[Federal Register: September 15, 2006 (Volume 71, Number 179)]
[Proposed Rules]
[Page 54448-54451]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15se06-19]
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DEPARTMENT OF COMMERCE
Bureau of Economic Analysis
15 CFR Part 801
[Docket No. 060824224-6224-01]
RIN 0691-AA60
International Services Surveys: BE-120, Benchmark Survey of
Transactions in Selected Services and Intangible Assets With Foreign
Persons
AGENCY: Bureau of Economic Analysis, Commerce.
ACTION: Notice of proposed rulemaking.
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SUMMARY: This proposed rule amends regulations of the Bureau of
Economic Analysis, Department of Commerce (BEA) to set forth the
reporting requirements for the BE-120, Benchmark Survey of Transactions
in Selected Services and Intangible Assets with Foreign Persons. This
rule would replace the rule for a similar but more limited survey, the
BE-20, Benchmark Survey of Selected Services Transactions with
Unaffiliated Foreign Persons. The agency form number and survey title
are being changed because the survey is being reconfigured to reflect
changes in BEA's survey program for international services that have
occurred since the previous BE-20 survey was conducted, as well as to
begin collection of data on transactions with affiliated foreigners and
unaffiliated foreigners using the same survey instruments. If adopted
the BE-120 survey would be conducted once every five years beginning
with fiscal year 2006.
The proposed BE-120 survey is intended to cover the universe of
selected services transactions and transactions in intangible assets
with foreign persons. In nonbenchmark years, universe estimates
covering these transactions would be derived from the sample data
reported on BEA's follow-on quarterly survey, by extrapolating forward
the universe data collected on the BE-120 benchmark survey.
DATES: Comments on this proposed rule will receive consideration if
submitted in writing on or before 5 p.m. November 14, 2006.
ADDRESSES: You may submit comments, identified by RIN 0691-AA60, and
referencing the agency name (Bureau of Economic Analysis), by any of
the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments. For agency, select
``Commerce Department-B all.''
E-mail: Obie.Whichard@bea.gov.
Fax: Office of the Chief, International Investment
Division, (202) 606-5318.
Mail: Office of the Chief, International Investment
Division, U.S. Department of Commerce, Bureau of Economic Analysis, BE-
50, Washington, DC 20230.
Hand Delivery/Courier: Office of the Chief, International
Investment Division, U.S. Department of Commerce, Bureau of Economic
Analysis, BE-50, Shipping and Receiving, Section M100, 1441 L Street,
NW., Washington, DC 20005.
Public Inspection: Comments may be inspected at BEA's offices, 1441
L Street, NW., Room 7006, between 8:30 a.m. and 5 p.m., Eastern Time
Monday though Friday.
FOR FURTHER INFORMATION CONTACT: Obie G. Whichard, Chief, International
Investment Division (BE-50), Bureau of Economic Analysis, U.S.
Department of
[[Page 54449]]
Commerce, Washington, DC 20230; e-mail Obie.Whichard@bea.gov; or phone
(202) 606-9890.
SUPPLEMENTARY INFORMATION: This proposed rule would amend 15 CFR Part
801.10 to replace the reporting requirements for the BE-20, Benchmark
Survey of Selected Services Transactions with Unaffiliated Foreign
Persons with requirements for the BE-120, Benchmark Survey of
Transactions in Selected Services and Intangible Assets with Foreign
Persons. The Department of Commerce, as part of its continuing effort
to reduce paperwork and respondent burden, invites the general public
and other Federal agencies to comment on proposed and/or continuing
information collections, as required by the Paperwork Reduction Act of
1995.
Description of Changes
The proposed BE-120 survey would be a mandatory survey and would be
conducted, beginning with transactions for fiscal year 2006, once every
5 years by BEA under the International Investment and Trade in Services
Survey Act (22 U.S.C. 3101C3108), hereinafter, ``the Act.'' BEA would
send the survey to potential respondents in January of 2007; responses
would be due by March 31, 2007.
BEA maintains a continuing dialogue with respondents and with data
users, including its own internal users, to ensure that, as far as
possible, the required data serve their intended purposes and are
available from existing records, that instructions are clear, and that
unreasonable burdens are not imposed. In designing the survey, BEA
contacted Government and non-Government data users outside the Bureau
and potential survey respondents to obtain their views on the proposed
benchmark survey. In reaching decisions on what questions to include in
the survey, BEA considered the Government's need for the data, the
burden imposed on respondents, the quality of the likely responses (for
example, whether the data are available on respondents' books), and
BEA's experience in previous benchmark and related annual and quarterly
surveys.
BEA proposes the following five changes to the Code of Federal
Regulations: (1) Include services transactions that were previously
collected on two annual surveys that have been discontinued--the BE-47,
Annual Survey of Construction, Engineering, Architectural, and Mining
Services Provided by U.S. Firms to Unaffiliated Foreign Persons and the
BE-93, Annual Survey of Royalties, License Fees, and Other Receipts and
Payments for Intangible Rights Between U.S. and Unaffiliated Foreign
Persons. BEA is currently collecting these transactions on the
surveys--the BE-22, Annual Survey of Selected Services Transactions
Between U.S. and Unaffiliated Foreign Persons and the BE-25, Quarterly
Survey of Transactions between U.S. and Unaffiliated Foreign Persons in
Selected Services and in Intangible Assets--for which the BE-120 survey
is designed to provide benchmark coverage. (2) Include services
transactions with affiliated parties (i.e., with foreign affiliates,
foreign parents, and foreign affiliates of foreign parents). BEA is
currently collecting these transactions on its quarterly direct
investment surveys (the BE-577, Direct Transactions of U.S. Reporter
with Foreign Affiliate, the BE-605, Transactions of U.S. Affiliate,
except a U.S. Banking Affiliate, with Foreign Parent, and the BE-605
Bank, Transactions of U.S. Banking Affiliate with Foreign Parent). BEA
proposes to remove quarterly collection of data on these affiliated
services transactions from these surveys beginning with reports for the
first quarter of calendar year 2007, and move them to a redesigned
quarterly survey of transactions in selected services and in intangible
assets (which will replace the current BE-22 and BE-25 surveys). (3)
Raise the exemption level for reporting sales from $1 million to $2
million. (The exemption level for purchases, for which transactions for
a given firm may often be smaller than sales, will remain at $1
million). (4) Combine several services into one ``other selected
services'' category, which will include any services not individually
covered by the survey or available from other sources. (5) Eliminate
several schedules from the prior benchmark survey that collected
additional detail on computer and data processing services; data base
and other information services (receipts only); telecommunications
services; financial services (payments only); and operational leasing
services (receipts only).
Survey Background
The Bureau of Economic Analysis (BEA), U.S. Department of Commerce,
would 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 (22 U.S.C. 3103(a)) provides that the President
shall, to the extent he deems necessary and feasible, conduct a regular
data collection program to secure current information related to
international investment and trade in services and publish for the use
of the general public and United States Government agencies periodic,
regular, and comprehensive statistical information collected pursuant
to this subsection.
In Section 3 of Executive Order 11961, as amended by Executive
Orders 12318 and 12518, the President delegated his responsibilities
under the Act for performing functions concerning international trade
in services to the Secretary of Commerce, who has redelegated them to
BEA. The survey would update and broaden data provided on the universe
of transactions between U.S. and foreign persons in selected services
and intangible assets. The data are needed to monitor trade in services
and intangible assets; analyze their impact on the U.S. and foreign
economies; compile and improve the U.S. international transactions,
national income and product, and input-output accounts; support U.S.
commercial policy on services and intangible assets; assess and promote
U.S. competitiveness in international trade in services; and improve
the ability of U.S. businesses to identify and evaluate market
opportunities.
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 Federal assessment
under E.O. 13132.
Paperwork Reduction Act
This proposed rule contains a collection-of-information requirement
subject to review and approval by the Office of Management and Budget
(OMB) under the Paperwork Reduction Act. The requirement will be
submitted to OMB as a request for a reinstatement, with change, of a
previously approved collection for which approval has expired under OMB
control number 0608-0058.
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 Office of Management and Budget Control
Number.
The BE-120 benchmark survey, as proposed, is expected to result in
the filing of reports containing mandatory data from approximately
5,000
[[Page 54450]]
respondents. The respondent burden for this collection of information
will vary from one respondent to another, but is estimated to average
12 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 the 2006 BE-120 survey is
estimated at 60,000 hours, compared to 13,200 hours estimated for the
previous, 2001, BE-20 survey. The increase in burden is a result of
several factors: more U.S. persons with transactions in international
services, the inclusion of transactions with affiliated foreign
persons, and the coverage of transactions in intangible assets and in
construction and related services.
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.
Comments should be addressed to: Director, Bureau of Economic Analysis
(BE-1), U.S. Department of Commerce, Washington, DC 20230, fax: 202-
606-5311; and the Office of Management and Budget, O.I.R.A., Paperwork
Reduction Project 0608-0058, Attention PRA Desk Officer for BEA, via e-
mail 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 provisions of the Regulatory Flexibility Act (5
U.S.C. 605(b)), that this proposed rulemaking, if adopted, will not
have a significant economic impact on a substantial number of small
entities. The information collection excludes most small businesses
from mandatory reporting. Companies that engage in international
transactions in covered services or intangible assets tend to be
relatively large. In addition, the reporting threshold for this survey
is set at a level that will exempt most small businesses from
reporting. The proposed BE-120 benchmark survey will be required from
U.S. persons whose sales to foreign persons in any of the covered
transactions exceeded $2 million during the fiscal year covered, or
whose purchases from foreign persons in any of the covered transactions
exceeded $1 million during the fiscal year covered. This amount is
applied separately to each of the individual types of transactions
covered by the survey. Thus, the exemption level will exclude most
small businesses from mandatory coverage. Of those smaller businesses
that must report, most will tend to have specialized operations and
activities, so they will likely report only one type of transaction,
often limited to transactions with a single partner country; therefore,
the burden on them should be small. In addition, BE survey mailings are
targeted mailings. Thus, since small businesses tend not to be involved
in the transactions to be covered by the BE-120 survey, few small
businesses should receive the survey. However, those receiving the
survey are expected to incur a minimal burden in completing the
exemption form.
List of Subjects in 15 CFR Part 801
International transactions, Economic statistics, Foreign trade,
Penalties, Reporting and recordkeeping requirements.
J. Steven Landefeld,
Director, Bureau of Economic Analysis.
For the 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
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;
and 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. Section 801.10 is revised to read as follows:
Sec. 801.10 Rules and regulations for the BE-120, Benchmark Survey of
Transactions in Selected Services and Intangible Assets with Foreign
Persons.
The BE-120, Benchmark Survey of Transactions in Selected Services
and Intangible Assets with Unaffiliated Foreign Persons, will be
conducted covering fiscal year 2006 and every fifth year thereafter.
All legal authorities, provisions, definitions, and requirements
contained in Sec. Sec. 801.1 through 801.9(a) are applicable to this
survey. Additional rules and regulations for the BE-120 survey are
given in paragraphs (a) through (c) of this section. More detailed
instructions and descriptions of the individual types of transactions
covered are given on the report form itself.
(a) The BE-120 survey consists of two parts and three schedules.
Part I requests information needed to determine whether a report is
required and which schedules apply. Part II requests information about
the reporting entity. Each of the three schedules covers one or more
types of transactions and is to be completed only if the U.S. reporter
has transactions of the type(s) covered by the particular schedule.
(b) Who must report--(1) Mandatory reporting. A BE-120 report is
required from each U.S. person that had sales to foreign persons that
exceeded $2 million during the fiscal year covered of any of the types
of services or intangible assets listed in paragraph (c) of this
section, or had purchases from foreign persons that exceeded $1 million
during the fiscal year covered of any of the types of services or
intangible assets listed in paragraph (c) of this section.
(i) The determination of whether a U.S. person is subject to this
mandatory reporting requirement may be judgmental, that is, based on
the judgment of knowledgeable persons in a company who can identify
reportable transactions on a recall basis, with a reasonable degree of
certainty, without conducting a detailed records search. Because the
reporting threshold ($2 million for sales and $1 million for purchases)
applies separately to sales and purchases, the mandatory reporting
requirement may apply only to sales, only to purchases, or to both
sales and purchases.
(ii) U.S. persons that file pursuant to this mandatory reporting
requirement must complete Parts I and II of Form BE-120 and all
applicable schedules. The total amounts of transactions applicable to a
particular schedule are to be entered in the appropriate column(s) and,
except for sales of merchanting services, these amounts must be
distributed among the countries involved in the transactions. For sales
of merchanting services, the data are not required to be reported by
individual foreign country, although this information may be provided
voluntarily.
(iii) Application of the exemption levels to each covered
transaction is indicated on the schedule for that particular type of
transaction. It should be noted that an item other than sales or
purchases may be used as the measure of a given type of transaction for
purposes of determining whether the threshold for mandatory reporting
of the transaction is exceeded.
[[Page 54451]]
(2) Voluntary reporting. If, during the fiscal year covered, the
U.S. person's total transactions (either sales or purchases) in any of
the types of transactions listed in paragraph (c) of this section are
$2 million or less for sales or $1 million or less for purchases, the
U.S. person is requested to provide an estimate of the total for each
type of transaction. Provision of this information is voluntary. The
estimates may be judgmental, that is, based on recall, without
conducting a detailed records search. Because the exemption threshold
applies separately to sales and purchases, the voluntary reporting
option may apply only to sales, only to purchases, or to both sales and
purchases.
(3) Any U.S. person that receives the BE-120 survey form from BEA,
but is not reporting data in either the mandatory or voluntary section
of the form, must nevertheless complete and return the ``Basis for not
reporting data'' included with the form to BEA. This requirement is
necessary to ensure compliance with reporting requirements and
efficient administration of the Act by eliminating unnecessary follow-
up contact.
(c) Covered types of services and intangible assets. The BE-120
survey is intended to collect information on U.S. international trade
in all types of services and intangible assets for which information is
not collected in other BEA surveys and is not available to BEA from
other sources. The major types of services transactions not covered by
the BE-120 survey are travel, transportation, insurance (except for
purchases of primary insurance), financial services (except for
purchases by non-financial firms), and expenditures by students and
medical patients who are studying or seeking treatment in a country
different from their country of residence. Covered services are:
Advertising services; accounting, auditing, and bookkeeping services;
auxiliary insurance services; computer and data processing services;
construction services; data base and other information services;
educational and training services; engineering, architectural, and
surveying services; financial services (purchases only, by companies or
parts of companies that are not financial services providers);
industrial engineering services; industrial-type maintenance,
installation, alteration, and training services; legal services;
management, consulting, and public relations services (including
allocated expenses); merchanting services (sales only); mining
services; operational leasing services; other trade-related services;
performing arts, sports, and other live performances, presentations,
and events; premiums paid on purchases of primary insurance; losses
recovered on purchases of primary insurance; research, development, and
testing services; telecommunications services; and other selected
services. ``Other selected services'' includes, but is not limited to:
Account collection services; disbursements to fund news-gathering costs
of broadcasters; disbursements to fund news-gathering costs of print
media; disbursements to fund production costs of motion pictures;
disbursements to fund production costs of broadcast program material
other than news; disbursements to maintain government tourism and
business promotion offices; disbursements for sales promotion and
representation; disbursements to participate in foreign trade shows
(purchases only); employment agencies and temporary help supply
services; language translation services; mailing, reproduction, and
commercial art; medical services (non-patient B e.g., laboratory or
diagnostic services); salvage services; satellite photography and
remote sensing/satellite imagery services; security services; space
transport (includes satellite launches, transport of goods and people
for scientific experiments, and space passenger transport);
transcription services; and waste treatment and depollution services.
The intangible assets covered by the BE-120 survey are rights related
to: Industrial processes and products; books, compact discs, audio
tapes and other copyrighted material and intellectual property;
trademarks, brand names, and signatures; performances and events pre-
recorded on motion picture film and television tape, including digital
recording; broadcast and recording of live performances and events;
general use computer software; business format franchising fees; and
other intangible assets, including indefeasible rights of users.
[FR Doc. E6-15304 Filed 9-14-06; 8:45 am]
BILLING CODE 3510-06-P