IN THIS GUIDE · A specialty-food processor whose ownership split decides which treaty her case is brought under
Start with the E-2 eligibility and application overview
The enterprise has a nationality, and arithmetic decides what it is
An E-2 enterprise takes its nationality from the people who own at least half of it, and the investor applying must share that nationality. Counted as a Canadian case, this purchase fails before any other question is reached: nationals of Canada would hold forty-five percent, which is short of the threshold, and no amount of management authority repairs a shortfall in ownership. Counted as a case under the treaty her brother's citizenship engages, nationals of that country hold the whole company, and Hilde qualifies as an applicant because she holds that citizenship too. Dual nationality is doing all the work here, and it is worth saying plainly that most investors do not have this option. Anyone in a similar position should confirm the country appears on the current treaty schedule published by the Department of State before building a structure on the assumption, and should fix the percentages before signing rather than afterwards.
Money borrowed against the plant you are buying is not money at risk
E-2 capital must be irrevocably committed to the enterprise and genuinely subject to partial or total loss if the business fails. The vendor here has offered to finance sixty percent of the price, secured against the plant, its equipment and its inventory. That structure is comfortable commercially and unhelpful legally, because if the venture collapses the vendor takes back the assets and the buyers lose only what they actually paid. Funds borrowed on security the investor is personally liable for, a line against a Canadian home for instance, are a different matter and can count, since the loss falls on the investor. The practical consequence is that the amount treated as invested may be far smaller than the purchase price, and substantiality is measured against that smaller figure. Reworking the financing before closing usually costs less than losing the application and restructuring afterwards.
Substantial, real and more than marginal are three separate findings
Substantiality is proportional rather than absolute: the committed capital is weighed against the total cost of buying an established enterprise of this kind, so a low-cost business demands a high proportion and there is no threshold to point at. Real and operating means an active commercial undertaking producing goods or services, which a plant already running shifts satisfies easily, and which a signed lease and a business plan alone do not. Marginality asks whether the enterprise has the present or future capacity to generate more than a minimal living for the investor and family, and six existing employees answer it well. Develop and direct is the fourth requirement and the one Hilde's forty-five percent puts in question. Ownership below half can still support it where a shareholders agreement gives her operational control, so that document should be drafted with this requirement in mind.
Sources reviewed 2026-09-07. This guide covers a preparation focus; it is not an individual eligibility assessment.