What is the best, E-1 or E-2 Visa?

The E-1 and E-2 visas are temporary non-immigrant visas to the United States. Unlike most work-type visas, these E visa cases generally are filed in the local US embassy and not with the United States Immigration and Citizenship Service (USCIS) in the United States. Also, unlike other work visas, the availability of the visas is dependent upon specific treaties signed between the United States and an individual country. In other words, only citizens of certain countries are eligible for these visas. Fortunately, for Israelis, both types of visas are available. However, their purposes and visa lengths are quite different.

What is the best for you? 

Who is the E-1 / E-2 visa for?

The E-1 visa is for someone who already has a business that makes significant trade with the United States. Trade can be for products, like shoes, or services, like software. The E-1 visa applicant does not need to open a company in the US (although it can). Rather, it must be doing trade with customers in the United States. This visa can be helpful for businesspersons who travel extensively to the United States for the purpose of selling their goods and services. While many business travelers use a B-1/B-2 tourist visa for business in the United States, this approach can become risky. The B visas do not allow the visa holder to work in the US. They can come for business meetings and conferences, but if they are selling goods or services, they could be found in violation of their visa and ultimately have it revoked.

The E-2 visa is for someone who wants to open or buy a business in the United States. The visa applicant must make a substantial investment into a US business, usually at least around $100,000. The investor must show that he/she will be involved in the maintenance of the business. Unlike the E-1 visa, the applicant for the E-2 need not have an ongoing business before applying. However, they must prove that their business will be sustainable. The E-2 visa applicant must submit an extensive business plan with their application.

The principal E-1 or E-2 visa holder may only work for the US company that qualified for the E-1/E-2 status. If he/she wants to work elsewhere, then their new employer must file a new visa petition for them. However, that is not the case for the spouse of the principal visa holder. The spouse can work anywhere. Let’s assume Company Z hires the spouse through the E-1/E-2 visa. After a period of time, Company Z offers a permanent position to the spouse. If Company Z is willing to file an Immigrant Petition for an Alien Worker – Form I-140 and ultimately it’s approved, then the spouse with her whole family can apply for Adjustment of Status – Form I-485 for green cards for the family.

In most cases, the process for filing an immigrant petition for an alien worker, who is not EB-1 above, is very involved and quite expensive. It means the employer must advertise for the position through local newspapers and job centers, interview any candidates who may be reasonably qualified, document all the interviews and indicate why the applicants are not qualified. Following that the employer must file what’s known as a Labor Certification Application with the Department of Labor, certifying that the only applicant qualified for the position was the foreign worker. Only after the Department approves the application may the employer file the immigrant petition with USCIS.

What is required for a successful E-1 visa application?

Success is a continuous journey…

Most importantly is a trade history for goods and services between the United States and the applicant’s country. The embassy will look at both the volume and value of the trade. So, numerous products for small monetary value or one or two products for significant value rarely will be successful at the embassy. There are no fixed amounts. The law says there must be substantial trade between the two countries. It’s probably advisable to have annual trade of at least $300,000 and at least ten yearly transactions.
Additionally, the applicant must show at least 50% of all international trade is with the United States. Sales within the home country do not count towards the volume of trade. So, for example, assume the applicant’s volume of business is $1 million/year. He sells numerous products within his home country valued at $300,000. He sells $400,000 of products to the United States and another $300,000 to various European countries. Because over 50% of his international trade is with the US, he potentially would qualify for the visa.

E-1 and E-2 visa lengths

E-1 and E-2 visa lengths differ from country to country and sometimes differ within the same country. For example, E-1 visas for Israelis are normally suitable for five years, but E-2 visas are authorized for only two years. Both visas permit the spouse of the E-1 treaty trader and E-2 investor to work in the United States anywhere. The primary visa holder, however, must work for his/her business only.

What is required for an E-2 investor? 

For the E-2 investor, the application normally is more extensive than the E-1. Again, the investor must be an owner of a US company. If the investor is opening a new company, this must be done in advance of filing the application. If the business does not exist yet, it’s advisable that the investor travel to the US in order to form the company. The two major types of business formations in the United States are a limited liability company (LLC) and a corporation. An investor should counsel with a certified public accountant (CPA) to determine which business formation is best for them. Typically, the biggest considerations between the two are tax issues. Traveling to the US for the purpose of setting up an E-2 company is permissible activity when using a tourist visa.
Whether the investor is opening a new company or buying into an existing one, to be eligible for an E-2 visa, he must be at least a 50% owner. If he is buying into an existing business, a purchase contract must be included in the filing of the E-2 application to the embassy. If the current company is a corporation, then it must be shown that the investor is a purchaser of the stock of the company. If the company is an LLC, then a new operating agreement must be adopted showing the investor as a member of the LLC, again at least with a 50% share.
In addition to setting up a company, the investor must open a US business bank account. This normally can be done through the acquisition of an employer identification number. Again, a CPA can assist with this. Once the business account is opened, the investor must transfer funds into the account for the purpose of investing in the business. The money must originate with the investor. Ideally, it should come from the investor’s personal account overseas, although transferring money into the business account from a personal account in the US is also permissible. At the embassy interview, questions usually arise as to the source of the investor’s funds. They can come from personal savings, from a business the investor owns, a gift, and even a loan as long as the loan is not secured by the US company.
The E-2 investor must also show that a significant portion of his investment is spent on the business before the E-2 visa application is filed. In other words, the investor cannot just have money sitting in a US business account and think that his visa application will be approved. This can be tricky for an E-2 investor because most investors, especially for a newly opened business, do not want to risk spending money on operating a business prior to the visa’s approval. Consequently, US embassies allow investors to invest through so-called escrow accounts. These are third-party accounts that can hold money on behalf of an investor who seeks to purchase things for his business. The investor’s money is not transferred to the seller of the products until the E-2 visa is approved. In this way, the investor protects his investment if the visa is not approved. In that case, the escrow agent returns the money to the investor.

One more difference

Another big difference between the E-1 and E-2 is that the E-1 visa does not necessitate the hiring of US workers. In fact, as described earlier, the E-1 applicant does not even need to open a US business. Instead, it must show extensive trade with US customers. On the other hand, the E-2 visa application must display that his/her business plans to hire US workers within the first two years of operation. Unless the business is already operating, the hiring of US workers is shown in a business plan.
The E-2 visa applicant must provide an extensive business plan to show how it will become a sustainable business. The plan must include a description of the business, its likely clients, its competitors, how it plans to market itself, how many employees it will hire and what their functions will be, and finally, extensive financial projections for the next five years.
While the E-1 process is simpler than the E-2 process, the E-2 is usually a more accessible option for visa renewals. For the E-1 renewal process, the visa holder must show that substantial trade continues to exist between his home country and the US and that at least 50% of his international trade remains between the two countries. This could get complicated if the E-1 visa holder decided to open a US subsidiary of his foreign company in the US. If most business transactions now take place between his US company and US customers, then those transactions are no longer considered international trade. If, however, the foreign company is selling its products to the related US company, which is then selling them to US customers, then the transactions between his two companies remain international trade.
Again, the following example can help clarify the situation. Company A is the foreign company that was initially granted an E-1 visa for its employee/owner. Company A opened a US subsidiary, Company B, to sell its wares in the US. Company B’s sales to US customers are not considered international trade because a US company, Company B, is selling to US customers. This trade is deemed to be domestic. If, however, Company A sells its products to Company B, which then sells to US customers, the transactions between Company A and Company B remain as international trade. Thus, the E-1 visa renewal is not necessarily a problem.
For E-2 visa renewals, the above problem does not exist. Because the E-2 visa is based upon establishing and investing in a US company, as long as the US company remains sustainable and employs US workers, the E-2 visa will likely be renewed.


As you can tell, E-1 and E-2 visa applications are complicated. However, Cohen and Brosh Law Offices have successfully filed numerous applications of both kinds. Please, contact us for more information.

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