Immigration Options For Entrepreneurs Seeking To Start Ventures In The United States

An international entrepreneur's ownership of a U.S. business offers the entrepreneur a wide range of options for temporary and permanent immigration to the United States. Most nonimmigrant (temporary) options available to entrepreneurs are largely dictated by the individual's personal history, goals and investment. This article will explore the business immigration options for foreign nationals seeking to start new business ventures in the United States.

Foreign investors seeking to expand or establish a business in the United States have several nonimmigrant options available to them. Each of these nonimmigrant categories provide unique opportunities and limitations to the foreign investor.

The E Treaty Trader and Treaty Investor

U.S. immigration officers often refer to the E status as a favored classification for international entrepreneurs. The treaty trader and treaty investor categories are the most ideally suited nonimmigrant visa category for international entrepreneurs. Pursuant to the Immigration and Nationality Act (INA) a treaty trader is an investor or business persons who is entitled to enter the United States under a treaty of commerce and navigation between the United States and the foreign state of which he is a national. Individuals entering the United States under this category are allowed to carry on international trade (via an E-1 visa) or to develop and direct a business in which they have invested a substantial amount of capital (via an E-2 visa). Admission under either E subcategory allows the entrepreneur to work at, direct, and manage an enterprise in the United States.

For entrepreneurs who want to take advantage of the E-2 treaty investor category by investing in a U.S. business venture, the U.S. enterprise must meet three basic criteria to support the admission as an E-2 investor. First, the enterprise must be owned and controlled by nationals of countries that have agreements or treaties of commerce and navigation with the United States. Second, the enterprise must prove that it has the present or future capacity to generate more than enough income to provide a "minimal living" for the treaty investor. Finally, the treaty national(s) must have made a substantial investment in the U.S. business relative to the amount normally needed to buy and successfully operate similar businesses.

The E status has several distinct advantages over other nonimmigrant visa categories. First, the E status is open-ended and may be extended in two-year increments indefinitely. Second, entrepreneurs with established businesses outside the United States may seek the transfer of managers and essential employees to the United States. Third, the spouse of an E-1 treaty trader or E-2 treaty investor may work with the permission of U.S. Citizenship and Immigration Services (USCIS). Finally, an entrepreneur may apply for the E visa at a U.S. consulate without the necessity of prior USCIS approval.

One limitation of the E category is admission on this status is restricted to citizens of countries that hold treaties of commerce and navigation with the United States. There are currently eighty countries that have such treaties and agreements with the United States. Some agreements support admission by both traders and investors while others are limited to only traders or only investors. Moreover, entrepreneur status is tied directly to the business. This could pose a potential problem. A merger, acquisition, sale, or failure of the business may lead to immediate status problems for the entrepreneur, employees in E status, and their families. Therefore, prior to any critical business restructuring is necessary to protect an E nonimmigrant from losing status.

For entrepreneurs who qualify, the E status offers an attractive option. It allows potentially long term stays in the United States, allows for the transfer of existing managers and essential employees, and provides for spousal employment authorization.
The following countries have trade and investment treaties with the United States and citizens of these countries are eligible for both E-1 and E-2 status:
Argentina, Australia, Austria, Belgium, Bolivia, Bosnia, Canada, Chile, Colombia, Costa Rica, Croatia, Estonia, Ethiopia, Finland, France, Germany, Honduras, Iran (with restrictions), Ireland, Italy, Japan , Jordan, South Korea , Latvia, Liberia, Luxembourg, Macedonia, Mexico, Netherlands, Norway, Oman, Pakistan, Paraguay, Philippines, Singapore, Slovenia, Spain, Suriname, Sweden, Switzerland, Thailand, Taiwan, Togo, Turkey, United Kingdom, and Yugoslavia.
The following countries have trade treaties with the United States which allow for conferral of E-1 (treaty-trader status) to the nationals of said countries:
Brunei, Denmark, Greece, and Israel.
The following countries have investment treaties with the United States which allow for conferral of E-2 (treaty-investor status) to the nationals of said country:
Albania, Armenia, Azerbaijan, Bahrain, Bangladesh, Bulgaria, Cameroon, Congo, Czech Republic, Ecuador, Egypt, Estonia, Grenada, Georgia, Jamaica, Kazakhstan, Kyrgyzstan, Lithuania, Moldova, Mongolia, Morocco, Panama, Poland, Romania, Senegal, Slovakia, Sri Lanka, Trinidad & Tobago, Tunisia, Ukraine


The H-1B Temporary Professional Worker

For those entrepreneurs who are not nationals of a "treaty" country or whose investment does not meet the substantiality requirements of the E visa, the H-1B visa may be an option. The regulations governing H-1B visas provide that a U.S. employer or agent with an IRS tax identification number that employs at least one worker and has an employee-employer relationship with that worker may petition for an H-1B professional. By limiting petitioners to U.S. employers or agents, the H-1B visa classification prohibits self-sponsorship. Therefore, the entrepreneur would need to set up a U.S. based venture to act as an employer in order to utilize the H-1B visa option.

Once the entrepreneur organizes a U.S. based business venture in order to file an H-1B petition on their behalf, several requirements must be met. Where the petitioning company is new or has few employees, the USCIS will require the entity to provide significant documentation proving the bona fide nature of the petitioner's job offer. The petitioning entity may be requested to submit its organizational documentation, records regarding its financial health, including capitalization, and records that establish compliance with claimed employment practices. Moreover, the petitioner will need to prove to the USCIS that it has sufficient business to ensure that the H-1B worker (beneficiary) will work for the entity in H-1B capacity as noted on the petition. A comprehensive business plan and evidence of capitalization may satisfy the government's concerns with respect to this issue.

The H-1B status presents a viable immigration option for entrepreneurs. First, it is available without restriction as to nationality. Second, unlike the E classification, a merger or acquisition may, but will not necessarily, require a change of status. The entrepreneur may buy or sell his or her business and stay in status so long as the new entity assumes the immigration obligation of the petitioner, and the H-1B status holder continues to render services.

However, the H-1B may present some drawbacks to an entrepreneur. First, admission to the United States as an H-1B visa holder is generally limited to a period of six years unless an immigrant petition or labor certification application is filed on behalf of the entrepreneur prior to the end of the fifth year. Second, the classification is principally limited to workers rendering services in a specialty occupation. This means that the services to be rendered by the entrepreneur must be professional in nature. Third, most entrepreneurs will be subject to the annual 65,000 H-1B visa cap, thereby creating the risk of delayed admission. Finally, spouses of the H-1B entrepreneurs will not be entitled to work in the United States unless they secure an employment authorized status of their own. Despite of these issues, the H-1B visa is a viable immigration option for entrepreneurs who will be rendering services of a professional nature.

The L Intra-company Transferee

For entrepreneurs who own and manage an existing business abroad, the L classification provides an important avenue for making and managing investments in the United States. The L classification allows the foreign corporation to transfer managers, executives, and specialized knowledge employees to its sister corporation(s) in the United States. The L visa classification thereby makes it possible for the transfer of an employee/owner of the foreign business to the United States. In order to qualify for the L classification certain basic requirements must be met. First, the relationship between the U.S. petitioner and entity abroad must be established. Second, the beneficiary of the L-1 visa must have been employed by the entity abroad for one year prior to filing the petition. Third, the beneficiary's role abroad must have been in an executive, managerial, or specialized knowledge capacity. Finally, the U.S. petitioner must prove that it is already or will be conducting business in the United States and abroad through a related qualifying organization.

The L-1 category allows an ownership interest in the petitioning entity by an applicant seeking admission as an L-l visa holder. However, where the beneficiary is an "owner or major stockholder of the company," the petition must include some evidence that the petitioner's need for the beneficiary is temporary and that the beneficiary will be transferred abroad upon completion of his or her temporary services. Once admitted to the United States in L status, the entrepreneur is authorized only to render services to the L petitioner. However, the L visa holder may receive remuneration from the petitioner or a related foreign enterprise. Typically, admission as an L-1A manager or executive is limited to seven years and admission as an L-1B specialized knowledge worker is limited to five years. Similar to spouses of E visa holders, the spouses of L visa holders may obtain employment authorization.

Conclusion

The E visa, H1B and L1 visas all offer entrepreneurs numerous advantages when considering non-immigrant and immigrant opportunities. The benefits and disadvantages of each of these options have been briefly explained, so that an educated decision can be made when determining how to move forward with your immigration matters. To fully understand which option would be most beneficial to you and your business, it is important to speak to an immigration professional that can completely assess your situation and provide legal guidance.

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