As the US economy continues to grow, foreign investors are finding it increasingly difficult to invest in companies in the United States. Several US consulates have restricted or suspended the processing of e-visa applications altogether, contributing to a significant drop in foreign investment in US companies.
What is an E visa?
While several countries have visas specifically designed to support non-nationals with start-up businesses, the United States does not. For this reason, non-nationals seeking to start a business, expand a business, or invest in the United States generally rely on electronic visas, which allow admission to the United States for traders and investors coming in the United States under a trade treaty. and navigation between the United States and the country of which they are citizens or nationals. While the various E visa subcategories can be confusing, their overall purpose remains simple: to promote foreign investment in U.S. businesses.
One category of E visas is the popular EB-5 visa (fifth preference based on employment), which offers foreign investors the opportunity to become lawful permanent residents of the United States if they invest substantial capital to finance a business. here. These investments, which generally require between $500,000.00 and $1 million, are used to promote job creation in targeted regions in the United States. In fact, investments in EB-5 visas are credited with providing the country with much-needed capital during the Great Recession.
Decline in foreign investments
Despite the economic support they have given to the United States, foreign investment has been declining for several years. According to the U.S. Department of Commerce’s Bureau of Economic Analysis, foreign direct investment fell 61% between 2018 and 2020, from $312 billion in 2018 to $221.2 billion in 2019 to $120.7 billion. dollars in 2020. Given such a rapid decline in such a short time, it is necessary to determine what is fueling this trend.
Delays and stoppages in e-visa processing
These declines are likely caused by several factors, but one that cannot be ignored is the chilling effect caused by the long delays in processing E visas. EB-5 petitions, for example, have one of the longest treatment times, with current wait times of 44 to 77 months, and even longer for some countries. The long waits continue despite recently announced guidelines from the US State Department to ease treatment restrictions associated with the COVID-19 pandemic.
Unfortunately, it seems that no immediate solution is in sight. In some US consulates, including the US consulate in Bogotá, Colombia, the issuance of E visas has ceased altogether.
Ongoing problems for foreign investors
A recent Forbes article sheds light on the continuing problems facing foreign investors. Recent communications from the Consulate in Bogotá indicated that they are unable to handle E visas at this time. The Istanbul Consulate, citing the pandemic, said the same. These delays have legitimately frustrated foreign investors who are forced to wait, sometimes for years, to start a business in the United States or invest here. Long delays continue to block foreign investment in U.S. businesses at all levels.
Although this issue continues to be a problem for foreign investors, it is not without proposed solutions. The U.S. government has the ability to inform U.S. consulates that they do not have the discretion to simply decline to adjudicate visa applications, including E visas. By eliminating the discretionary aspect of visa processing, it is possible to restart the settlement of the backlog of E visa applications.
Until something changes, however, countless non-citizen investors will be forced to keep waiting.
©2022 Norris McLaughlin PA, All Rights ReservedNational Law Review, Volume XI, Number 356