Assessing the Substantiality of Trade for E-1 Visa Purposes
The E-1 “Treaty Trader” visa is a nonimmigrant visa classification designed for citizens of countries that maintain a treaty of commerce and navigation with the U.S. (e.g. Canada, the U.K., Australia, etc.). Its primary purpose is to facilitate international trade by allowing business owners and/or their employees to work and live in the U.S. while engaged in substantial and principal trade with the U.S.
Trade encompasses a wide range of activities, including trade for services. For example, a business owner or employee may need to enter the U.S. to provide services to U.S.-based customers pursuant to contracts between the U.S. client and foreign business.
Principal trade between the U.S. and the treaty country exists when over 50% of the total volume of international trade (not domestic) is between the U.S. and the trader’s treaty country.
How do the officers determine if trade is “substantial” for E-1 purposes?
The term “substantial trade” refers to a continuous flow of international trade items or services that involve numerous transactions over time. It is important to note that there is no minimum monetary threshold to define substantial trade. Instead, officers look at the overall volume and monetary value of the transactions to determine if it meets the substantiality requirement.
Typically, the number of transactions is more important than the value of each transaction, but an officer is going to assess both. The officers will ultimately accord greater weight to cases involving more numerous transactions of larger value.
Factors considered in assessing substantiality are as follows:
- Value of Trade: While there’s no specific dollar amount that qualifies as substantial, trade that is of higher value is more likely to be considered substantial.
- Volume of Trade: Numerous transactions can demonstrate substantial trade. The officers will often assess a period, such as a year, to see how often trade is conducted.
- Continuity of Trade: The qualifying trade should be ongoing and not a single, one-time transaction. Officers will look for a continuous pattern of qualifying U.S. trade.
Can a smaller business utilize the E-1 visa to facilitate U.S. trade?
The U.S. regulations specifically note that a smaller businessperson should not be excluded from the opportunity of demonstrating substantial trade. In such situations, the officers will still assess whether there is a pattern of transactions of value with the U.S., but substantial trade may still be found where there are numerous transactions, although relatively small in value. In general, income derived from the international trade that is sufficient to support the treaty trader and their family should be considered favorably when assessing the substantiality of trade in a case.
What evidence can be provided to prove substantial trade?
Applicants should be ready to provide contracts, invoices, purchase orders, bills of lading, and/or other supporting documentation to support a showing of qualifying U.S. trade. Officers will review these documents to assess the volume and monetary value of existing and/or future U.S. transactions.
Conclusion
Assessing whether trade is substantial for E-1 visa purposes involves a comprehensive evaluation of the trade’s volume, continuity, and monetary value. There’s no one-size-fits-all answer, as each case is unique and assessed on its own merits. As applicants prepare their documentation, they should focus on presenting a clear and compelling picture of their ongoing international trade activities.
