L-1 vs. E-1 and E-2

The United States government provides more than a few types of visas, each with its own list of precise requirements and limitations. It’s no surprise, then, that it can be hard to keep track of which visa classification is for whom, and in which situations one may be preferable to a similar visa type.

A notable example of potentially confusing overlap between similar visa categories involves the L visa for multinational transferees and the E visa, which is meant for treaty traders and investors. As you would expect, it is imperative to understand the requirements for each visa category. Even though there’s clear overlap between the two, there are significant differences between L and E visas.

In this article, we’ll help you differentiate between these two categories so that you can choose the option that best suits your needs.

Basic Requirements

Both L-1 and E visas are used by aliens seeking to work in the U.S. for business-related reasons. Below is a brief rundown of the eligibility criteria for the two visa categories.

Eligibility Overlap

In the L-1 category, a U.S. employer petitions on behalf of an alien employee of an overseas parent, branch, subsidiary, or affiliate of the U.S. company. This employee must have been employed with that organization in an executive, managerial, or specialized knowledge position prior to coming to the United States. L-1 workers can come from any foreign country so long as they meet specific requirements.

Similarly, employees of treaty traders and investors seeking an E-1 or E-2 must be employed in an executive, supervisory, or specialized knowledge position.

Eligibility Distinctions

Despite the above-described overlap, there are key differences between the qualifications for L-1 and E-1 or E-2 visas.

For the E category, foreign business owners, business managers, and employees of treaty traders and investors may come to the United States to oversee or work for an enterprise that is engaged in trade with the United States or that has a substantial investment in the United States. This condition of either trade with the U.S. or investment in the country is the first obvious difference between the E and L categories, as L visas require only that the foreign entity be a parent, branch, subsidiary, or affiliate of a United States company. L-1 petitioners also do not have to satisfy the criterion of conducting international trade. 

The second distinction in initial eligibility is the range of countries petitioners in both categories can hail from. The E visa program has its origins in treaty requirements between the U.S. and certain foreign countries, a list of which can be found here. Each country must provide for reciprocal benefits for those who conduct trade with or invest in the other country. As such, E-1 and E-2 visas are only available to nationals of those countries where a bilateral investment treaty or treaty of commerce and navigation exists. There is no such requirement for L-1, for which, theoretically, any company from any country could qualify.

Time Limits

Disparate maximum timeframes are allowed for aliens in L-1 and E-1 or E-2 status. Generally speaking, the maximum period of stay for an E-1 or E-2 holder is much more flexible than that of an L-1 holder.

The total period of time an alien can stay in L status depends first on what subtype of L visa he or she is the beneficiary of. Two subtypes are available under the L category: L-1As for executive and managerial transferees and L-1Bs for employees with specialized knowledge. L-1A visas are issued initially for one year for a new company in the U.S. or three years for a U.S. company which has been in existence for more than one year. Extensions for L-1As beyond the initial period of stay are available in two-year increments for a total stay not to exceed seven years. Alternatively, L-1B visas are issued initially for three years with the option of one two-year extension, meaning the maximum period of stay is five years. Once an L-1A or L-1B holder has reached her maximum allowable period, she must leave the United States for a minimum of one year and must work for a foreign operation of a U.S. company before being eligible for a new L visa.

By contrast, an E-1 or E-2 status holder is granted an initial period of stay of up to two years. Extensions of stay can be granted by U.S. Citizenship and Immigration Services (USCIS) in increments of up to two years. There is no limit on how many times an E visa holder can extend his stay, so theoretically one could legally remain in the U.S. under E-1 or E-2 status indefinitely. Extensions are granted as long as the E status holder declares that she will depart the United States when the period of authorized stay, including extensions, terminates.

Pathway To Permanent Resident Status

L-1A holders, rejoice: this status provides a relatively easy pathway to permanent residency compared to other employment-based nonimmigrant statuses.

Since the L-1 is a “dual intent” visa, L-1 holders may apply for an adjustment of status at any time during their stay, including immediately upon entry into the United States, without worrying about preconceived intent issues. Moreover, an employment-based immigrant preference category, the EB-1C visa for managers and executives, was created specifically for aliens who meet the L-1A standards and are interested in gaining lawful permanent resident status. Although having L-1 status is not a prerequisite for obtaining an EB-1C, an applicant will have a stronger case if he or she was previously an L holder, and many such beneficiaries are able to smoothly transition into EB-1C permanent resident status. (For more information on the specific requirements for obtaining an EB-1C visa, click here.)

On the other hand, the path to permanent resident status from E-1 or E-2 status is not as easy. Since E visas are not dual intent, immigration officials want to make sure E visa holders do not actually intend to enter the U.S. permanently. If a nonimmigrant on an E visa attempts to apply for an immigrant visa soon after his arrival in the United States, his application will be considered fraudulent, or otherwise based on preconceived immigrant intent, and therefore denied. E-1 or E-2 visa holders, when applying for extensions of status, must prove to USCIS that they intend to depart the United States when their legal status ends.

Types of Applicants

Both E and L visas may be used by companies to expand their business in the United States. However, there are dissimilarities between the types of companies that tend to apply for each visa. Generally, E visas are used by small businesses whereas L-1 visas are used by all types of businesses—large, medium, and small.

Although there is a minimum threshold for the amount of capital invested in the United States by a foreign company applying for an E visa, this visa classification is often sought by smaller companies seeking to send employees to the U.S. to help grow their businesses. While an L-1 visa can most certainly be used by small companies to send employees to the United States to start a new branch of a foreign company, it is also widely used by large, international companies who want to rotate executives or managers through their international offices. There’s also considerably less documentation required of large companies applying for L-1 visas; if a company is well-known, USCIS tends not to scrutinize its L petitions as much as the agency would a smaller company’s.

Application Processes

The major distinction between the application processes for L and E visas is that treaty traders are able to apply for an E visa directly at a U.S. consulate or a port of entry. Prospective L visa beneficiaries have to have an underlying employer-sponsored Form I-129 approved before applying for a visa at a consulate (or changing status if in the U.S.). When changing status or applying for an extension of status, both L-1 and E visa holders submit I-129s to USCIS.

The major difference between the application processes occurs during the initial stage. For an L-1 visa application, whether or not the beneficiary is applying at a consulate abroad or is changing status from within the United States, the sponsoring employer must submit an L petition to USCIS. Only after USCIS has approved the application may the beneficiary proceed to a consulate, if abroad, to obtain their visa. In contrast, an E-1 or E-2 visa applicant may simply apply with the Department of State at a U.S. consulate without the need to submit a separate I-129 to USCIS.

Final Thoughts

While these two visas may be easily confused at first glance, as we have outlined above, there are several key differences between L-1 and E-1 or E-2 visas. It’s important to keep these distinctions in mind. Foreign businesses, employees, and investors who wish to come to the United States to grow their companies have a number of options. Whether to apply for an L-1 or an E-1 or E-2 depends on the needs of the company and beneficiary. Zhang & Associates can help you determine which visa is right for your situation. Visit our free evaluation page for more information on how to contact us. And for more information about the E visa, please click here.

For more information on the L-1 category, refer to the following links:

Updated 05/18/2017