The Bureau of Economic Analysis (“BEA”), a division of the U.S. Department of Commerce conducts surveys to collect and analyze investments into and out of the United States (“U.S.”). These surveys, conducted quarterly, annually, and every five years, analyze U.S. investments in foreign funds and foreign investments in U.S. funds.
In 2015, the BEA changed the reporting requirement of one of these surveys, Form BE-10, and made filing mandatory by all eligible entities that met the reporting requirements under the BE-10, even if they were not contacted by the BEA. The BE-10 is conducted every five years and was last conducted in May 2015.
Recently, in an supposed effort to distinguish between direct investments and portfolio investments as well as streamline reporting requirements and eliminate duplicative reporting, the BEA, along with the U.S. Treasury Department announced a plan to move certain reporting that was under the BEA to reporting on Treasury International Capital (“TIC”) surveys of portfolio investments under the U.S. Treasury Department.
This change in reporting will only apply to certain U.S. entities with investments in Foreign Private Funds that exceed a 10% voting interest and foreign entities with investments in U.S. private funds that exceed a 10% voting interest. These types of investments were usually reported to BEA under direct investments, however this failed to take into account when the investments did not involve operating companies, not other private funds or holding companies, and are therefore considered portfolio investments. The TIC reporting system already reports on related portfolio investments.
This change will apply to surveys conducted in 2017.