On a panel recently at a conference sponsored by the American Immigration Lawyers (AILA) Conference in London, I was asked why I might advise a client to file an E-2 visa application instead of seeking an L-1 visa. The answer is simple.

E-2 visa applications are adjudicated by U.S. consular posts abroad. The culture of reviewing E-2 visa applications is extraordinarily friendly to businesses. Specifically, at U.S. consular posts, visa officers are mandated by the Foreign Affairs Manual “to be flexible, fair, and uniform” in adjudicating treaty-based E-2 visas. This culture results in favorable decisions, where visa officers exercise judgment and discretion in an application process. The process is about facilitating economic and commercial ties between the United States and treaty countries.

In sharp contrast, United States Citizenship and Immigration Services (USCIS) is now tougher than ever before in adjudicating L-1 visas for new U.S. offices of foreign businesses. The culture of adjudication at USCIS is about fraud detection, not fostering the expansion of businesses. The concern about fraud has overtaken what should be a normative USCIS adjudication process. In some cases, new U.S. offices of strong businesses spend many months proving their ability to launch into the U.S. marketplace. Bureaucratic hassles, delays and in some cases unwarranted denials are common with L-1 adjudications.

The regulatory requirements for both E-2 and L-1 visas are rigorous, with applicants needing to make a strong case about financial backing to support a U.S. venture. But USCIS adjudicates L-1 cases without a strong understanding of the businesses that are seeking L-1 benefits. For example, asking promising software and technology companies with venture capital (VC) funding to provide evidence of the “feasibility” of their ventures, which we see USCIS do on a regular basis, is not reasonable. The process of securing VC funding is itself a major challenge. And without ever meeting applicants in person, USCIS is even less qualified to assess issues of credibility and to ferret out fraud.

Entrepreneurs who are eligible for E-2 treaty visas are well served bypassing the L-1 option until a U.S. business has expanded sufficiently to satisfy a very tough and uncertain L-1 process. A list of countries that have E-2 treaties with the U.S. is available on the Department of State website.