Author: visaadmin

The E-2 Investor Visa opens a powerful route for business-minded individuals to live and work in the United States — but one key question always comes first: is the investor’s nationality eligible in 2025 and 2026?

Why nationality matters for the E-2 Investor Visa

The E-2 visa is a nonimmigrant classification reserved for nationals of countries that maintain a qualifying treaty of commerce and navigation with the United States. In short, the visa’s availability depends on whether the applicant is a citizen of a treaty country. That single factor can determine whether a person can apply directly as an E-2 investor or must pursue alternate strategies to qualify.

Readers should note that the E-2 is distinct from immigrant investor programs (such as EB-5) and has different goals: it facilitates temporary entry to develop and direct a bona fide enterprise in the U.S., not a direct path to a green card.

Where to check the official list of treaty countries (and why it matters in 2025 and 2026)

The authoritative source for country eligibility is the U.S. Department of State. Because treaty relationships are set by government agreement and can change, the most reliable way to confirm whether a nationality qualifies in 2025 or 2026 is to check the State Department’s list of treaty countries and the USCIS guidance on E-2 classification.

• U.S. Department of State — Treaty Traders and Investors (official treaty-country list and overview).
• U.S. Citizenship and Immigration Services — E-2 Treaty Investor (requirements and adjudicatory guidance).

For anyone preparing an application in 2025 or 2026, checking these pages is the first essential step. Counsel should be engaged if there is any uncertainty or if a recent treaty change is suspected.

Which nationalities typically qualify? Examples and context

Rather than reproducing an exhaustive country list in this post (which can become outdated), it is helpful to highlight common patterns and examples. Many long-standing U.S. treaty partners are included — major economies whose citizens frequently use the E-2 pathway.

Examples of nations that traditionally appear on the treaty list include the United Kingdom, Japan, Germany, France, South Korea, Australia, Canada and Mexico. These countries’ nationals commonly apply for E-2 visas to launch or expand businesses in the U.S.

At the same time, the treaty list contains many smaller states across the Caribbean, Europe, Asia, and elsewhere. Some smaller Caribbean states are particularly notable because they offer citizenship-by-investment programs; certain investors from non-treaty countries sometimes use those programs to obtain citizenship in a treaty country to qualify for an E-2.

Because the list is extensive and periodically updated, the right approach is to verify eligibility via the State Department link above rather than rely on memory or third-party summaries.

How nationality is determined for E-2 purposes

Understanding how nationality is defined is critical because eligibility can turn on subtle facts about ownership and corporate structure.

Individual applicants

An individual’s eligibility rests on their current nationality (citizenship). If the person is a citizen of a treaty country, they may be eligible to apply as the principal investor or as a manager/essential employee of the treaty-national-owned enterprise.

Corporate and entity ownership

A business applying for E-2 classification must be a qualifying enterprise. If an entity (rather than an individual) seeks to qualify as the investor, the entity itself must be considered a national of a treaty country. That usually means:

• The company is organized under the laws of a treaty country, and
• Its ownership and control reflect treaty-country nationality — often interpreted to mean that at least 50% of the ownership is held by nationals of the treaty country.

These rules mean investors sometimes structure ownership or create entities in a treaty country to secure E-2 eligibility. However, structuring must be genuine; artificial or sham arrangements intended simply to satisfy the nationality test can lead to denial.

Dual nationals and derivatives

Dual nationals may use the nationality that qualifies. Spouses and unmarried children under 21 of an E-2 principal often derive E-2 dependent status and may accompany the primary visa holder. Spouses of E-2 principals are generally eligible for work authorization in the U.S.

What if someone is not a citizen of a treaty country?

Not having a qualifying nationality is a common obstacle — but it is not always the end of the road. There are several lawful options to consider, each with trade-offs in cost, timing, and legal complexity.

• Obtain citizenship in a treaty country: Some applicants pursue naturalization or citizenship-by-investment in a treaty country to become eligible. This route may be practical for some but is a significant life decision that requires full legal and tax analysis. A frequently discussed example (not a recommendation) is that certain Caribbean countries with citizenship-by-investment programs are treaty partners; potential investors weigh cost, processing time, and residency/citizenship requirements.
• Structure the investor as a treaty-national-owned company: If a qualifying treaty national controls the investing entity by the required ownership percentage, the enterprise may meet the nationality test. This must be bona fide — treaty nationals must genuinely own and control the business.
• Consider alternative U.S. visas: Other immigration pathways may be available, such as EB-5 (immigrant investor program, with different investment thresholds), L-1 (intracompany transfer), O-1 (extraordinary ability), or traditional employment visas. Each program has unique eligibility rules and should be compared carefully.

Because each strategy carries legal, tax, and practical implications, consultation with an immigration lawyer and a tax advisor is recommended before making major moves such as acquiring a second citizenship or restructuring ownership.

Common questions and practical examples

Practical scenarios help clarify how nationality rules play out in real cases.

Scenario: The entrepreneur from a non-treaty country

An entrepreneur from a non-treaty country may partner with a friend who is a treaty-country national and have that person invest and control at least 50% of the U.S. company. If the arrangement is genuine and the treaty national exercises true control over the enterprise, the business may qualify for E-2 status. The entrepreneur must be careful to document roles, capital contributions, and governance to show the relationship is commercially real.

Scenario: The corporate investor

Suppose a corporation organized in a treaty country invests in a U.S. subsidiary. If the parent company is properly considered a national of the treaty country (by domicile and ownership rules), the E-2 application may be viable. Complex ownership chains require careful legal analysis to ensure that the corporation’s nationality traces to treaty-country nationals.

Scenario: Dual nationality

A dual national of a treaty country and a non-treaty country may apply based on the treaty-country citizenship. This often simplifies eligibility but applicants should present clear proof of nationality during consular processing or change-of-status requests.

Practical diligence: documents and proof of nationality

Examples of commonly required documentation for nationality proof include:

• Current passport from the treaty country (primary evidence).
• Naturalization or citizenship certificates if citizenship was acquired by process.
• Corporate formation documents and ownership records showing treaty-national ownership where a company is the investor.
• Consular guidance may request additional evidence where dual nationality or complex ownership exists.

Because consular posts and USCIS adjudicators can be strict about documentary proof, applicants should compile clear, contemporaneous records showing nationality, ownership, and control.

Changes to the treaty list and political considerations in 2025 and 2026

Treaty relationships are matters of foreign policy and law. From time to time, countries are added or removed based on bilateral negotiations. The effect of a change can be significant: a newly recognized treaty country opens E-2 access for its citizens; a treaty’s suspension or termination could remove eligibility for future applicants (though existing visa holders often remain unaffected for the duration of their visas).

Because of this, anyone planning an E-2 application in 2025 or 2026 should confirm the current treaty list with the State Department and seek legal counsel for recent developments or ambiguous cases.

Tips for a smoother E-2 nationality assessment

• Confirm nationality early. Check the State Department’s treaty list before investing significant time or capital.
• Document everything. Maintain clear records of citizenship, corporate ownership, bank transfers, and governing documents to establish nationality and control.
• Avoid sham structures. Genuine commercial purpose and real ownership are essential; contrived arrangements risk denial.
• Evaluate alternatives. If nationality blocks E-2 eligibility, compare the timelines, costs, and outcomes of alternative paths like EB-5, L-1, or citizenship options.
• Get specialist advice. Complex ownership or dual-nationality situations benefit from an immigration attorney experienced in treaty investor cases and international corporate structure.

Where to get authoritative answers

For the most accurate and up-to-date information about country eligibility in 2025 and 2026, consult these official sources:

• U.S. Department of State — Treaty Traders and Investors
• USCIS — E-2 Treaty Investor
• U.S. consulate or embassy website in the applicant’s country of nationality for local consular procedures and processing notes.

These resources provide the official treaty list, guidance on documentary requirements, and any recent policy updates that could affect eligibility in 2025 or 2026.

Final practical thought

Nationality is the gateway to E-2 eligibility: if the investor is a citizen of a treaty country, the E-2 visa can be a fast, flexible option for launching or growing a U.S. business. If not, the route forward requires careful planning — whether that means restructuring ownership, pursuing other visa categories, or considering lawful routes to citizenship in a treaty country. In every case, the best outcomes come from verifying the treaty list through official channels and working with experienced immigration counsel to design a compliant, realistic plan.

What nationality questions does the investor face right now — and what small steps can be taken this week to confirm eligibility or explore alternatives?

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

Choosing between buying an existing U.S. business and starting a new one is one of the most important strategic decisions an E-2 investor will make — it affects risk, timing, evidence for the visa application, and long-term success in the United States.

Quick refresher: What an E-2 investor must show

An E-2 Investor Visa grants nonimmigrant status to nationals of treaty countries who make a substantial investment in a bona fide U.S. enterprise and will direct and develop that enterprise. Key elements adjudicators look for include:

• Treaty country citizenship — the investor must be a national of a country with an E treaty with the United States. See the U.S. Department of State for a list and background: travel.state.gov - Treaty Traders and Investors.
• Substantial investment — the investor must commit funds sufficient to establish or purchase and operate the business; there is no fixed dollar threshold but the investment must be proportional to the cost of the business and be enough to ensure its success.
• Funds at risk — the investment must be subject to loss; paper transactions, guaranteed returns, or purely passive investments generally do not qualify.
• Control of the enterprise — the investor must possess operational control, usually through majority ownership or by being in a managerial/operational position.
• Non-marginality — the enterprise must generate more than the investor’s own living (i.e., have capacity to contribute to the U.S. economy beyond providing the investor a minimal livelihood).

USCIS and consular officers assess the totality of circumstances when deciding whether these requirements are met, so the business structure and documentation matter as much as the business economics. For general business guidance, the U.S. Small Business Administration provides helpful resources: SBA - Buying an Existing Business.

Why the choice matters specifically for E-2 applications

Whether an investor buys an existing business or starts a new one affects how easily they can show the enterprise is operational, that funds are invested and at risk, and that the business will not be merely marginal. It also influences timing to visa application, complexity of documentation, and the types of risks (regulatory, financial, contractual) the investor must manage.

Buying an existing U.S. business: Advantages and pitfalls

Advantages

Buying an established business can make it easier to demonstrate a functioning enterprise, with tangible assets, employees, customer base, and revenue history — all of which help meet the real and operating enterprise and non-marginality standards.

• Faster operational status: An existing business is already running, which can shorten the time to file an E-2 application and reduce the need to show a speculative business plan.
• Historical financials: Tax returns, profit-and-loss statements, and bank records provide concrete evidence of the business’s viability and scale.
• Easier staffing and revenue evidence: Payroll, customer contracts, and vendor relationships can support the argument that the business has more-than-marginal impact.
• Potentially lower start-up uncertainty: Buying can reduce market-entry risk compared with building new brand awareness and operations from scratch.

Pitfalls and risks

Acquiring an existing enterprise carries its own legal and financial hazards. Sellers may not disclose liabilities, revenue may be declining, or assets may be overvalued.

• Hidden liabilities: Tax debts, litigation, or environmental issues can attach to the business and harm both operations and the immigration case.
• Seller relationships and customer concentration: A business might rely on the seller’s personal contacts; once the seller leaves, revenue could fall, undermining the investor’s immigration evidence.
• Valuation disputes: The purchase price must represent a real investment rather than an overinflated transaction designed solely to meet E-2 optics.
• Control questions: If the investor purchases less than a controlling interest, adjudicators may question whether the investor truly directs and develops the enterprise.

Due diligence checklist for buyers pursuing E-2

Thorough due diligence is essential. For E-2 purposes, in addition to standard commercial review, the investor should obtain:

• At least three years of tax returns and financial statements.
• Detailed asset lists and verifiable valuations.
• Full disclosure of liabilities, pending litigation, and environmental permits.
• Contracts with major customers, suppliers, and landlords (with review of assignability and change-of-control clauses).
• Employee lists, payroll records, and benefits obligations.
• Verification that the purchase funds can be traced to a treaty-country source and will be placed at risk.

Starting a new U.S. business: Advantages and pitfalls

Advantages

A new business offers flexibility in structuring operations and ownership to optimize E-2 compliance. It can showcase the investor’s active role from day one and avoid legacy problems associated with prior ownership.

• Tailored business model: The investor can design the business to fit the required investment level, staffing plan, and projected revenues that demonstrate non-marginality.
• Clear ownership and control: Starting fresh removes ambiguity about managerial control or transferability of contracts and permits.
• Clean asset base: No hidden liabilities from prior operations and easier documentation of funds used for start-up costs.

Pitfalls and risks

Starting a business typically requires a longer runway before meaningful revenues appear, which can make proving the enterprise’s viability harder at the time of the visa application.

• Longer time to show non-marginality: New ventures usually need time to scale, so the investor must demonstrate a credible plan and sufficient capital to survive the start-up phase.
• Higher early-stage risk: Market acceptance, customer acquisition, and team building are unpredictable.
• Greater emphasis on business plan and pro formas: Consular officers and USCIS will scrutinize projections, assumptions, and the investor’s ability to execute.

Start-up documentation checklist for E-2 applicants

When launching a new business, an E-2 application should include:

• A detailed business plan with market research, staffing timelines, and realistic financial projections.
• Evidence of committed funds and expenditures (escrow receipts, wire transfers, leases signed, equipment purchases).
• Licenses and permits showing the enterprise is authorized to operate.
• Contracts that demonstrate initial customers, suppliers, or partnerships where possible.

Key E-2 legal and evidentiary considerations that affect both choices

Certain legal factors influence whether buying or starting is the better route for an E-2 investor.

• Ownership and control: The investor must show the ability to direct the enterprise. Majority ownership is simpler, but operational control can suffice if clearly documented.
• Substantiality in context: The investment must be substantial relative to the business type and cost. A rule of thumb: low-cost, labor-intensive businesses often require proportionally more investment to rebut marginality concerns.
• Source and path of funds: Funds must be lawfully obtained and traceable to the investor’s treaty-country source. Gifts, loans, and corporate transfers are acceptable if properly documented; however, funds tied up in escrow or protected from risk can raise issues.
• Investment at risk: Passive investments, such as buying stocks or certain types of real estate programs, typically won’t meet the at-risk requirement unless the investor exercises operational control.
• Marginality and job creation: Although E-2 does not require a specific job-creation number, evidence that the enterprise produces economic impact beyond merely supporting the investor strengthens the case (payroll, hires, growth plans).

For legal definitions and regulatory context, the U.S. Department of State’s E visa materials and USCIS policy memos provide useful background; working with an experienced immigration attorney ensures these elements are properly addressed in the application.

Practical scenarios: Which option fits which investor?

Investor seeking steady cash flow and faster visa filing

If the investor prioritizes immediate revenue and a shorter runway to file for E-2, buying a profitable retail operation or service business with a strong track record can be attractive. That said, the buyer must ensure seller-dependent revenue won’t evaporate after acquisition.

Investor prioritizing control and scalability

An investor who wants to shape the company culture, product roadmap, or long-term growth often prefers starting a new business. For example, a technology consultant from a treaty country could create a U.S.-based consultancy with targeted staffing and client acquisition plans tailored to the investor’s expertise.

Franchises and the middle ground

Buying a franchise can combine the advantages of an established brand and operational model with the ability to demonstrate the investor’s managerial role. Franchise agreements, however, must be examined for exclusivity, transferability, and whether the franchisor’s involvement could render the investor passive.

A practical decision framework

To decide which path is better, the investor should ask:

• How quickly does the investor need to file for the E-2 visa?
• How much capital is available, and is the investor comfortable placing it at risk?
• Does the investor prefer an operation with existing revenue and staff or building something from the ground up?
• Are there existing liabilities or seller dependencies that could jeopardize the business after purchase?
• Will the structure allow the investor to demonstrate control and non-marginality?

Using answers to these questions, investors can map risk tolerance and immigration timelines to the right business option.

Actionable steps and practical tips

Whether buying or starting, the following steps help set up both a sound business and a strong E-2 application:

• Engage specialists early: Work with an experienced E-2 immigration attorney, a U.S. business attorney, a CPA familiar with cross-border transactions, and a business valuation expert if considering a purchase.
• Document source of funds: Collect bank records, sale-of-assets documents, loan agreements, and tax returns to clearly show lawful origin and transfer details.
• Structure the transaction with immigration in mind: Payment schedules, escrow provisions, and staged investments can demonstrate substantial, at-risk capital while protecting the investor.
• Prioritize operational control: Even if buying a minority stake, secure contractual authority to direct operations, or aim for majority ownership.
• Keep the business active: For purchases, ensure contracts are assignable, key employees are retained, and the business continues normal operations during the transition.

For more business-buying guidance, the U.S. Small Business Administration provides checklists and tips; for legal immigration guidance, consider consultation with a specialized E-2 attorney and resources from professional groups such as the American Immigration Lawyers Association.

Choosing between buying an existing business and starting a new one depends on the investor’s priorities: speed and revenue history versus control and clean structure. Both paths can lead to a successful E-2 visa USA application if planned carefully, documented fully, and executed with professional guidance.

What kind of business is the investor considering, and what is the timeline for obtaining the visa? Thoughtful answers to those questions will point toward the better option; speaking with an experienced E-2 attorney early will help translate those answers into a concrete immigration and business strategy.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

Many entrepreneurs ask whether they can use borrowed money to meet the financial requirements for an E-2 Investor Visa. The short answer is: sometimes — but there are important rules, documentation demands, and strategic choices that determine whether a loan will help or hurt the application.

How the E-2 Visa Treats Investment Funds — the basics

The E-2 visa is a treaty investor classification administered by the U.S. Department of State (for consular adjudication) and interpreted by immigration officials. Its core requirements are that the investor be a national of a treaty country and make a substantial, bona fide investment in a U.S. enterprise that is more than marginal. The investment must be lawfully obtained and at risk for the purpose of generating profit through active operations.

Authoritative descriptions and guidance about the E-2 visa are available from the U.S. Department of State and U.S. Citizenship and Immigration Services; see the Department of State’s page on treaty traders and investors and USCIS’s overview of E-2 status for more on the legal framework and requirements.

U.S. Department of State – Treaty Traders and Investors

USCIS – E-2 Nonimmigrant Treaty Investors

Can a business loan be used for an E-2 investment?

Yes — but with important caveats. Immigration officers will evaluate whether the loaned funds qualify as a legitimate, lawful, and at-risk investment. Loans can be part of the financing mix, but the structure and documentation must demonstrate that the investor’s money is genuinely committed to the business and that the investor bears economic risk.

What this means in practice is that an applicant cannot simply show that a bank lent money to the company while the investor has no real capital at stake. Adjudicators will look closely at the source of funds, terms of the loan, security or collateral, the timing of disbursement, and the investor’s level of ownership and control.

Key legal and factual criteria that govern loaned funds

To understand whether a loan supports an E-2 application, the investor should consider the following criteria:

• Lawful source of funds: Every dollar used in the investment — whether from savings, a personal loan, a bank loan, or seller financing — must be traceable to a lawful source. Documentation such as bank records, tax returns, loan agreements, and evidence of business sale proceeds will be required.
• Funds must be at risk: The investment must be subject to loss if the business fails. If loan proceeds are effectively guaranteed or protected so the investor does not bear real commercial risk, adjudicators may find the investment does not satisfy the “at risk” requirement.
• Inevitably committed to the enterprise: Funds should be irrevocably committed to the business — e.g., deposited into business accounts, applied to purchase assets, or paid into escrow for business acquisition. Promise to invest in the future is weaker than actual funds put to work.
• Substantiality: The amount invested must be substantial in relation to the business type and sufficient to ensure the enterprise’s viability. Debt-heavy structures where the investor contributes only token equity can raise questions about whether the investment is truly substantial.
• Ownership and control: The investor must have the rights to direct and control the enterprise. A loan should not leave the investor without meaningful ownership or managerial authority.
• Not marginal: The enterprise must generate more than just a minimal living for the investor and family; it should have present or future capacity to create job opportunities. Heavy reliance on debt that prevents business growth may be problematic.

Common types of loans and how adjudicators treat them

Personal bank loans and lines of credit

If an investor personally borrows from a bank (secured or unsecured) and then invests those proceeds into the U.S. enterprise, the transaction can qualify — provided the bank loan itself is lawfully obtained, properly documented, and the investor bears the economic risk. If the loan is secured by the investor’s personal assets (e.g., a house), the investor has personal exposure to loss and that helps satisfy the “at risk” requirement.

SBA or commercial loans made to the business

Loans made directly to the U.S. business by banks are not uncommon. These may be acceptable when paired with substantial financial contribution from the investor. Where the business is funded almost entirely by debt and the investor contributes little capital, adjudicators may question whether the investor’s own funds are at risk. The investor should still be able to demonstrate control, contribution, and risk.

Seller financing (owner carry)

Seller financing — where the buyer places a down payment and the seller provides a promissory note for the remainder — sometimes occur in E-2 cases. When seller provides financing, the investor needs to contribute a significant down payment of their own funds, and the note terms are commercial and enforceable. A distant or symbolic down payment coupled with a large seller note can result in E-2 visa denial.

Loans secured by the business’s assets

Loans that are secured by the same assets being acquired (or by the enterprise itself) are scrutinized closely. If the loan creates a situation in which the investor has no real equity cushion and little exposure to loss, adjudicators may conclude the funds are not truly at risk. Structuring and timing matter: showing that investor's substantial equity was used first and that the loan represents a small percentage of the total investment and was obtained under commercial terms can help.

Third-party or investor loans

Loans from friends, family, or third-party investors can be used if they are legitimate loans (with repayment terms) or if they represent capital contributions. If the funds are gifts disguised as loans, or if the lender retains control that undermines the investor’s ownership, problems can arise. Detailed documentation of the loan agreement and proof of transfers is essential.

Practical scenarios: what usually works and what often fails

These common examples illustrate how loan structures play out in adjudication:

• Scenario A — Start-up with investor substantial cash + bank loan (good): The investor contributes 75% personal funds into the business and secures a commercial bank loan for the remainder with a personal guarantee. The investor’s personal funds are deposited into the business bank account and used to buy equipment and lease space. This is often acceptable because the investor has clear, at-risk capital and control.
• Scenario B — Purchase of existing business with seller financing and a sizable down payment (potentially acceptable): The investor pays 50% of purchase price from personal savings and finances the rest with seller owner-carry at market rates. If documentation shows the buyer’s funds were committed and that the note is bona fide, adjudicators generally treat this as a legitimate investment.
• Scenario C — 100% debt-funded purchase with minimal investor funds (very risky): The investor contributes 10% and obtains a loan for 90% of the purchase price, with the loan secured by the business assets. This raises red flags about whether the investor truly has funds at risk and whether the enterprise is viable beyond servicing debt.
• Scenario D — Loan secured by the same assets before transfer (highly problematic): If the investor obtains a loan that is secured by the assets being purchased before ownership changes hands, adjudicators may view the arrangement as circumventing the at‑risk requirement.

Documentation checklist — what to show in the E-2 application

When loans are part of the financing, the investor should compile thorough, clear documentation to prove source, lawfulness, commitment, and risk. Important documents include:

• Loan agreements, promissory notes, security/collateral documents, and repayment schedules.
• Bank statements showing transfers from lender to investor and from investor to business accounts.
• Escrow closing statements and purchase agreements (for business acquisitions).
• Evidence of the lawful source of loaned funds (if funds originated from abroad: foreign bank statements, tax records).
• Personal tax returns, pay stubs, or business sale proceeds supporting the investor’s ability to secure the loan.
• Corporate formation records, stock certificates, operating agreements, and records demonstrating the investor’s ownership and control.
• Business plan, financial projections, payroll records, and evidence of hires or contracts showing the enterprise is more than marginal.

Practical tips to strengthen a loan-funded E-2 petition

• Use investor funds first: Where possible, show that the investor’s personal funds were placed into the enterprise before or at the same time as loan disbursements; this demonstrates genuine commitment.
• Prefer personal guarantees or investor collateral: Lenders’ reliance on the investor’s personal assets (rather than only on the business) strengthens the arguable “at risk” nature of the investment.
• Keep loan terms commercial: Market-rate interest, clear repayment schedules, documented collateral, and enforceable notes reduce suspicion that the loan is a sham.
• Down payments matter: A substantial down payment from investor funds mitigates concerns about excessive leverage.
• Document every transfer: Traceability is crucial. Show source and path of funds through bank records and legal agreements.
• Prepare a robust business plan: Demonstrate how loan funds will be used and how the enterprise will support operations and job creation.
• Consult counsel early: Structuring and documentation choices made before closing can be decisive. An experienced E-2 attorney can help structure financing to satisfy adjudicators.

Common pitfalls to avoid

• Relying on unverifiable or illegal funds: Any hint that funds come from unlawful activities will lead to denial and potential legal consequences.
• Showing loans without evidence of investor risk: If the investor faces no real economic exposure, the investment may not qualify.
• Using loans that give lenders control: If the lender’s terms effectively remove investor control, the investor may not meet the control requirement.
• Waiting to document until after the fact: Poor recordkeeping or post-hoc explanations are weak; contemporaneous documents carry more weight.

Consular adjudication versus change of status

Most E-2 applications are adjudicated at U.S. consulates or embassies abroad. The consular officer will evaluate the evidence in light of Department of State guidance. Some applicants adjust status within the United States where USCIS handles the petition; the same substantive tests apply, but documentary expectations may vary slightly. It is important to present consistent, persuasive documentation no matter the forum.

When to get professional help

Structuring financing for an E-2 case often blends immigration law, corporate law, and commercial lending practices. An investor who plans to rely on loans should consult an experienced immigration attorney early in the process to tailor the loan documents and the overall transaction in ways that meet E-2 visa requirements. Early legal advice can prevent common missteps — for example, collateral provisions, timing of disbursements, and ownership mechanics — that later lead to denials.

In short, loans can be used to fund an E-2 investment, but success depends on careful structuring and comprehensive documentation demonstrating lawful source, real economic risk, investor control, and enterprise viability. Thoughtful planning and professional guidance make the difference between a financing arrangement that strengthens an application and one that raises red flags.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

Proving that an investor is positioned to “develop and direct” an E-2 enterprise is one of the most important — and most scrutinized — parts of an E-2 application.

What “develop and direct” actually means for an E-2 investor

The E-2 treaty investor classification requires that the applicant will be coming to the United States to develop and direct a qualifying enterprise. At its core, this means the investor must have the authority and intention to exercise meaningful operational control over the business, not merely hold passive financial interests.

Government guidance from the Department of State and U.S. Citizenship and Immigration Services explains that control is typically shown by ownership or by an active executive or managerial position. See the Department of State E-2 overview for consular guidance and USCIS for U.S.-based adjudication perspectives:

• U.S. Department of State — E visa overview
• USCIS — E-2 Treaty Investors

Key legal and practical standards adjudicators apply

Adjudicators focus on three interrelated questions:

• Does the investor have legal authority? That means ownership, voting rights, contractual authority, or a formal executive role.
• Can the investor exercise actual operational control? Beyond titles, can the investor hire/fire, approve strategy, sign contracts, and control funds?
• Is the enterprise substantial and active? A passive investment in stocks or a marginal venture will not meet the test.

There is no single magic percentage of ownership written into the regulations. In practice, ownership of more than 50% makes the “develop and direct” showing straightforward. However, a minority investor can also qualify if he or she demonstrates clear, enforceable control through governance documents, employment agreements, voting trusts, or other arrangements.

Types of evidence that prove the ability to develop and direct

Adjudicators prefer contemporaneous, detailed documentation. Examples of persuasive evidence include:

• Ownership and governance documents: share certificates, operating agreements, articles of incorporation, shareholder agreements, voting trusts, and amendments showing the investor’s control rights.
• Corporate resolutions and board minutes: records showing the investor’s appointment to a senior management role (CEO, President, Managing Member) and authority for major decisions.
• Employment agreements and job descriptions: signed contracts that outline duties, decision-making authority, term, compensation, and reporting lines.
• Business plan with operational detail: a realistic, well-supported plan that describes responsibilities, organizational chart, staffing timeline, revenue projections, and how the investor will execute the plan.
• Financial documents and proof of investment: bank statements, wire transfers, invoices, receipts, and evidence that the investor’s capital is at risk in the business.
• Contracts and client relationships: major supply agreements, purchase orders, client contracts, or letters of intent showing active business operations.
• Payroll records and tax filings: payroll summaries, employment tax returns, and state filings showing the enterprise’s payroll and hiring plans.
• Permits, licenses, and insurance: business licenses, professional certifications, lease agreements, and insurance policies that evidence commercial activity.
• Communications and marketing: website screenshots, marketing materials, press coverage, and client emails that demonstrate the enterprise’s presence in the marketplace.

How different business structures affect the “develop and direct” showing

The investor’s legal structure changes which documents matter most:

• Corporations: focus on stock ownership, board resolutions, appointment letters for executive roles, and shareholder agreements that spell out control rights.
• LLCs: operating agreements and member resolutions are central; they often specify management authority, allocation of profits, and voting rules.
• Partnerships: partnership agreements, general partner status, and management clauses show whether the investor can direct operations.
• Sole proprietorships or single-member LLCs: ownership is self-evident but the investor must still document operational control and commercial activity.

Common scenarios and how to prove control in each

Majority owner who is CEO or managing member

This is the clearest case. The investor should submit share certificates or membership interest documents plus appointment letters, an organizational chart showing the investor’s role, and board minutes evidence. Demonstrate actual duties with copies of contracts the investor signed, major decisions he or she led, and payroll records that show staff reporting to the investor.

Minority owner with contractual control

When the E-2 applicant personally owns less than 50%, but the combined shares of treaty nationals still satisfy majority, the emphasis shifts to contractual and governance evidence. Useful items include a shareholders’ agreement giving veto or special voting rights, management agreements, power of attorney, and documentation of exclusive control over funds or executive appointments. The business plan should explain why the investor’s role is essential and how day-to-day control flows to them despite minority ownership.

Passive investor vs. active investor

Passive investors who buy stock and have no management role will not qualify. To convert a passive investment into an active one for E-2 purposes, the investor must assume an executive or managerial role and show operational duties and evidence of decision-making authority. Adjudicators will look for contemporaneous, pre-existing records where the investor takes an active role, not just declarations drafted after the fact.

Employee of an E-2 enterprise

Non-investor employees seeking E-2 classification through an E-2 enterprise must demonstrate that they are coming in an executive or supervisory capacity, or possess special qualifications essential to the enterprise’s operation. Evidence includes detailed job descriptions, organizational charts, the employer’s documents showing need for the employee’s services, and proof that the employee’s role cannot be filled by a U.S. worker in the immediate term.

Building a persuasive business plan focused on “develop and direct”

A robust business plan is a cornerstone of a strong E-2 submission. It should be realistic, supported by evidence, and tailored to demonstrate the investor’s role in building the business.

Key elements of the plan include:

• Detailed organizational chart: show the investor’s position, reporting lines, and planned hires by month/year.
• Operational timeline: milestones for launching or scaling operations, when key hires will be made, and when revenue targets are expected.
• Financial projections and assumptions: monthly cash flow for at least 12 months, sources and uses of funds, and sensitivity analysis for realistic scenarios.
• Management responsibilities: specific duties the investor will perform—e.g., negotiating contracts, hiring management team, selecting vendors, overseeing production.
• Market analysis: evidence of demand, customer pipeline, sales strategy, and competitive advantage demonstrating a real enterprise, not a minimal activity.

Responding to RFEs and consular interviews

If an adjudicator requests further proof via a Request for Evidence (RFE) or if the investor faces tough questioning at a consulate, the response should be documentary and specific. Vague descriptions will weaken the application.

Practical tips for responses and interviews:

• Provide direct evidence rather than summaries — e.g., append signed contracts and board minutes rather than paraphrasing.
• Address any apparent gaps: if the investor owns less than 50%, provide governance agreements showing control and explain why ownership percentage does not limit authority.
• Describe daily duties and strategic responsibilities clearly. Interviewers often probe what the investor will do on a typical weekday.
• Bring corroborating third-party evidence — client letters, supplier contracts, or bank confirmations can validate claims about the business’s activity level.
• When possible, use contemporaneous documents prepared before filing; after-the-fact documents can look contrived.

Real-world examples

Example 1 — Technology founder: A software founder owns 50% of an LLC and holds contractual rights to appoint the CEO, control the operating account, and veto major transactions through a shareholder agreement. The founder provides the operating agreement, board resolutions, a signed employment contract naming him CEO, a business plan showing growth and hiring plans, and client contracts. Even with 50% ownership, this package demonstrates the control needed to satisfy the “develop and direct” test.

Example 2 — Franchise owner: An investor purchases a franchise and is listed as the managing member with 75% equity. The franchise agreement, lease, bank receipts, payroll documents, and franchise training records show the investor’s operational control and active management role, creating a straightforward case for E-2 status.

Example 3 — Passive investor issue: An investor buys 51% of a holding company but does not engage in decision making and hires a manager to handle everything, keeping a truly passive role. Adjudicators may view this unfavorably because the investor is not demonstrating the intention to personally develop and direct the enterprise.

Common pitfalls to avoid

Several recurring mistakes undermine the “develop and direct” showing:

• Relying on titles alone: a title like “Chairman” or “CEO” means little without supporting evidence of authority and activity.
• Using post-filing documents only: creating records after the application to prove control can raise credibility concerns.
• Investing passively: purchasing shares without taking on operational responsibilities will fail the test.
• Fuzzy business plans: unrealistic projections, vague staffing plans, or absent operational detail weaken the case.
• Ignoring entity governance: inconsistent or missing agreements (e.g., no operating agreement for an LLC) create avoidable gaps.

Practical checklist to prepare a convincing E-2 package

Before filing, the investor should assemble:

• Ownership and governance documents (articles, operating agreements, shareholder agreements)
• Proof of capital at risk (bank records, purchase invoices, escrow statements)
• Signed employment contracts and job descriptions
• Board minutes or corporate resolutions appointing the investor to a managerial role
• Detailed business plan with organizational chart and financials
• Contracts, leases, licenses, insurance policies
• Client/supplier contracts and marketing materials
• Payroll and tax records if the business is already operating
• Consistent, contemporaneous evidence rather than retroactive statements

When to get professional help

Because adjudicators evaluate the totality of the circumstances, small gaps can be fatal. If the investor’s control is not obvious — for instance, when ownership is less than 50% or governance arrangements are complex — legal counsel can structure governance documents, prepare a persuasive business plan, and assemble evidence to present a coherent narrative. Experienced counsel can also prepare tailored responses to potential RFEs and simulate consular interview questions.

For more about the E-2 process and how to prepare the strongest possible application, the Department of State and USCIS pages provide official guidance:

• Department of State — Treaty Investor (E) Visas
• USCIS — E-2 Treaty Investors

Which aspects of the investor’s role are strongest to document — ownership, contractual control, or day-to-day managerial duties — and which require more work to satisfy an adjudicator? Thinking through that question early and assembling clear, contemporaneous evidence will greatly increase the chance of approval. If uncertainty remains, seeking an experienced E-2 immigration attorney can help turn a complex ownership picture into a convincing case for the investor’s ability to develop and direct the enterprise.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

Investing in a U.S. startup under the E-2 visa can be one of the fastest ways for entrepreneurs from treaty countries to live and work in the United States, but getting approval requires careful planning and airtight documentation.

Understand the core E-2 visa requirements

Before committing time or capital, it is essential that an investor understands the fundamental elements of the E-2 visa USA category. The applicant must be a national of a qualifying treaty country, make a substantial investment in a bona fide U.S. enterprise, and be coming to the U.S. to develop and direct that enterprise. The investment cannot be merely passive (for example, buying stocks or rental property without active management), and the enterprise must be more than marginal — it should generate more than minimal income for the investor and their family or have a significant economic impact through job creation.

For an official overview, see the U.S. Department of State’s E-2 page: travel.state.gov - E-2 Treaty Investors, and USCIS guidance: uscis.gov - E-2 Treaty Investors.

Choose the right startup model for stronger approval odds

Not every startup profile fits the E-2 standard equally. Some models naturally present stronger evidence of a non-marginal, active enterprise:

• Service and local businesses (e.g., restaurants, clinics, digital marketing firms) often show faster local hiring and steady revenue, making it easier to document job creation.
• Capital-intensive businesses (e.g., manufacturing, restaurants with equipment purchases) help demonstrate a substantial monetary commitment.
• Scalable tech startups can qualify, but they must show a credible plan to hire U.S. personnel or generate measurable economic effects in the U.S., not only future market potential.

Entrepreneurs should select a model that aligns with the available investment amount, timeline to hire, and the investor’s role in managing the business.

Document the investment carefully — timing and traceability matter

One of the most scrutinized areas in an E-2 application is proof the investment is real, at risk, and traceable. Adjudicators want to see that funds were legally obtained and are irrevocably committed to the enterprise.

Key documentation strategies include:

• Source of funds: Provide bank records, sale documents (real estate, business sale), loan agreements (with evidence that debt is market-rate and properly documented), tax returns, and any other documentary chain proving lawful origin.
• Transfer and commitment evidence: Show wire transfers, canceled checks, escrow agreements, equipment invoices, vendor contracts, lease signed in the company’s name, or purchase contracts demonstrating committed funds.
• Maintain separation: Keep personal and business accounts separate and show bookkeeping that tracks how investment funds are spent.

Common supporting documents checklist

• Bank statements and wire transfer confirmations
• Sale agreements for assets used as funding
• Corporate formation documents (articles of incorporation, operating agreements)
• Lease agreements, commercial invoices, purchase orders
• Payroll records or signed offer letters for U.S. hires
• Licenses, permits, and proof of insurance

Build a persuasive, realistic business plan

An adjudicator cannot rely on promises or vague forecasts. A well-crafted business plan is one of the most powerful tools to persuade an adjudicator that the enterprise is viable and non-marginal.

Essentials for an effective E-2 business plan:

• Market analysis: Define the target market, competition, customer acquisition strategy, and pricing assumptions.
• Detailed financials: Provide at least three to five years of projected income statements, cash-flow analysis, and balance sheets with clear assumptions (sales per client, conversion rates, margins).
• Staffing plan: Show when and how many U.S. employees will be hired, job descriptions, salary levels, and payroll projections.
• Milestones and timeline: Include a practical roadmap with timelines for major tasks (leasing, hiring, first sales, break-even).
• Risk assessment: Acknowledge risks and present mitigation strategies; realistic, balanced plans are more credible than overly optimistic projections.

Structure the company to show control and treaty compliance

Control of the enterprise is a critical legal requirement: the investor must be coming to the U.S. to develop and direct the business. Ownership percentage, board voting rights, and managerial authority should align to show that control exists.

Practical steps include:

• Ensure the investor’s ownership stake and governance documents (operating agreements, bylaws) clearly reflect decision-making authority.
• If multiple investors are involved, document the nationality of each investor and ensure that corporate ownership structure demonstrates that a qualifying treaty national controls the enterprise (this can involve direct or indirect ownership chains with documentary proof).
• Use board resolutions, employment contracts for the investor as CEO or manager, and consistent payroll or compensation arrangements to evidence the investor’s role in direction and management.

Demonstrate non-marginality — show economic benefit beyond the family

“Not marginal” means the business should create more than just a living for the investor and family. Because there is no fixed dollar threshold, adjudicators look for measurable economic effects.

Proven ways to show non-marginality:

• Job creation: Hiring U.S. employees with payroll records, signed employment offers, or contractor agreements strengthens the case.
• Sales and contracts: Executed client contracts, letters of intent, and purchase orders demonstrate real demand.
• Local economic impact: Leases, vendor agreements, and evidence of local taxes paid help substantiate economic contribution.

For startups especially, the business plan must tie projected hiring and revenue to the investment amount, explaining how the enterprise will move beyond marginal thresholds within a reasonable timeframe.

Prepare convincingly for the consular interview or USCIS adjudication

Whether the investor applies at a U.S. consulate abroad or seeks a change of status via USCIS (Form I-129), preparation for the adjudication stage is critical:

• Organize a concise packet of supporting documents. Adjudicators appreciate clear, well-tabbed bundles that tell the story at a glance.
• Practice consistent answers about investment amount, timeline, and business purpose. Inconsistencies between the application and oral testimony can lead to denials.
• Bring originals for key documents and credible copies for others; be ready to explain the source of funds and how money was used.
• Expect questions on job creation, revenue assumptions, investor role, and future funding plans.

Work with experienced professionals and time submissions strategically

An experienced immigration attorney can help craft a submission designed for E-2 adjudication standards and prevent common legal missteps. Likewise, collaboration with a CPA, business plan writer, or industry consultant adds credibility to financial and market assumptions.

Timing strategies include:

• Make clear, irreversible commitments (signed leases, vendor contracts) before applying when possible, so the adjudicator sees funds “at risk.”
• Avoid last-minute cash transfers that lack documentation; build a clear funding trail over several months when feasible.
• If the business model is complex (e.g., tech with deferred hiring), prepare additional evidence like contracts, letters of intent from partners, or pilot project results.

Common pitfalls to avoid

Understanding common reasons for denial helps applicants proactively prevent mistakes:

• Passive investment — purchasing real estate or passive securities without operational involvement often fails.
• Insufficient documentation of source of funds or transfers.
• Unclear control — ownership documents that do not show the investor’s right to direct business operations.
• Unrealistic projections that are unsupported by market analysis or industry benchmarks.
• Mixing personal and business funds without clear accounting and separation.
• Failing to show non-marginality when the enterprise appears intended only to support the investor’s family.

Consider alternative pathways and long-term planning

If the startup or investment does not fit the E-2 criteria or the investor seeks permanent residency, other options may be appropriate. The EB-5 investor program has different investment thresholds and immigration outcomes and may suit investors with larger capital. See USCIS EB-5 info here: uscis.gov - EB-5 Immigrant Investor Program.

For entrepreneurs planning U.S. growth over several years, a staged approach can work: start with an E-2 to build operations, document growth and job creation, and later explore EB-5, employment-based immigrant categories, or sponsorship options as the business scales.

Final practical tips and interactive prompts

Small details can sway an adjudicator. Entrepreneurs should:

• Keep an audit-ready paper trail for every dollar invested.
• Document the investor’s active participation — board minutes, management agreements, and time logs of business activities help demonstrate direction and development.
• Start local hiring and sign suppliers early to show real commercial activity.
• Prepare a concise executive summary for adjudicators who review many cases quickly.

Which area of the investor’s plan is the strongest — funding traceability, staffing, or market traction? Identifying that strength helps tailor the application message around the most persuasive evidence.

By aligning the startup model with the legal requirements, documenting every step, and presenting a realistic plan for growth and employment, an investor greatly improves the odds of E-2 visa approval. For tailored advice, working with an immigration attorney and financial professionals who understand both the E-2 visa requirements and the specific dynamics of U.S. startups is a practical next step.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

Valuing intellectual property and other intangible assets correctly can make or break an E-2 investor petition — it affects whether an investment is seen as substantial, bona fide, and at risk. This guide explains practical methods, documentation, and red flags so he or she can present a credible valuation that supports an E-2 visa application.

Why intellectual property value matters for an E-2 petition

For an E-2 investor visa, the applicant must show a substantial investment in a bona fide U.S. enterprise and that the funds are at risk to generate a real commercial enterprise. Intangible assets—such as trademarks, patents, software, and customer lists—often form a significant portion of an entrepreneur’s deployed capital. When properly valued and documented, those assets can strengthen the case that the investment is meaningful and viable.

USCIS and consular officers scrutinize whether an investment is genuine and whether the valuation is credible. Unsupported or inflated valuations, related‑party transfers with no independent corroboration, and optimistic unsupported projections can undermine the petition. A carefully prepared, well-documented valuation mitigates those risks and helps satisfy key E-2 visa requirements.

Which intangible assets commonly appear in E-2 investments

Not all intangibles are created equal. Common classes of intangible assets in E-2 filings include:

• Trademarks and trade names — brand identity and goodwill tied to a name or logo.
• Patents — exclusive rights to an invention.
• Proprietary software — custom code, SaaS platforms, or embedded software.
• Trade secrets — processes, formulas, or techniques that provide a competitive edge.
• Customer lists and relationships — contracts or repeat revenue streams linked to a client base.
• Licenses and distribution rights — rights to sell products or services in a territory.
• Non-compete agreements and franchise rights — contractual restrictions that add value.

Each class requires tailored valuation logic. For example, a patent’s value often rests on future cash flows and exclusivity, while a customer list is typically valued based on retention rates and profit contribution.

Primary valuation approaches and when to use them

Three broad valuation approaches are widely accepted in practice. A strong E-2 presentation will explain why a chosen method fits the asset and will provide supporting calculations and assumptions.

Market approach

The market approach compares the subject asset to recent sales or license transactions for comparable assets. It is most persuasive when there are active, transparent market transactions (for example, domain name sales or trademark transfers with documented prices).

Income approach

The income approach is common for patents, software, and customer lists. It projects the future economic benefits (royalties or cash flows) attributable to the asset and discounts them to present value. Common techniques include:

• Discounted Cash Flow (DCF) — forecasts of income attributable to the asset discounted at an appropriate rate.
• Relief-from-royalty — estimates the royalties the owner would have to pay to license the asset, then discounts the avoided royalties.
• Multi-Period Excess Earnings Method (MPEEM) — allocates the portion of overall business cash flows specifically attributable to the intangible after charging returns for tangible and other intangible assets.

Cost approach

The cost approach estimates the cost to recreate or replace an asset (historical development costs, reproduction costs) and is most useful when market or income data are limited, or for recently developed software or prototypes. It is less persuasive when the asset’s value depends on future earnings rather than past development.

Step-by-step process for building a defensible valuation for E-2

A methodical, transparent process increases credibility with USCIS and consulates.

1. Identify and classify the assets

Begin with a clear inventory: who owns each asset, the rights being acquired (exclusive vs. non‑exclusive), and whether the asset is transferable. Ownership and control are crucial — an E-2 investor must show control of the enterprise and the assets supporting it.

2. Determine the appropriate valuation method(s)

Match the method to the asset and the available evidence. For a patented product with forecastable sales, an income approach (DCF or relief-from-royalty) is often most persuasive. For a purchased brand with comparable sales, the market approach may be strong. A combination of methods strengthens the report where feasible.

3. Gather supporting evidence

Collect transactional documents and economic data to support assumptions:

• Purchase agreements, invoices, and escrow records showing price paid.
• Licensing agreements, royalty schedules, and historical revenue from the asset.
• Market comparables and industry reports demonstrating rates and multiples.
• Development budgets, invoices, and payroll records reflecting costs incurred.
• Customer contracts, churn statistics, and gross margin data.

4. Prepare conservative, documented projections

Forecasts should be realistic and grounded in historical performance, market evidence, and defensible assumptions about growth, margins, and customer retention. USCIS often flags overly optimistic projections that lack independent support.

5. Select discount rates and survival/obsolescence assumptions carefully

Discount rates must reflect the specific risk profile of the asset and the enterprise. For technology subject to rapid change, shorter useful lives and higher discount rates are appropriate. Show how rates were derived (country risk, industry beta, capital asset pricing model inputs, or quoted market rates).

6. Produce a written valuation report and expert declaration

Provide a formal valuation report with methodologies, calculations, sensitivity analyses, and a qualified expert declaration that states the expert’s credentials, scope, and limitations. Reports that follow recognized standards and frameworks carry more weight.

Documentation checklist for submission

Concrete documentary evidence increases the chance of approval. The following items should be included with an E-2 petition when intangibles constitute part of the investment:

• Purchase and sale agreements with proof of payment (bank transfers, escrow statements).
• Independent third‑party valuation report or expert appraisal.
• Licensing or assignment documents showing transfer of rights.
• Historical financials linking the asset to revenue and profit (if available).
• Detailed business plan showing how the asset will be used to generate income.
• Contracts with customers and suppliers demonstrating existing or expected revenue streams.
• Proof of source of funds used to acquire the intangible (bank statements, sale proceeds, loan documents).
• Evidence of market comparables or licensing rates for similar assets.

Working with valuation professionals: who to hire and what to expect

Valuation for immigration purposes benefits from an experienced appraiser who understands both technical valuation and immigration scrutiny. Look for professionals with credentials such as the ASA (Accredited Senior Appraiser), CVA (Certified Valuation Analyst), or membership in reputable bodies that follow industry standards such as the Appraisal Foundation and the American Society of Appraisers.

A qualified valuator will:

• Explain which valuation approaches are most appropriate and why.
• Document assumptions and provide sensitivity analyses.
• Prepare a clear report and be available for a declaration or deposition if needed.

Hiring a valuator familiar with immigration contexts is helpful because they can tailor the report to the sort of evidence USCIS and consular officers expect without overstating value.

Common pitfalls and how to avoid them

Many E-2 petitions involving intangibles fail or face extensive requests for evidence because of predictable errors:

• Overvaluation — Unsupported premium valuations or “book valuations” without independent analysis raise red flags. Avoid relying solely on seller’s asking prices.
• Related-party transactions without arm’s-length evidence — Transfers among family members or affiliated companies must be backed by independent justification and market comparables.
• Counting the same economic benefit twice — For example, valuing a patent by DCF and also recognizing the same projected revenues as separate goodwill can lead to double-counting.
• Lack of proof of transferability — Non-transferable licenses or rights that the investor cannot control do not strengthen an E-2 case.
• Relying solely on future promises — Letters of intent and future contracts are weaker than executed agreements and past performance data.

He or she should always err on the side of conservative, well-documented valuations and be ready to explain methodologies and assumptions in plain language.

Hypothetical examples to illustrate methods

Example 1 — Purchase of a SaaS platform: An investor buys an existing SaaS product for $600,000. The valuator uses an income approach (DCF) projecting net cash flows attributable to the software for five years and a terminal value, applying a discount rate that reflects technology and market risk. The report includes churn rates, customer acquisition costs, and historical revenue growth. The valuation shows the purchase price reflects fair market value and the funds were at risk in an operating business.

Example 2 — Licensing a foreign trademark to a U.S. startup: The investor pays $200,000 to acquire exclusive U.S. rights to a brand. The valuator uses a relief-from-royalty method, estimating the royalty rate market participants would pay and discounting the avoided royalty stream. The analysis is supported by comparable trademark license agreements and a conservative business plan showing U.S. distribution channels.

How USCIS evaluates intangible-heavy investments

USCIS evaluates whether the assets create a real, operating commercial enterprise and whether the investment is substantial in relation to the business. When intangibles form a large portion of the investment, adjudicators will ask: Does the investor control the assets? Are the assets actively deployed in the enterprise? Is there objective evidence (sales, licenses, third-party payments) showing the asset’s value and economic use?

Supporting the valuation with transactional evidence, independent appraisals, and realistic business plans substantially improves credibility. For official guidance on the E-2 category, see the USCIS page on E-2 Treaty Investors.

Practical tips to strengthen an E-2 filing that relies on intangibles

• Document every payment — bank transfers, escrow releases, and receipts linking money to asset acquisition.
• Use independent appraisals — a third‑party report carries more weight than founder statements.
• Show economic deployment — evidence the asset is being used: customers, sales, marketing, licensing, or active development.
• Keep projections conservative — include sensitivity analysis showing the effect of lower growth or higher discount rates.
• Address related-party concerns — if the asset was purchased from an affiliate, provide evidence of arm’s‑length terms and market comparables.
• Be prepared to explain methodology — concise expert declarations that explain why chosen methods are standard for the asset help adjudicators understand technical analyses.

Where to find valuation standards and professional guidance

Settlement on a valuator who follows accepted standards helps. Useful resources include the Appraisal Foundation (USPAP), the American Society of Appraisers, and the AICPA business valuation resources. These organizations publish standards and best practices for business and intangible asset valuation and can help identify qualified experts.

Deciding how to value intellectual property and other intangibles for an E-2 application requires technical rigor, conservative assumptions, and clear documentary support. He or she can improve the chances of success by selecting appropriate valuation methods, gathering robust evidence, and working with a qualified valuation professional who understands immigration scrutiny. Would it help to review a sample evidence checklist tailored to a specific asset type (patent, trademark, or software)?

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

The idea of a “substantial” investment is central to qualifying for an E-2 Treaty Investor visa — but it’s not defined by a single dollar figure. This article explains how U.S. adjudicators apply the proportionality test, what counts as a qualifying investment, and how an investor can present a strong case.

What "substantial" means under the E-2 rules

The E-2 visa requires that a foreign national make a substantial investment in a bona fide enterprise in the United States. The law does not set a numerical dollar threshold. Instead, adjudicators apply a comparative approach known as the proportionality test: the investment must be substantial in proportion to the total cost of either purchasing an established enterprise or creating a new one.

Put simply, the question is not just how much money the investor puts in, but whether that amount is reasonably necessary to start and operate the specific business. The goal is to ensure that the investor has made a real economic commitment and that the enterprise has a realistic chance of success.

Official guidance on E-2 eligibility and requirements is available from the U.S. Citizenship and Immigration Services (USCIS) and the U.S. Department of State. For more detail, see the USCIS E-2 page: https://www.uscis.gov/working-in-the-united-states/temporary-workers/e-2-treaty-investors.

The proportionality test — how adjudicators evaluate investment

The proportionality test compares the investor’s committed capital to the total cost of the business. Adjudicators ask whether the investment is large enough, when viewed against the project’s total budget, to ensure the enterprise’s successful operation. Several practical factors influence the outcome:

• Total cost of the enterprise: The higher the overall budget, the lower the percentage of that sum an investor might need to contribute while still being considered substantial.
• Nature of the business: A capital-intensive manufacturing business will have different expectations than a small consulting firm or retail startup.
• Stage of development: Purchasing an established business often requires a different analysis than starting a business from scratch.
• Evidence of commitment: Whether funds are actually at risk (spent or irrevocably committed) matters more than promises or conditional loans.

Because there’s no fixed threshold, adjudicators evaluate each case on the business’s own facts and supporting documentation.

Practical numerical examples (illustrative only)

These examples are illustrative — they do not predict individual outcomes — but they show how proportionality works in practice.

• Small, low-cost business: A coffee cart with a total startup cost of $30,000. An investor who contributes $20,000 (66%) will likely fail the proportionality test because $20,000 is unlikely to be sufficient to operate the cart. An investor who commits $30,000 (100%) is more likely to meet the test.
• Mid-range startup: A specialty food truck budgeted at $150,000. An investment of $113,000 (75%) or $125,000 (83%) stands a reasonable chance of being found substantial because the contributions represent a significant portion of the total needed to put the truck into operation.
• Large enterprise: A manufacturing facility with a $5,000,000 cost. An investor contributing $1,500,000 (30%) might still be considered substantial if the amount is meaningful relative to the enterprise’s needs — for example, if those funds finance a crucial production line or if an investor’s capital is part of a larger legitimate financing plan. The key is whether the contribution materially enables the business to operate.

These scenarios show why context matters. A high percentage of a small total cost is often required for low-cost businesses, while a smaller percentage can be acceptable when the business is capital-intensive, provided the funds are meaningful to the operation.

How "capital at risk" works and what counts

An essential E-2 principle is that the investor’s funds must be at risk. The capital must be subject to partial or total loss if the enterprise fails. Funds that are not genuinely committed or that remain under the investor’s control without real exposure typically do not qualify.

Common forms of qualifying investment include cash deposited into the business bank account and spent on business assets, equipment purchases, leasehold improvements, inventory purchases, payment for professional services essential to the business, and documented expenditures that are integral to starting or operating the enterprise.

By contrast, the following are often problematic unless structured carefully and documented clearly:

• Loans where the investor is the borrower and the loan is secured by the investor’s personal assets — these may not count unless the loan proceeds were actually committed to the enterprise and meaningfully at risk.
• Promises of future funding or unexecuted agreements — adjudicators look for funds already invested or irrevocably committed.
• Assets that remain personal and not transferred to the enterprise — funds must be committed to the business.

Marginality: the enterprise must be more than a means to support the investor

In addition to being substantial, the investment enterprise must not be marginal. A marginal enterprise is one that will only generate enough income to provide a minimal living for the investor and family. To meet the E-2 standard, an enterprise must either:

• Have the capacity to generate more than minimal household income; or
• Create job opportunities for U.S. workers — the presence of clear and credible plans to hire U.S. employees is strong evidence that the business is not marginal.

Evidence that strengthens the non-marginality argument includes detailed financial projections showing revenues, profits, and the capacity to support the investor’s family; concrete and realistic staffing plans; evidence of contracts or market traction; and documentation of actual hires or payroll commitments.

Documentation that persuades adjudicators

Because E-2 adjudications are fact-based, the quality and breadth of documentary evidence matters greatly. Typical documentation to assemble includes:

• Investment evidence: bank statements showing transfers into the business, wire receipts, cancelled checks, invoices for equipment or inventory, bills of sale, and purchase agreements.
• Proof funds are at risk: receipts for expenditures, cancelled checks, proof of asset purchases, and contracts that demonstrate irrevocable obligation.
• Business formation records: corporate or LLC formation documents, operating agreements, shareholder agreements, and state registrations.
• Leases and real property documents: signed commercial lease agreements, property purchase contracts, proof of leasehold improvements being paid for.
• Detailed business plan: narrative description, market analysis, realistic financial projections (cash flow, profit & loss, balance sheet), staffing and hiring timelines, and marketing strategy.
• Contracts and customer evidence: signed client contracts, letters of intent, supplier agreements, and purchase orders.
• Employment evidence: job descriptions, staffing projections, copies of payroll or offers to U.S. employees.
• Tax and accounting records (if purchasing an existing business): prior tax returns, balance sheets, and profit/loss statements to demonstrate historical performance.

Adjudicators weigh the totality of this documentation to decide whether the investment is substantial relative to the business’s needs.

Common pitfalls and how to avoid them

Investors often make avoidable mistakes that weaken their E-2 petitions. Recognizing and preventing these pitfalls improves the odds of success:

• Undercapitalization: Starting with too little money or hoping to raise funds after obtaining the visa without a credible initial investment plan weakens the proportionality argument.
• Poorly documented funds: Lack of clear paper trails for the source and use of funds can lead to denial. Every major transaction should be verifiable.
• Counting non-risked funds: Treating temporary or conditional loans, escrowed funds that can be returned freely, or personal assets not committed to the business as investment will be questioned.
• Weak business plan: Vague projections, unrealistic assumptions, or absence of a hiring plan make it difficult to prove both substantiality and non-marginality.
• Inconsistent documentation: Differences between financial statements, bank records, and the business plan raise red flags.

Structuring the investment: practical tips

To present the strongest possible E-2 case, investors should consider practical structuring steps:

• Match funding to business needs: Ensure initial capital reasonably covers startup costs and critical operations until the business is revenue-generating.
• Document every step: Maintain a clear audit trail for transfers, purchases, and contracts. Adjudicators prefer evidence showing funds were actually spent on business operations.
• Use a credible business plan: Include conservative, well-supported financial projections and a realistic timeline for hiring and sales growth.
• Show funds at risk early: Even if investment proceeds in phases, make an unequivocal initial capital commitment that is meaningful to immediate operations.
• Avoid relying solely on future investors: While future financing can be part of a long-term plan, the initial investor must show that the business is viable with the capital already committed.
• Consider hiring plans: If the enterprise will be small, focus on proving it will generate more than minimal income; if possible, show credible plans to employ U.S. workers.

Special situation: buying an existing business

When buying an existing enterprise, the proportionality test looks at the purchase price as the enterprise’s total cost. Documentation from the sale is critical: purchase agreement, escrow statements, proof of funds transferred, and historical financial records of the business.

Adjudicators will examine whether the investment paid to acquire the business was real and at risk and whether the purchase price reflected market value (not an inflated or artificially low price arranged solely to meet E-2 requirements).

When an investor should consult an attorney

Because E-2 adjudications hinge on nuanced factual assessments and careful documentation, experienced counsel can help design the investment structure, prepare a persuasive business plan, and assemble the evidentiary record. An attorney with E-2 experience can also anticipate likely questions from consular officers or USCIS adjudicators and advise on strategies to demonstrate both substantiality and non-marginality.

Which part of the proportionality test is most challenging for an investor: deciding how much to invest, documenting funds at risk, or proving non-marginality? Thinking through that question early helps shape a stronger application strategy.

With careful planning, transparent documentation, and a business plan that shows how the investment supports real operations and job creation or meaningful income, an investor can make a persuasive case that the investment is substantial and meets the E-2 standard. For practical guidance on preparing an E-2 petition and sample business plan expectations, see the USCIS E-2 information: https://www.uscis.gov/working-in-the-united-states/temporary-workers/e-2-treaty-investors.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

Proving that investment funds are “irrevocably committed” is one of the most important hurdles in an E-2 visa application — and it often decides whether an application is approved or denied.

What "Irrevocably Committed" Means for E-2 Investors

For an E-2 treaty investor, the phrase “irrevocably committed” means that the investor has placed funds into a real business enterprise in a way that eliminates the possibility of an easy refund or reversal, and therefore demonstrates that the funds are genuinely at risk. The requirement flows from the E-2 criteria that an investment be substantial and at risk in a real enterprise, rather than simply sitting in a bank account waiting to be spent only after visa approval. Government guidance on E-2 status, including the Department of State and USCIS descriptions, emphasizes that the investment must be a bona fide commercial enterprise and that the investor must be committed to its success (USCIS - E-2 Treaty Investors, U.S. Department of State - Treaty Traders and Investors).

Why Demonstrating Irrevocable Commitment Matters

Consular officers and adjudicating officials examine whether the investor’s funds are sufficiently committed because an investment that can be refunded at will would not be “at risk.” If funds remain refundable or their transfer to the enterprise is conditional, the officer may conclude the investment is speculative or merely intended to support a visa application. A clear showing of irrevocable commitment increases the likelihood of approval and reduces the chance of requests for additional evidence or a denial.

Types of Evidence That Convince Adjudicators

Not every document is equally persuasive. Some forms of proof are routinely accepted as strong indicators that funds are irrevocably committed:

• Executed purchase or sale agreements for business assets or commercial real estate, with signatures on behalf of the buyer and seller and clear closing dates.
• Escrow instructions and confirmations showing funds deposited into an escrow account with an independent escrow agent, and language specifying non-refundable deposits or unconditional release to the seller at closing.
• Wire transfer confirmations, cancelled checks, and bank withdrawal records that show funds leaving the investor’s control and moving toward the enterprise or escrow.
• Closing documents and settlement statements (for example, HUD-1 or equivalent closing statements) that demonstrate completion of an acquisition and transfer of title.
• Paid invoices, bills of sale, shipping documents, and customs entries that show the investor purchased equipment, inventory, or supplies and the items were shipped or delivered.
• Vendor contracts or supply agreements signed by both parties, together with deposit receipts and cancellation penalties, to prove that the investor cannot simply walk away without financial consequence.
• Corporate formation documents, operating agreements, and capital contribution records that show funds were contributed to the business capital and recorded in official company books.
• Board resolutions or shareholder meeting minutes approving the investment and authorizing the transfer of funds.
• Stock certificates or membership interest certificates showing that ownership of the enterprise or its assets passes to the investor.
• Loan documents (when funding is borrowed) that show a bona fide financing arrangement, including promissory notes, security interests, and repayment terms, which demonstrate the investor’s commitment to the venture rather than simply borrowing to qualify for a visa.

Escrow and Non-Refundable Deposits — The Gold Standard

One of the clearest ways to show an investment is irrevocably committed is to use an escrow arrangement or a non-refundable deposit. Escrow provides objective proof that funds are no longer in the investor’s direct control and will be released only upon meeting agreed conditions (like closing). When funds are placed in escrow with explicit, signed instructions, consular officers can see that the investor cannot recover the funds without breaching the contract.

Escrow documentation should include:

• Escrow account details and the escrow agent’s contact information.
• Signed escrow instructions that explain when funds will be released and whether the deposit is refundable under any circumstances.
• Escrow confirmation showing the deposit of funds and the date of deposit.

Loans and Third-Party Financing — When They Help and When They Hurt

Third-party financing is not automatically disqualifying, but it must be structured and documented carefully. A commercial loan from a reputable lender—with a formal loan agreement, evidence of disbursement, security instruments, and a demonstrated ability to repay—can be acceptable because it realistically finances a business placed at risk.

Conversely, informal loans from relatives or friends without documentation, or loans that are repayable only after visa approval, are problematic. The same is true for loans that are secured solely by the assets being acquired if the terms allow the investor to reclaim funds without meaningful risk to the lender.

When loans are used, it helps to document:

• The lender’s identity and credentials (e.g., a bank or financing company).
• The loan agreement’s terms, repayment schedule, and security interests.
• Evidence that the loan funds were disbursed and used for the business (wire transfers, vendor receipts).

Source of Funds — Proving Legitimacy and Permanence

Adjudicators also require a credible trail showing where the money originated. This is separate from whether an investment is irrevocably committed, but it is equally important. Common acceptable evidence includes:

• Sale of assets: contracts of sale, transfer deeds, closing statements.
• Business proceeds: audited financial statements, tax returns, bank statements.
• Loans: formal loan agreements and evidence of disbursement.
• Gifts or inheritance: wills, probate records, or notarized gift letters with supporting evidence.

Working backward from the business transaction to show the exact path the funds took — from the source account into escrow or to the seller — is persuasive. The key is demonstrating continuity of the funds and lawful provenance.

How to Prepare the Strongest Possible Presentation

Organization and clarity make a big difference during review. An investor should prepare a document package that tells a concise story: how much was invested, where it came from, how it was spent, and why the expenditure is irreversible.

Best practices include:

• Start with an annotated timeline that highlights critical steps: source of funds, transfer dates, contract signings, escrow deposit, asset delivery, and closing.
• Include a one-page executive summary that states the amount invested, the form of commitment (escrow, purchase, lease, etc.), and the evidence index.
• Provide certified copies of key contracts, translated into English if necessary, and include legible bank records showing transfers out of investor accounts.
• Use tabs or an exhibit index and refer to exhibit numbers in the cover letter and timeline.
• Where possible, include contemporaneous correspondence such as vendor acknowledgments, shipping confirmations, or escrow receipts that corroborate dates and amounts.
• Have documents notarized or certified when appropriate, and attach professional translations for any foreign-language documents.

Common Mistakes That Undermine "Irrevocably Committed" Claims

Some pitfalls recur in E-2 applications and interviews. Investors should avoid these mistakes:

• Relying on a letter of intent or unsigned contracts without deposits or escrow — these are frequently seen as insufficient.
• Keeping funds in a foreign bank account and describing an intention to transfer them only after visa issuance — that indicates lack of commitment.
• Using vague or informal evidence of funding, such as untracked cash withdrawals or undocumented gifts.
• Showing refundable deposits or conditional holds that allow the investor to reclaim money with little or no cost.
• Making last-minute bookkeeping entries without supporting documentary trail (e.g., claiming a capital contribution without bank records or corporate minutes).

Practical Examples — What Works in Real Cases

Concrete examples make the standard more understandable:

• Commercial property purchase: The investor signs a purchase agreement for a warehouse, deposits a non-refundable earnest money check into an escrow account, and later closes; the deed and closing statement show full transfer of funds and title. This combination is very strong evidence of irrevocable commitment.
• Restaurant startup: The investor signs a long-term commercial lease, pays a sizable non-refundable tenant improvement deposit, orders and pays for kitchen equipment with signed vendor contracts and shipping receipts. Funds used to buy inventory and install equipment provide tangible proof the business is operational and funds were committed.
• Franchise purchase: The investor signs the franchise agreement and pays the franchise fee into the franchisor’s account; the franchisor issues a receipt and training dates are scheduled. The documented payment plus contractual obligations illustrate commitment.

When to Seek Professional Help

Because the concept of irrevocable commitment is fact-intensive and adjudicators have discretion, it is wise to consult experienced E-2 counsel early. An attorney can review transactional documents, identify weak points (for example, refundable deposits or ambiguous escrow language), and suggest restructuring steps to make the investor’s commitment more robust before filing or attending a consular interview.

Legal counsel also helps when loans are part of the financing plan, ensuring loan documents reflect real commercial obligations and that the investor’s risk exposure is clear.

Putting an E-2 case together is both an exercise in careful documentation and in storytelling: the investor must show a clear, documented path from source of funds to active business use, and that the funds cannot simply be taken back. A well-organized submission with signed contracts, escrow records, bank transfers, receipts, and a concise timeline often makes the difference.

Would the investor like a checklist tailored to a specific business model (real estate acquisition, service business, franchise, or startup)? Sharing the type of investment and stage of transactions will help craft precise guidance on strengthening the irrevocable commitment evidence.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.

The E-2 visa can be a powerful path to live and work in the United States, but many applicants are surprised when a promising investment is rejected because it is seen as passive. This article explains why passive investments fail the E-2 test and gives practical, actionable steps to avoid denial.

What the E-2 visa requires — the essentials

The E-2 Treaty Investor classification is for nationals of countries that have a qualifying treaty with the United States who make a significant financial commitment in a U.S. business. Key legal concepts that determine eligibility include a bona fide enterprise, a substantial and at-risk investment, and that the enterprise is more than marginal.

Official guidance from the U.S. Department of State and U.S. Citizenship and Immigration Services makes clear that the enterprise must be a real, active commercial or entrepreneurial undertaking; mere ownership of idle or speculative assets typically does not qualify. See the State Department overview for Treaty Traders and Investors and the USCIS summary of the E-2 classification for more detail:

• U.S. Department of State — Treaty Traders and Investors
• USCIS — E-2 Nonimmigrant Treaty Investors

Why passive investments fail the E-2 test

At its core, the E-2 visa is intended to permit an investor to come to the United States to develop and direct an enterprise. That means the investor must show more than ownership of capital: the investor must show they will lead or direct an operational business whose growth and success depend on active management.

Passive investments fail for several overlapping reasons:

• Lack of operational control — The investor does not demonstrate involvement in day-to-day or strategic decision-making. Evidence of a purely silent investor role raises red flags.
• Not at risk — Funds held in escrow, insured accounts, or invested in refundable instruments do not meet the “at-risk” standard because they can be reclaimed without genuine business risk.
• Marginality — If the enterprise is shown to be primarily created to support the investor’s living expenses without a realistic plan to generate more than minimal income or create U.S. jobs, consular officers or adjudicators may find it marginal.
• Portfolio nature — Buying stocks, bonds, mutual funds, or real estate for passive income is viewed as a portfolio investment, not a qualifying E-2 commercial enterprise.

How adjudicators evaluate activity and control

Consular officers and USCIS evaluate whether the business requires active management and whether the investor is positioned to provide that management. They look for concrete operational markers: active contracts, leases, employees on payroll, vendor relationships, advertising, client invoices, and business licenses that show the enterprise is functioning and growing under the investor’s direction.

Common passive-investment scenarios that lead to rejection

Here are some typical cases that create problems and how adjudicators view them.

• Rental property held as passive income: Owning residential or commercial property that is leased to tenants with a third-party property manager is often treated as passive. Unless the investor can show an active management business—renovations, leasing operations, direct management, or value-add activity—this usually fails.
• Purchasing stocks or mutual funds: These clearly are portfolio investments and do not qualify for E-2.
• Silent partner in an LLC or corporation: If the investor provides capital but has no documented managerial duties, the application risks denial.
• Loaning money to a U.S. enterprise: A straightforward loan where the investor expects repayment is not an at-risk equity investment unless the terms and business structure show the funds are functionally at risk in business operations.

Real-world examples: passive vs. active approaches

Concrete scenarios help identify how to transform a risky structure into a qualifying one.

Example: Small apartment building

Passive approach: The investor purchases a four-unit building, hires a property manager, collects rents, and treats it as rental income. This looks passive and is likely to be denied.

Active approach: The investor forms a U.S. operating company that renovates the units, markets them for short-term corporate rentals, employs on-site staff, contracts with local service providers, and scales to additional properties. The investor provides management oversight and strategic control. Supporting documentation includes renovation contracts, payroll records, marketing plans, and a five-year projection showing job creation and revenue growth.

Example: Franchise investment

Passive approach: Buying a franchise but appointing a local manager to run everything, while the investor remains hands-off.

Active approach: The investor takes an executive role—hiring staff, selecting locations, managing operations, and implementing franchise expansion. They document day-to-day involvement and strategic responsibilities in an organizational chart, job descriptions, and meeting minutes.

Steps to avoid rejection — a practical roadmap

Transforming a passive investment into an E-2-qualifying enterprise requires careful planning and documentation. The following steps are practical and frequently recommended by experienced immigration counsel.

Choose an operating business model

Structure the investment as an active operating company rather than a holding company for passive assets. Businesses that require ongoing management—restaurants, manufacturing, retail, service providers, or active property management—are better fits than portfolio-style investments.

Document the investor’s management role

Show an organizational chart, an employment contract or consultant agreement describing executive duties, and evidence of daily or strategic decision-making (emails, meeting minutes, strategic plans). If the investor will be the company’s president, managing partner, or general manager, that must be clear on paper and in practice.

Make the investment truly at risk

Funds must be committed and subject to loss if the enterprise fails. Non-refundable purchases, payments for equipment, leasehold improvements, stock purchases of the operating company, and transferred funds used for business expenses are all evidence the money is at risk. Avoid refundable escrow arrangements or conditions that permit easy return of the funds.

Prepare a convincing business plan

A well-prepared business plan is often decisive. It should include:

• Executive summary and company background
• Market analysis and competitive positioning
• Detailed five-year financial projections with assumptions
• Staffing plan showing U.S. job creation
• Marketing, operations, and risk mitigation strategies

Detailed, realistic financials demonstrating the business will produce more than minimal income and is capable of growth will help refute a marginality finding.

Hire employees and show payroll

Creating U.S. jobs is persuasive evidence the enterprise is active and non-marginal. Payroll records, job offers, W-2s, and evidence of recruitment strengthen the case.

Provide transactional evidence

Consular officers want to see that the investor has spent money and that the business is operational. Useful documents include purchase invoices, receipts for equipment, lease agreements, supplier contracts, client invoices, bank statements showing transfers into business accounts, and photos of premises and operations.

Document source of funds and ownership

Traceable, legitimate source-of-funds documentation is essential. Include sale agreements, tax returns, bank statements, and evidence of funds transfers. Demonstrate clear ownership of the funds and that they were lawfully obtained.

Options when the investment is already passive

If an investor already owns passive assets, there are practical options to consider.

• Convert the investment into an active enterprise: Add operational elements—service offerings, on-site staff, renovations, or direct management—that create an active business.
• Form a management company: Create a separate entity that manages the passive assets and provides services (maintenance, leasing, tenant relations). Ensure the management company has employees and operational substance.
• Enter as an E-2 employee: If the investor’s role is specialized, they may qualify as an E-2 employee of a qualifying enterprise if they hold executive, managerial, or essential skills position; appropriate documentation is required.
• Consider alternative visa paths: For purely passive capital investors, the EB-5 immigrant investor program (which requires larger investments and job creation) or other nonimmigrant classifications may be more appropriate.

Documentation checklist — what adjudicators often expect

The quality and organization of evidence can strongly influence the outcome. A practical checklist often includes:

• Comprehensive business plan with financial projections
• Evidence of funds invested and funds at risk (bank transfers, canceled checks, invoices)
• Contracts and leases showing business commitments
• Organizational chart, employment contracts, and job descriptions
• Payroll records, W-2s, or contractor agreements
• Marketing materials, customer contracts, and invoices
• Photos of premises, equipment purchases, and operations
• Source-of-funds documentation (sale agreements, tax returns, bank records)
• Evidence that the investor holds the requisite nationality and is eligible for the E-2 treaty

Practical tips and traps to avoid

Some common mistakes lead to unnecessary denials:

• Avoid presenting a business plan that is vague or unrealistic; over-optimistic projections without supporting market data can weaken credibility.
• Do not rely solely on agreements that can be canceled; non-refundable commitments are stronger evidence.
• Be prepared to explain any changes in ownership, unusual transfers, or complex funding chains — clear documentation is crucial.
• Engage counsel early; last-minute attempts to assemble documents often miss the operational evidence adjudicators seek.

When to consult an immigration attorney

E-2 cases turn on both legal standards and factual presentation. An experienced E-2 attorney helps a prospective investor structure the transaction, prepare a business plan that meets expectations, assemble documentation that shows funds at risk and operational control, and anticipate questions consular officers may ask. For complex funding sources or unusual business models, professional guidance is often worth the investment.

Understanding the difference between passive capital placement and an active, at-risk business is the single most important factor in avoiding an E-2 denial. By structuring the enterprise to require and demonstrate ongoing management, committing funds that are truly at risk, documenting a realistic growth and job-creation plan, and assembling detailed evidence, an investor greatly increases the chance of approval. If someone is unsure whether their plan meets E-2 standards, seeking expert advice early will save time and prevent costly surprises during adjudication.

Please Note: This blog is intended solely for informational purposes and should not be regarded as legal advice. As always, it is advisable to consult with an experienced immigration attorney for personalized guidance based on your specific circumstances.