Entrepreneurs applying for an E-2 Investor Visa must meet several key requirements to qualify. One of the most important—and often misunderstood—is the real and operating business requirement.
This rule ensures that the business is not just an investment on paper but an actual, functioning enterprise that will provide goods or services once the visa is issued. Failure to meet this requirement can result in visa denial, making it crucial to understand what the U.S. government expects.
This article will explain:
- What the real and operating business requirement entails
- Why passive investments (such as real estate holdings) do not qualify
- The documentation required to prove operational readiness
- How to properly prepare your E-2 visa application
What Does “Real and Operating” Mean for an E-2 Visa?
To qualify for an E-2 Visa, the business must be real and operational, meaning:
- It actively sells a product or service
- It is not a speculative or passive investment
- It is ready to operate as soon as the visa is approved
Example of an Eligible Business:
- A restaurant that has signed a lease, purchased equipment, and begun hiring staff.
Example of an Ineligible Business:
- An investor purchasing real estate properties without actively managing a business.
Why Passive Investments Do Not Qualify
Some investors mistakenly assume that purchasing stocks, real estate, or other assets will meet the E-2 investment requirement. However, the U.S. government specifically excludes passive investments that do not involve active business operations.
Businesses that face higher scrutiny for E-2 approval include:
- Real estate holding companies that do not offer property management services
- Stock trading or asset speculation firms
- Any business that does not require active involvement from the investor
To increase the likelihood of approval, investors in real estate or investment firms should demonstrate that the business will:
- Employ U.S. workers
- Offer services to the public beyond personal or family connections
- Have the necessary licenses and permits
Without clear proof of active business operations, an E-2 visa application is likely to be denied.
How to Prove That Your Business is Ready to Operate
Many E-2 visa applicants fail to provide sufficient evidence that their business is operational. The consular officer reviewing the application wants to see proof that the company can begin providing goods or services immediately after visa approval.
To demonstrate compliance, applicants should include the following documents:
1. Business Legitimacy Documentation
- Business registration and incorporation documents
- Lease agreements for office or retail space
- Relevant business licenses and permits
2. Operational Readiness Evidence
- Proof of a business bank account with active transactions
- Purchase agreements or invoices for business equipment and supplies
- A professionally developed website marketing the business
3. Hiring and Financial Documentation
- Payroll records (if employees have already been hired)
- Five-year financial projections demonstrating growth and sustainability
- Signed contracts with potential clients or vendors
By providing comprehensive documentation, applicants can assure the consular officer that the business is not just an idea but a fully developed enterprise ready to launch immediately.
Do E-2 Businesses Need to Generate Revenue Before Visa Approval?
A common misconception is that an E-2 business must already be generating revenue before visa approval. While some businesses may have income before submitting their application, it is not required.
Applicants can still receive an E-2 visa if:
- The business has not yet earned revenue
- Employees have not yet been hired
However, in these cases, the application should include a detailed business plan outlining a five-year strategy for hiring and revenue generation.
Key Takeaways for a Strong E-2 Visa Application
To improve the chances of approval, applicants should ensure that their business meets the real and operating requirement by:
- Choosing a business that actively provides a product or service
- Avoiding passive investments, such as real estate holdings
- Providing clear evidence of business setup and operational readiness
- Submitting all necessary documentation, including financial projections and contracts
For investors unsure about their application, consulting an immigration attorney can help avoid common pitfalls and increase the likelihood of success.
If you are considering starting or investing in a business in the U.S. and want to explore the E-2 visa option, we can help! Schedule a consultation with our experienced immigration attorneys today to discuss your eligibility and the steps needed to achieve your immigration and business goals.
