An individual or company that is engaged in a substantial amount of trade between the US and a treaty country may qualify the “trader” or key employee for an E-1 visa.
Generally, the overall requirements include:
(1) The requisite treaty exists;
(2) The individual and/or business possess the nationality of the treaty country;
(3) The activities constitute trade within the meaning of INA 101(a)(15)(E);
(4) Such trade is substantial;
(5) Such trade is principally between the US and the treaty country;
(6) The applicant, if an employee, is destined to an executive/ supervisory position or possesses skills essential to the firm’s operations in the United States; and
(7) The applicant intends to depart the US when the E-1 status terminates.
To discuss what the Embassy will look for when reviewing the above requirements, I provide the following:
(1)First, we must have a Treaty of Commerce and Navigation or similar treaty with the visa applicant’s country. That can be verified at the State Departments “reciprocity schedule” for the country to see if an E-1 visa is available. See http://www.travel.state.gov/visa/reciprocity/index.htm.
An E-1 visa may be obtained by the person owning and engaging in the trade, or for a person from the same treaty country entering to work in a managerial or executive position or using essential skills, and the person has the
Trade for E-1 purposes consists of three ingredients, each of which must be present in all E-1 cases. The three requirements are:
(3.1) Trade must constitute an exchange – There must be an actual exchange, in a meaningful sense, of qualifying commodities such as goods, moneys, or services to constitute transactions considered trade within the meaning of INA 101(a)(15)(E)(i). An exchange of a good or service for consideration must flow between the two treaty countries and must be traceable or identifiable. However, the fact that proceeds from services performed in the U.S. may be placed in a bank account in a treaty country does not necessarily indicate that meaningful exchange has occurred if the proceeds do not support any business activity in the treaty country. Title to the trade item must pass from one treaty party to the other.
(3.2) Trade must be international in scope – The purpose of these treaties is to develop international commercial trade between the two countries. Development of the domestic market without international exchange does not constitute trade in the E-1 visa context. Thus, engaging in purely domestic trade is not contemplated under this classification. The traceable exchange in goods or services MUST be between the US and the other treaty country.
An alien cannot qualify for E-1 status for the purpose of searching for a trading relationship. Trade between the treaty country and the US must already be in progress on behalf of the individual or firm to entitle one to treaty trader classification. Existing trade includes successfully integrated contracts binding upon the parties which call for the immediate exchange of qualifying items of trade.
(3.3) Trade must involve qualifying activities –
a. As noted above, trade for E-1 purposes involves the commercial exchange of goods or services in the international market place. In the rapidly changing business climate with an increasing trend toward service industries, many more services, whether listed below or not, might benefit from E-1 visa classification.
b. To constitute trade in a service for E-1 purposes, the provision of that service by an enterprise must be the purpose of that business and, most importantly, must itself be the saleable commodity which the enterprise sells to clients. The term “trade” as used in this statute has been interpreted to include international banking, insurance, transportation, tourism, communications, and newsgathering activities. (Aliens engaged in newsgathering activities, however, should usually be classified under INA 101(a)(15)(I).) These activities do not constitute an all inclusive list but are merely examples of the types of services found to fall within the E-1 meaning of trade. Essentially, any service item commonly traded in international commerce would qualify.
(4) Trade Must Be substantial -
a. The word "substantial" is intended to describe the flow of the goods or services which are being exchanged between the treaty countries. That is, the trade must be a continuous flow which should involve numerous transactions over time. Consular officers should focus primarily on the volume of trade conducted but they should also consider the monetary value of the transactions as well. Although the number of transactions and the value of each transaction will vary, greater weight should be accorded to cases involving more numerous transactions of larger value.
b. The smaller businessman should not be excluded if demonstrating a pattern of transactions of value. Thus, proof of numerous transactions, although each may be relatively small in value, might establish the requisite continuing course of international trade. Income derived from the international trade which is sufficient to support the treaty trader and family should be considered as a favorable factor when assessing the substantiality of trade in a particular case.
(5) Trade Must Be Principally Between US and Country of Alien’s Nationality
The general rule requires that over 50 percent of the total volume of the international trade conducted by the treaty trader regardless of location must be between the US and the treaty country of the alien’s nationality. The remainder of the trade in which the alien is engaged may be international trade with other countries or domestic trade. The application of this rule requires a clear understanding of the distinctions in business entities described below.
a. Measurement of Trade -
To measure the requisite trade one must look to the trade conducted by the legal "person" who is the treaty trader. Such trader might be an individual, which was often the case many years ago, a partnership, a joint venture, a corporation (whether a parent or subsidiary corporation), etc. It is important to note that a branch is not considered to be a separate legal person or trader but part and parcel of another entity. In contrast, a subsidiary is a separate legal person/entity. Thus, to measure trade in the case of a branch, the consular officer shall look to the trade conducted by the entity of which it is a part, usually a foreign-based business (individual, corporation, etc.).
b. Effect on Employee’s Responsibilities in US -
If the trader, whether foreign-based or U.S.-based, meets this percentile requirement, the duties of an employee need not be similarly apportioned to qualify for an E-1 visa. For an example, if a U.S. subsidiary of a foreign firm is engaged principally in trade between the United States and the treaty country, it is not material that the E-1 employee is also engaged in third-country or intra-U.S. trade or that the parent firm’s headquarters abroad is engaged primarily in trade with other countries. As noted above, this would not be true in the case of a branch of a foreign firm.
As you can see, these provisions are designed for those actually engaging in an exchange between the two countries (monies, shipments, etc.), whereas the E-2 "investor" provisions do not necessarily require any return in goods, monies, etc. to the treaty country. An investor can essentially abandon business ties to the home country, but the E-1 contemplates continued business, exchange, etc.
After you have had an opportunity to review these detailed requirements, if you think that you can qualify and wish to move forward with this office, please advise us.