2022-19436. International Services Surveys: Renewal of and Changes to BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property With Foreign Persons, and Clarifying When BE-140 and BE-180 Benchmark Surveys Are Conducted

AGENCY:

Bureau of Economic Analysis, Commerce.

ACTION:

Final rule.

SUMMARY:

This final rule amends regulations of the Department of Commerce's Bureau of Economic Analysis (BEA) to renew reporting requirements for the BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons. This final rule also amends the regulations for BEA's two other international services benchmark surveys, the BE-140 Benchmark Survey of Insurance Transactions by U.S. Insurance Companies with Foreign Persons and the BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons, to clarify when the surveys will be conducted.

DATES:

This final rule is effective October 11, 2022.

FOR FURTHER INFORMATION CONTACT:

Christopher Stein, Chief, Services Surveys Branch (BE-50), Balance of Payments Division, Bureau of Economic Analysis, U.S. Department of Commerce, 4600 Silver Hill Rd., Washington, DC 20233; email [e-mail] or phone [phone].

SUPPLEMENTARY INFORMATION:

On June 15, 2022, BEA published a notice of proposed rulemaking that set forth the revised reporting criteria for the BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons and that clarified when BEA's two other international services benchmark surveys, the BE-140 Benchmark Survey of Insurance Transactions by U.S. Insurance Companies with Foreign Persons and the BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons, will be conducted (87 FR 36091). No public comments were received. This final rule amends 15 CFR part 801 to set forth the reporting requirements for the BE-120 benchmark survey and clarify when the BE-140 and BE-180 benchmark surveys will be conducted.

The BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons is a mandatory survey and is conducted once every five years by BEA under the authority of the International Investment and Trade in Services Survey Act (22 U.S.C. 3101-3108). The data reported to BEA through this survey are confidential and may be used only for analytical and statistical purposes. A response is required from persons subject to the reporting requirements of the BE-120, whether or not they are contacted by BEA.

The BE-120 benchmark survey covers the universe of selected services and intellectual property transactions of U.S. companies with foreign persons and is BEA's most comprehensive survey of such transactions. The data collected through the BE-120 are needed to monitor U.S. trade in services and intellectual property, to analyze the impact of U.S. trade in these services on the U.S. economy and on foreign economies, to compile and improve the U.S. economic accounts, to support U.S. commercial policy on trade in services, to conduct trade promotion activities, and to improve the ability of U.S. businesses to identify and evaluate market opportunities. The benchmark data will be used, in conjunction with data collected from a sample of respondents on the companion BE-125 Quarterly Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons, to produce quarterly estimates of selected services and intellectual property components for BEA's international transactions accounts, national income and product accounts, and industry accounts.

Description of Changes

This final rule amends the regulation at 15 CFR part 801 by modifying § 801.3 and 801.11 through 801.13 and removing § 801.9 to clarify the timing of the three international services benchmark surveys: the BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons, the BE-140 Benchmark Survey of Insurance Transactions by U.S. Insurance Companies with Foreign Persons, and the BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons. The next BE-120 survey will apply to the 2022 fiscal reporting year, and will be conducted once every five years, for reporting years ending in 2 and 7, thereafter. Additionally, the next BE-140 survey and BE-180 survey will be collected for the 2023 and 2024 reporting years, respectively, and will continue to be conducted every five years thereafter. The BE-140 will be collected for reporting years ending in 3 and 8, and the BE-140 will be collected for reporting years ending in 4 and 9. See the most recent versions of the BE-120, BE-140, and BE-180 benchmark surveys at www.bea.gov for a more detailed description of covered transactions and definitions.

Each time a benchmark survey is to be conducted, BEA will describe any proposed changes to the information collected through the survey (including the addition, deletion, and/or modification of existing questions and definitions) in a public notice and will solicit comments as part of the requirements of the Paperwork Reduction Act (PRA). Any changes to reporting requirements or significant expansions in scope of the surveys will be conducted by rulemaking.

This final rule amends the regulation at 15 CFR part 801.11 to set forth the reporting requirements for the BE-120 benchmark survey, and amends the survey form for the BE-120 benchmark in response to suggestions from data users and to allow BEA to more closely align its statistics with international guidelines and publish more information on U.S. trade in services. The amendments include several changes in data items collected and the design of the survey form relative to the 2017 benchmark survey.

BEA adds the following to the BE-120 benchmark survey form:

(1) Questions to collect information on the largest U.S. states (up to three) for sales (exports) and purchases (imports) of services. Respondents that meet the thresholds ($2 million in combined sales, and/or $1 million in combined purchases) for filing on the mandatory schedules will be required to report information for up to three U.S. states that accounted for the largest shares of their sales and purchases activity. Reporters will be instructed to consider all of their cross-border sales and purchases of services (in aggregate for all transaction types and affiliation categories) and report the U.S. states that represented the largest share of their sales and (separately) their purchases. After identifying the states, reporters will provide an estimate of the percentage of their sales and purchases that were transacted from each state.

(2) Questions to collect information on digital intermediation platforms. BEA will ask if the reporters operated a digital intermediation platform, and if so, the value of their digital intermediation sales and associated transaction categories. All BE-120 respondents that meet the thresholds for filing on the mandatory schedules will be required to respond to these questions. Survey instructions and definitions will be modified to ensure fees and commissions for sales and purchases made through digital intermediation platforms are reported in the correct transaction categories.

(3) Question on employment size class. BEA will add a question asking for the employment size class of the consolidated U.S. company. The question will ask all respondents to check a box indicating their employment size class: 0—( e.g., Sole Proprietorship), 1-19, 20-49, 50-99, 100-249, 250-499, 500-999, 1,000-9,999, greater than 10,000. BEA has modified the size categories that were in the proposed rule to enhance the utility of the data collected.

Additionally, BEA will modify the remote services schedules (Schedules D and E) to better capture trade in digitally delivered services. Survey instructions will direct reporters to provide an estimate of the percentage of services that were provided remotely from the U.S. Reporter's domestic offices to foreign persons and to the U.S. Reporter's domestic offices from foreign persons via information and communications technology networks (via the internet, mobile device, extranet, telephone, fax, video conference, or other comparable online system). Services provided via in-person meetings, or postal or private delivery will be excluded. The percentage reported should reflect all interactions with the customer, not just the delivery of the final product.

BEA will delete the following two items from the BE-120 benchmark survey:

(1) Transaction categories for “Other intellectual property” will be eliminated. Rights to use other intellectual property (code 8.1), rights to reproduce and/or distribute other intellectual property (code 8.2), and outright sales or purchases of proprietary rights related to other intellectual property (code 8.3) will no longer be collected. Reporters will be instructed to reclassify transactions in these categories to research and development (R&D) services (transaction code 29.1, the provision of customized and non-customized R&D services; and, transaction code 29.2, other R&D services, including testing) and to other selected services (transaction code 42).

(2) Questions on “Contract manufacturing services” will be eliminated. Details regarding the material inputs, as well as the output product of the contract manufacturing services activity, for both sales and purchases activities will no longer be collected.

BEA will also redesign the format and wording of the survey. The new survey design will incorporate improvements that have been made to other BEA surveys. BE-120 benchmark survey instructions and data item descriptions will be changed to improve clarity and ensure that the survey form is consistent with other BEA surveys.

Change to the Survey Additions From the Proposed Rule

BEA made a change to the proposed question on employment size class (addition 3 above) to adjust the check box ranges to enhance the usefulness of the data collected. The modifications from the initial proposal do not impact the reporter's burden associated with the question; reporters will still only be required to check a single box when responding.

Additionally, BEA made a minor modification to the originally proposed “exclusions” in defining which digitally delivered services are to be reported on Schedules D and E. The original text in the proposed rule indicated that services provided by manually-typed email, telephone, or fax would be excluded. In this final rule, BEA has removed these exclusions to better align BEA statistics with new developments in international guidelines. Specifically, subsequent to publication of the proposed rule, an expert group organized by the Organisation for Economic Co-operation and Development (OECD) adopted a final definition of digital trade for the forthcoming Handbook on Measuring Digital Trade that only excludes services provided via in-person meetings, or postal or private delivery.

Executive Order 12866

This final rule has been determined to be not significant for purposes of Executive Order 12866.

Executive Order 13132

This final rule does not contain policies with federalism implications sufficient to warrant preparation of a Federalism assessment under Executive Order 13132.

Paperwork Reduction Act

The collection-of-information in this final rule was submitted to the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3520 (PRA). OMB approved the reinstatement, with change, of the information collection under OMB control number 0608-0058.

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 PRA unless that collection displays a currently valid OMB control number.

The BE-120 survey is expected to result in the filing of reports from approximately 15,000 respondents. Approximately 11,000 respondents will complete the survey, and approximately 4,000 will file exemption claims. The respondent burden for this collection of information will vary from one respondent to another, but is estimated to average (1) 24 hours for the 5,000 respondents that report data by transaction type, country, and affiliation; (2) 4 hours for the 6,000 respondents that report data by transaction type only; and (3) 1 hour for the 4,000 that file an exemption claim. These burden-hour estimates consider time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Thus, the total respondent burden for this survey is estimated at 148,000 hours, or approximately 10 hours per response (148,000 hours/15,000 respondents), compared to 145,000 hours, or about 9.5 hours per response (145,000 hours/15,500 respondents) for the 2017 BE-120 benchmark survey. The increase in burden hours is due to estimated changes in the expected quantity of survey responses, the composition of the respondent universe (those filing full schedule detail vs. totals by transaction type only) from 2017 to 2022, as well as modifications to the content of the survey for those filing schedule detail.

Written comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in the final rule should be sent to both BEA via email at [e-mail], and OMB, OIRA, Paperwork Reduction Project 0608-0058, Attention PRA Desk Officer for BEA, via email at [e-mail].

Regulatory Flexibility Act

The Chief Counsel for Regulation, Department of Commerce, certified to the Chief Counsel for Advocacy, Small Business Administration, at the proposed rule stage that this action will not have a significant impact on a substantial number of small entities. No comments were received on that certification or on the economic impacts of this rule more generally. Therefore, no regulatory flexibility analysis is required and none has been prepared.

List of Subjects in 15 CFR Part 801

• Economic statistics
• Foreign trade
• International transactions
• Penalties
• Reporting and recordkeeping requirements

Dated: September 2, 2022.

Paul W. Farello,

Associate Director of International Economics, Bureau of Economic Analysis.

For 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 AND SURVEYS OF DIRECT INVESTMENT

1. The authority citation for 15 CFR 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. 12318 (3 CFR, 1981 Comp. p. 173); and E.O. 12518 (3 CFR, 1985 Comp. p. 348).

2. Amend § 801.3 by revising the introductory text to read as follows:

§ 801.3

Reporting requirements.

Except for surveys subject to rulemaking in §§ 801.7, 801.8, 801.10, 801.11, 801.12, and 801.13, reporting requirements for all other surveys conducted by the Bureau of Economic Analysis shall be as follows:

* * * * *

§ 801.9

[Removed and Reserved]

3. Section 801.9 is removed and reserved.

4. Section 801.11 is revised to read as follows:

§ 801.11

Rules and regulations for the BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons.

The BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons will be conducted once every five years and covers years ending in 2 and 7. BEA will describe the proposed information collection in a public notice and will solicit comments according to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501-3520).

All legal authorities, provisions, definitions, and requirements contained in §§ 801.1 through 801.2 and 801.4 through 801.6 are applicable to this survey. Specific additional rules and regulations for the BE-120 survey are given in this section. More detailed instructions are given on the report form and in instructions accompanying the report form.

(a) Response required. A response is required, every fifth year, from persons subject to the reporting requirements of the BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property with Foreign Persons, contained in this section, whether or not they are contacted by BEA. Also, a person, or its agent, that is contacted by BEA about reporting on this survey, either by sending a report form or by written inquiry, must respond in writing pursuant to this section. This may be accomplished by:

(1) Completing and returning the BE-120 by the due date of the survey; or

(2) If exempt, by completing the determination of reporting status section of the BE-120 survey and returning it to BEA by the due date of the survey.

(b) Who must report. A BE-120 report is required of each U.S. person that had transactions with foreign persons in the categories covered by the survey during the fiscal year covered by the survey.

(c) What must be reported. (1) A U.S. person that had combined sales to foreign persons that exceeded $2 million, and/or combined purchases from foreign persons that exceeded $1 million in the services and intellectual property categories covered by the survey during its fiscal year, on an accrual basis, is required to provide data on total sales and/or purchases of each of the covered types of transactions and must disaggregate the totals by country and by relationship to the foreign transactor (foreign affiliate, foreign parent group, or unaffiliated). The $2 million threshold for sales and the $1 million threshold for purchases should be applied to the covered transactions categories with foreign persons by all parts of the consolidated domestic U.S. Reporter. Because the $2 million and $1 million thresholds apply separately to sales and purchases, the mandatory reporting requirement may apply to sales only, to purchases only, or to both. The determination of whether a U.S. services provider is subject to this reporting requirement can 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.

(2) A U.S. person that had combined sales to foreign persons that were $2 million or less, and combined purchases from foreign persons that were $1 million or less in the transaction categories covered by the survey during its fiscal year, on an accrual basis, is required to provide the total sales and/or purchases for each type of transaction in which they engaged. The $2 million threshold for sales and the $1 million threshold for purchases should be applied to the covered transactions categories with foreign persons by all parts of the consolidated domestic U.S. Reporter. Because the $2 million and $1 million thresholds apply separately to sales and purchases, the mandatory reporting requirement may apply to sales only, to purchases only, or to both.

(i) Voluntary reporting of transactions. If, during the reporter's fiscal year, combined sales were $2 million or less, and combined purchases were $1 million or less, on an accrual basis, the U.S. person may, in addition to providing the required total for each type of transaction, report sales at a country and affiliation level of detail on the applicable mandatory schedule(s). The estimates can be judgmental, that is, based on recall, without conducting a detailed records search.

(ii) [Reserved]

(3) Exemption claims: Any U.S. person that receives the BE-120 survey form from BEA, but is not subject to the reporting requirements, must file an exemption claim by completing the determination of reporting status section of the BE-120 survey and returning it to BEA by the due date of the survey. This requirement is necessary to ensure compliance with reporting requirements and efficient administration of the Act by eliminating unnecessary follow-up contact.

(d) Covered types of services and intellectual property. Services transactions covered by this survey consist of: Advertising and related services; Architectural, engineering, scientific, and other technical services; Computer services; Construction; Financial services (for reporters who are not a financial services providers); Franchises and trademarks licensing fees; Information services; Legal, accounting, management consulting, and public relations services; Licenses for the use of outcomes of research and development; Licenses to reproduce and/or distribute computer software; Licenses to reproduce and/or distribute audiovisual products; Maintenance and repair services; Manufacturing services; Operating leasing services; Other business services; Personal, cultural, and recreational services; Research and development services; Primary insurance premiums and losses (for reporters who are not a U.S. insurance company); Space transport services; Telecommunications services; Trade-related services; Waste treatment and de-pollution, agricultural, and mining services.

(e) Types of transactions excluded from the scope of this survey. (1) Financial services transactions conducted by a U.S. financial services provider, all insurance services conducted by a U.S. insurance company, and all travel and transport activities that are not space transport services.

(2) Sales and purchases of goods. Trade in goods involves products that have a physical form, and includes payments or receipts for electricity.

(3) Sales and purchases of financial instruments, including stocks, bonds, financial derivatives, loans, mutual fund shares, and negotiable CDs. (However, securities brokerage is a service).

(4) Income on financial instruments (interest, dividends, capital gain distributions, etc.).

(5) Compensation paid to, or received by, employees.

(6) Penalties and fines and gifts or grants in the form of goods and cash (sometimes called “transfers”).

(f) Due date. A fully completed and certified BE-120 report, or qualifying exemption claim with the determination of reporting status section completed, is due to be filed with BEA by July 31 of the year after the year covered by the survey.

5. Section § 801.12 is revised to read as follows:

§ 801.12

Rules and regulations for the BE-140 Benchmark Survey of Insurance Transactions by U.S. Insurance Companies with Foreign Persons.

The BE-140 Benchmark Survey of Insurance Transactions by U.S. Insurance Companies with Foreign Persons will be conducted once every five calendar years and covers years ending in 3 and 8. BEA will describe the proposed information collection in a public notice and will solicit comments according to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501-3520). All legal authorities, provisions, definitions, and requirements contained in §§ 801.1 through 801.2 and 801.4 through 801.6 are applicable to this survey. Specific additional rules and regulations for the BE-140 survey are given in this section. More detailed instructions are given on the report form and in instructions accompanying the report form.

(a) Response required. A response is required from U.S. insurance companies subject to the reporting requirements of the BE-140 Benchmark Survey of Insurance Transactions by U.S. Insurance Companies with Foreign Persons, contained in this section, whether or not they are contacted by BEA. Also, a U.S. insurance company, or its agent, that is contacted by BEA about reporting on this survey, either by transmission of a report form or by written inquiry, must respond in writing pursuant to this section. This may be accomplished by:

(1) Completing and returning the BE-140 by the due date of the survey; or

(2) If exempt, by completing the determination of reporting status section of the BE-140 survey and returning it to BEA by the due date of the survey.

(b) Who must report. A BE-140 report is required of each U.S. insurance company that had insurance transactions with foreign persons in the categories covered by the survey during the calendar year covered by the survey.

(c) What must be reported. (1) A U.S. insurance company that had transactions with foreign persons that exceeded $2 million in the insurance categories covered by the survey during its calendar year, on an accrual basis, is required to provide data on the total transactions of each of the covered types of insurance transactions and must disaggregate the totals by country and by relationship to the foreign counterparty (foreign affiliate, foreign parent group, or unaffiliated). The $2 million threshold should be applied to insurance services transactions with foreign persons by all parts of the consolidated domestic U.S. Reporter. The determination of whether a U.S. insurance company is subject to this 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.

(2) A U.S. insurance company that had transactions with foreign persons that were $2 million or less in the insurance categories covered by the survey during its calendar year, on an accrual basis, is required to provide the total for each type of transaction in which they engaged.

(i) Voluntary reporting of insurance transactions. If, during the calendar year covered by the survey, total transactions were $2 million or less in the insurance categories covered by the survey, on an accrual basis, the U.S. insurance company may, in addition to providing the required total for each type of transaction, voluntarily report transactions at a country and affiliation level of detail on the applicable mandatory schedule(s).

(ii) [Reserved]

(3) Exemption claims: Any U.S. person that receives the BE-140 survey form from BEA but is not subject to the reporting requirements must file an exemption claim by completing the determination of reporting status section of the BE-140 survey and returning it to BEA by the due date of the survey. This requirement is necessary to ensure compliance with reporting requirements and efficient administration of the Act by eliminating unnecessary follow-up contact.

(d) Covered types of insurance services. Insurance services covered by the BE-140 survey consist of transactions between U.S. insurance companies and foreign persons for premiums and losses on primary insurance, premiums on reinsurance assumed and ceded, losses on reinsurance assumed and ceded, as well as receipts and payments for auxiliary insurance services.

(e) Types of transactions excluded from the scope of this survey. Premiums paid to, or losses received from, foreign insurance companies on direct insurance.

(f) Due date. A fully completed and certified BE-140 report, or qualifying exemption claim with the determination of reporting status section completed, is due to be filed with BEA by July 31 of the year after the year covered by the survey.

6. Section 801.13 is revised to read as follows:

§ 801.13

Rules and regulations for the BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons.

The BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons will be conducted every five years and covers fiscal years ending in 4 and 9. BEA will describe the proposed information collection in a public notice and will solicit comments according to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501-3520). All legal authorities, provisions, definitions, and requirements contained in §§ 801.1 through 801.2 and 801.4 through 801.6 are applicable to this survey. Specific additional rules and regulations for the BE-180 survey are given in this section. More detailed instructions are given on the report form and in instructions accompanying the report form.

(a) Response required. A response is required from persons subject to the reporting requirements of the BE-180 Benchmark Survey of Financial Services Transactions between U.S. Financial Services Providers and Foreign Persons, contained in this section, whether or not they are contacted by BEA. Also, a person, or its agent, that is contacted by BEA about reporting on this survey, either by sending a report form or by written inquiry, must respond in writing pursuant to this section. This may be accomplished by:

(1) Completing and returning the BE-180 by the due date of the survey; or

(2) If exempt, completing the determination of reporting status section of the BE-180 survey and returning it to BEA by the due date of the survey.

(b) Who must report. A BE-180 report is required of each U.S. person that 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 that had financial services transactions with foreign persons in the categories covered by the survey during the fiscal year covered by the survey.

(c) BE-180 definition of financial services provider. The definition of financial services provider used for this survey is identical to the definition of the term as used in the North American Industry Classification System, United States, Sector 52-Finance and Insurance, and holding companies that own or influence, and are principally engaged in making management decisions for, these firms (part of Sector 55—Management of Companies and Enterprises). 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, savings institutions, credit unions, and other depository credit intermediation); non-depository credit intermediation (including credit card issuing, sales financing, and other non-depository credit intermediation); activities related to credit intermediation (including mortgage and nonmortgage loan brokers, financial transactions processing, reserve, and clearinghouse activities, and other activities related to credit intermediation); securities and commodity contracts intermediation and brokerage (including investment banking and securities dealing, securities brokerage, commodity contracts and dealing, and commodity contracts brokerage); securities and commodity exchanges; other financial investment activities (including miscellaneous intermediation, portfolio management, investment advice, and all other financial investment activities); insurance carriers; insurance agencies, brokerages, and other insurance related activities; insurance and employee benefit funds (including pension funds, health and welfare funds, and other insurance funds); other investment pools and funds (including open-end investment funds, trusts, estates, and agency accounts, real estate investment trusts, and other financial vehicles); and holding companies that own, or influence the management decisions of, firms principally engaged in the aforementioned activities.

(d) What must be reported. (1) A U.S. person that had combined sales to, or purchases from foreign persons that exceeded $3 million in the financial services categories covered by the survey during its fiscal year, on an accrual basis, is required to provide data on total sales and/or purchases of each of the covered types of financial services and must disaggregate the totals by country and by relationship to the foreign transactor (foreign affiliate, foreign parent group, or unaffiliated). The $3 million threshold for sales and purchases should be applied to financial services transactions with foreign persons by all parts of the consolidated domestic U.S. Reporter. Because the $3 million threshold applies separately to sales and purchases, the mandatory reporting requirement may apply to sales only, to purchases only, or to both. The determination of whether a U.S. financial services provider is subject to this reporting requirement can 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.

(2) A U.S. person that had combined sales to, or purchases from foreign persons that were $3 million or less in the financial services categories covered by the survey during its fiscal year, on an accrual basis, is required to provide the total sales and/or purchases for each type of transaction in which they engaged. The $3 million threshold for sales and purchases should be applied to financial services transactions with foreign persons by all parts of the consolidated domestic U.S. Reporter. Because the $3 million threshold applies separately to sales and purchases, the mandatory reporting requirement may apply to sales only, to purchases only, or to both.

(e) Voluntary reporting of financial services transactions. If, during the fiscal year, combined sales and purchases were $3 million or less, on an accrual basis, the U.S. person may, in addition to providing the required total for each type of transaction, report sales at a country and affiliation level of detail on the applicable mandatory schedule(s). The estimates can be judgmental, that is, based on recall, without conducting a detailed records search.

(f) Exemption claims. Any U.S. person that receives the BE-180 survey form from BEA, but is not subject to the reporting requirements, must file an exemption claim by completing the determination of reporting status section of the BE-180 survey and returning it to BEA by the due date of the survey. This requirement is necessary to ensure compliance with reporting requirements and efficient administration of the Act by eliminating unnecessary follow-up contact.

(g) Covered types of financial services. Financial services covered by the BE-180 survey consist of transactions between U.S. financial services companies and foreign persons for brokerage, underwriting, financial management, credit-related, credit-cards, financial advisory, financial custody, securities lending, electronic funds transfers, and other financial services.

(h) Due date. A fully completed and certified BE-180 report, or qualifying exemption claim with the determination of reporting status section completed, is due to be filed with BEA by July 31 of the year after the year covered by the survey.