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Tax & Assurance Guidance

Foreign Direct Investment Survey Year 2022

Posted on December 7, 2022 by

Sue Tuson

Sue Tuson

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FDI Survey 2022Another five years have slipped by and that means it is once again time to complete the BE-12, Benchmark Survey of Foreign Direct Investment in the United States. 

The BE-12 survey is conducted every five years under the authority of the International Investment and Trade in Services Survey Act. The purpose of the survey is to obtain data on the financial and operating characteristics of U.S. affiliates and the positions and transactions between U.S. affiliates and their foreign parent groups. The data is needed to measure the size and economic significance of foreign direct investment in the U.S. and assess its impact on the U.S. economy. The survey will cover fiscal and calendar years ending in 2022. 

While the official forms have not been released, final rules amending existing regulations became effective October 31, 2022, describing changes to the information collected. 

Who must file? 

A BE-12 report is required for each U.S. affiliate or business enterprise (including real estate held for non-personal use) where a foreign person or entity owned or controlled, directly or indirectly, 10 percent or more of the voting securities. This also applies to an equivalent interest in an unincorporated U.S. business enterprise. Certain private funds may be exempt from filing. 

What information is disclosed? 

The survey is based on the business enterprise’s calendar or fiscal year ending in 2022 and will cover: 

  • Ownership information 
  • Financial and operating data 
  • Investment and transactions between U.S. affiliate and affiliated foreign group 

Where is the survey filed?  

The survey is filed with the Bureau of Economic Analysis, U.S. Department of Commerce. 

When is the survey due?  

The survey is due on May 31, 2023, but it is possible to request an extension. 

Why should I file the survey?  

Failure to file the survey can result in civil penalties.  

How do I file the survey 

The forms are expected to be released in 2023. You can file the survey online. In previous years, there was also the ability to file via fax. This may be an option in 2023.  

How is this different from previous surveys? 

For businesses that filed in the past, the following changes are expected based on the amended regulations. 

The following items will be added to the BE-12 survey: 

  1. A question to collect the city of each foreign parent and ultimate beneficial owner (UBO) on all forms. 
  2. The balance sheet and income statement sections on the BE-12A form will be modified to separately collect the investment in, and income from, (a) “unconsolidated U.S. affiliates” and (b) “foreign entities,” which were previously collected as a combined total. 
  3. Supplemental sections A and B, which collect identification information on business enterprises owned by the U.S. affiliate, will be modified on all BE-12 forms to request more information on the reasons the U.S. business enterprises changed since the last report. This will include options for “newly acquired” or “newly established” if an enterprise is being reported on a supplement for the first time, and options to report U.S. business enterprises that had a name change, were sold, merged or liquidated. A follow-up question will be added requesting the date of the corporate change for new enterprises. 
  4. Questions will be added on the BE-12A form to collect sales data for certain service types where there is no clear link between the industry of sales and the type of services supplied. These service types are (1) intellectual property (IP) rights and (2) advertising. 
  5. Questions will be added to collect sales data on the BE-12A form related to the provision of selected services generally recognized as prevalent in the digital economy. These selected services are (1) cloud computing and data storage and (2) digital intermediation services. In addition, checkboxes will be added to the BE-12A form for respondents to identify the percentage of their sales of services delivered remotely, sales of services that were digitally ordered, and sales of goods that were digitally ordered, along with checkboxes to identify if this information was sourced from their accounting records or from recall/general knowledge.  

The following items will be eliminated from the BE-12 survey: 

  1. Expensed petroleum and mining expenditures from the BE-12A form. 
  2. Commercial property from the state schedule of the BE-12A and BE-12B forms. 
  3. Part III of the BE-12A and BE-12B forms, which collects information on investment and transactions between the U.S. affiliate and the affiliated foreign group, will be scaled back to include only the following items: 
  • Foreign parent ownership and classification information 
  • A question on reverse investment 
  • Intercompany debt balances for U.S. affiliates with less than $60 million in assets, sales or net income. 

The final rule will also modify the survey forms to improve question wording, layout and instructions. 

Continue the Conversation 

If you would like to learn more about the Foreign Direct Investment Survey, please reach out. 

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Sue Tuson

Shareholder, International Tax

As an international tax advisor, Sue helps businesses structure their operations globally to mitigate tax costs and maximize profits.

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