Financing the expansion of your business in the U.S. with Visas

Finance the Expansion of Your Business in the U.S. Through E-2, L-1/EB-1C, & EB-5 Visa Pathways

Originally published in the November 19, 2018 edition of the Orange County Business Journal

The U.S. economy is going strong now with businesses on the rise, unemployment at a record low, and more open job positions than there are applicants. We can see many businesses implementing expansion plans on a regular basis these days, with such growing businesses searching for good sources of capital. The purpose of this article is to introduce the idea that it can be worthwhile and even cheaper to use non-U.S. sources of capital in order to expand your business in the U.S.

One good way of accessing foreign sources of capital is tying the foreign capital investment to immigration pathways. The U.S. offers a few different avenues of immigration that combine a foreign individual’s dreams of coming and starting/expanding a business here on U.S. soil. Let’s go over a few key points of the E-2, L-1, EB-1C, and EB-5 visas:

E-2 Treaty Investor Visa

An individual may be issued an E-2 Treaty Investor visa if:

  • The individual or the individual’s business is from an E-2 Treaty nation and at least half of the business must be owned by nationals of the treaty nation.
  • The individual or the individual’s business has made or is in the process of making a substantial investment (generally in excess of $100,000) in a business in the U.S.
  • The individual is either the principal investor who will direct and develop the business in the U.S., or the individual is an executive manager or employee with special skills essential to the company.
  • The investment is not the individual’s sole source of income.

E-2 Treaty Nations are countries that have treaties of trade and commerce with the U.S. There are a lot of E-2 treaty nations. Unfortunately, countries such as China and India are not E-2 treaty nations and therefore do not qualify for E-2 Treaty Investor visas. (That being said, individuals from China or India could potentially obtain citizenship from other E-2 treaty nations that have Citizenship by Investment (“CBI”) programs and then the Chinese or Indian national could subsequently qualify for an E-2 visa.)

L-1 Intracompany Executive/Manager Transferee Visa (Nonimmigrant Visa)

An L-1 Intracompany Executive/Manager Transferee visa is for those foreign nationals who have plans to be employed in the U.S. by a parent, subsidiary, affiliate, or branch of a foreign business where the foreign national had already been working overseas for at least one year (within the three preceding years). The foreign national must have been employed in an executive, managerial, or specialized knowledge capacity for the overseas employer and subsequently be employed in an executive, managerial, or specialized capacity in the U.S. company.

The L-1 visa allows a qualifying foreign national to enter the U.S. relatively quickly to start working. It is important to note that the L-1 transferee does not need to do the same work as he or she was performing overseas; this means that the foreign transferee who managed a factory in China could potentially come and manage a new franchise business in the U.S. given that the U.S. franchise will become an affiliate or subsidiary company of the Chinese factory. This visa is only a temporary work visa.

EB-1C Intracompany Transferee Visa (Immigrant Visa)

The EB-1C (a.k.a. EB-1-3) visa is the permanent version of the L-1 visa which leads to U.S. permanent resident status with a green card. The requirements for this visa are very similar to the L-1 executive/manager visa requirements, except that there is no “specialized knowledge” qualification category. The foreign national must be coming to the U.S. on the basis of a permanent job offer to work in a management or executive capacity. It is important to note that while this visa leads to a foreign national obtaining a green card, the applicant must wait for an EB-1C visa number to be available.

In some circumstances where a company is just starting its operations in the U.S., a foreign manager or executive can apply for an L-1 visa first and then submit an EB-1C visa application after a year or so.

EB-5 Immigrant Investor Visa

The EB-5 visa has become very popular in recent years as a pathway for foreigners to invest in the U.S., create full-time jobs for U.S. workers, and bring their families to the U.S. There are no managerial, executive, or specialized knowledge requirements for this visa because the EB-5 requirements focus on the foreign national investing either $500,000 or $1 million (depending on the investment’s location and minimum investment amounts subject to change soon) and that investment must be proven to have created at least 10 full-time U.S. jobs per EB-5 investor.

There is currently a huge backlog for EB-5 visa applicants from China, Vietnam, and India. This has led EB-5 applicants from these countries to explore other corporate immigration pathways such as the L-1/EB-1C visa pathways that require foreign nationals to come and manage a sizeable business in the U.S.

It is at this point that some foreign nationals start to look at investing in and running their own franchise business in the U.S. Some brand-name franchises are now cooperating with foreign investors who are looking to tie their family’s immigration dreams with a dream of running a business in the U.S. The L-1/EB-1C visa pathways can become a viable tool that allows U.S. businesses to expand by working with foreign nationals who become managers of the expanding or new U.S. business.

The attorneys at our law firm, David Hirson & Partners, LLP, specialize in successfully strategizing and filing these corporate immigration visas and many other visa types. Come find out if your U.S. business expansion plans can work alongside the E-2, L-1/EB-1C, or EB-5 visa pathways.

David Hirson, Esq. has more than 35 years of experience in corporate immigration law, specializing in business and investment immigration. David is the founding and manager partner of David Hirson & Partners, LLP (“DHP”), and he is internationally-recognized for his decades of success in investment immigration. DHP’s attorneys have over 70 years of combined experience in advising individuals, start-ups, large corporations, hospitals, and universities in navigating complex areas of employment immigration.

The firm’s business and employment-based immigration practice provides a full range of services, including EB-1-1(A), EB-1-2(B), EB-1-3(C), National Interest Waivers (NIW), EB-2, EB-3, EB-5, H-1B, E-1/2, L-1(A)/2(B), H1B, and other immigrant and non-immigrant visas. DHP is one of a select few firms that also specialize in immigration for franchise businesses who have foreign partners/managers. David’s firm also works closely with individuals and HR departments to understand their needs and customize an immigration plan that surpasses their expectations.