Making An E-2 Investment With Existing Assets - Frear Law

Using Existing Assets Towards Your E-2 Visa Investment Amount

The thought of making a qualifying E2 Visa Investment is intimidating for a few reasons.

First, the investment must be substantial. This essentially means that it must be large enough to make your particular business work. So, instead of focusing on the investment amount, the US government focuses on the amount needed to start your business.

Second, the investment must be irrevocably committed to the business at the time of the application. In other words, the money must be spent. Simply transferring funds to the corporate bank account will not be sufficient.

These requirements put the E2 investor in a difficult situation. If they go all in and commit a pile of money to the enterprise, they could risk a massive financial loss if the E2 visa application is denied. 

Fortunately, there are ways to go “all in” while still protecting yourself in the event of a visa denial. 

Avoiding Loss By Using Escrow Agreements

One method to avoid a catastrophic financial loss is to use escrow accounts and agreements. The investor can craft an agreement that basically says that the invested money will be released(typically to a seller or franchisor) only in the event of an E2 visa approval. If the E2 application is denied, the money goes back to the investor.

Avoiding Loss By Using Existing Property Towards Your E2 Visa Investment Amount

 

In addition to using escrow, some E2 visa investors can protect themselves by counting existing assets towards their investment tally. 

This option is typically available to entrepreneurs who have established a similar business abroad. 

These experienced entrepreneurs are in an ideal position to successfully apply for the E2 visa for a number of reasons. First, the US government will be more likely to conclude that they have the ability to direct and develop the new business in the US. And, they oftentimes have existing assets that they can apply towards their investment amount.

How Existing Assets Can Qualify

For existing assets to be counted towards the E-2 investment amount, their value must be demonstrated. And, they must be transferred to the US. Additionally, existing assets will not count unless they will be used for business—not personal use. 

So, for example, an E2 investor’s Tesla—that was transferred to the US—will not count towards an investment in a Papa John’s franchise, but a transferred pizza oven would count. 

Intellectual Property Can Qualify 

In addition to tangible assets, the value of intellectual property can also count towards your investment total. If there is no identifiable market value for a patent or copyright, you can enlist the services of an expert who can attest to the value of the intellectual property.

Conclusion

In addition to using escrow agreements, the use of existing assets drastically reduces the risk to the E2 visa investor.

If the E2 application is denied, the investor will simply transfer tangible property back to their home country.

In order to learn about your options for using existing assets towards the E2 visa investment amount, reach out to one of the many talented US immigration lawyers.

If you have any questions or comments for me, please feel free to contact me at ben@frearlaw.com