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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 innovate 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.

Here is a 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 Carribean (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 no country limitations and it may be utilized by executives or special skilled workers of an existing business.

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 Owner?

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 in emerging markets.

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

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

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 their location in 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.

A Complete breakdown of the requirements and benefits of each of these visas for foreign investors and business people can be found at this link.

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

  1. Lack of Knowledge - We believe that most business people in emerging markets are generally unaware of these visas. Since their market and business to business trade is not as developed as developed nations, the conversation never happens. Queen City Immigration Law is dedicated to the mission of educated the underserved market about global business solutions through E and L visa categories.

 

  1. Repatriation of Funds - In many countries, the 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. We may be able to introduce you to a lender.

  2. Source of Funds - For investment based visas, the United States Citizen 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.

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

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