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Freight

Bureau of Economic Analysis Ramps Up Data Gathering

Highlights

  • The Bureau of Economic Analysis (BEA), an agency of the U.S. Department of Commerce, has published 10 notices regarding annual and quarterly surveys that track various types of foreign investment into the United States. The BEA will contact all entities required to respond to the mandatory surveys.
  • Companies contacted by BEA must submit the completed survey forms within 30 days after the end of each fiscal year or quarter, or within 45 days if the report is for the final quarter of the financial reporting year.
  • Companies should be cognizant of the potential obligation to submit these survey filings, as the regulations impose strict penalties for the failure to do so.

The Bureau of Economic Analysis (BEA), an agency of the U.S. Department of Commerce, published 10 notices on Jan. 27, 2020, regarding annual and quarterly surveys that track various types of foreign investment into the United States. The BEA will contact all entities required to respond to its mandatory surveys. Entities not contacted by BEA have no reporting responsibilities.

The publications include the following:

  • BE-9: Foreign Airline Operators’ Revenues and Expenses in the United States (quarterly). A foreign airline operator must file a report if it transported passengers or freight to or from the United States, and reaches a $5 million threshold of revenue or expenses during the previous or upcoming fiscal year.
  • BE-15: Foreign Direct Investment in the United States (annually). A business enterprise must file a report if, at the end of a fiscal year, a foreign entity owns or controls at least 10 percent of the voting securities of the U.S. enterprise (or equivalent interest in an unincorporated enterprise).
  • BE-29: Foreign Ocean Carriers’ Expenses in the United States (annually). A foreign ocean carrier must file a report if it: 1) handled 40 or more port calls in the United States during the fiscal year, or 2) handled total covered expenses of at least $250,000 during fiscal year.
  • BE-30: Ocean Freight Revenues and Foreign Expenses of U.S. Carriers (quarterly). A U.S. ocean carrier must file a report if it: 1) transported freight or passengers to or between some foreign ports, and 2) reaches a threshold of $500,000 of revenue or expenses during the previous or upcoming fiscal year.
  • BE-37: U.S. Airline Operators’ Foreign Revenues and Expenses (quarterly). A U.S. airline operator must file a report that: 1) transported passengers or U.S. freight, or transported passengers or freight or between two foreign points, and 2) reaches a $500,000 threshold of revenue or expenses during the previous or upcoming fiscal year.
  • BE-45: Insurance Transactions by U.S. Insurance Companies with Foreign Persons (quarterly). A U.S. insurance company that engaged in reinsurance transactions with a foreign person or that engaged in international transactions in services related to insurance must file a report. Filing is mandatory if any of eight categories of transactions exceeded $8 million (positive or negative) for the previous calendar year or is expected to exceed that amount in the current calendar year.
  • BE-125: Transactions in Selected Services and Intellectual Property with Foreign Persons (quarterly). A report is required from U.S. persons that: 1) had combined sales to foreign people in certain intellectual property or services transactions that exceeded $6 million in the person’s prior fiscal year, or 2) had combined purchases from foreign people in intellectual property or certain services transactions that reach a threshold of $4 million in the U.S. person’s prior or upcoming fiscal year.
  • BE-185: Financial Services Transactions Between U.S. Financial Services Providers and Foreign Persons (quarterly). A report is required from financial services providers, or their subsidiaries, who had sales to foreign persons in all financial services of more than $20 million for the previous year or will have in the upcoming year, or had purchases from foreign persons in all financial services of more than $15 million for the previous year or will have in the upcoming year.
  • BE-577: U.S. Direct Investment Abroad – Transactions of U.S. Reporter with Foreign Affiliate (quarterly). A report is required from a U.S. person that had direct transactions with a foreign business in which it had ownership interest of at least 10 percent of voting stock (or an equivalent interest of an unincorporated business) at any time during the reporting period.
  • BE-605: Foreign Direct Investment in the United States – Transactions of U.S. Affiliate with Foreign Parent (quarterly). If a foreign entity owns 10 percent or more of voting securities in a U.S. business (or an equivalent interest of an unincorporated U.S. business enterprise), at any time during the quarter, the U.S. business must file a report.

Guidelines and Potential Penalties

Companies contacted by BEA must submit the completed survey forms within 30 days after the end of each fiscal year or quarter, or within 45 days if the report is for the final quarter of the financial reporting year. Companies should be cognizant of the potential obligation to submit these survey filings, as the regulations impose strict penalties for the failure to do so. With two exceptions, failure to timely report could result in a fine of between $4,454 and $44,539 (the penalties for the Foreign Direct Investment in the United States annual report and the Transactions with U.S. Reporter with Foreign Affiliate quarterly report are slightly higher, both carrying fines of between $4,527 and $45,268). In addition, a willful failure to report may result in a fine of up to $10,000 or carry a prison sentence of up to a year, or both.

Companies filing reports generally should not be concerned about disclosure of sensitive business information in filing BEA reports because BEA operates under strict confidentiality requirements. First, under BEA’s governing statute, access to any information obtained from BEA surveys is limited to “officials or employees designated to perform functions” under the regulations. Second, information gathered from BEA surveys may only be used “for analytical or statistical purposes” (or in penalty proceedings for willful violations of filing requirements). Furthermore, information gathered by BEA is statutorily exempt from Freedom of Information Act (FOIA) requests. Thus, while the reporting is mandatory and should be done with care, companies should be confident that their selection as mandatory respondents will not put them at a competitive disadvantage.

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