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Why Emerging Markets Are Not Using Business and Investment Visas

Over the past five years,  foreign business people are using investment and employment based visa solutions to do  business in the United States more than ever before. This trend has not occurred in emerging markets such as Africa and the Caribbean. Immigration is often a significant incentive to foreign businesses looking to provide foreign direct investment into the United States. Of course there are large multi-billion dollar foreign companies that can benefit from business and investment visas, but there are also “mom and pop” sized  enterprises that also play a role in investment related immigration incentives. 

The world’s most powerful and innovative countries take full advantage of the visas available for employment and investment.  Emerging countries in Africa and the Caribbean are far behind in the number of applications for these visas. One primary reason is that many emerging market countries are not eligible to apply for E category visas due to the requirement of a U.S. Treaty authorization. However, even in countries that do have treaties with the United States for the E category visas do not take advantage of the visas.

Here is a link to a list of E visa eligible countries in Africa, the Caribbean, and the Middle East.

Below is good comparison of the disparity of use of the most popular investment visa between developed and emerging countries, the E-2 Treaty Investment Visa. The E-2 visa approvals for June 2017 of the countries that historically apply for the most E-2 visas are as follows: 

  1. Japan - 1,556

  2. Germany - 458

  3. Great Britain - 349

  4. Canada - 297

  5. Mexico - 295

  6. France - 275

  7. Italy - 220

  8. South Korea - 191

  9. Spain - 135

  10. Argentina - 47 

In Comparison, here is a list of E-2 visa approvals of emerging markets in Africa and the Caribbean (remember only this list of countries are eligible for E visas):

CARIBBEAN

Dominican Republic 1

Jamaica 1

AFRICA

Cameroon  1

Democratic Republic of Congo 0

Egypt 21

Eithopia 0

Gabon 1

Liberia 0

Morocco 0

Senegal 0

Togo 0

Tunisia 0

 

What Solutions are out there?

 While  most popular visa solution for foreign entrepreneurs is the E2 Treaty Investor visa, there is also the E1 Treaty Trader Visa and L-1 Intra-Company Transfer Visa. The E1 Treaty Trader visa may be impractical in emerging markets due to limited eligibility. The L-1 is a very viable solutions because there are few country limitations and it may be utilized by executives or special skilled workers of an existing foreign business who opens a U.S. subsidiary.

 Visitor visas are not flexible enough for an executive of a company to establish a business in the United States when the executive plans to be hands on with the business. In fact, in certain cases it is not legal for the the executive or any of his foreign employees to receive compensation in visitor visa status. There are a many other advantages of obtaining an employment or investment based visas as well for persons involved in international business.

 

What are the incentives for the Foreign Business Owners taking advantage of business and investment visas? 

1.    Less red-tape for traveling to the United States – Visitor visas have a lot of limitations and are becoming more difficult to obtain, especially for business people in emerging markets. 

2.    Work Authorization – Visitor visas do not permit a foreigner to legally work in the United States. The L visa comes with a work authorization while the family members of an E visa holder can also obtain work authorization.

3.    Period of Stay – Visitor visas usually only authorize 6 months of visitation at a time and the beneficiary can risk losing the visa if they stay in the United States too long. Both the L and E visa permit lengthy periods of stay for foreign nationals.

4.    Legal Permanent Residence – There are direct and indirect avenues for foreign nationals to obtain Legal Permanent Residence (“Green Card”) through the L and E visa programs.

5.    Education – Many foreigners invest copious amounts of money to facilitate their children being able to receive an education in the United States. Children of E and L beneficiaries may attend school in the United States.

6.    Access to Finance – In many cases, it is easier for a foreign business to receive more affordable financing through an entity domesticated in the United States rather than in their the home country.

7.    Transfer Workers – Both the L and E-1 visa have features that allow for the transfer of employees which facilitates business growth and training.

Why Business People in Emerging Markets may not be taking advantage of investment and employment based visas?

 1. Lack of Knowledge - Most business people in emerging markets are generally unaware of these visas. Queen City Immigration Law is dedicated to the mission of educating the underserved market about global business solutions through the E and L visa categories.

2. Repatriation of Funds - In many countries, there are governmental hurdles to getting USD out of the country. For example, Ethiopia has government regulations to control the flow of USD out of the country due to an effort to curtail inflation of its own currency. These barriers are not always fatal to success as there are private lenders in the market for assisting in these situations. In certain circumstances, our firm is able to introduce the person facing repatriation issues  to a private trade finance lender.

3. Source of Funds - For investment based visas, the United States Citizenship and Immigration Service has strict guidelines about getting comfortable with the SOURCE of the funds used to make the investment. In emerging markets, a lack of records and transparency are fatal to investment deals because USCIS cannot verify the source of the investment.

 4. Corruption - Issues at the consular offices have also been blamed for lack of knowledge about immigration solutions. These issues are commonly foreign government officials creating barriers to complete the application process such as charging miscellaneous fees to provide documentation the petitioner needs for their applications.

Can Undocumented Foreign Natinations in the United States Take Advantage of E and L Visas?

One common question is, whether persons that have overstayed their visa status in the United States can take advantage of these visas. The answer is: it is possible, but very risky. The only way to have a nonimmigrant visa based on employment or investment for these individuals  is to leave the United States and acquire the visa from a consular office. However,  a three (3) year overstay on a visa will trigger a ten (10) year bar from reentering the United States once the foreign national departs. 

There are nonimmigrant visa waivers available for these circumstances such as the I-601 waiver. Additionally,  the foreign national would need to go through the normal process for applying for an L or E visa to have an opportunity to submit a waiver requests. Once the foreign national reaches the consular processing step (done in their home country after the visa application is filed online, generally after an approved petition), the foreign national will be deemed inadmissible based on the overstay in the United States and his case will be denied.

At that point, the consular officer will provide the foreign national with the available options for filing a waiver under section 212 of the INA. These waivers require the submission of a legal brief to prove the case. The consular officers are looking for the gravity of the offense, the risk of harm in admitting the applicant back into the United States, and the importance of the applicant's reason for entering. Decisions are determined on a case by case basis, and the reviewing officer has discretion. Generally speaking, these waivers are not easy. That being said, waivers for nonimmigrant visas are usually easier to obtain than immigrant visas. Keep in mind, they will be temporary (for admission of up to five (5) years). They will not allow for adjustments of status to obtain a green card unless a separate waiver is submitted for that case upon filing it.

Once the waiver is submitted and reviewed, the applicant will be called for an interview at the consulate and a decision will be made. Unfortunately, the applicant will have to leave the US in order to complete this process. Although the foreign national may be eligible for a provisional unlawful presence waiver (which can be filed in the United States while foreign national is there) the foreign national will still need to leave the United States to attend the interview at the consular office. The risk of  leaving to proceed with this process is that, if denied, he will be barred from returning for ten (10) years.

 

Does the Travel Ban Affect Persons Applying for E and L Category Visas?

Another recently common  inquiry is whether or not the Trump administration’s travel ban will affect business and investment based visas in the countries listed in the ban. As far as the travel ban is concerned, it only applies to nationals of “banned” countries  who are applying for visitor visas, and who also do not a bona fide relationship with a person or entity in the United States. So the ban does not apply to applicants of non-immigrant visas based on business or investment. . Additionally, if the applicant is applying for an L-1 visa, the beneficiary’s employment with a U.S. based would be considered a bona fide relationship. Also, if a beneficiary has already been issued a visitor visa and been to the US, even if the ban were to apply to them, the beneficiary would qualify for a waiver.  

Conclusion

Immigration is an underappreciated incentive to global business development, with small to medium sized enterprises. In truth, foreign business partners in emerging markets often do not know of the immigration opportunities available for business people. If you are interested in further explanation or to schedule a consultation, please contact our office at 704-500-2075 or email info@qcilaw.com.

 

Complete Breakdown of Usage of E-1, E-2, and L-1 Visas in Emerging Markets

 

Caribbean

Dominican Republic E2 1

Jamaica E2 1

Trinidad and Tobago L1 8

Trinidad and Tobago L2 9

 

Africa

Cameroon E2 1

Cameroon L1 1

Democratic Republic of Congo 0

Congo, Republic of the L2 1

Cote D'Ivoire L1 1

Egypt E2 21

Egypt L1 27

Egypt L2 43

Ethiopia 0 E-1 and E-2 and L-1 0

Gabon E2 1

Gabon L1 1

Ghana L1 6

Ghana L2 2

Kenya L1 5

Kenya L2 1

Liberia E1 0

Liberia E2 0

Liberia L1 0

Libya L1 1

Libya L2 3

Malawi L1 1

Morocco L1 2

Morocco E2 0

Morocco E1 0

Mozambique L1 3

Mozambique L2 6

Namibia L1 1

Niger L1 1

Nigeria L1 18

Nigeria L2 30

Rwanda L1 1

Senegal E1 0

Senegal E2 0

Senegal L-1 0

South Africa L1 48

South Africa L2 59

Tanzania L1 1

Tanzania L2 4

Togo E1 0

Togo E3 0

Tunisia L1 2

Tunisia L2 3

Tunisia E1 0

Uganda L1 3

Uganda L2 7

 

About the Author  - Sherrod Seward, Esq.

Sherrod Seward is an experienced lawyer with a passion for entertainment, investment, and employment-based immigration law and international business in emerging markets. In addition, he has an extensive background in global risk mitigation as a broker with the Export-Import Bank of the United States. The same cultured approach Sherrod brings to Queen City Immigration Law,  he also applies to his extreme love for all things Cleveland and MMA (Mixed Martial Arts including www.combatsportsvisas.com). Sherrod began his legal career at Cleveland State University, Cleveland-Marshall College of Law in Cleveland, Ohio and did his undergrad at Hampton University in Hampton, Virginia. Since obtaining his Juris Doctor, Sherrod has become more intentional than ever to be an advocate for clients in need of international legal assistance.

 About the Author  - Dinh Tran, Esq.

 A multicultural lawyer with a passion for immigration and an extensive background in global affairs, Dinh is no stranger to diversity, as he is of Vietnamese descent and was raised in Poland.  His native languages are Polish and Vietnamese, and he is fluent in English.

Dinh earned his Juris Doctor from Mercer University’s Walter F. George School of Law, completed several internships at prominent law firms in Hanoi, Vietnam, and holds license to practice in both North Carolina and Georgia. Dinh’s multifaceted approach to legal practice has afforded him the opportunity to further his expertise in the area of immigration and nationality laws, as well as skills in handling cases including personal injury, family law and more.