As of November 2014, the United
States Bureau of Economic Analysis (“BEA”) has reintroduced mandatory survey reports for foreign
direct investors who recently acquired or established a U.S. business, or
expanded an existing one.
Foreign direct investors
(individual or company) owning directly and/or indirectly a 10% or more voting
interest in a U.S. business are subject to these reporting requirements. Any
person (or company) living or existing outside of the U.S. (disregarding any
nationality, even U.S. nationality) subject to these reporting requirements is
hereinafter referred to as a foreign direct investor. These investors must
provide the report(s) whether or not they are contacted by the BEA. The BEA has
issued six versions of the BE-13 report for different transactions. For
example, there are distinct BE-13s for mergers, acquisitions and expansions.
The reporting threshold for all transactions is US $3 million. However, even if
an investment transaction does not exceed US $3 million, you still have to file
the BE-13 Claim for Exemption.
The report requirement has been
reinstated retroactively for any
activity that took place from January 1, 2014 to November 26, 2014 inclusively,
with a due date of January 12, 2015. Any activity going forward is subject to
these reporting requirements, with reports required to be filed within 45 days
of completion of the investment transaction.
Whoever fails to report is
subject to a civil penalty ranging from US $2,500 to US $32,500, and an
injunctive order enjoining such person to file the report. If the failure to
report is willful, individual(s) and/or company can be fined up to US $10,000
and individuals may be imprisoned up to one year. In each scenario, both
penalties can be applied.
The purpose of the survey reports
is to gather information regarding new investment transactions, measure the
amount of new foreign direct investment in the U.S., and identify new U.S.
affiliates that meet reporting criteria for BEA’s related surveys of foreign
direct investment. Reports can be filed electronically through BEA’s eFile
system at www.bea.gov/efile.
