L-1 vs E-2 Visa: Which US Work Visa is Right for Your Business?
Why Are You Considering a US Work Visa?
If you want to move permanently to the U.S. and meet the criteria for both, there’s little doubt that the L-1A visa is the way to go. The L-1A is very similar to the EB-1C green card, and has the added advantage of being dual-intent exempt.
But the L-1A isn’t for everyone. And if you have no plans to live permanently in the U.S., the E visa may be the better way to go.
Why Do You Want a Visa?
We’re surprised how many clients ask about how much time it will take to apply for an E visa or L visa and what we charge, before they’ve figured out their own motivations.
Commonly, they tell us that they Googled U.S. visas, asked ChatGPT, or a friend of a friend told them they must apply for this visa!
They’re then unprepared when we ask the most basic questions: why do you want to move to the U.S.? If you had a visa that allowed you to do anything you wanted, what would you do?
First, you need to understand your motivations and intentions.
Key Questions:
- Are you mainly motivated by business or lifestyle?
- Are you moving for you, or are you moving for your family?
- Do you want to keep your business running on both sides of the Canada-US border?
- Are you expecting to turn an immediate profit when you open in the U.S. or are you prepared for losses?
Understanding your motivations will help your US immigration lawyer figure out the best option for you. If you haven’t given it any thought, now’s the time to ask yourself the question: why do you want a U.S. visa?
Which Business Owners Qualify for L-1 or E-2 Visas?
After you’ve thought about your motivations, the next step is to determine which visa type you may qualify for. A thorough assessment requires answering a number of questions:
- Are you expanding your Canadian business into the U.S., starting a new business in the U.S., or purchasing a business in the U.S.?
- When do you need to be in the U.S.?
- Do you have employees in Canada?
- Are you planning to hire employees in the U.S.?
- Are you able to stay for long periods in the U.S.?
- Do you have existing customers or clients in the U.S.?
- How much do you have available to invest in the U.S.?
- Do you have any business partners?
Size of business, scale of operations, family planning, funds available for investment – these are all factors that influence what visa you can apply for. So, while it may be nice to say you want an L visa or E visa, it must be the right visa for you and your business.
We often remind clients not to get caught up in hype about visas they read online or heard from friends. Picking a visa because of hype can cost you dearly later, when it becomes clear that the visa doesn’t match your motivations.
It’s also important to realize that some of your motivations may conflict. Expect there to be trade-offs. You may be able to get most of what you want, but if you expect to get everything, you’re likely setting yourself up for disappointment.
Don’t get trapped by the sales tactics of E visa consultants. A visa application is always more work for you than you think before going in, and you will need to make some sacrifices. But a visa plan that matches best with you and your business is a great way to ensure business and immigration success.
A US immigration lawyer will be honest with you about these trade-offs and help you determine the benefits and risks of a visa application.
L-1A Visa Requirements for Business Owners
What is an L-1A Visa?
An L-1A visa is often suited to a business owner/operator who has been running their business in Canada for a few years, earns a regular income from that business, has employees in that business, can delegate management responsibilities to some of those employees, and would like to expand their business into the U.S. either through a branch expansion, establishing a subsidiary, or purchasing a related business in the U.S.
L-1A Visa Eligibility: Do You Qualify?
The L-1A requires a relationship between the Canadian and U.S. businesses. Commonly, this is a parent-subsidiary relationship, though affiliations where both businesses have common ownership, or branch operations where the Canadian company itself operates across the border, are also eligible. For tax and corporate planning reasons, branches are the least common relationship.
L-1A Parent-Subsidiary Requirement
For simplicity of immigration, tax and corporate law, a strong parent-subsidiary model is often selected. That is, your Canadian company will own 100% of your new U.S. enterprise, and will fund expansion, startup or acquisition.
You must have an office in the U.S., and a plan to hire staff in your first year.
Your Canadian company can supply financial and human resources to support the U.S. business.
L-1A vs Sole Proprietorship
A sole proprietorship or family run business, where you are the only person working for the company (or you and your spouse), is not typically able to meet the requirements of an L-1A.
The L-1A is therefore for small-medium sized business owning entrepreneurs.
It’s also for large companies and multinational corporations.
Put another way, if you’re running a very small business, an L-1A is probably not right for you.
An immigration lawyer can assess whether you look like a good fit for an L-1A visa.
E-1 and E-2 Visa Requirements and Qualifications
Well, there are two types of E visas:
- E-1 Treaty Trader, and
- E-2 Investor
An E-1 Treaty Trader is someone or some business that is already doing substantial cross border business with the U.S., and needs a visa for the owner/operator or key employees to be in the U.S. You can be doing business in the U.S. by selling goods or services.
An E-2 Investor is someone who is starting a new business or buying an existing business, and is making a substantial investment to launch or assume operations.
What is an E-1 Treaty Trader Visa?
An E-1 Treaty Trader might be a consultant who has U.S. customers and is providing services to them remotely from Canada. Or it could be a wholesaler selling clothing to customers in the U.S., a brand manager growing their U.S. clients’ online image, or an advertiser producing short commercial films.
E-1 Visa Substantial Trade Requirement
The key is that there is an element of cross-border trade and that the trade is substantial. For a small business owner or sole proprietor, substantial trade may simply be that your business in the U.S. will generate enough income to support the livelihood of you and your family. For larger businesses, we may examine the total volume of trade and percentage of all international trade outside Canada to determine substantiality.
The corporate structure for E-1 visa holders is very flexible. You can be a sole proprietor or a large multinational corporation. You can keep your Canadian business running or you can close it down and operate exclusively in the U.S. And you can remain a small provider or grow to as large as you wish.
A US E1 visa lawyer can assess whether you look like a good fit for an E-1 visa.
Related: E-1 visa services
What is an E-2 Investor Visa?
An E-2 Investor is committing their own dollars to operate a profitable business in the U.S. You must make your irrevocable, at-risk investment before you apply for your visa. The visa application is also made to a consulate or embassy, and can take a few months to adjudicate.
If you’re a small business owner, and you’re not sweating or losing sleep after having made an investment and now needing to wait months for a visa, you probably aren’t doing it right!
E-2 Visa Investment Amount: How Much Do You Need?
Your investment can be from loans or personal savings, but it cannot be leveraged against the assets of the business nor be conditional on closing. The only time you can keep your investment in escrow is if the investment of funds is conditional on E visa issuance. Other conditions or qualifications intended to mitigate your risk can result in an E visa refusal.
For small business investors making an investment of about $100,000, your investment must be enough to fully commence business operations. For startups, you might find yourself spending a lot of money to get the business nearly ready for opening before you can apply for your visa, or else you’ll need to transfer those funds into a U.S. business bank account for the business with a clear and reasonable plan to spend that money.
Often, that means supporting your investment with a business plan complete with financial projections, hiring plans and market assessments. You must present a clear and convincing case that your investment is sufficient to launch operations, and generate a non-marginal profitable return. This means your business must be able to support at least you and your family, with something left over – typically, to hire 1 or more staff.
Should You Buy an Existing Business for E-2 Visa?
For small business owners, it can often be easier to purchase an existing business in the U.S. with employees than launch new operations. You’ll still need to show how your investment will generate non-marginal returns, such as by paying you an income and supporting the incomes of existing employees of the business. But by buying a business with a decent positive income statement and assets, a convincing management strategy – based on your prior management experience and small business ownership expertise – may be enough to result in a visa.
A US E2 visa lawyer can assess whether you look like a good fit for an E-2 visa.
Related: E-2 visa services
Key Differences: L-1A vs E-2 Visa Comparison
L-1A vs E-2: Employee Requirements
The E visa is different than the L-1A in that:
Sole proprietor entrepreneurs can qualify for an E visa, whereas they usually cannot qualify for an L-1A.
E visa entrepreneurs don’t need employees in Canada whereas L-1A entrepreneurs must have employees in Canada including management personnel.
L-1A vs E-2: Hiring and Staffing
E visa entrepreneurs don’t always need to hire employees in the U.S. whereas L-1A entrepreneurs must staff their U.S. operations.
L-1A vs E-2: Corporate Structure Differences
E visa entrepreneurs have a variety of corporate structures available to them, whereas L-1A entrepreneurs are usually best served by a parent-subsidiary corporate structure.
Which Visa Allows Sole Proprietors?
E visa entrepreneurs must be engaged in substantial trade or have made a substantial investment sufficient to create a profitable U.S. business, whereas L visa entrepreneurs can rely on their existing Canadian business to support U.S. business operations.
Comparison Table: L-1A vs E Visa
| Feature | L-1A Visa | E-1 Visa | E-2 Visa |
|---|---|---|---|
| Sole proprietors qualify? | Usually cannot | ✅ Yes | ✅ Yes |
| Employees needed in Canada? | ✅ Yes (management) | ❌ No | ❌ No |
| Must hire in US? | ✅ Yes | ❌ Not always | ⚠️ Eventually |
| Corporate structure | Parent-subsidiary preferred | Flexible | Flexible |
| Basis for visa | Intra-company transfer | Substantial trade | Substantial investment |
We often like to think in terms of size and scale when comparing E and L entrepreneurs, but the details matter. You will likely need a US immigration lawyer to help you figure out the costs and benefits of these differences, and determine which visa is right for you.
Related: Immigration lawyer Toronto
L-1 vs E-2 Visa: Processing Time, Green Card Path, and Duration
L-1A to EB-1C Green Card: Fastest Path to Permanent Residency
Unlike the L-1, the E-1 visa does not have an analogous permanent residency visa, and is not dual-intent exempt. The E-2 somewhat has an analogous permanent residency visa type, the EB-5, but don’t let appearances fool you. Practitioners are well aware that the EB-5 is very different than the E-2, with much higher investment and job creation thresholds.
Put another way, if you are a significant investor/entrepreneur, and your enterprise investment may qualify you for an EB-5 permanent residency, you may also qualify for an E-2 visa, but smaller investors may not be eligible for EB-5.
L-1 Visa Application Process: Port of Entry vs Consulate
Canadians can apply for an L-1 at a port-of-entry into the U.S. This means on-the-spot, same-day processing, and is great if you need to start working in the U.S. right away. You travel to the port-of-entry as a visa-exempt traveller and seek admission into the U.S. in nonimmigrant status in the L classification.
E-2 Visa Processing Time and Consulate Interview
The E visa application must be submitted to a consulate or embassy for visa processing. You cannot travel to the U.S. to obtain E classification without a valid E visa. This means waiting for consular adjudication and available appointments for your E visa interview. Waiting 2 or 3 months after submission for a decision is common.
L-1 and E-2 Visa Duration
The L-1 for a startup is typically valid for 1 year, with 2-year extensions available up to a total maximum time in the U.S. of 7 years. After 7 years in the U.S., you must leave for 1 year, or else you must have acquired a Green Card before the 7-year maximum is reached. This is usually not an issue since you can apply for the EB-1C after 1 year of maintaining business operations in both Canada and the U.S.
The E visa is typically valid for 5 years. When you enter the U.S., you are given 2-years of status. Each time you leave and re-enter the U.S., your status should be extended for 2 years, until you reach your 5-year limit. If you never leave the U.S., you’ll need to extend your status in the U.S. Staying beyond your 2-year status, even if you have a 5-year visa, can result in an overstay and inadmissibility. It’s important therefore to understand the difference between visa and status.
Can You Get a Green Card from E-2 Visa?
The L visa is dual-intent exempt. This means that, if you apply for U.S. permanent residency, you can continue to travel in and out of the U.S. without risking that an officer will presume you to have permanent residency intention.
Dual Intent: L-1 vs E-2 Visa Differences
The E visa is not dual-intent exempt. This means that you are required to demonstrate nonimmigrant temporary intent whenever you enter the U.S. on your E visa. If you file a green card application, you express your permanent intent, and you may have a hard time convincing an officer that you are only re-entering the U.S. for temporary work reasons. Risk mitigation strategies must be undertaken to avoid being denied re-entry. Consulting with a US visa and immigration lawyer is therefore critical before you file your US permanent residency application.
Related: US immigration lawyer
How to Choose Between L-1 and E-2 Visa
This is more complicated than I thought. How do I decide which visa is right for me?
Before you invest time, money and effort into a visa application or business in the U.S., Canadians should consult with a US immigration attorney to help them choose the right visa.
Call, email or fill out a webform to contact our law firm to discuss your E visa or L-1 visa application.
Frequently Asked Questions
What is the difference between L-1A and E-2 visa?
The E visa is different than the L-1A in that: Sole proprietor entrepreneurs can qualify for an E visa, whereas they usually cannot qualify for a L-1A. E visa entrepreneurs don’t need employees in Canada whereas L-1A entrepreneur must have employees in Canada including management personnel. E visa entrepreneurs don’t always need to hire employees in the U.S. whereas L-1A entrepreneurs must staff their U.S. operations.
Can Canadians apply for L-1 visa at port of entry?
Yes, Canadians can apply for an L-1 at a port-of-entry into the U.S. This means on-the-spot, same-day processing.
Which visa leads to green card faster: L-1 or E-2?
The L-1A provides a path to EB-1C green card after 1 year of maintaining business operations in both Canada and the U.S. The E-2 visa does not have a direct green card path, though the EB-5 investor green card may be an option with higher investment.
How long does E-2 visa processing take?
The E visa application must be submitted to a consulate or embassy. Waiting 2 or 3 months after submission for a decision is common.
How can I schedule a consultation appointment?
Contact us to arrange a consultation with a lawyer:
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