[Federal Register Volume 74, Number 235 (Wednesday, December 9, 2009)]
[Rules and Regulations]
[Pages 65017-65019]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-29312]


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DEPARTMENT OF COMMERCE

Bureau of Economic Analysis

15 CFR Part 806

[Docket No. 090130108-91414-02]
RIN 0691-AA70


Direct Investment Surveys: BE-605, Quarterly Survey of Foreign 
Direct Investment in the United States--Transactions of U.S. Affiliate 
With Foreign Parent

AGENCY: Bureau of Economic Analysis, Commerce.

ACTION: Final rule.

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SUMMARY: This final rule amends regulations of the Bureau of Economic 
Analysis (BEA) setting forth reporting requirements for the BE-605 
quarterly survey of foreign direct investment in the United States. The 
survey obtains quarterly sample data on transactions and positions 
between foreign-owned U.S. business enterprises (U.S. affiliates) and 
their ``affiliated foreign groups'' (i.e., their foreign parents and 
foreign affiliates of their foreign parents).
    Through this rule, BEA will make a number of changes to the BE-605 
survey. BEA will discontinue the use of separate forms for banks. 
Beginning with the first quarter of 2010, both bank and nonbank U.S. 
affiliates will file Form BE-605. In conjunction with this change, BEA 
will change the title of Form BE-605. BEA will add and delete certain 
items on the survey form and change the reporting criteria. BEA will 
also collect identification information for affiliates filing Form BE-
605 for the first time, and make changes to the BE-605 form and 
instructions to bring them into conformity with the recently revised 
annual and benchmark surveys of foreign direct investment in the United 
States.

DATES: This final rule will be effective January 8, 2010.

FOR FURTHER INFORMATION CONTACT: David H. Galler, Chief, Direct 
Investment Division (BE-50), Bureau of Economic Analysis, U.S. 
Department of Commerce, Washington, DC 20230; e-mail 
[email protected] or phone (202) 606-9835.

SUPPLEMENTARY INFORMATION: In the September 2, 2009, Federal Register, 
74 FR 45383-45385, BEA published a notice of proposed rulemaking that 
set forth revised reporting criteria for the BE-605, Quarterly Survey 
of Foreign Direct Investment in the United States--Transactions of U.S. 
Affiliate with Foreign Parent. No comments on the proposed rule were 
received. Thus, the proposed rule is adopted without change. This final 
rule amends 15 CFR 806.15 to set forth the reporting requirements for 
the BE-605 quarterly survey of foreign direct investment in the United 
States.
    The BE-605 survey is a mandatory quarterly survey of foreign direct 
investment conducted by BEA under the International Investment and 
Trade in Services Survey Act (22 U.S.C. 3101-3108). BEA will send BE-
605 survey forms to potential respondents each quarter; responses will 
be due within 30 days after the end of each quarter, except for the 
final quarter of the fiscal year when reports will be due within 45 
days of the end of the quarter.

Description of Changes

    BEA is making a number of changes to the BE-605 survey. BEA is 
discontinuing the use of separate forms for banks. Beginning with the 
first quarter of 2010, both bank and nonbank U.S. affiliates will file 
Form BE-605. In conjunction with this change, BEA is changing the title 
of Form BE-605 to ``Quarterly Survey of Foreign Direct Investment in 
the United States--Transactions of U.S. Affiliate with Foreign 
Parent.'' Changes to language and instructions are being made to align 
Form BE-605 with recent changes to the annual and benchmark surveys of 
foreign direct investment.

[[Page 65018]]

    BEA is adding items to Form BE-605 to collect additional 
identification information on U.S. affiliates of foreign parents filing 
the survey for the first time. (BEA previously collected more extensive 
identification information on the U.S. business being established or 
acquired, and on the new foreign owner, through Form BE-13, Initial 
Report on a Foreign Person's Direct or Indirect Acquisition, 
Establishment, or Purchase of the Operating Assets, of a Business 
Enterprise, Including Real Estate, which was recently discontinued.) 
These additional items include the date the business enterprise became 
a U.S. affiliate of a foreign parent, and the U.S. affiliate's 
industry. BEA is adding a question to the survey that asks U.S. 
affiliates whether they are planning to construct, or are in the 
process of constructing, a new production establishment.
    BEA is discontinuing the collection of information on permanent 
intercompany debt funding, and interest receipts and payments 
associated with that funding, between U.S. affiliates that are banks 
and their foreign parents. This debt funding information is collected 
by the Treasury International Capital System, and recent changes in 
international statistical guidelines call for it now to be classified 
as portfolio investment. BEA will no longer collect data on loan loss 
reserves for banks, which, along with a number of related items, had 
been requested on the specialized bank form that will be discontinued. 
BEA will continue to collect intercompany debt and related interest 
data for the units of a consolidated U.S. bank affiliate that have 
insurance, real estate, or leasing activities.
    BEA is increasing the exemption level for reporting on Form BE-605 
from $30 million to $60 million. The exemption level is stated in terms 
of the U.S. affiliate's total assets, sales or gross operating 
revenues, and net income after U.S. income taxes. At the new reporting 
threshold, BEA expects about 4,000 U.S. affiliates to report each 
quarter. This number is slightly higher than the number--3,950--
estimated at the time of the last clearance of the survey. However, the 
increase reflects growth in the number of foreign-owned firms, and 
would be significantly higher in the absence of the increase in the 
reporting threshold.

Survey Background

    The BEA conducts the BE-605 survey under the International 
Investment and Trade in Services Survey Act (``the Act''). Section 4(a) 
of the Act provides that, with respect to foreign direct investment in 
the United States, the President shall, to the extent he deems it 
necessary and feasible, ``conduct a regular data collection program to 
secure current information on international capital 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 * * * position of the United States.''
    In section 3 of Executive Order 11961, as amended by Executive 
Orders 12318 and 12518, the President delegated the responsibility for 
performing functions under the Act concerning direct investment to the 
Secretary of Commerce, who has redelegated it to BEA.
    The BE-605 quarterly survey is a sample survey that collects data 
on transactions and positions between foreign-owned U.S. business 
enterprises and their ``affiliated foreign groups'' (i.e., their 
foreign parents and foreign affiliates of their foreign parents). The 
sample data are used to derive universe estimates in non-benchmark 
years from similar data reported in the BE-12, Benchmark Survey of 
Foreign Direct Investment in the United States, which is conducted 
every five years. The data are used in the preparation of the U.S. 
international transactions accounts, national income and product 
accounts, and input-output accounts. The data are needed to measure the 
size and economic significance of foreign direct investment in the 
United States, measure changes in such investment, and assess its 
impact on the U.S. economy.

Executive Order 12866

    This final rule has been determined to be not 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 in this final rule has been submitted 
to the Office of Management and Budget (OMB) under the Paperwork 
Reduction Act (PRA). OMB approved the information collection under 
control number 0608-0009.
    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 BE-605 survey is expected to result in the filing of about 
4,000 reports each financial quarter. The respondent burden for this 
collection of information is estimated to vary from one-half hour to 
three hours per response, with an average of one hour 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. (The burden will vary 
depending, in part, on the size and ownership structure of the U.S. 
business enterprise that is being reported.) Because reports are filed 
4 times per year, 16,000 responses annually are expected. Thus, the 
average total annual respondent burden of the survey is estimated at 
16,000 hours (4,000 respondents filing 4 times per year multiplied by 1 
hour average burden). This estimate is slightly higher than the 15,800 
burden hours currently in the OMB inventory for this survey because the 
increase in burden due to the growth in the number of foreign-owned 
firms slightly exceeds the reduction in burden resulting from the 
increase in the reporting threshold.
    Written comments regarding the burden-hour estimates or any other 
aspect of the collection-of-information requirements contained in the 
final rule should be sent both to the Bureau of Economic Analysis via 
mail to U.S. Department of Commerce, Bureau of Economic Analysis, 
Office of the Chief, Direct Investment Division, BE-50, Washington, DC 
20230; via e-mail at [email protected]; or by FAX at (202) 606-5311, 
and to the Office of Management and Budget, O.I.R.A., Paperwork 
Reduction Project 0608-0009, Attention PRA Desk Officer for BEA, via e-
mail at [email protected], 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 final 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

[[Page 65019]]

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

    Economic statistics, Foreign investment in the United States, 
International transactions, Penalties, Reporting and recordkeeping 
requirements.

    Dated: November 16, 2009.
J. Steven Landefeld,
Director, Bureau of Economic Analysis.

0
For the reasons set forth in the preamble, BEA amends 15 CFR Part 806 
as follows:

PART 806--DIRECT INVESTMENT SURVEYS

0
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), and E.O. 12518 (3 CFR, 1985 Comp., p. 348).


0
2. Section 806.15(h) is revised to read as follows:


Sec.  806.15  Foreign direct investment in the United States.

* * * * *
    (h) Quarterly report form. BE-605, Quarterly Survey of Foreign 
Direct Investment in the United States--Transactions of U.S. Affiliate 
with Foreign Parent: One report is required for each U.S. affiliate 
exceeding an exemption level of $60 million.
* * * * *
[FR Doc. E9-29312 Filed 12-8-09; 8:45 am]
BILLING CODE 3510-06-P