If you've ever thought, "I want to start a business in the U.S.!" then this post is for you.
Hello, this is Matsui of IMS Legal Professional Corporation. I am happy to report that the number of inquiries to our company is rapidly increasing. Thankfully, the spread of COVID has calmed somewhat, and the global movement of people has increased. In particular, we receive all kinds of inquiries about U.S. visas from companies and individuals every day.
About today's topic, there are many things to think about when starting a business in the United States.
- What kind of business will it be?
- Are there really business opportunities?
- Where should I set up shop (state, city)?
- What type of company (corporation, limited liability company, etc.) should I form?
- How do I establish a corporation?
- What size of investment should I make?
- What is the taxation system?
- Do I need a local partner?
- How should we conduct local research?
At the same time, we would like to emphasize the importance of visa issues when you begin to think about expanding overseas. We understand that sometimes visa issues tend to get put on the back burner. However, there is no doubt that having a good knowledge of visa issues ahead of time will make the subsequent procedures smoother.
The E-2 Visa
If you want to start a business in the U.S., the most appropriate visa is an investment visa called an E-2 visa. The four basic requirements for the E-2 visa are as follows:
- Nationality requirement: The invested U.S. company must be a "foreign national" as well as the visa applicant. For example, Japanese nationals or Japanese companies entering the U.S. market.
- Investment requirement: Aggressive investments with risk are in proportion to the business itself (earnings, etc.)
- The company must be "real": A paper company (shell corporation) is not acceptable.
- Marginality: Applicants must prove that the business will not solely be for the purpose of earning a living for themselves and their families. In other words, the business needs to create U.S. jobs.
Of these, 1 and 2 are particularly important.
Nationality requirement
The E-2 visa also has a concept of nationality for corporations. (The following information assumes Japanese corporations and applicants.) In order for a U.S. corporation to be recognized as a Japanese national, it must be funded by a Japanese national or a "Japanese company". In this case, a "Japanese company" is a company funded by Japanese nationals. In the case of a foreign company, even if the company is located in Japan, in principle, it is not recognized as a "Japanese company". At least 50% of the investment in the U.S. corporation must be made by Japanese nationals or Japanese companies.
Note: Even if the partner is Japanese, if the partner is a green card holder in the U.S., the partner is not considered Japanese for the purpose of E-2 visa.
Investment requirement
The most important point is the concept of "investment". To be considered an "investment" on an E-2 visa, it is not enough to merely transfer funds; the funds must be invested in the U.S. This may be a case of "which comes first, the chicken or the egg?", but for an E-2 visa, the "investment comes first," not the visa. That is why "risky" investments are legally required.
We sometimes receive enviable inquiries such as, "I just bought a condominium in Hawaii for 100 million yen, and I want to get an investment visa." However, no matter how expensive the condominium is, if the family uses the condo only a few times a year when they visit Hawaii, it is not considered an "active" investment. In this case, an E-2 visa cannot be obtained. In other words, the investment must be for business development.
In addition, we are often asked, "How much do I have to invest to get a visa?" This may surprise you, but there is no minimum amount of investment required by law. This is because the required investment amount varies depending on the nature of the business. Generally speaking, at least $200,000 to $300,000 is required, but the visa application process often goes relatively smoothly if the investment amount is large.
If you are thinking about an E-2 visa, we have many more points we would like to share with you! It does not matter if your business plan is still in the blueprint stage. If you have a dream of starting a business in the U.S., please contact IMS for more information.
For more information, please contact us below ↓
https://imsvisa.support/en/contact/
