Direct Investment Surveys: BE-10, Benchmark Survey of U.S. Direct Investment Abroad
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Notice of proposed rulemaking.
CFR Part: "15 CFR Part 801"
RIN Number: "RIN 0691-XC026"
Citation: "79 FR 47599"
Document Number: "Docket No. 140613502-4502-01"
"Proposed Rules"
SUMMARY: This proposed rule would amend regulations of the
EFFECTIVE DATE: Comments on this proposed rule will receive consideration if submitted in writing on or before
ADDRESSES: You may submit comments, identified by RIN 0691-XC026, and referencing the agency name (
* Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. For Keyword or ID, enter "EAB-2014-0002."
* Email: [email protected].
* Fax:
* Mail:
* Hand Delivery/Courier:
Written comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in the proposed rule should be sent to both BEA through any of the methods above and to the
Public Inspection: All comments received are a part of the public record and will generally be posted to http://www.regulations.gov without change. All personal identifying information (for example, name, address, etc.) voluntarily submitted by the commenter may be publicly accessible. Do not submit confidential business information or otherwise sensitive or protected information. BEA will accept anonymous comments (enter N/A in required fields if you wish to remain anonymous). Attachments to electronic comments will be accepted in Microsoft Word, Excel, or Adobe portable document file (pdf) formats only.
FOR FURTHER INFORMATION CONTACT:
SUPPLEMENTARY INFORMATION: The BE-10,
Section 3103(b) also instructs BEA to:
(1) Identify the location, nature, and magnitude of, and changes in total investment by any parent in each of its affiliates and the financial transactions between any parent and each of its affiliates;
(2) Obtain (A) information on the balance sheet of parents and affiliates and related financial data, (B) income statements, including the gross sales by primary line of business (with as much product line detail as is necessary and feasible) of parents and affiliates in each country in which they have significant operations, and (C) related information regarding trade, including trade in both goods and services, between a parent and each of its affiliates and between each parent or affiliate and any other person;
(3) Collect employment data showing both the number of
(4) Obtain information on tax payments by parents and affiliates by country; and
(5) Determine, by industry and country, the total dollar amount of research and development expenditures by each parent and affiliate, payments or other compensation for the transfer of technology between parents and their affiliates, and payments or other compensation received by parents or affiliates from the transfer of technology to other persons.
By rule issued in 2012 (77 FR 24373), BEA established guidelines for collecting data on international trade in services and direct investment through notices, rather than through rulemaking. This proposed rule would amend the regulations to require a response from persons subject to the reporting requirements of the BE-10, whether or not they are contacted by BEA, in order to ensure complete coverage of U.S. direct investment abroad.
The benchmark survey covers the U.S. direct investment abroad universe and is BEA's most comprehensive survey of such investment in terms of subject matter. U.S. direct investment abroad is defined as the ownership or control, directly or indirectly, by one U.S. person of 10 percent or more of the voting securities of an incorporated foreign business enterprise or an equivalent interest in an unincorporated foreign business enterprise, including a branch.
The purpose of the benchmark survey is to obtain universe data on the financial and operating characteristics of, and on positions and transactions between, U.S. parent companies and their foreign affiliates. The data are needed to measure the size and economic significance of U.S. direct investment abroad, measure changes in such investment, and assess its impact on the U.S. and foreign economies. These data are used to derive current universe estimates of direct investment from sample data collected in other BEA surveys in non-benchmark years. In particular, they would serve as benchmarks for the quarterly direct investment estimates included in the U.S. international transactions, international investment position, and national income and product accounts, and for annual estimates of the operations of U.S. parent companies and their foreign affiliates.
This proposed rule would amend 15 CFR part 801 by adding a new section 801.8 to set forth the reporting requirements for the BE-10,
Description of Changes
The proposed changes would amend the regulations and the survey forms for the BE-10 benchmark survey. These amendments include changes in the data items collected and questionnaire design.
If this proposed rule is made final, unlike most other BEA surveys conducted pursuant to the Act, persons subject to the reporting requirements of the BE-10, Survey of U.S. Direct Investment Abroad, would be required to respond whether or not they are contacted by BEA.
BEA proposes to add and delete some items on the benchmark survey forms. Most of the additions are proposed in response to suggestions from data users. The following items would be added to the benchmark survey:
(1) For U.S. parent companies, questions will be added to collect data on the U.S. imports of goods by the intended use of the goods and by whether the shipper of the goods is a foreign affiliate or an unaffiliated foreign entity.
(2) For larger U.S. parent companies (those with assets, sales, or net income greater than
(3) A question will be added to identify the city in which each foreign affiliate is located.
(4) For majority-owned foreign affiliates with assets, sales, or net income greater than
(5) For larger majority-owned foreign affiliates (those with assets, sales, or net income greater than
(6) For majority-owned foreign affiliates with assets, sales, or net income greater than
(7) For foreign affiliates with assets, sales, or net income greater than
(8) For foreign affiliates with assets, sales, or net income between
Several questions will be modified:
(1) Questions on contract manufacturing will be updated to incorporate improved wording.
(2) The cash item on the balance sheet for U.S. parent companies will be modified to include cash equivalents.
BEA proposes to eliminate the following items from the benchmark survey because they are no longer used:
(1) Official foreign identification numbers issued by host-country governments to foreign affiliates on BE-10B.
(2) Withholding taxes on interest received from and paid to U.S. parent companies by foreign affiliates on BE-10B.
In addition, BEA plans to redesign the survey questionnaires. The new design will incorporate improvements made to other BEA surveys. Survey instructions and data item descriptions will be changed to improve clarity and make the benchmark survey forms more consistent with those of other BEA surveys.
Executive Order 12866
This proposed rule has been determined to be not significant for purposes of E.O. 12866.
Executive Order 13132
This proposed rule does not contain policies with Federalism implications sufficient to warrant preparation of a Federalism assessment under E.O. 13132.
Paperwork Reduction Act
This proposed rule contains a collection-of-information requirement subject to review and approval by OMB under the PRA. The requirement will be submitted to OMB for approval as a reinstatement, with change, of a previously approved collection under OMB control number 0608-0049.
Notwithstanding any other provisions of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA unless that collection displays a currently valid OMB control number.
The BE-10 survey, as proposed, is expected to result in the filing of reports from approximately 3,900 respondents. The respondent burden for this collection of information will vary from one company to another, but is estimated to average 144 hours per response, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Thus the total respondent burden for this survey is estimated at 561,100 hours, compared to 459,400 hours for the previous (2009) benchmark survey. The increase in burden hours is due to an increase in the size of the respondent universe.
Comments are requested concerning: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) The accuracy of the burden estimate; (c) Ways to enhance the quality, utility, and clarity of the information collected; and (d) Ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology.
Written comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in the proposed rule should be sent to both BEA and OMB following the instructions given in the ADDRESSES section above.
Regulatory Flexibility Act
The Chief Counsel for Regulation,
A BE-10 report is required of any U.S. company that had a foreign affiliate--that is, that had direct or indirect ownership or control of at least 10 percent of the voting stock of an incorporated foreign business enterprise, or an equivalent interest in an unincorporated foreign business enterprise, including a branch--at any time during the U.S. company's 2014 fiscal year. U.S. companies that have direct investments abroad tend to be quite large, and few small U.S. businesses are subject to the reporting requirements of this survey. Also, U.S. businesses that meet the SBA small business standards tend to have few foreign affiliates and the foreign affiliates that they do own are small. BEA estimates that approximately 800 of the approximately 3,900 U.S. parent companies that will be required to respond to the BE-10 benchmark survey are small businesses according to the standards established by the SBA. The number of items required to be reported for a foreign affiliate is determined by the size of the affiliate's assets, sales, and net income. In the BE-10 survey, for the smallest foreign affiliates--those with total assets, sales or gross operating revenues, and net income of less than or equal to
Because a very small percentage of the over 5 million U.S. small businesses are impacted by this rule (.016 percent or less than 2/100th of 1 percent of all small businesses), and because those small businesses that will be impacted will be subject to only minimal reporting burdens, the Chief Counsel for Regulation certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities.
List of Subjects in 15 CFR Part 801
Economic statistics, International transactions, Multinational companies, Penalties, Reporting and record keeping requirements, U.S. direct investment abroad.
Dated:
Acting Director,
For reasons set forth in the preamble, BEA proposes to amend 15 CFR part 801 as follows:
PART 801--SURVEY OF INTERNATIONAL TRADE IN SERVICES BETWEEN U.S. AND FOREIGN PERSONS AND SURVEYS OF DIRECT INVESTMENT
1. The authority citation for 15 CFR part 801 continues to read as follows:
Authority: 5 U.S.C. 301; 15 U.S.C. 4908; 22 U.S.C. 3101-3108; E.O. 11961 (3 CFR, 1977 Comp., p. 86), as amended by E.O. 12318 (3 CFR, 1981 Comp. p. 173); and E.O. 12518 (3 CFR, 1985 Comp. p. 348).
2. Revise
Except for surveys subject to rulemaking in SUBSEC 801.7 and 801.8, reporting requirements for all other surveys conducted by the
(a) Notice of specific reporting requirements, including who is required to report, the information to be reported, the manner of reporting, and the time and place of filing reports, will be published by the Director of the
(b) In accordance with section 3104(b)(2) of title 22 of the United States Code, persons notified of these surveys and subject to the jurisdiction of
(c) Persons not notified in writing of their filing obligation by the
3. Add
A BE-10,
(a) Response required. A response is required from persons subject to the reporting requirements of the BE-10,
(1) Certifying in writing, by the due date of the survey, to the fact that the person had no direct investment within the purview of the reporting requirements of the BE-10 survey;
(2) Completing and returning the "BE-10 Claim for Not Filing" by the due date of the survey; or
(3) Filing the properly completed BE-10 report (comprising Form BE-10A and Form(s) BE-10B, BE-10C, and/or BE-10D) by
(b) Who must report. (1) A BE-10 report is required of any U.S. person that had a foreign affiliate--that is, that had direct or indirect ownership or control of at least 10 percent of the voting stock of an incorporated foreign business enterprise, or an equivalent interest in an unincorporated foreign business enterprise, including a branch--at any time during the U.S. person's 2014 fiscal year.
(2) If the U.S. person had no foreign affiliates during its 2014 fiscal year, a "BE-10 Claim for Not Filing" must be filed by the due date of the survey; no other forms in the survey are required. If the U.S. person had any foreign affiliates during its 2014 fiscal year, a BE-10 report is required and the U.S. person is a
(3) Reports are required even if the foreign business enterprise was established, acquired, seized, liquidated, sold, expropriated, or inactivated during the U.S. person's 2014 fiscal year.
(4) The amount and type of data required to be reported vary according to the size of the U.S. Reporters or foreign affiliates, and, for foreign affiliates, whether they are majority-owned or minority-owned by U.S. direct investors. For purposes of the BE-10 survey, a "majority-owned" foreign affiliate is one in which the combined direct and indirect ownership interest of all U.S. parents of the foreign affiliate exceeds 50 percent; all other affiliates are referred to as "minority-owned" affiliates.
(c) Forms to be filed. (1) Form BE-10A must be completed by a
(2) Form BE-10B must be filed for each majority-owned foreign affiliate for which any of the following three items--total assets, sales or gross operating revenues excluding sales taxes, or net income after provision for foreign income taxes--was greater than
(3) Form BE-10C must be filed:
(i) For each majority-owned foreign affiliate for which any one of the three items listed in paragraph (c)(2) of this section was greater than
(ii) For each minority-owned foreign affiliate for which any one of the three items listed in (c)(2) of this section was greater than
(4) Form BE-10D must be filed for majority- or minority-owned foreign affiliates for which none of the three items listed in paragraph (c)(2) of this section was greater than
(d) Due date. A fully completed and certified BE-10 report comprising Form BE-10A and Form(s) BE-10B, C, and/or D (as required) is due to be filed with BEA not later than
[FR Doc. 2014-18623 Filed 8-13-14;
BILLING CODE 3510-06-P
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