E-2 Visa "Foreign investors in CBI programs will have to reside in Grenada for 3 years first"
By Yang Fankai
The U.S. E-2 visa situation has changed dramatically. As one of the earliest immigration lawyers who participated in the E-2 visa application for third-country passports, the author would like to analyze the corresponding short-, medium- and long-term countermeasures for this sudden political change.
What happened?
In a nutshell, the U.S. Congress passed a new law, adding the requirement that investors who apply for E-2 visas with third-country passports from treat countries (i.e Grenada, Turkey, etc.) need to live in the treaty country for 3 years. The relevant change is highlighted in yellow as follows:
"(E) an alien entitled to enter the United States under and in pursuance of the provisions of a treaty of commerce and navigation between the United States and the foreign state of which he is a national, or, in the case of an alien who acquired the relevant nationality through a financial investment and who has not previously been granted status under this subparagraph, the foreign state of which the alien is a national and in which the alien has been domiciled for a continuous period of not less than 3 years at any point before applying for a nonimmigrant visa under this subparagraph, and the spouse and children of any such alien if accompanying or following to join such alien; (i) solely to carry on substantial trade, including trade in services or trade in which the alien is a national; or (ii) solely to develop and direct the operations of an enterprise in which the alien has invested, or of an enterprise in which the alien is actively in the process of investing, a substantial amount of capital. (cited with emphasis on certain terms)
The new law is signed into law by President Biden. A more detailed explanation is that the above-mentioned “3-year residency requirement” was attached to the Act (AMIGOS Act) granting Portugal E-2 treaty country status, which in turn was attached to the annual defense budget for the 2023 fiscal year.
The specific content of the E-2 changes
Medium-term strategy – Challenging the legal interpretation of “financial investment” in the law
As stated above, the new law only limits E-2 applicants who are (1) first-time applicants and (2) obtain their passports through a “financial investment.” The concept of “financial investment” is not a definitive concept defined by the Immigration and Nationality Act. According to the case of Scheidler v. Nat’l Org. for Women, Inc. 537 USD 393 (2003), the principle of legal interpretation in the United States, is that in the absence of a clear legislative intent of Congress, if a word in the law is not clearly defined, it should be construed in accordance with the ordinary common law definition of that term. However, under the common law, that is, under the framework of contract law in the United States, there is a clear requirement for “investment” to “create income”. Therefore, for investors who obtain passports of treaty countries through donations (or certain fixed deposits with no returns), challenging the legal interpretation of
President Biden signed the bill on December 23, 2022, enshrining new E2 visa regulations for treaty investors in law with immediate effect.
"Foreign investors in CBI programs will have to reside
in CBI country for 3 years first"
“financial investment” for investors who “donated” is a legal defense that can be tried. Of course, the author cannot predict whether the trial judge or the visa officer will agree with this point of view. It may be necessary to go through a lawsuit to make a final confirmation of the feasibility of this approach.
Long-term strategy 1 – change the application direction to EB-5, EB1C or C-1
For some suitable E-2 investors, it is possible to meet the requirements of L-1/EB-1C or EB-5 if they can increase the scale of the enterprise or the amount of investment. Of course, EB-5, L-1, and EB-1C have specific administrative requirements to be aware of. For EB-5, due to the passage of the revised EB-5 regulations in 2022; if the project location is in a rural or high unemployment area (“TEA”), it is possible to obtain an EB-5 green card in a relatively short period of time if the investment can be changed into an EB-5 direct investment project. Due to limited space, the author will not go into details about the strategy of changing the application direction. Interested readers can contact me individually for discussion.
Long-term strategy 2 – Political lobbying
Obviously, this E-2 change was very sudden, and its legislative procedure was very unfair to investors. There was negative news about any third-country E-2 project this year, and for a non-immigrant visa project that attracts investment and creates jobs for the United States, the E-2 visa is beneficial to the national interests of the United States without any harm. Of course, I don’t think it is realistic to make any changes in the defense budget at this stage. However, in the long run, this non-immigrant program that benefits the US economy has a lot of room for political lobbying. Since individual congressmen are able to act secretly through this unfair form, our industry should also take active actions to state the significant contribution of third-country E-2 investors to the US economy, express our demands, and attempt to use political lobbying to amend the law again. If you are interested in participating in or understanding the process of political lobbying, you can contact the author of this article, lawyer Oliver Yang (fyang@reidwise.com/WeChat oliveyanglaw1). The author hopes to gather the greatest power in the industry and cooperate with the best lobbying team in Washington to try to solve this problem at the legislative level.
This article is for communication purposes only and does not represent the legal opinion or interpretation of the law
Author : Yang Fankai, Ruiming Wenze Law Firm
USA refuses Grenada’s CBI passport holder from E2 investment visa.
CBI passport holders from Grenada now have to live in the country for three years before applying for an E2 Investment Visa in the USA. These are the new guidelines for the eligibility of applying for an E2 Investment Visa.
This decision by the USA affected Grenada’s Citizenship By Investment plan, as it was the only Caribbean nation with whom the USA went under the treaty, after which the CBI passport holders will get an E2 investment visa. This decision, after some years, became a security threat for the USA as most of the people who purchased citizenship under the CBI program of Grenada do not live there and only want to get a USA E2 visa, which was proven as a wide-open loophole.
The American government and their few agencies reported that most of the crimes that happened in the past were also the main reason. According to some sources who have invested in Grenada and purchased CBI passports, they have been suspected to be one of the reasons.
Like every developing nation Grenada also generated revenue by selling passports under the CBI program:
$ 24 million in the year 2021
$ 78million in the year 2022
Moreover, the newly elected government in Grenada is estimated to generate revenue of $ 240 million in 2023. After this decision by the USA, the country may be affected economically as this decision made Grenada’s CBI programme less appealing to buyers after it has been put under high-risk jurisdictions.
The E-2 Visa is a nonimmigrant investor visa for foreign individuals from treaty countries seeking to operate a business in the United States. The E-2 Visa is available to foreign nationals from treaty countries, including the United Kingdom, Australia, Japan, Argentina, and Ethiopia. Countries with no treaty with the US for the E2 Visa include India, China, Vietnam, Kenya, and Dubai.
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By BowTiedMara
The National Defense Authorization Act (NDAA), which includes the AMIGOS Act, which modifies E2 visa requirements, was introduced in the United States House of Representatives. The new law would only let CBI-origin citizens of a treaty country apply for E1 and E2 visas if they have been “domiciled” in their new country for at least three years.
President Biden signed the bill on December 23, enshrining new E2 visa regulations for treaty investors in law with immediate effect.
Foreign investors in CBI programs will have to reside in CBI country for 3 years first
The National Defense Authorization Act, an omnibus bill that authorizes the continuation of a wide range of federal programs and spending, is about 2,000 pages long.
None of the minimum investment amounts (for the E2 this has to be a significant amount, no predefined amount) or existing rules changed.
However, the section of the law that expressly applies to E2 visa modifications is the rather brief Section 5902:
(B) MODIFICATION OF ELIGIBILITY CRITERIA FOR E VISAS.–SECTION
101(A)(15)(E) OF THE IMMIGRATION AND NATIONALITY ACT (8 U.S.C.
1101(A)(15)(E)) IS AMENDED–
(1) IN THE MATTER PRECEDING CLAUSE (I)–
(A) BY INSERTING “(OR, AND WHO HAS NOT PREVIOUSLY BEEN GRANTED STATUS UNDER THIS SUBPARAGRAPH, THE FOREIGN STATE OF WHICH THE ALIEN IS A NATIONAL AND IN WHICH THE ALIEN HAS BEEN DOMICILED FOR A CONTINUOUS PERIOD OF NOT LESS THAN 3 YEARS AT ANY POINT BEFORE APPLYING FOR A NONIMMIGRANT VISA UNDER THIS SUBPARAGRAPH)”
BEFORE “, AND THE SPOUSE”; AND
(B) BY STRIKING “HIM” AND INSERTING “SUCH ALIEN”; AND
(2) BY STRIKING “HE” EACH PLACE SUCH TERM APPEARS AND INSERTING “THE ALIEN”.
The phrasing clearly indicates that the law’s goal is to dissuade CBI jurisdictions from leveraging E2 access as an extra value proposition in program promotion. However, the law is wide enough to allow for interpretation and it is unclear how it will impact current visa applications or processing times.
Grenada Citizenship by Investment loses main E2 Visa selling point
Grenada Passport CoverIt is unclear what this means for Grenada’s CBI program, but it is likely that this shortcut will not be available in the future unless the CBI investor first resides on the island for at least three years.
This requirement is likely to impede the growth of a country’s CBI program, especially if that country is Grenada, whose programs don’t need applicants to visit or live in the island nation. Unrestricted access to the E-2 Visa is one of Grenada’s programs’ primary selling advantages.
The interpretation of the two phrases by the US government will be critical in determining
whether countries such as Grenada, Turkey, or Montenegro may continue to utilize their E2 treaty status as a selling feature for their citizenship by investment program.
Both the legal systems of the United States and Grenada are founded on common law, which historically interprets the term “domiciled” (typically in connection with tax issues) as the country in which the individual “belongs” and makes their permanent home. In practice, determining one’s nation of residence usually entails making a qualitative case.
The Grenada Donation is not an “Investment”
It’s unclear how the US government will define “financial investment.” To characterize an unrecoverable donation to Grenada’s National Transformation Fund – which expressly excludes the possibility of earning any financial returns – as a “investment” (financial or otherwise) would require defining the term in a fundamentally new way.
Grenada E2 visa route allowed Russian nationals to evade sanctions here.
whether countries such as Grenada, Turkey, or Montenegro may continue to utilize their E2 treaty status as a selling feature for their citizenship by investment program.
Both the legal systems of the United States and Grenada are founded on common law, which historically interprets the term “domiciled” (typically in connection with tax issues) as the country in which the individual “belongs” and makes their permanent home. In practice, determining one’s nation of residence usually entails making a qualitative case.
The Grenada Donation is not an “Investment”
It’s unclear how the US government will define “financial investment.” To characterize an unrecoverable donation to Grenada’s National Transformation Fund – which expressly excludes the possibility of earning any financial returns – as a “investment” (financial or otherwise) would require defining the term in a fundamentally new way.
