Form BE-12: Information on the Five Year Filing of the Benchmark
Survey of Foreign Direct Investment in the United States

Gatti & Associates
May 2003

All Rights Reserved

Every five years, the U.S. Department of Commerce issues a mandatory survey requesting information on the amount and type of foreign direct investment in U.S. business enterprises.  “Business enterprise” includes any corporation, organization, association, branch or venture that is for profit in the United States, including U.S. real estate.  The data obtained, which remains confidential, is used by the Bureau of Economic Analysis for evaluating the effect of foreign investment on the U.S. economy.  The most recent survey was due May 31, 2003.  Failure to report may subject the enterprise to a civil penalty of $2,500 to $25,000.  A willful refusal to file may result in a criminal penalty of up to $10,000 and/or up to a year in prison.

This information is required pursuant to the International Investment and Trade in Services Survey Act.   U.S. businesses in which a foreign individual or entity owns (directly or indirectly) ten percent or more of the voting stock must report this information.  This includes foreign ownership in U.S. property that is used for business purposes.  Beneficial ownership (not record ownership) is used to gauge whether the enterprise meets the ten percent rule.

The size of the enterprise determines which version of the Form needs to be used.  There are four versions of Form BE-12: LF (long form), SF (short form), Bank (bank form), X (exemption from filing the other versions).  LF should be used by each non-bank, majority-owned U.S. affiliate with total assets exceeding $125 million.  SF should be used for those affiliates with greater than $10 million, but less than $125 million in assets.  The bank form should be used by banks (or bank hold companies), including all of the banking and non-banking subsidiaries, with assets exceeding $10 million.  X should be completed by each U.S. affiliate if assets do not exceed $10 million or if foreign ownership falls below ten percent.  Regardless of the form used, all financial information must be reported according to generally accepted accounting principles.

In addition to Form BE-12, other reports may be required for certain transactions.  This may include Form BE-13 for new investments, Form BE-14 for initial foreign acquisitions of U.S. enterprises, and Form BE-605 which is a quarterly survey for certain U.S. enterprises otherwise required to file an annual survey.

The forms and accompanying instructions can be found at the Bureau of Economic Analysis website at www.bea.doc.gov.