[Code of Federal Regulations]
[Title 15, Volume 3]
[Revised as of January 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 15CFR806.11]

[Page 22-23]
 
                  TITLE 15--COMMERCE AND FOREIGN TRADE
 
    CHAPTER VIII--BUREAU OF ECONOMIC ANALYSIS, DEPARTMENT OF COMMERCE
 
PART 806_DIRECT INVESTMENT SURVEYS--Table of Contents
 
Sec. 806.11  Estates, trusts, and intermediaries.

    (a) An estate, either U.S. or foreign, is a person and therefore may 
have direct investment, and the estate, not the beneficiary, is 
considered to be the owner.
    (b) A trust, either U.S. or foreign, is a person, but is not a 
business enterprise. The trust shall be considered the same as an 
intermediary and reporting should be as outlined in paragraph (c) of 
this section. For reporting purposes, the beneficiary(ies) of the trust, 
or the creator(s) of the trust in the situation detailed below or if 
there is, or may be, a reversionary interest, shall be considered to be 
the owner(s) of the investments of the trust for determining the 
existence of direct investment. Where a corporation or other 
organization creates a trust designating its shareholders or members as 
beneficiaries, the creating corporation or organization shall be deemed 
to be the owner of the investments of the trust, or succeeding trusts 
where the presently existing trust has evolved out of a prior trust, for 
the purposes of determining the existence and reporting of direct 
investment.

This procedure is adopted in order to fulfill the statistical purposes 
of this part and does not imply that control over an enterprise owned or 
controlled by a trust is, or can be, exercised by the beneficiary(ies) 
or creator(s).
    (c) Intermediary. (1) If a particular U.S. direct investment abroad 
is held, administered, or managed by a U.S. intermediary, such 
intermediary shall be responsible for reporting the required information 
for, and in the name of, its principal or shall instruct the principal 
to submit the required information. Upon instructing the principal, the 
intermediary shall be released from further liability to report provided 
it has informed this bureau of the date such instructions were given and 
the name and address of the principal, and has supplied the principal 
with any information in the possession of, or which can be secured by, 
the intermediary, that is necessary to permit the principal to complete 
the required reports. When acting in the capacity of an intermediary, 
the accounts or transactions of the U.S. intermediary with the foreign 
affiliate shall be considered as accounts or transactions of the U.S. 
principal with the foreign affiliate. To the extent such transactions or 
accounts are unavailable to the principal, they may be required to be 
reported by the intermediary.
    (2) If a U.S. person holds a foreign affiliate through a foreign 
intermediary, the U.S. person will be considered to own the foreign 
affiliate directly and all accounts or transactions of the U.S. person 
with the intermediary will be considered to be with the foreign 
affiliate.
    (3) If a particular foreign direct investment in the United States 
is held, exercised, administered, or managed by a U.S. intermediary for 
the foreign beneficial owner, such intermediary shall be responsible for 
reporting the required information for, and in the name of, the U.S. 
affiliate, and shall report on behalf of the U.S. affiliate or shall 
instruct the U.S. affiliate to submit the required information. Upon so 
instructing the U.S. affiliate, the intermediary shall be released from 
further liability to report provided it has informed this Bureau of the 
date such instructions were given and the name and address of the U.S. 
affiliate, and has supplied the U.S. affiliate with any information in 
the possession of, or which can be secured by, the intermediary that is 
necessary to permit the U.S. affiliate to complete the required reports. 
When acting in the capacity of an intermediary, the accounts or 
transactions of the U.S. intermediary with a foreign beneficial owner 
shall be considered as accounts or transactions of the U.S. affiliate 
with the foreign beneficial owner. To the extent such transactions or 
accounts are unavailable to the U.S. affiliiate, they may be required to 
be reported by the intermediary.
    (4) If a foreign beneficial owner holds a U.S. affiliate through a 
foreign intermediary, the U.S. affiliate may report the intermediary as 
its foreign parent

[[Page 23]]

but, when requested, must also identify and furnish information 
concerning the foreign beneficial owner, if known, or if such 
information can be secured. Accounts or transactions of the U.S. 
affiliate with the foreign intermediary shall be considered as accounts 
or transactions of the U.S. affiliate with the foreign beneficial owner.

[42 FR 64315, Dec. 22, 1977, as amended at 43 FR 54624, Nov. 22, 1978]