L-1 or E Visa: Setting up a New Business (Ⅰ)

Setting up a new business can be quite exciting. But there are also many challenges. In-depth market research and planning can minimize the risks. Foreign nationals setting up a business in the U.S. face another challenge - which visa do they use to be able to enter the U.S. to operate the business once it has been established? Generally L-1 visas are used to set-up a new entity in the U.S. when it is a subsidiary, parent, branch, or affiliate of an overseas company. However, foreign nationals from countries with certain treaty with the U.S. have the choice of using E-1, E-2 or L-1 visa for establishing a new entity in the U.S. Let us first understand the situations under which each of these visa options can be used.

E-1 visa:
The E-1 treaty trader visa allows nationals of an E-1 treaty nation to enter the U.S. and carry out substantial trade. Trade means the international exchange of goods, services and technology. The item of trade, and title of that item, must pass from one party to the other in exchange for consideration. The international trade between your home country and the U.S. must be 'substantial' in the sense that there is a sizable and continuing volume of trade. More than 50% of the international trade involved must be between the U.S. and your home country.

E-2 visa:
The E-2 treaty investor visa allows foreign entrepreneurs from E-2 treaty nations to enter into the U.S. for the purpose of directing and developing the operations of an enterprise they have invested in, or are in the process of investing, a substantial amount of capital. Investment activities include purchase of a new business. The investment must be significantly proportional to the total investment, usually more than half the total value of the enterprise or, if a new business, an amount normally considered necessary to establish the business.

L-1 visa