E2 vs. L1 2/2

Posted on November 22, 2006 by Warren Wen | Category: Immigration

In the last article, we mentioned that both L visa and E-2 visa could be a good choice for the foreign investors.  Then, how does one decide which one is better for him or her? Which one should he or she choose?

In general, L visa gears towards managers, executives or employees of qualified multinational companies with some special knowledge. In the meanwhile, E-2 gears to principal owners, supervisors, executives or key employees of U.S. businesses that have 50% or more ownership by the nationals of foreign investment treaty countries. If the alien’s motherland has investment treaty with the U.S., he or she could choose both. However, as the number of applicants for the E-2 visa is relatively smaller than that of the L visa, it may be easier for foreign investors to get their E-2 application approved.  Currently, P. R. China has no investment treaty with the U.S., so investors in China are not qualified for the E-2 visa. Nevertheless, for those Chinese investors who have immigrated to Canada, Australia etc. and wish to enter the U.S. market, they could be qualified for the E-2 visa as well.

Secondly, the L visa requires the multinational companies who wish to send their employees to the United States and work have a branch, a subsidiary, an affiliate or a joint venture in the U.S.  If the foreign investor has not established any branches, subsidiaries, affiliates or joint ventures in the U.S., it needs to incorporate or purchase one in order to be qualified for the L visa.  For the E-2 visa, as long as the investor has taken significant steps towards establishing business in the U.S., he or she would not be required to establish an office in the United States before they applied for the E-2 visa.  Moreover, for E-2 investors, it does not even require for them to have a business in their home country either.

Thirdly, if the foreign investors intend to immigrant, the L-1A visa seems like a better choice than the E-2 visa. Because L-1A holders are considered as the first preference of employment-based immigration, they would not have to go through the Labor Certification process when applying for green card. Additionally, the waiting period for this category is much shorter than other employment categories, so L-1A holders could get green card earlier than other employment-based immigrants could.  E-2 visa holders could not apply for immigration directly, however.

Although either E-2 visa or L visa has any restrictions on business scopes or the investment amount, the U.S. government encourages the investors of both categories to invest in real businesses. Therefore, investing in mere stocks, bonds, or land speculation could not get the investors qualified for either the L visa or the E-2 visa.  Additionally, both visas would allow the spouses and unmarried children under 21 years of age to accompany the investors to the U.S.

In general, both visas have their advantages and disadvantages. Which one is better for you would depend on your own situation. Meanwhile, you would need to understand the U.S. corporation law before any investment is made. Thus, it would be better for you to seek some help from an experienced attorney before you made your investment.

This article is only for your reference. Please do not apply mechanically to any exact cases. You are welcome to consult our attorneys at Liu & Associates, P.C. For contact information, please click here.