L1 Visa vs. E2 Visa: The Key Differences

 

The L1 and E2 visas are powerful options for investors and entrepreneurs. Both of these options allow someone to live and work in the United States.

 

While the L1 visa and the E2 visa have many similarities, they are very different in many ways. In this guide, I will compare these 2 visa options to help you determine whether the L1 visa or E2 visa is the right option for you.

 

If you have any questions, feel free to email me directly at michael@ashoorilaw.com. I am very responsive to email and would be happy to help you.

 

Overview

 

1. Quick Introduction to L1 Visa and E2 Visa

 

2. Non-Immigrant Visas

 

3. Position-Based vs. Investment-Based Visa

 

4. Availability Based on Nationality

 

5. Work Authorization

 

6. Work Authorization for Spouse

 

7. Visa Duration

 

8. Ability to Convert to Green Card

 

9. New Offices and Existing Offices

 

10. Conclusion

 

 

1. Quick Introduction to L1 Visa and E2 Visa

 

The L1 visa and the E2 visa have different requirements. In this section, I will cover the basics of both of these visas.

 

L1 Visa

 

The L1 visa is a non-immigrant visa which allows a foreign company to send an employee to work for a related U.S. company. To qualify for an L1 visa, there are several requirements to fulfill.

 

L1 Visa Requirements

 

• The foreign company and U.S. company must be parent/subsidiary, branch offices, or affiliates.

 

• In the last three years, the transferred employee must have worked full-time continuously for one year for the foreign company.

 

• The employee's role in the foreign company must have been managerial, executive, or for specialized knowledge.

 

• The employee's new role in the U.S. company must be managerial, executive, or for specialized knowledge.

 

E2 Visa

 

The E2 visa is a non-immigrant visa for investors, entrepreneurs, and people looking to run a business in the United States. With an E2 visa, you can start a new US business or invest in an existing business.

 

E2 Visa Requirements

 

• You must be a national of an E2 treat country.

 

• You must intend to depart the US once your E2 status ends.

 

• You must make a substantial investment in a U.S. company.

 

• Your E2 business must be an active, for-profit business.

 

• Your E2 business must not be a marginal enterprise.

 

• You must be entering the U.S. to direct and develop your E2 business.

 

• Your investment funds' source must be lawful.

 

• Your investment must be irrevocably committed to the E2 business and must be at-risk.

 

2. Non-Immigrant Visas

 

The key similarity between the L1 and E2 visas is that they are both non-immigrant visas. They both are temporary and do not lead directly to a green card. While both of these visas are temporary, they can both be renewed. Later in this guide, I will talk about the duration of each of these visas.

 

Additionally, while the L1 and E2 visa do not directly lead to a green card, there are ways to convert both of these visas into a green card (permanent residence). Later in this article, I will discuss how to do this.

 

3. Position-Based vs. Investment-Based Visa

 

One of the fundamental differences between the L1 visa and E2 visa has to do with the focus of the visa.

 

L1 Visa

 

For the L1 visa, the main focus is on the L1 visa beneficiary’s job duties. Specifically, the L1 visa requires that the L1 visa beneficiary (the person applying for the L1 visa) must have worked in a managerial, executive, or specialized knowledge position with the foreign company. The L1 visa also requires that the L1 visa beneficiary will work in a managerial, executive, or specialized knowledge position with the US company. The L1 visa has 2 categories: L1A and L1B. The L1A category is for workers working in a managerial or executive capacity. The L1B category is for workers working in a specialized knowledge capacity. The job description forms the basis for which visa category to apply under.

 

Basically, the main focus of the L1 visa is to make sure that the L1 worker’s job duties are truly managerial, executive, or specialized knowledge in nature.

 

E2 Visa

For the E2 visa, the main focus has to do with making an investment in a US business. Specifically, the E2 visa requires that you make a substantial investment in a US business.

 

The Foreign Affairs Manual states: “No set dollar figural constitutes a minimum amount of investment to be considered ‘substantial’ for E-2 visa purposes” [9 FAM 402.9-6(D)].

 

Instead, USCIS conducts a proportionality test. The proportion is the amount of money invested versus the value of the business.

 

As a general rule of thumb, at my firm, I like to see that at least $100,000 invested in the business and put at risk. The higher the investment, the better the chance for your investment to be considered substantial.

 

If you have any questions about the E2 investment, please email me at michael@ashoorilaw.com. I’d be happy to help analyze your investment.

 

4. Availability Based on Nationality

 

One of the main differences between the L1 visa and the E2 visa has to do with the availability of the visa.

 

E2 Visa

 

The E2 visa is based on a treaty and is only available to people from certain countries. In order to be eligible for an E2 visa, you must have the nationality of a country that has an E2 treaty with the United States. Here is a list of the E2 treaty countries. While there are many E2 treaty countries, there are also many countries that do not have an E2 treaty. Some major countries that do not have an E2 treaty with the U.S. include China, Russia, India, and Brazil.

 

L1 Visa

 

The L1 visa is not based on a treaty. People with all nationalities are eligible to apply for the L1 visa (excluding travel ban issues).

 

5. Work Authorization

 

Both the L1 visa and the E2 visa authorize you to work in the United States.

 

With an L1 visa, you can only work for your U.S. company petitioner.

 

With an E2 visa, you must work for your E2 business. You cannot be a passive investor. As an E2 investor, you must be direct and develop the E2 business (meaning that you are actively involved in the business). You may not work for other businesses that are not your E2 business.

 

6. Work Authorization for Spouse

 

Both the L1 visa and the E2 visa allow your spouse to obtain work authorization.

 

The spouse of an L1 visa holder may apply for an L2 visa which is eligible for work authorization.

 

The spouse of an E2 visa holder, may also apply for an E2 visa. The spouse would also be eligible for work authorization as the dependent of the principal E2 investor.

 

7. Visa Duration

 

The E2 and L1 visas have different maximum durations of stay.

 

L1 Visa

 

For a new office, the initial visa is granted for a 1-year period and can be extended. For an existing office, the L1 visa is granted for a 3-year period and can be extended.

 

For an L1A visa, the maximum duration is 7 years. For an L1B visa, the max has a maximum duration is 5 years.

 

E2 Visa

 

The E2 visa’s validity period depends on the country issuing the visa. Most E2 visas range from 1 year to 5 years.

 

The E2 visa can be renewed as long as your E2 company continues to satisfy all the E2 visa requirements. There is no limit to the number of times an E2 visa can be renewed.

 

Important Point:

 

If your E2 visa is valid for 5 years, this does not mean that you may remain inside the US for 5 years straight. The E2 visa gives 2 years of status every time you enter the US. As long as your E2 visa is still valid, you may exit and re-enter the US for another 2 years of status. This concept can be confusing to understand, so if you have any questions about this, please email me at Michael@AshooriLaw.com.

 

8. Ability to Convert to Green Card

 

Both the E2 visa and the L1 visa are non-immigrant visas. This means that they do not directly lead to a green card. However, both the L1 and the E2 visa can be converted to a green card.

 

L1 Visa to Green Card

 

There are multiple ways to go from an L1 visa to green card. One of the most common ways to go from an L1 visa to green card is through the EB1C immigrant visa category. The EB1C in an immigrant visa category which very closely resembles the L1A visa with some key differences.

 

In addition to the EB1C option, another way to go from L1 visa to green card is through an employer sponsored green card. To learn more about how to go from an L1 visa to green card, please see my article on this subject here.

 

E2 Visa to Green Card

 

There are multiple ways to go from an E2 visa to green card. One option to do this is through the EB5 visa. The EB5 visa is an investment-based immigrant visa. Through the EB5 visa someone can apply for a green card based on making an investment in a U.S. company. As of the time this article is being written, the minimum EB5 investment amount is $800,000. One of the benefits of going from an E2 visa to an EB5 visa is that you may be able to credit the amount you’ve already invested in your E2 business toward your required EB5 investment. This is a complex area of immigration law, so if you have any questions about this, feel free to email me directly at Michael@AshooriLaw.com.

 

Another way to go from an E2 visa to green card is through an employer sponsored green card. To learn more about how to go from an E2 visa to green card, please take a look at my article on how to do this.

 

 

9. Availability for New Businesses and Existing Businesses

 

Both new businesses and existing businesses are eligible to apply for an E2 or an L1 visa, assuming all requirements are met.

 

Under the L1 visa, you may apply for a “new office” L1 if your U.S. business has been operational for less than 1 year. Basically, the L1 visa has a special option for new offices. Through the L1 visa, a foreign company can transfer an employee to come to the U.S. to work for a brand-new office. If the U.S. business has been operating for longer than a year, the foreign company can also transfer the L1 beneficiary to the U.S. company (this would be an existing office L1 visa).

 

To qualify for the E2 visa, you can either start a new business or invest in an existing business. These two visas present excellent opportunities for people to create new businesses in the U.S.

 

10. Conclusion

 

The L1 visa and E2 visa are both great options for coming to the U.S. if you are an entrepreneur, investor, or high-level manager/executive. These visas have many benefits and similarities. Simultaneously, the L1 visa and E2 visa have several key differences.

 

You should now have a much better understanding of the similarities and differences between these two visas.

 

If you would like further help in choosing between these two visa categories or if you have any questions, please email me at Michael@AshooriLaw.com.  I would be happy to help you.