[Federal Register Volume 64, Number 42 (Thursday, March 4, 1999)]
[Rules and Regulations]
[Pages 10387-10389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-5342]


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DEPARTMENT OF COMMERCE

Bureau of Economic Analysis

15 CFR Part 806

[Docket No. 990106005-9055-02]
RIN 0691-AA32


Direct Investment Surveys: Raising Exemption Level for Annual 
Survey of Foreign Direct Investment in the United States

AGENCY: Bureau of Economic Analysis, Commerce.

ACTION: Final rule.

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SUMMARY: These final rules amend 15 CFR Part 806.15 by raising the 
exemption level for reporting in the Annual Survey of Foreign Direct

[[Page 10388]]

Investment in the United States (Form BE-15. The survey is a mandatory 
survey conducted by the Bureau of Economic Analysis (BEA), U.S. 
Department of Commerce, under the authority of the International 
Investment and Trade in Services Survey Act. These changes bring the 
survey into conformity with the Benchmark Survey of Foreign Direct 
Investment in the United States--1997 (Form BE-12) and reduce reporting 
burden on small respondents. The revised rules raise the exemption 
level for the survey to $30 million on the BE-15(SF) short form, up 
from $10 million (measured by the Company's total assets, sales, or net 
income or loss); on the survey's long form, the exemption level is 
raised to $100 million, up from $50 million. In addition, the revised 
survey bases industry coding on the North American Industry 
Classification System (NAICS) in place of the U.S. Standard Industrial 
Classification system that was formerly used, and modifies the detail 
collected on the composition of external financing of the reporting 
enterprise, on research and development expenditures, and on the 
operations of foreign-owned businesses in individual States.

EFFECTIVE DATE: These rules will be effective April 5, 1999.

FOR FURTHER INFORMATION CONTACT: R. David Belli, Chief, International 
Investment Division (BE-50), Bureau of Economic Analysis, U.S. 
Department of Commerce, Washington, DC 20230; phone 202-606-9800.

SUPPLEMENTARY INFORMATION: In the January 14, 1999 Federal Register, 
Volume 64, No. 9, pages 2454-2455, the Bureau of Economic Analysis 
published a notice of proposed rulemaking to amend 15 CFR part 806.15 
by raising the exemption level for reporting in the annual survey of 
foreign direct investment in the United States. No comments on the 
proposed rule were received. Thus, this final rule is the same as the 
proposed rule.
    The Annual Survey of Foreign Direct Investment in the United States 
(Form BE-15) is part of BEA's regular data collection program for 
foreign direct investment in the United States. The surveys are 
mandatory and are conducted pursuant to the International Investment 
and Trade in Services Survey Act (22 U.S.C. 3101-3108, as amended). The 
annual survey is necessary to provide reliable, useful, and timely 
measures of foreign direct investment in the United States. The survey 
covers all affiliates above a size-exemption level and collects annual 
data on the financial structure and operations of nonbank U.S. 
affiliates of foreign companies needed to update similar data for the 
universe of U.S. affiliates collected once every 5 years in the BE-12 
benchmark survey. The data are used to derive annual estimates of the 
operations of U.S. affiliates of foreign companies, including their 
balance sheets; income statements; property, plant, and equipment; 
external financing; employment and employee compensation; merchandise 
trade; sales of goods and services; taxes; and research and development 
(R&D) activity. The data will also be used to measure the economic 
significance of foreign direct investment in the United States and to 
analyze its effect on the U.S. economy. Finally, they will be used in 
formulating, and assessing the impact of, U.S. policy on foreign direct 
investment.
    The revisions to the survey will bring it into conformity with the 
Benchmark Survey of Foreign Direct Investment in the United States--
1997 (BE-12) and will be effective beginning with the 1998 annual 
survey. The BE-12 is BEA's quinquennial census of foreign direct 
investment in the United States; it collects annual data and is 
intended to cover the universe of U.S. affiliates. (A U.S. affiliate is 
a U.S. business enterprise in which a foreign person owns or controls 
ten percent or more of the voting stock, or an equivalent interest in 
an unincorporated business enterprise.) The new rules raise the 
exemption level for the survey to $30 million on the BE-15(SF) short 
form, up from $10 million (measured by the company's total assets, 
sales, or net income or loss), and increase the exemption level at 
which the long form is required to $100 million, up from $50 million. 
Both changes reduce burden for smaller companies. In addition, the 
survey bases industry coding on the North American Industry 
Classification System (NAICS) in place of the U.S. Standard Industrial 
Classification system, and modifies the detail collected on the 
composition of external financing of the reporting enterprise, on 
research and development expenditures, and on the operations of 
foreign-owned businesses in individual States.

Executive Order 12612

    These proposed rules do not contain policies with Federalism 
implications sufficient to warrant preparation of a Federalism 
assessment under E.O. 12612.

Executive Order 12866

    These proposed rules have been determined to be not significant for 
purposes of E.O. 12866.

Paperwork Reduction Act

    The collection of information required in these final rules has 
been approved by OMB (OMB No. 0608-0034).
    Notwithstanding any other provisions of 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; such a 
Control Number (0608-0034) has been displayed. Public reporting burden 
for this collection of information is estimated to vary from 2 hours to 
550 hours per response with an average of 26 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.
    Send comments regarding this burden estimate or any other aspect of 
this collection of information, including suggestions for reducing this 
burden to: Director, Bureau of Economic Analysis (BE-1), U.S. 
Department of Commerce, Washington, DC 20230; and to the Office of 
Management and Budget, O.I.R.A., Paperwork Reduction Project 0608-0034, 
Washington, DC 20503.

Regulatory Flexibility Act

    The Assistant General Counsel for Legislation and 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 these final rules 
will not have a significant economic impact on a substantial number of 
small entities. Most small businesses are not foreign owned, and many 
that are will not be required to report because their assets, sales, 
and net income are each equal to or less than the $30 million exemption 
level at or below which reporting is not required. Also under these 
rules, companies with assets, sales, or net income above $30 million, 
but not above $100 million will report on the abbreviated BE-15(SF) 
short form, rather than on the BE-15(LF) long form. These provisions 
are intended to reduce the reporting burden on smaller companies.

List of Subjects in 15 CFR Part 806

    Balance of payments, Economic statistics, Foreign instruments in 
United

[[Page 10389]]

States, Reporting and recordkeeping requirements.
J. Steven Landefeld,
Director, Bureau of Economic Analysis.

    For the reasons set forth above, BEA amends 15 CFR Part 806 as 
follows:

PART 806--DIRECT INVESTMENT SURVEYS

    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, and E.O. 11961 (3 
CFR, 1977 Comp., p. 86), as amended by E.O. 12013 (3 CFR, 1977 
Comp., p. 147), E.O. 12318 (3 CFR, 1981 Comp., p. 173), and E.O. 
12518 (3 CFR, 1985 Comp., p. 348).


Sec. 806.15  [Amended]

    2. Section 806.15(i) is amended as follows:
    The exemption level of $10,000,000 in the first sentence is revised 
to read ``$30,000,000''; in the second sentence, the long form 
exemption level of $50,000,000 is revised to read ``$100,000,000''; and 
the short form exemption level ``at least one of the three items 
exceeds $10,000,000 but no one item exceeds $50,000,000 (positive or 
negative)'' is revised to read ``at least one of the three items 
exceeds $30,000,000 but no one item exceeds $100,000,000 (positive or 
negative).''

[FR Doc. 99-5342 Filed 3-3-99; 8:45 am]
BILLING CODE 3510-06-M