Every five years, the Bureau of Economic Analysis (BEA) of the US Department of Commerce conducts the BE-12 Benchmark Survey of Foreign Direct Investment in the United States. The BE-12 report is a mandatory, comprehensive survey, the purpose of which is to obtain data on the size and economic significance of foreign direct investment in the United States, measure changes in such investment, and assess its impact on the US economy. Responses provided on the BE-12 report are confidential. Unlike some BEA surveys, all entities subject to the reporting requirements must file, even if they are not contacted by BEA.
The BE-12 report must be filed by each US business enterprise in which a foreign person owned or controlled, directly or indirectly, at least 10% of the voting stock of an incorporated US business enterprise, or an equivalent interest in an unincorporated US business enterprise, at the end of the business enterprise's fiscal year that ended in the calendar year covered by the survey. The direct or indirect ownership of US real estate is treated as a US business enterprise, although no filing may be required for certain residential real property held for personal use. Additionally, certain private funds are exempt from BE-12 reporting.
There are four different types of BE-12 report forms. The specific BE-12 report form that must be filed largely depends on whether certain minimum dollar thresholds are met. Generally, all US real estate investments of a foreign person must be aggregated to apply the reporting criteria, and a single report form must be filed to report the aggregate holdings. The BEA has made some changes to the 2022 BE-12 reports, including adding questions on digital economy activities.
The due date for 2022 BE-12 reports is May 31, 2023 (or June 30, 2023, for reporting companies that use BEA's eFile system). Reasonable requests for an extension of the filing deadline normally will be granted if requested before the applicable filing deadline. Failure to file a BE-12 form with the BEA can result in civil penalties, and willful violations may be subject to criminal penalties. Steptoe can assist in determining whether clients have a BE-12 reporting requirement, requesting an extension, and preparing any necessary BE-12 forms.
The BEA conducts an analogous (though not identical) benchmark survey on US direct investment abroad (the "BE-10 Benchmark Survey of US Direct Investment Abroad"). The BE-10 survey is also conducted every five years, with the next set of BE-10 reports due in 2025. Persons required to file BE-10 or BE-12 reports may also have quarterly and annual BEA reporting requirements. Further, a BE-13 report generally is required to be filed whenever a foreign entity acquires a new US real estate property.
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