The EB-5 program is not the only visa program that may be impacted by sweeping reforms in the near future. Specifically, on April 9th, 2015, Florida Congressman David Jolly (R) introduced a bill that could have a significant and beneficial impact on E-2 Treaty Investor Visa holders whose ultimate desire is to obtain permanent residence in the U.S…if said bill is passed into law.
Currently, the E-2 Visa is a “nonimmigrant” visa, which means that to remain eligible; an E-2 visa holder must maintain an intent to return abroad to his/her home country following their permitted stay in the U.S. The E-2 visa allows a national of a treaty country (a country with which the U.S. maintains a Treaty of Bilateral Investment) to be admitted to the U.S. to manage or direct a business in which at least 50% of the ownership is held by nationals of the treaty country and in which the amount of capital invested is “substantial” (which term is not specifically defined). While it is renewable indefinitely for the life of the business, the E-2 visa is specifically designed not to lead directly to a green card. Rather, it must be renewed every few years (depending on the term granted), and is subject to nonrenewal in the event that the business proves unsuccessful.
While some E-2 visa holders do attempt to parlay their E-2 visa into an EB-5 visa—because the latter involves the granting of a conditional green card and further offers a path to lawful permanent residence in the U.S.—it is not always feasible to satisfy EB-5 requirements. In brief, an E-2 visa holder who has either invested less than $500,000 in a Targeted Employment Area (or $1 million, otherwise) and/or is unable to meet the requisite job creation requirements (creating at least 10 new jobs), cannot use the E-2 company as an EB-5 investment vehicle.
The stated purpose of the E-2 Visa Improvement Act of 2015 is to “permit certain E-2 nonimmigrant investors to adjust status to lawful permanent resident status.” Specifically, the Act would grant permanent residence to E-2 Treaty Investors who have resided in the U.S. for at least 10 years in E-2 status and whose business enterprise has created a minimum of two full-time jobs during such E-2 status. Their children (up until the age of 26) would be permitted to remain in the U.S. as dependents and could apply for employment authorization upon turning 18.
The bill is currently being reviewed by the House Judiciary Committee (among all of the other bills under consideration). If enacted, the bill would address a much-discussed deficit in the American immigration system: the lack of visa options for foreign-born entrepreneurs. Though “improving access to the U.S. for foreign-born entrepreneurs has been talked about for years and has wide bipartisan support,” the discussion of how to accomplish same has been caught up in “bigger fights over how to overhaul the country’s immigration laws.” Notably, a so-called “start-up” visa that would offer permanent residency to immigrant entrepreneurs, whether or not they are residents of an E-2 Treaty Country, was one of the subjects of President Obama’s Executive Action on immigration matters (November, 2014).
The security of permanent residence would be much-welcomed by foreign entrepreneurs who often use the E-2 visa to launch businesses in the United States, many of which are significant contributors to the American economy in a variety of ways.
by Shani Muschel contributing to ILW.com