By Danila Palmieri and Chris Costa
When opening up a business in a new market, there are many things to consider. When you’re specifically hoping to open your business in the United States, there are legal aspects that come into play. One of the best tips we can give for all businesses is to be prepared for the time and effort it will take to not only secure your visa, but to open your business in the U.S. successfully. Your immigration planning for your business can’t be an afterthought – it needs to be considered before any of the actual work is done.
Map Out Your Expansion Journey
In mapping out a business’ expansion journey it is important to consider that different sized businesses will have different journeys to obtain visa approval. This will impact the ability to transfer key managerial or executive personal and to commence business operations in the United States. New U.S. businesses must present a detailed prospectus of their operation in the form of a five-year business plan detailing foreign and U.S. operations, hiring plans, expansion plans and projected revenue. Businesses with larger foreign operations typically have an easier time with the process. They most likely have larger capital, more clearly defined roles and hierarchies, and more experience as a company. Smaller foreign businesses might have to work a little bit harder along the way. They will likely have to plan further ahead, involving their founders and CEOs more deeply into the process. Essentially, they have more hoops to jump through to prove the viability of their new U.S. operations to establish that it will soon sustain a certain managerial or executive hierarchy. Either way, one of the best places to start is with preparation.
For foreign-based companies, opening up an office in the U.S. requires immigration considerations that will impact business operations and future foreign national hiring. This includes preparing and analyzing documents, plans, records, and contracts. A lot of companies do all of the heavy lifting to get their businesses ready to open in a new market, but fail to properly prepare for the time and detail it takes to actually apply for a visa. We suggest that companies take the time to prepare for both business expansion and setting a foundation with immigration authorities.
Type of Visa
The type of visa you apply for depends on the types of employees you plan to send over. For most businesses initially transferring executive and managerial personnel from foreign operations to U.S. operations, the L-1 visa would be the most applicable. Another option may be the E-2 visa, which only applies to businesses and individuals of certain nationalities and focuses on investment amount rather than organizational structure. Either way, the process of applying for a visa and obtaining approval can take months. Be prepared for some setbacks that can arise along the way. Initially, both the L-1 and E-2 visa will require a five-year business plan and proof of financials. This initial step also requires that you have more clearly defined roles in place. Who will be managing the U.S. office? What will the organizational structure look like? Businesses will need to start thinking about the staffing of the new branch and projecting plans for its first five years early on.
Timing of Visa
One of the biggest things you need to consider is timing – the time it takes to apply for your visa, and the time it takes to keep it. One of the biggest mistakes we see is businesses that jump headfirst into the process, without considering the effort and time it takes. Take the time to work out all the details that will be necessary in your visa journey. In the case of L-1 visas for new offices in the U.S., an important consideration is that such visas are only initially valid for one year and renewal is conditional on the U.S. business developing to the point that it has an organizational hierarchy capable of supporting a visa beneficiary’s managerial or executive role. E-2 visas may be issued for a longer period initially, however visa renewal will be conditional on the U.S. business’ profitability. Think of the initial visa validity period as a test year for your business. In this first year, you need to do everything in your power to keep your visa. This means hiring a U.S. team, growing your business and profit, and showcasing the benefit of your business to the U.S. economy.
When you’re looking to make the next step to opening your business in the U.S., don’t go it alone. Utilize all the resources within and outside of your business that can be offered to you. We recommend utilizing a professional to help with your visa application. The U.S. visa process is incredibly detailed and most businesses that try to do it on their own end up missing key elements which can have devastating setbacks and consequences. Having a partner and resource that has experience and knows what’s required can help expedite the process and offer you support. UnniCo and Drummond Advisors are both here to help.
Visit the UnniCo Cross-Border page for more information on how to take your business into a new market. Then, visit the Drummond Legal Services page to learn more about how they can help with visa applications.