[Federal Register Volume 64, Number 211 (Tuesday, November 2, 1999)]
[Rules and Regulations]
[Pages 59119-59121]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-28576]


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DEPARTMENT OF COMMERCE

Bureau of Economic Analysis

15 CFR Part 801

[Docket No. 9906111599276-02]
RIN 0691-AA35


International Services Surveys: BE-80, Benchmark Survey of 
Financial Services Transactions Between U.S. Financial Services 
Providers and Unaffiliated Foreign Persons

AGENCY: Bureau of Economic Analysis, Commerce.

ACTION: Final rule.

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SUMMARY: These final rules revise regulations for the BE-80, Benchmark 
Survey of Financial Services Transactions Between U.S. Financial 
Services Providers and Unaffiliated Foreign Persons.
    The BE-80 survey is mandatory and is conducted once every 5 years 
by the Bureau of Economic Analysis (BEA), U.S. Department of Commerce, 
under the International Investment and Trade in Services Survey Act, 
and under the Omnibus Trade and Competitiveness Act of 1988. The 
benchmark survey will be conducted for 1999. BEA will send the survey 
to potential respondents in January of the year 2000; responses will be 
due by March 31, 2000. The last benchmark survey was conducted for 
1994. The benchmark survey will obtain universe data on trade in 
financial services, by type and by country, between U.S. financial 
services providers and unaffiliated foreign persons. Data from the BE-
80 survey (and the follow-on annual survey, the BE-82) are needed to 
monitor trade in financial services, analyze its impact on the U.S. and 
foreign economies, compile and improve the U.S. economic accounts, 
support U.S. commercial policy on financial services, conduct trade 
promotion, improve the ability of U.S. businesses to identify and 
evaluate market opportunities, and for other Government uses.
    The revised rules raise the exemption level for the 1999 survey to 
$3 million in covered sales or purchases transactions, from $1 million 
on the previous (1994) survey. Raising the exemption level will reduce 
respondent burden, particularly for small companies. The revised rules 
also combine private placement services with underwriting services, 
combine foreign exchange brokerage services with other brokerage 
services, and create a separate category for electronic funds 
transfers. Finally, the revised

[[Page 59120]]

rules restate the definition of ``financial services provider'' using 
the nomenclature of the new North American Industry Classification 
System that has replaced the U.S. Standard Industrial Classification 
System.
    The changes in the types of services to be reported separately 
reflect BEA's experience in collecting data on financial services 
transactions over the past 5 years. Data collected for both private 
placement and foreign exchange brokerage services have been very small 
and do not justify the continuation of separate reporting. Electronic 
funds transfer services, in contrast appear to account for a large 
fraction of both total receipts and total payments for ``other 
financial services,'' in which electronic funds transfers were 
previously included.

EFFECTIVE DATE: These final rules are effective December 2, 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 July 9, 1999 Federal Register, volume 
64, No. 131, 64 FR 37049-37051, BEA published a notice of proposed 
rulemaking setting forth revised reporting requirements for the BE-80, 
Benchmark Survey of Financial Services Transactions Between U.S. 
Financial Services Providers and Unaffiliated Foreign Persons. No 
comments on the proposed rules were received. Thus, these final rules 
are the same as the proposed rules.
    These final rules amend 15 CFR part 801 to set forth revised 
reporting requirements for the BE-80, Benchmark Survey of Financial 
Services Transactions Between Financial Services Providers and 
Unaffiliated Foreign Persons. 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'', and under Section 5408 of the 
Omnibus Trade and Competitiveness Act of 1988 (15 U.S.C. 4908). 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, the 
President delegated authority granted under the Act as concerns 
international trade in services to the Secretary of Commerce, who has 
redelegated it to BEA.
    The major purposes of the survey are to monitor trade in financial 
services, analyze its impact on the U.S. and foreign economics, compile 
and improve the U.S. economic accounts, support U.S. commercial policy 
on financial services, conduct trade promotion, and improve the ability 
of U.S. businesses to identify and evaluate market opportunities.
    BEA will conduct the BE-80 survey once every 5 years. They last 
survey was conducted for 1994. The survey is intended to cover the 
universe of financial services transactions between U.S. financial 
services providers and unaffiliated foreign persons. Reporting is 
required from U.S. financial services providers who have sales to or 
purchases from unaffiliated foreign persons in all covered financial 
services combined in excess of $3 million during the reporting year. 
Financial services providers meeting these criteria must apply data on 
the amount of their sales or purchases for each covered type of 
service, disaggregate by country. U.S. financial services providers 
that have covered transactions of less than $3 million during the 
reporting year are asked to provide voluntary estimates of their total 
sales or purchases of each type of financial service.
    The information from the benchmark survey is updated in 
nonbenchmark years by an annual follow on survey, the BE-82. Currently, 
the annual survey covers only those U.S. financial services providers 
that have covered transaction in excess of $5 million during the 
reporting year.

Executive Order 12612

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

Executive Order 12866

    These final 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. 0608-0062) under the Paperwork Reduction 
Act. 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 survey is expected to result in the filing of reports, 
containing mandatory or voluntary data, from about 500 respondents. The 
average burden for completing the BE-80--both the mandatory and 
voluntary sections--is estimated to be 7 hours. Thus, the total 
respondent burden of the survey is estimated at 3,500 hours (500 
respondents times 7 hours average burden). The actual burden will vary 
from reporter to reporter, depending upon the number and variety of 
their financial services transactions and the ease of assembling the 
data. Thus, it may range from 4 hours for a reporter that has a small 
number and variety of transactions and easily accessible data, or that 
reports only in the voluntary section of the form, to 150 hours for a 
very large reporter that engages in a large number and variety of 
financial services transactions and has difficulty in locating and 
assembling the required data. This estimate includes time for reviewing 
instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information.
    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, and to the Office of Management and Budget, O.I.R.A., Paperwork 
Reduction Project 0608-0062, Washington, DC 20503 (Attention PRA Desk 
Officer for BEA).

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 these final rules 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 financial services 
transactions tend to be quite large. In addition, the reporting 
threshold for this survey is set at a level that will exempt most small 
businesses from reporting. The BE-80 benchmark survey will be

[[Page 59121]]

required only from U.S. persons with sales to, or purchases from, 
unaffiliated foreign persons in excess of $3,000,000 during the 
reporting year, in all covered financial services transactions 
combined; the exemption level for the previous benchmark survey, 
covering 1994, was $1,000,000. 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; therefore, the burden on them should be small.

List of Subjects in 15 CFR Part 806

    Balance of payments, Economic statistics, Foreign trade, Penalties, 
Reporting and recordkeeping requirements.

    Dated: October 8, 1999.
J. Steven Landefeld,
Director, Bureau of Economic Analysis.

    For the reasons set forth in the preamble, BEA amends 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 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. 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.

    2. Section 801.11 is revised to read as follows:


Sec. 801.11  Rules and regulations for the BE-80, Benchmark Survey of 
Financial Services Transactions Between U.S. Financial Services 
Providers and Unaffiliated Foreign Persons.

    A BE-80, Benchmark Survey of Financial Services Transactions 
Between U.S. Financial Services Providers and Unaffiliated Foreign 
Persons, will be conducted covering 1999 and every fifth year 
thereafter. All legal authorities, provisions, definitions, and 
requirements contained in Secs. 801.1 through 801.9 are applicable to 
this survey. Additional rules and regulations for the BE-80 survey are 
given in paragraphs (a) through (d) of this section. More detailed 
instructions are given on the report forms and instructions.
    (a) Who must report--(1) Mandatory reporting. Reports are required 
from each U.S. person who is a financial services provider or 
intermediary, or whose consolidated U.S. enterprise includes a 
separately organized subsidiary, or part, that is a financial services 
provider or intermediary, and who had transactions (either sales or 
purchases) directly with unaffiliated foreign persons in all financial 
services combined in excess of $3,000,000 during its fiscal year 
covered by the survey. The $3,000,000 threshold should be applied to 
financial services transactions with unaffiliated foreign persons by 
all part of the consolidated U.S. enterprise combined that are 
financial services providers or intermediaries. Because the $3,000,000 
threshold applies separately to sales and purchases, the mandatory 
reporting requirement may apply only to sales, only to purchases, or to 
both.
    (i) The determination of whether a U.S. financial services provider 
or intermediary is subject to this mandatory reporting requirement may 
be 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 manual records 
search.
    (ii) Reporters who file pursuant to this mandatory reporting 
requirement must provide data on total sales and/or purchases of each 
of the covered types of financial services transactions and must 
disaggregate the totals by country.
    (2) Voluntary reporting. If during the fiscal year covered, sales 
or purchases of financial services by a firm that is a financial 
services provider or intermediary, or by a firm's subsidiaries, or 
parts, combined that are financial services providers or 
intermediaries, are $3,000,000 or less, the U.S. person is requested to 
provide an estimate of the total for each type of service. Provision of 
this information is voluntary. Because the $3,000,000 threshold applies 
separately to sales and purchases, this voluntary reporting option may 
apply only to sales, only to purchases, or to both.
    (b) BE-80 definition of financial services provider. Except for 
Monetary Authorities (i.e. Central Banks), the definition of financial 
services provider used for this survey is identical in coverage to 
Sector 52--Finance and Insurance--of the North American Industry 
Classification System, United States, 1997. For example, companies and/
or subsidiaries and other separable parts of companies in the following 
industries are defined as financial services providers: Depository 
credit intermediation and related activities (including commercial 
banking, holding companies, savings institutions, check cashing, and 
debit card issuing); nondepository credit intermediation (including 
credit card issuing, sales financing, and consumer lending); 
securities, commodity contracts, and other financial investments and 
related activities (including security and commodity futures brokers, 
dealers, exchanges, traders, underwriters, investment bankers, and 
providers of securities custody services); insurance carriers and 
related activities (including agents, brokers, and services providers); 
investment advisors and managers and funds, trusts, and other financial 
vehicles (including mutual funds, pension funds, real estate investment 
trusts, investors, stock quotation services, etc.).
    (c) Covered types of services. The BE-80 survey covers the 
following types of financial services transactions (purchases and/or 
sales) between U.S. financial services providers and unaffiliated 
foreign persons: Brokerage, including foreign exchange brokerage 
services; underwriting and private placement services; financial 
management services; credit-related services, except credit care 
services; credit card services; financial advisory and custody 
services; securities lending services; electronic funds transfer 
services; and other financial services.
    (d) What to file. (1) The BE-80 survey consists of Forms BE-80 (A) 
and BE-80(B). Before completing a form BE-80 (B), a consolidated U.S. 
enterprise (including the top U.S. parent and all of its subsidiaries 
and parts combined) must complete Form BE-80(A) to determine its 
reporting status. If the enterprise is subject to the mandatory 
reporting requirement, or if it is exempt from the mandatory reporting 
requirement but chooses to report data voluntarily, it should either:
    (i) File a separate Form BE-80(B) for each separately organized 
financial services subsidiary or part of a consolidated U.S. 
enterprise; or
    (ii) File a single BE-80(B) representing the sum of all covered 
transactions by all financial services subsidiaries or parts of the 
enterprise combined.
    (2) Reporters who receive the BE-80 survey from BEA but are not 
subject to the mandatory reporting requirements and choose not to 
report data voluntarily must complete and return to BEA the Exemption 
Claim.

[FR Doc. 99-28576 Filed 11-1-99; 8:45 am]
BILLING CODE 3510-06-M