A different path to the U.S. – the E2 visa

When you hear “Filipino immigrant” or “Fil-Am,” the first image that comes to mind might be a hardworking health care worker who works 2 or 3 jobs at multiple hospitals and urgent care facilities across the city, or a debonair IT programmer or CPA who doubles as a karaoke master, all of whom are reliable coworkers who’ll pick up overtime or extra shifts for you.

Or you might be more familiar with second or third generation Fil-Ams who grew up eating the food but not speaking the language, or engineers or lawyers who are the children of Filipino teachers or doctors who immigrated decades ago. But there is another path forward that is available to Filipinos that few of us take advantage of — through investment and entrepreneurship.

What is the E-2?

A lesser-traveled path that Filipinos can take to the U.S. is through the E-2 treaty investor visa, which stems from a treaty of commerce and navigation signed by the U.S. and the Philippines in 1955. Although it is not a permanent immigration visa, E-2 is designed for investors who develop and direct the operations of an enterprise in which they have invested a substantial amount of capital. E-2 status can be granted for up to 2 years, in renewable increments, and can cover the investors, their spouses and minor children.

E-2 also covers other Filipino nationals that work for the business, as long as they are supervisors, executives, or have specialized knowledge. There is no limit to how many times E-2 status can be renewed, but you must be clear that you and your employees intend to return to the Philippines after your E-2 status ends. E-2s can travel freely in and out of the U.S. and are usually stamped in for 2 years each time they enter. Although E-2s are technically non-immigrants, E-2s can live in the U.S. for decades, so long as they continue operating their business and complying with American law.

What are the requirements of E-2?

To be eligible for an E-2, at least 50% of the business must be owned by Filipino nationals, and it needs to be a real business. Businesses that only exist on paper or optimistic business projections won’t fly. An E-2 business is a real, active and operating commercial or entrepreneurial undertaking which produces services or goods for profit. It must be legally registered in the jurisdiction where it operates, and the initial capital must be from clean, traceable money. Many types of small business qualify, and they can be new entities or even existing businesses that the investor buys or invests in, ideally with operational control.

Although many E-2s go through the same visa application and interview process through the U.S, Embassy in Manila, lawful non-immigrants such as F-1 students can change status to E-2 within the U.S. This means that Filipino international students who graduated from U.S. colleges but don’t have an employer or weren’t picked in the H-1B lottery can pivot to become entrepreneurs instead.

Show me the money

Unlike the pricier EB-5, we’re not talking a million dollars here, and there’s no set minimum numbers of U.S.-based jobs your business must create, although creating more jobs increases the chance of approval. An investment of $100,000 can count as a “substantial” investment in an E-2 business. This is less than the pre-selling price for a studio apartment in a Metro Manila condo, and has a much faster return on investment. A good rule of thumb for an E-2 business is that you need to be making a significant profit within 5 years or less. Unlike EB-5, your money is not parked and untouchable — it’s working capital that grows.

There are many examples of possible E-2 businesses, from laundromats or restaurants to more technical, possibly IT-oriented firms. You can even franchise an existing business. Those of us who live in areas far from a Seafood City would welcome Filipino food franchises such as the ones famous for fried chicken, french fries, or ube ensaymadas. Considering the current pandemic, perhaps a modern e-commerce enterprise might be a good idea.

Prove that it works

Aside from forms and interviews with U.S. immigration officers, the key piece to an E-2 application is the business briefing book. Now, many of you are probably CPAs or MBAs, or if not, you might have some on staff. Pro-tip: Don’t forget your audience. Your average USCIS or State Department officer probably doesn’t have a degree in business — they might even be a student or recent grad with no actual work experience.  Filipinos love to use big words, industry-specific jargon, and especially acronyms, and all of this might be more of a disadvantage than an advantage. Consider hiring a professional, who can take the complicated concepts of your business and explain it so a high school student or someone who’s never been to school can get what it is that your business does.

Where do I go?

There are two main ways to get the E-2 visa. The first way is to change status from another non-immigrant status such as F-1 student. If you are the principal investor or your employees are already in the U.S. in lawful status, you can file with USCIS — the federal agency that adjudicates immigration benefits for people physically in the U.S. If you are the principal investor, your spouse and children under 21 can accompany or follow you to the U.S. An E-2 spouse can apply for work authorization, while a child dependent cannot work but can generally study in school.

If you’re in the Philippines, you would apply through the U.S. Embassy in Manila. Either way, E-2s can travel in and out of the U.S., and each time you return, you can be admitted for up to 2 years assuming the CBP officer at the border finds you admissible. E-2 dependent stays will not usually be granted for longer than the main E-2 investor, and you must intend to depart the U.S. at the end of your E-2 stay.

There’s nothing wrong with working professional jobs or government jobs like USPS that come with retirement benefits, but entrepreneurship can be a different way for Filipinos to come to America. The Philippines is one of roughly 60 nations in the world whose citizens are eligible, and more importantly, E-2 visas are one of the few visa categories that are not currently suspended by executive order. If you have some capital and a great business idea, why not try it Stateside and see what happens?

Jath Shao is a Filipino-American attorney with clients across the U.S. and around the world. He understands the challenges immigrants face, which helps him advise, advocate for and address their legal needs in various fields of law. Contact [email protected] with any questions, comments, or concerns.