued to those skilled foreign workers who have a bachelor’s degree or higher in the specialty occupation for which they are being issued the visa.[1] US employers sponsor the foreign worker and file a labor condition application (LCA) with the U.S. Department of Labor, and the employer  makes several attestations in the LCA, mainly the following: the H-1B worker is being paid the same wage as U.S. workers who have similar experience and qualifications for that specific employment;  employment of the non-immigrant does not adversely affect working conditions of other workers similarly employed;, and notice of filing the application was provided to workers employed in the occupation at the place where the H-1B worker would be employed.[2]

Problems with H-1 visa:

Practitioners and applicants for the H-1B visa find that the most salient problem with the H-1B visa filing is the annual cap. Currently, the visa cap is set at 65,000, with an exemption for 20,000 nonimmigrants who hold master’s degrees or higher.[3]  The problem is that the number of applicants greatly outstrips the number of available visas, often resulting in the visa cap being filled on the very first days when filings are accepted.[4]

Therefore, potential H-1B applicants may try to explore alternative methods to enter or stay in the US, without having to deal with the visa cap. One possibility is that worker may come to the US under a B-1 visa. However, this approach is somewhat controversial and not yet widely accepted or understood within the different the government agencies.  Consular posts may not know how to properly adjudicate these applications and even if granted, foreign nationals may encounter problems at the port of entry when the Customs and Border Patrol (CBP) officers are not willing to grant them admission.  The United States Citizenship & Immigration Services (USCIS) and its predecessor, the legacy Immigration and Nationality Services (INS), have traditionally been hostile to this visa category and viewed it with much skepticism.  Therefore, employers and foreign nationals wishing to pursue this visa option should understand the requirements and proceed with caution.

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