TheCorporateCounsel.net

This recent Lowenstein Sandler memo highlights the obligation that certain companies with foreign investors have to submit BE-12 survey filings to the Dept. of Commerce’s Bureau of Economic Analysis. The BE-12 benchmark survey is required for all U.S. entities in which a foreign investor directly or indirectly owns or controls a 10% or greater voting interest and asks for information related to fiscal year 2022.  This excerpt from the memo provides additional details about what companies are required to file:

All U.S. business enterprises (including real estate held for nonpersonal use) in which a foreign individual or entity owns or controls, directly or indirectly, at least 10 percent of the voting interest or equivalent. Complex business structures file on a consolidated basis, so U.S. affiliate entities should be included in a parent company’s filing when a parent holds at least 50 percent of the affiliate’s voting rights.

Even if a business is contacted by the BEA to submit a filing, exemptions are available if foreign ownership is less than 10 percent, the business is consolidated with another U.S. affiliate, or the business was liquidated or dissolved. Note, the business must still file a form to claim the exemption.

Additionally, certain private funds1 that do not hold direct or indirect interests in any operating companies2 may be automatically exempt or may qualify to file a claim for exemption. When assessing the direct or indirect voting interest of foreign entities in funds, note that limited partner interest is not considered to be voting interest.

The survey is due by May 31, 2023, and the memo also provides an overview of what the information is used for and what other BEA filing requirements might apply to particular companies.

– John Jenkins