[Federal Register: November 28, 2005 (Volume 70, Number 227)]
[Rules and Regulations]
[Page 71238-71240]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28no05-7]
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DEPARTMENT OF COMMERCE
Bureau of Economic Analysis
15 CFR Part 806
[Docket No. 050726200-5305-2]
RIN 0691-AA58
Direct Investment Surveys: BE-11, Annual Survey of U.S. Direct
Investment Abroad
AGENCY: Bureau of Economic Analysis, Commerce.
ACTION: Final rule.
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SUMMARY: This final rule amends regulations of the U.S. Department of
Commerce, Bureau of Economic Analysis (BEA), for the BE-11, Annual
Survey of U.S. Direct Investment Abroad.
The BE-11 survey is conducted annually and is a sample survey that
obtains financial and operating data covering the overall operations of
nonbank U.S. parent companies and their nonbank foreign affiliates. To
address the current needs of data users while at the same time keeping
the respondent burden as low as possible, BEA is modifying, adding, or
deleting items on the survey forms and in the reporting criteria. Most
of the changes will bring the BE-11 forms and related instructions into
conformity with the 2004 BE-10, Benchmark Survey of U.S. Direct
Investment Abroad.
DATES: This final rule will be effective December 28, 2005.
FOR FURTHER INFORMATION CONTACT: Obie G. Whichard, Chief, International
Investment Division (BE-50), Bureau of Economic Analysis, U.S.
Department of Commerce, Washington, DC 20230; phone (202) 606-9890 or
e-mail (obie.whichard@bea.gov).
SUPPLEMENTARY INFORMATION: In the August 22, 2005, Federal Register, 70
FR 48920-48923, BEA published a notice of proposed rulemaking setting
forth revised reporting requirements for the BE-11, Annual Survey of
U.S. Direct Investment Abroad. No comments on the proposed rule were
received. Thus, the proposed rule is adopted without change. This final
rule amends 15 CFR 806.14 to set forth the reporting requirements for
the BE-11, Annual Survey of U.S. Direct Investment Abroad.
Description of Changes
The BE-11, Annual Survey of U.S. Direct Investment Abroad, is a
mandatory survey and is conducted annually by BEA under the
International Investment and Trade in Services Survey Act (22 U.S.C.
3101-3108), hereinafter, the Act. BEA will send the survey to potential
respondents in March of each year; responses will be due by May 31.
This final rule: (1) Increases the exemption level for reporting on
the BE-11B(SF) form and BE-11C form from $30 million to $40 million;
(2) increases the exemption level for reporting on the BE-11B(LF) form
from $100 million to $150 million; and (3) increases the exemption
level for reporting only selected items on Form BE-11A from $100
million to $150 million. In addition to certain identification items,
U.S. Reporters with total assets, sales or gross operating revenues,
and net income (loss) less than or equal to $150 million report only
selected items on the BE-11A report. In conjunction with the increase
in the exemption level for reporting on Forms BE-11B(SF) and BE-11C, a
schedule on Form BE-11A is introduced for reporting a few data items
for affiliates with assets, sales, and net income between $10 million
and $40 million that were established or acquired during the year. The
foreign affiliate exemption level is the level of a foreign affiliate's
assets, sales, or net income below which a Form BE-11B(LF), BE-11B(SF),
or BE-11C is not required.
In addition to the changes in reporting criteria mentioned above,
BEA is introducing a statistical sampling procedure that utilizes a new
BE-11B(EZ) form. This form provides a few basic indicators for non-
sample foreign affiliates that can be used as a basis for estimating
data that otherwise would have to be reported on the lengthier BE-
11B(LF) and BE-11B(SF) forms.
BEA is introducing a few changes to the report forms themselves.
BEA is adding questions to the BE-11A form, BE-11B(LF) form, and BE-
11B(SF) form to bring the annual survey into conformity with the BE-10
benchmark survey. BEA is collecting detail on: (1) The broad
occupational structure of employment, (2) premiums earned and claims
paid by U.S. Reporters and foreign affiliates operating in the
insurance industry, and (3) goods purchased for resale for U.S.
Reporters and foreign affiliates operating in the wholesale and retail
trade industries. In addition, BEA is expanding the ownership section
on the BE-11B(LF) and (SF) forms to include components that are
collected on the benchmark survey and to add a retained earnings
reconciliation section on the BE-11B(LF) form similar to that on the
benchmark survey.
Survey Background
The Bureau of Economic Analysis (BEA), U.S. Department of Commerce,
will conduct the survey under the International Investment and Trade in
Services Survey Act (22 U.S.C. 3101-3108), hereinafter, the Act.
Section 4(a) of the Act requires that with respect to United States
direct investment abroad, the President shall, to the extent he deems
necessary and feasible, conduct a regular data collection program to
secure current information on international financial flows and other
information related to international investment and trade in services,
including (but not limited to) such information as may be necessary for
computing and analyzing the United States balance of payments, the
employment and taxes of United States parents and affiliates, and the
international investment and trade in services position of the United
States.
In Section 3 of Executive Order 11961, the President delegated
authority granted under the Act as concerns direct investment to the
Secretary of Commerce, who has redelegated it to BEA. The annual survey
of U.S. direct investment abroad is a sample survey that provides a
variety of measures of the overall operations of U.S. parent
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companies and their foreign affiliates, including total assets, sales,
net income, employment and employee compensation, research and
development expenditures, and exports and imports of goods. The sample
data are used to derive universe estimates in nonbenchmark years from
similar data reported in the BE-10, Benchmark Survey of U.S. Direct
Investment Abroad, which is taken every five years. The data are needed
to measure the size and economic significance of direct investment
abroad, measure changes in such investment, and assess its impact on
the U.S. and foreign economies. The data are disaggregated by country
and industry of the foreign affiliate and by industry of the U.S.
parent.
Executive Order 12866
This final rule has been determined not to be significant for
purposes of E.O. 12866.
Executive Order 13132
This final rule does not contain policies with Federalism
implications sufficient to warrant preparation of a Federalism
assessment under E.O. 13132.
Paperwork Reduction Act
The collection-of-information required in this final rule has been
approved by the Office of Management and Budget (OMB) under the
Paperwork Reduction Act (PRA).
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 Paperwork Reduction Act unless that collection
displays a currently valid OMB control number. The OMB control number
for the BE-11 is 0608-0053; the collection will display the number.
The survey is expected to result in the filing of reports from
approximately 1,500 respondents. The respondent burden for this
collection of information will vary from one company to another, but is
estimated to average 78.4 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 of the
survey is estimated at 117,600 hours (1,500 respondents times 78.4
hours average burden).
Comments regarding the burden estimate or any other aspect of this
collection of information should be addressed to: Director, Bureau of
Economic Analysis (BE-1), U.S. Department of Commerce, Washington, DC
20230 (Fax: 202-606-5311); and Office of Management andBudget,
O.I.R.A., Paperwork Reduction Project 0608-0053, Attention PRA Desk
Officer for BEA, via the Internet at pbugg@omb.eop.gov, or by Fax at
202-395-7245.
Regulatory Flexibility Act
The Chief Counsel for Regulation, Department of Commerce, has
certified to the Chief Counsel for Advocacy, Small Business
Administration, under the provisions of the Regulatory Flexibility Act
(5 U.S.C. 605(b)), that this rule will not have a significant economic
impact on a substantial number of small entities. The factual basis for
the certification was published in the proposed rule and is not
repeated here. No comments were received regarding the economic impact
of the rule. As a result, no final regulatory flexibility analysis was
prepared.
List of Subjects in 15 CFR Part 806
U.S. investment abroad, Multinational corporations, Economic
statistics, Penalties, Reporting and recordkeeping requirements.
Dated: November 14, 2005.
J. Steven Landefeld,
Director, Bureau of Economic Analysis.
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For the reasons set forth in the preamble, BEA is amending 15 CFR Part
806 as follows:
PART 806--DIRECT INVESTMENT SURVEYS
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1. The authority citation for 15 CFR Part 806 continues to read as
follows:
Authority: 5 U.S.C. 301; 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); E.O. 12518 (3 CFR, 1985 Comp., p. 348).
0
2. Section 806.14(f)(3) is revised to read as follows:
Sec. 806.14 U.S. direct investment abroad.
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(f) * * *
(3) BE-11--Annual survey of U.S. Direct Investment Abroad: A
report, consisting of Form BE-11A and Form(s) BE-11B(LF) (Long Form),
BE-11B(SF) (Short Form), BE-11B(EZ), and/or BE-11C, is required of each
nonbank U.S. Reporter that, at the end of the Reporter's fiscal year,
had a nonbank foreign affiliate reportable on Form BE-11B(LF), (SF),
(EZ), or BE-11C. Forms required and the criteria for reporting on each
are as follows:
(i) Form BE-11A (Report for U.S. Reporter) must be filed by each
nonbank U.S. person having a foreign affiliate reportable on Form BE-
11B(LF), (SF), (EZ), or BE-11C. If the U.S. Reporter is a corporation,
Form BE-11A is required to cover the fully consolidated U.S. domestic
business enterprise. However, where a U.S. Reporter's primary line of
business is not in banking (or related financial activities), but the
Reporter also has ownership in a bank, banking activities should be
included on the BE-11A using the equity method of accounting.
(A) If for a nonbank U.S. Reporter any one of the following three
items total assets, sales or gross operating revenues excluding sales
taxes, or net income after provision for U.S. income taxes was greater
than $150 million (positive or negative) at the end of, or for, the
Reporter's fiscal year, the U.S. Reporter must file a complete Form BE-
11A. It must also file a Form BE-11B(LF), (SF), (EZ), or BE-11C as
applicable, for each nonexempt foreign affiliate.
(B) If for a nonbank U.S. Reporter no one of the three items listed
in paragraph (f)(3)(i)(A) of this section was greater than $150 million
(positive or negative) at the end of, or for, the Reporters fiscal
year, the U.S. Reporter is required to file on Form BE-11A only items 1
through 27 and Part IV. It must also file a Form BE-11B(LF), (SF),
(EZ), or BE-11C as applicable, for each nonexempt foreign affiliate.
(ii) Forms BE-11B(LF), (SF), and (EZ) (Report for Majority-owned
Foreign Affiliate).
(A) A BE-11B(LF) (Long Form) is required to be filed for each
majority-owned nonbank foreign affiliate of a nonbank U.S. Reporter for
which any one of the three items total assets, sales or gross operating
revenues excluding sales taxes, or net income after provision for
foreign income taxes was greater than $150 million (positive or
negative) at the end of, or for, the affiliate's fiscal year, unless
the nonbank foreign affiliate is selected to be reported on Form BE-
11B(EZ).
(B) BE-11B(SF) (Short Form) is required to be filed for each
majority-owned nonbank foreign affiliate of a nonbank U.S. Reporter for
which any one of the three items listed in paragraph (f)(3)(ii)(A) of
this section was greater than $40 million (positive or negative), but
for which no one of these items was greater than $150 million (positive
or negative), at the end of, or for, the affiliate's fiscal year,
unless the nonbank foreign affiliate is selected to be reported on Form
BE-11B(EZ).
(C) A BE-11B(EZ) is required be filed for each nonbank foreign
affiliate that is selected to be reported on this form in
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lieu of Form BE-11B(LF) or Form BE-11B(SF).
(iii) Form BE-11C (Report for Minority-owned Foreign Affiliate)
must be filed for each minority-owned nonbank foreign affiliate that is
owned at least 20 percent, but not more than 50 percent, directly and/
or indirectly, by all U.S. Reporters of the affiliate combined, and for
which any one of the three items listed in paragraph (f)(3)(ii)(A) of
this section was greater than $40 million (positive or negative) at the
end of, or for, the affiliate's fiscal year. In addition, for the
report covering fiscal year 2007 only, a Form BE-11C must be filed for
each minority-owned nonbank foreign affiliate that is owned, directly
or indirectly, at least 10 percent by one U.S. Reporter, but less than
20 percent by all U.S. Reporters of the affiliate combined, and for
which any one of the three items listed in paragraph (f)(3)(ii)(A) of
this section was greater than $100 million (positive or negative) at
the end of, or for, the affiliate's fiscal year.
(iv) Based on the preceding, an affiliate is exempt from being
reported if it meets any one of the following criteria:
(A) None of the three items listed in paragraph (f)(3)(ii)(A) of
this section exceeds $40 million (positive or negative). (However,
affiliates that were established or acquired during the year and for
which at least one of these items was greater than $10 million but not
over $40 million must be listed, and key data items reported, on a
supplement schedule on Form BE-11A.)
(B) For fiscal year 2007 only, it is less than 20 percent owned,
directly or indirectly, by all U.S. Reporters of the affiliate combined
and none of the three items listed in paragraph (f)(3)(ii)(A) of this
section exceeds $100 million (positive or negative).
(C) For fiscal years other than 2007, it is less than 20 percent
owned, directly or indirectly, by all U.S. Reporters of the affiliate
combined.
(D) Its U.S. parent (U.S. Reporter) is a bank.
(E) It is itself a bank.
(v) Notwithstanding paragraph (f)(3)(iv) of this section, a Form
BE-11B(LF), (SF), (EZ) or BE-11C must be filed for a foreign affiliate
of the U.S. Reporter that owns another non-exempt foreign affiliate of
that U.S. Reporter, even if the foreign affiliate parent is otherwise
exempt. That is, all affiliates upward in the chain of ownership must
be reported.
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[FR Doc. 05-23316 Filed 11-25-05; 8:45 am]
BILLING CODE 3510-06-P