Buying an Existing Business for an E-2 Visa

For substantiality, an operating business acquisition often provides a more concrete denominator because the parties negotiate a purchase price.

The purchase agreement, asset schedule, valuation, closing statement, and financial records can help explain what the investor is buying and how the price was determined.

The E-2 regulations permit qualifying escrow arrangements.

An investor can enter into a genuine purchase agreement and irrevocably fund escrow while conditioning release on issuance or approval of E classification.

The release conditions should be carefully drafted so the investor is genuinely committed rather than free to withdraw for unrelated reasons.

An existing enterprise usually has revenue, expenses, tax returns, employees, customers, and financial statements.

Those records can make real enterprise and marginality easier to establish, but weak revenue, recurring losses, unexplained tax issues, or collapsing employment can create significant immigration questions.

The purchase price and qualifying E-2 investment are not always the same number.

Debt secured by the assets of the acquired E-2 enterprise generally does not qualify as the investor's personal investment risk.

Seller notes and financing arrangements should therefore be analyzed before presenting the claimed investment amount.

Purchasing a minority interest can create a develop and direct issue even when the amount invested is substantial.

The purchase documents should therefore be reviewed together with voting rights, management provisions, shareholder agreements, and the post-closing governance structure.

• Executed purchase agreement
• Escrow agreement
• Closing statement
• Proof of payment
• Seller financing documents
• Financial statements
• Tax returns
• Payroll records
• Licenses
• Customer and vendor records
• Ownership documents