Q How can a foreign entrepreneur start a company in the U.S.?

A Being in the center of innovation in Silicon Valley, this is a commonly asked question and the following lays out some visa options to explore.

First, the L-1 visa. Known as the intra-company transfer visa, the L-1 visa specifically permits the starting up of a new office in the U.S.  The caveat, though, is that the new office must be related (ex. subsidiary or affiliate) to a foreign company, and the visa applicant must have worked as an executive, manager or specialized knowledge employee for that foreign company for at least one year out of the last three years.  If approved, the L-1 visa is granted for only one year, after which time the L-1 visa holder must apply for a visa extension.  The benefits of this visa are that there are no minimum education requirements and visa holders can likely eventually qualify for the fast-track EB-1 category to obtain permanent residence.  However, all L-1 new office applications must include extensive evidence of the company’s viability as well as proof of sufficient physical premises to house the new company.

Second, the E-2 visa. This visa also permits foreign nationals to start up a new company in the U.S.  However, it is only reserved for citizens of E visa treaty countries.  Unfortunately, India is not an E visa treaty country, but Japan and many South American and European Union countries are treaty countries. If the foreign entrepreneur is a citizen of an E-2 treaty country, then this visa further requires that he or she make an at-risk, “substantial” investment in a bona fide U.S. enterprise. The E-2 investor must also own at least 50% of the startup company. The E-2 investor could potentially stay indefinitely on the E-2 visa, but the downside is that, unlike the L-1 visa, E-2 visa holders are not permitted to pursue permanent residence.

Third, the H-1B visa. Most everyone has heard of the H-1B visa.  Although commonly used by companies to hire specialized workers, it can also be used by foreign nationals to startup a company in the U.S. under certain conditions.  According to a recent initiative by the U.S. Citizenship and Immigration Service, a foreign entrepreneur can apply for the H-1B visa to start a company in the U.S. if he or she can demonstrate that the startup company has the right to control the foreign entrepreneur’s employment (i.e. an employer-employee relationship). Such control would exist, for example, if the company has a separate Board of Directors that has the authority to hire, fire, pay, or supervise the foreign entrepreneur.  As with any H-1B application, the startup company must also still demonstrate its viability to sponsor an H-1B employee.

Finally, the EB-5 visa, which was addressed in the August issue of India Currents.
The above is a very general outline of the visa options available to foreign entrepreneurs.  Each option comes with its own set of unique requirements, but it provides a good place to start for those brave and innovative foreign citizens wanting to launch a startup in the United States.

Priya Alagiri is the founder of The Alagiri Immigration Law Firm, which represents individuals and companies with regard to their immigration matters. Priya is a former Presidential Appointee and has also worked for the U.S. Congress. For more information, please visit alagirilaw.com.