Archive for 'Cross-border corporate'


“Simplicity is hard work. But, there’s a huge payoff. The person who has a genuinely simpler system – a system made out of genuinely simple parts, is going to be able to affect the greatest change with the least work. He’s going to kick your ass. He’s gonna spend more time simplifying things up front and in the long haul he’s gonna wipe the plate with you because he’ll have that ability to change things when you’re struggling to push elephants around.”

— Rich Hickey, Creator of the Clojure programming language

See Rich Hickey’s Rails Conf 2012 Keynote Speech. (YouTube). Quoted portion starts at 23:02.

The same thing is true for tax planning. I have been working on tax planning for U.S. corporations doing business abroad. Don’t get too caught up with cleverness and structuring. My work in the last couple of weeks has consisted of demolishing and burning bad stuff (corporations, structures, convoluted business transactions) and replacing it with K.I.S.S. stuff. Disregarded entities. “I hire you, you do this project, I pay you $X” contracts instead of messy joint ventures.

Reaching for $1,000X of tax savings frequently costs you $2,000X in accounting and legal fees to make the IRS all warm and fuzzy on your tax returns. We saw this last week where a prior year tax election was made that saved $5,000 (!) of tax, but so far has cost $40,000 to fix. Not to mention the time distraction for the principal of the venture.

More to Rich Hickey’s point, a U.S. multinational that keeps its affairs rigorously simple will be nimble. They’re executing a deal while their competitors are sitting in a law firm (or Big 4) conference room looking at PowerPoints.

The same, of course, is true of foreign businesses expanding to do business in the United States.

Keep it simple.

Hat tip: DevOpsU.

International Tax Planning Comes Third

Tax planning across borders is complicated.  A massive public company has the budget to deal with complex international tax problems.  Privately-held businesses must deal with the same tax rules that Apple, Google, and Ford face.  But they don’t have the budget to deal with the legal and accounting costs that those highly complex rules will trigger.  And more importantly, they cannot afford the opportunity cost—top management will spend too much time wrestling with tax problems, and not enough time running the business.

Let’s call these companies mini-multinationals.  Multinational because they do business in more than one country, and mini because they aren’t huge, whatever your definition of “huge” may be.  Whether annual revenues are $5 million or $50 million or $750 million, as soon as these businesses start operating abroad the accounting and tax problems facing the CFO will add exponential complexity.

These are the companies we deal with.  These companies do not have infinite budgets for tax advisory services.  Even more important, these companies have an incredibly thin resource:  management time and focus.

We have strong opinions about how these companies should approach international tax planning.  We think international tax strategies should be ridiculously simple.  We think tax savings should be third—at best—on your “to do” list when you are expanding abroad.  We optimize for nimble, adaptable, easily operated, and cheap.

When a U.S. mini-multinational decides to expand operations abroad, some decisions need to be made.  Here is the sequence we follow:

  • Optimize for simplicity.  First, organize the business operations to be as simple as possible.   This allows the business to operate with a minimum of distractions, ideally allowing it to concentrate on generating revenue.
  • Optimize for reality.  Next, dial back the simplicity to acknowledge reality.  You will need to add some overhead and complexity to deal with an assortment of practical problems.  You are adding overhead and administrative costs here.
  • Optimize for tax savings.  Finally, look at income taxes.  How can you reduce these enough to hit the sweet spot on your cost/benefit analysis?

Optimize for simplicity

What is the absolute bare minimum that you need to make a dollar of profit abroad?  The closer you can get to the business model of a street musician, the better.  A street musician stands there, making music.  People throw money in the guitar case.

Or let’s be a bit more realistic, and describe a situation we see again and again.

Take the extreme example of a mini-multinational:  a one-person consulting firm.  Perhaps this is a software developer, or perhaps a management consultant.  The person might even be a tax lawyer.  That person enters and leave a country on a tourist visa, lives in a hotel, gives consulting advice and receives payment, then leaves the country.

You can’t get much simpler than that.  This doesn’t scale at all, and it has obvious legal risks.  But there is almost no infrastructure and complexity.  It is fly-by-night almost by definition, and not recommended.

Diagram1 09-12-2013


Still, the general principle holds true:  get everything out of the way that interferes with your ability to generate a dollar of revenue.  Start with an exaggeratedly overly-simple business structure.  You will add complexity, one piece at a time.  Consciously and deliberately.

Optimize for reality

Next, optimize for reality.  The business model of a street musician or the “under the radar” one-person service company is not practical at scale, even for one person. Even a one-person consultancy needs more infrastructure.

Your brain will pop up a large list of fears:  liability protection, the need for a business license, insurance, employment concerns, questions of trust (your employees, your vendors, your partners, your bankers, etc.).  List everything you can think of.  For each concern, there is a solution.  The solutions are largely the same as the solutions you see for purely domestic businesses.  The only difference is—you’re implementing them in another country.

As a general rule, you will probably want to set up an entity of some kind wherever you are operating, just to make business operations easier day to day.  It is harder (not impossible) to do business in Singapore when you are walking around with the Articles of Incorporation for a Delaware corporation.  If you’re planning to stay put for a while, set up a company there.

Screen Shot 2013-09-12 at 1.53.37 PM


Again, this is an entirely practical exercise. Every time your brain pops up a “Wait a minute! What about ________?” thought, write this down.  As you are wandering the streets of Bangkok trying to get a business going, you’ll encounter problems.  Solve the problem with as little additional permanent legal infrastructure as possible.  Legal infrastructure requires time, money, and attention to keep healthy.  If the infrastructure breaks, you have serious problems.

“Everything should be made as simple as possible, but no simpler.”  This quote is attributed to Albert Einstein, possibly incorrectly.  In the first step, we overstepped the limits and oversimplified things.  Here, by optimizing for reality, we carefully add back enough complexity to solve the known problems, but no more than that.

Optimize for tax

Finally, we optimize for tax savings.  This approach is entirely upside down, coming from an international tax law firm.  Most people approach us and say “help me minimize income tax” and many are nonplussed when we focus elsewhere first.

There is a reason for putting tax planning third in line.  The reason is simple:  you only pay tax when you have profits.  You only have profits when you have revenue.  The CEO’s concentrated attention on gross revenue will pay off far more than attention focused on tax savings.  Go for revenue first.  You will make more money from generating an extra dollar of revenue than you will from changing your tax rate a few percentage points.

For a mini-multinational, reducing your average tax rate by one percentage point will not add a lot to the bottom line.  And if you sacrifice the ability to be nimble, move quickly, and focus everyone’s attention on what is important (hint:  getting a customer and collecting money) you will hurt—not help—your bottom line.

“Optimize for tax” means transfer pricing

Create a fraction.  The numerator of that fraction is the total income tax paid worldwide.  The denominator is your gross profit worldwide.  That is your average tax rate.

Tax planning is first all about attempting to reduce that fraction.  This is a game of looking at a lot of tax systems from a lot of different countries.  Do not optimize for U.S. tax savings.  Optimize for worldwide tax savings.

In general this means that if you have the possibility of booking a dollar of taxable profit in one country or another, you are going to have it land in the country with the lower tax rate.  The insider jargon for this strategy is “transfer pricing”.  These are the games played by Apple and Google that appear in the popular press from time to time, triggering much clutching of pearls by horrified onlookers.

“Optimize for tax” means deferral

Second, international tax planning is about postponing the day you must actually take money out of the bank and give it to the government for income tax due.  The insider jargon amongst tax professionals for these strategies is “deferral”.

The U.S. tax system attempts to impose tax on income in the year it is earned.  If you can figure out how to postpone the date that you have to pay income tax on that income, you create an economic benefit for yourself.

You have $4,000 of profit from your foreign business operations.  Your U.S. income tax rate is 25%, so you will pay income tax of $1,000 if the profit is subject to tax in the United States this year.  Assume further that your foreign business operations were in Dubai, where there is no income tax.

You create a strategy so you legally are not required to include your $4,000 of foreign-source profit on your U.S. income tax return this year.  Instead, you will have to report the income of $4,000 and pay the IRS the income tax of $1,000 in twelve months— on next year’s tax return.

Instead of giving the IRS $1,000, you put it in the bank, where it earns a princely 1% interest rate.  Next year you have $1,010 in the bank.  You pay the tax of $1,000, and have $10 of interest income left over.  You pay income tax of 25% on the interest income, you have $7.50 left over, after tax.

By postponing the payment of U.S. income tax by one year, you have made yourself $7.50 wealthier.

Now let’s get realistic.

Your multinational business has $4,000,000 of profit generated from its foreign operations.  The U.S. income tax rate is 25%.  If the profit is taxable in the United States your business will pay $1,000,000 income tax.

You once again find a strategy to defer the time for payment of income tax for one year.  Instead of parking the $1,000,000 in a bank account for a year, you use it as working capital in your foreign business operations.

Your multinational’s profit margin is 40%.  This means that if you use the $1,000,000 to buy inventory and then sell it, you will end up with $1,400,000:  you recovered your costs and earned $400,000 of profit.  That’s exactly what you do.  One year later the business has $1,400,000.

You pay the $1,000,000 to the IRS that was deferred for one year.  And you pay $100,000 in income tax on the $400,000 of profit.

The payoff for deferring the payment of tax by one year is $300,000 of after-tax profit.

That’s not peanuts.

Ingredients for a Successful Deferral Strategy

This example reveals the dynamics of the deferral strategy.  In order to make it work, you need the following:

  • A lot of taxable profit from foreign operations.  (A lot of profit means a lot of U.S. tax liability that you can defer).
  • The ability to reinvest the deferred tax and generate a high rate of return.  (Parking cash at 1% does not make sense, but using the money as working capital in your business does).
  • No need for capital in the United States for a long time.  (You only defer the U.S. income tax liability if you leave the money outside the United States).
  • Your U.S. income tax rate is high.  (If your tax rate is low, you might as well pay the tax, then be free of the artificial restrictions imposed by your tax deferral strategy).
  • Your foreign taxes are low.  (If you are paying tax on a dollar of foreign profit to another country, the money is gone; there is no deferral).

The Price of Tax Optimization

This just gives you a sense of the size of the economic benefit from doing international tax planning.  But that’s half of the question. You are buying tax rate reduction and tax deferral.  What does it cost you?

Some costs are quantifiable; some are not:

  • The legal and accounting costs of creating, implementing, and maintaining the tax strategy;
  • The expected value of penalties incurred because you screwed up some paperwork somewhere (and you will screw things up because thing get really complicated);
  • The in-house administrative cost of running your business through this new structure (you will need more employees); and
  • A loss of nimbleness and simplicity, which slows down business operations and creates distraction to management.

Much more subtle is the change in that planning will affect your strategic business decisions. Using the tax deferral strategy is a commitment to long term growth outside the United States.  Bringing earnings back to the United States means a tax hit, so you are better off leaving foreign operating profits outside the United States permanently, and reinvesting them in your foreign business operations.

How Do You Begin?

So how does a mini-multinational begin?

  • Optimize for simplicity.  Send your scouts abroad and create the business plan.  As soon as you have decided to start up operations abroad, bring in your CFO and tax accountants in the United States.  Pretend you are opening up a new line of business in the United States, and pretend you are using a limited liability company wholly owned by the parent corporation of your business.
  • Optimize for reality.  Get a lawyer and an accountant where you are going to be operating.  They will tell you the baseline legal and tax requirements for that country.  Ideally you will have hired someone local who can tell you about the practical things that will make running the business easier.  Do what sounds sensible.
  • Optimize for tax.  From the foreign tax advice you get, make sure your CFO and tax accountants can flow the income through to the U.S. parent corporation, and that any foreign income tax can be easily taken as a foreign tax credit on the parent corporation’s U.S. income tax return.  In a perfect world this means you will be able to make a “check the box” election for the foreign entity you form.  See Form 8832.  This makes that foreign entity behave (for U.S. tax purposes) just like a domestic limited liability company—it is disregarded for U.S. tax.
  • Be ready for the jump.  Develop a business model that will help you see when foreign operating profits becoming large enough (and the costs for achieving them small enough) so that it is economically to your advantage to shift from a flow-through tax strategy to a deferral strategy.  Know—and plan for—the threshold and when you know you should restructure.

That’s the big picture.  Good luck with your new foreign business plans, and remember to keep things simple.

Oh, what a tangled web we weave (Subpart F edition)

Oh what a tangled web we weave, When first we practise to deceive!
Sir Walter Scott, Marmion, Canto vi. Stanza 17

I have been doing cite-checking and editing for a friend’s international tax treatise and as a result I have been living in Subpart F recently.

Two interesting points here.

Subpart F + Subpart G = Subpart F

The first is of interest to tax lawyers only. When we say “Subpart F” we are wrong. The subject matter is actually contained in Subpart F and Subpart G. I never realized this until last night, while perusing a footnote.

Start with a lie . . .

The second point is one brought up by my friend yesterday in conversation. Subpart F achieves its desired result (anti-deferral) through a fiction. The fiction is that we will treat a corporation as a passthrough even though it is not.

As my friend says, the base assumption of Subpart F is a lie. What happens when you start from a lie?

Why are we so amazed that Subpart F has developed over 50 years into a byzantine collection of rococo logical dead-ends, cul-de-sacs, and frankly utter bullshit so convoluted it would be impossible for the Pope to keep up with the theology, let alone mere mortals running businesses and trying to go home to their families before midnight?

My friend’s thought is that the international tax system would be better served by adopting the California model. We’d blow away Subpart F. Section 367? Probably. Lots of other stuff in the Code would be blown away as well.

Expatriation, too

I can’t help but think about Section 877A here. We start from the fiction of a “make-pretend” sale on the date a person terminates U.S. citizenship or a green card.

This tiny (and seemingly sensible) lie will sprout into a monster. My guess is that in 15 years there will be a metric ton of regulatory debris and administrativia published by the Service, all of which is written with the best of intentions by well-meaning people.

But we’re starting from a lie. The expatriation rules will only get worse. (And for that blinding flash of the obvious I have Steve Toscher to thank. One day a few years ago at a tax conference I was standing between sessions, whining at a Federal official about how badly things were broken. He was standing there. He pulled me aside and said “Trust me. The LAST thing you want is for the government to write a set of rules to fix a messy situation. It only makes it worse.” The topic at hand was the FBAR debacle and the voluntary disclosure program. He was right, of course.)

Apple, $82 Billion of Cash, and Tax Policy

Via Glenn Reynolds I was pointed to a TUAW article that referenced a SeekingAlpha article about Apple, its mythical mountain of cash, and the Law of Unintended Consequences.  (That, by the way, is a demonstration of the fabulosity of the interwebs.  Hyperlinks and attributions back to the source.  The internet is just one person talking to another.)

Back to tax policy and unintended consequences.  This stuff is right up my alley because this type of tax planning is What We Do here at the Hodgen Law Group Tax Ranch & Rocket Factory.

Put this blog post under the heading of “Unintended Consequences of International Tax Policy.”

Apple Inc. has a reported $82 billion of cash.  That sounds like Apple could buy anything, do anything.  It could even spend that money in the United States and (God forbid) create jobs for people.

The author of the Seeking Alpha blog post has read Apple’s financial statements and points out the obvious.  A large chunk of that cash — $54 billion, to be precise — is sitting outside the United States and will not return to the United States.

Here’s why.  Blame Congress for this.

How Multinational Corporations Pay Income Tax

The default tax treatment for U.S. taxpayers — corporations included — is “All of your income, earned worldwide, is taxed in the year you earn it.”  Whether Apple sells an iPhone in China or in Chicago, the profit it earns will be subjected to U.S. income tax in the year that iPhone was sold.

For U.S. corporations doing business outside the United States, however, we can alter the default tax treatment.  If the U.S. corporation configures its business operations correctly, a dollar of profit earned outside the United States will only be taxed by the United States when that dollar of profit is brought back to the United States.  Earn a dollar of profit abroad and don’t bring it home?  No U.S. income tax.  Earn a dollar of profit abroad and bring it home?  U.S. income tax.

Call this a “deferral strategy.”  The U.S. corporation is not exempt from U.S. income tax on its foreign profits.  It is just postponing the day that it has to pay tax on those foreign profits to the Internal Revenue Service.

A corporation that follows the deferral strategy ends up with two buckets of income — the U.S. domestic income, which is fully subject to tax, and the foreign income, on which U.S. income tax is deferred until the corporation chooses to bring the income back to the mothership in the United States.

That’s the picture that Seeking Alpha points out for Apple Inc.  It has two buckets of cash:

  • $28 billion of cash it generated from selling stuff in the United States, on which U.S. income tax has presumably been paid; and
  • $54 billion of cash it generated from selling stuff outside the United States, on which foreign income tax has (probably) been paid but U.S. income tax has not (yet) been paid.

Why Tax Deferral is Good

Why would U.S. corporations do such a thing?  The short answer is to blurt out the words “present value” and your nimble brain can connect the dots.

The better way to explain this is with an example.

Pretend that Apple has a subsidiary corporation in China.  They sell iPhones in China and generate $1,000,000 of profit.

  • Scenario Number 1.  If they bring the $1,000,000 back to the United States, that $1,000,000 of income on Apple’s income tax return will be taxed (let’s pretend) at 35%, leaving Apple with $650,000 in after-tax cash.  Apple now has $650,000 in the bank.  It is going to use that money to build more iPhones to sell.  Pretend that each iPhone costs $130 to build–that is Apple’s cost to manufacture an iPhone.  (I’m making up numbers here, folks.  They’re all fakey-fake for the purpose of this example.)  That means Apple can build 5,000 iPhones to sell using the profits it generated from the first batch of iPhones it sold.
  • Scenario Number 2.  If Apple Inc. leaves the money outside the United States, the IRS does not take 35%.  That means Apple has $1,000,000 in the bank to use to build more iPhones to sell.  At $130/unit for cost of manufacture, Apple can build (Phil runs to his calculator . . . let’s see . . . $1,000,000 divided by $130 = . . . ) 7,692 iPhones.

If you can build more iPhones, you can sell more iPhones.  If you can sell more iPhones, you can make more profit.  So we like Scenario Number 2.

Tax Deferral Drives Business Expansion

If you’re going to pick Scenario Number 2 and the deferral strategy, you can’t bring your foreign profits back to the United States.  If the foreign profits are transferred to back to the Mothership in Cupertino, they get taxed.

What happens is that a multinational corporation starts to accumulate cash.  Self-evidently you can accumulate more cash quicker if you’re not paying tax than if you are.  So cash in the bank grows faster outside the United States than inside the United States.

The multinational corporation uses that cash as working capital.  Since it has more working capital outside the United States, it has more fuel to generate sales growth which can only occur outside the United States.  The multinational corporation has an incentive to focus on foreign markets because its return on investment is higher.  Over time, this leads to faster growth outside the United States and the U.S. market becomes a smaller and smaller slice of the multinational corporation’s overall sales.

That’s tax policy at work.  U.S. tax policy makes it expensive for a U.S. corporation to repatriate its earnings.  That means that it has less working capital in the United States.  That, in turn, means it can’t spend as much money in the United States to generate more sales, grow its business, hire people, etc.

There’s another self-evident point.  There are more people outside the United States than there are inside the United States.

So from Apple’s perspective, they have a LOT of working capital outside the United States and a LOT of potential customers outside the United States.  Hmmm.  I wonder what is going through Tim Cook’s mind.

Now do you start to see why there are so many articles about China quickly becoming Apple’s biggest market?  It’s not just that there are so many people there who want iPhones.  It is because Apple has a big bucket of cash that they must reinvest to fuel further expansion outside the United States.  Apple must plow its foreign profits back into making more products to sell outside the United States.

Tax Repatriation Holidays and Some History

Periodically Congress wakes up and sees the problem.  Laws are proposed to provide a temporary tax loophole for U.S. corporations to bring their foreign profits back to the United States.  Here’s recent example.

That’s dumb.

The better solution would be a wholesale re-architecture of the Internal Revenue Code.  That’s a topic for another blog post sometime.

I would just point out, however, that the current Internal Revenue Code we have has its intellectual underpinnings in brains that hearken back to the Civil War.  Our current version of the Internal Revenue Code is the 1986 Code.  It is largely a creature of the Internal Revenue Code of 1954.  The Chairman of the House Ways & Means Committee from 1933 until 1953 (except for a two year stretch) was Robert L. Doughton.  He was born in 1863 and his father was a Captain in the Confederate Army.

Imagine what international commerce looked like to someone born in 1863.  When Robert Doughton was working on tax laws in the 1930s, 1940s, and 1950s, all of which culminated in the 1954 Code, what did his world look like?  His childhood knew of steam ships.  The telegraph.  Horses as transportation.  From brains like these grew our current international tax rules.

Another major slice of the U.S. international tax law came into place in 1960.  What was the world like then?  People in Congress in 1960 would have been born in the early (20th) Century.  What biases and understanding did they bring to the table about America’s place in international commerce?

Life moves fast.  You Don’t Live in the World You Were Born Into.  But to a surprisingly large extent, Apple Inc.’s current business strategies are driven by tax policies from the brain of a man born in 1863 to a Confederate Army veteran.  Funny, that.

Credit where credit is due.  Brian Dooley is the one who first introduced me into the history lesson I have described here.  He does it far more eloquently than I do.



List of international tax forms (first draft)


Upcoming speech

I am going to be giving a one-hour high speed presentation at the 2011 Tax Update and Planning Conference sponsored by the California Society of CPAs. It will be presented in Universal City, San Francisco, and on the web.

My hour is intended to give practitioners a checklist approach to the various tax and reporting forms they might need to know about in the international context. For someone who deals primarily with domestic stuff, the international world is a mystery. I want to dispel that mystery a bit.

First draft of a list

Here, from my course materials for my Tax Planning and Compliance for Multinational Families course is where I am in gathering a comprehensive list of all of the tax forms that are specific to international tax practice.

I need help

Help! Do you know of any other forms out there that I might have missed?

Another point — what would be a good way to organize these?  By taxpayer type (individual, trust, estate, corporation, etc.)?  By inbound/outbound?  By reverse height according to eye color?  What is useful?

Tax Forms

  • Form W-7 — (Application for Individual Taxpayer Identification Number)
  • W-8 — Certificate of Foreign Status
  • W-8EXP — Certificate of Foreign Government or Other Foreign Organization for United States Tax
  • W-8BEN — Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding
  • W-8ECI — Certificate of Foreign Person’s Claim for Exemption From Withholding on Income Effectively Connected With the Conduct of a Trade or Business in the United States
  • W-8IMY — Certificate of Foreign Intermediary, Foreign Partnership, or Certain U.S. Branches for United States Tax Withholding
  • Form 706 — United States Estate (and Generation-Skipping Transfer) Tax Return
  • Form 706-A — United States Additional Estate Tax Return
  • Form 706-GS(D) — Generation-Skipping Transfer Tax Return for Distributions
  • Form 706-GS(D-1):Notification of Distribution from a Generation-Skipping Trust
  • Form 706-CE — Certificate of Payment of Foreign Death Tax
  • Form 706-GS(T) — Generation-Skipping Transfer Tax Return for Terminations
  • Form 706-NA — United States Estate (and Generation Skipping Transfer) Tax Return
  • Form 706-QDT — U.S. Estate Tax Return for Qualified Domestic Trusts
  • Form 720 — Quarterly Federal Excise Tax Return
  • Form 1001 — Ownership, Exemption, or Reduced Rate Certificate
  • Form 1040NR — U.S. Non-Resident Alien Income Tax Return
  • Form 1040NR-EZ — U.S. Income Tax Return for Certain Nonresident Aliens with No Dependents
  • Form 1042 — Annual Withholding Tax Return for U.S. Source Income of Foreign Persons
  • Form 1042-S — Foreign Person’s U.S. Source Income Subject to Withholding
  • Form 1078 — Certificate of Alien Claiming Residence in the United States
  • Form 1120-F — U.S. Income Return of a Foreign Corporation
  • Form 5472 — Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business
  • Form 8288 — U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests
  • Form 8288-B — Application for Withholding Certificate for Dispositions by Foreign Persons of U.S. Real Property Interests
  • Form 8300 — Report of Cash Payments Over $10,000 Received in a Trade or Business
  • Form 8709 — Exemption from Withholding on Investment Income of Foreign Governments and International Organizations
  • TD F 90-22.1 — Report of Foreign Bank and Financial Accounts
  • TD F 90-22.47 — Suspicious Activity Report
  • TD F 90-22.53 — Designation of Exempt Person

U.S. Direct Investment Abroad

These forms are found at the United States Department of Commerce website for the Bureau of Economic Analysis:

  • BE-10A — Benchmark Survey of U.S. Direct Investment Abroad
  • BE-11A — Annual Survey of U.S. Direct Investment Abroad — Report for U.S. Reporter
  • BE-11B(LF) — Annual Survey of U.S. Direct Investment Abroad — Report for Majority Owned Foreign Affiliate
  • BE-11B(SF) — Annual Survey of U.S. Direct Investment Abroad — Report for Majority Owned Foreign Affiliate
  • BE-11C — Annual Survey of U.S. Direct Investment Abroad — Report for Minority Owned Foreign Affiliates
  • BE-11 — Annual Survey of U.S. Direct Investment Abroad — Claim for Not Filing
  • BE-577 — Direct Transactions of U.S. Reporter with Foreign Affiliate

Foreign Direct Investment in the United States

These forms can be found at the United States Department of Commerce website for the Bureau of Economic Analysis:

  • BE-12(LF) — Benchmark Survey of Foreign Direct Investment in the U.S.
  • BE-12 Bank — Benchmark Survey of Foreign Direct Investment in the U.S.
  • BE-12(SF) — Benchmark Survey of Foreign Direct Investment in the U.S.
  • BE-12(X) — Benchmark Survey of Foreign Direct Investment in the U.S. — Claim for Exemption from Filing BE-12(LF), BE-12(SF), or BE-12Bank
  • Initial Report on a Foreign Person’s Direct or Indirect Acquisition, Establishment, or Purchase of the Operating Assets of a U.S. Business Enterprise, Including Real Estate
  • Report by a U.S. Person Who Assists or Intervenes in the Acquisition of a U.S. Business Enterprise by, or Who Enters Into a Joint Venture With, a Foreign Person

Other Surveys

These forms are found at the United States Department of Commerce website for the Bureau of Economic Analysis:

  • BE-605 — Transactions of a U.S. Affiliate, Except a U.S. Banking Affiliate, with Foreign Parent
  • BE-605 (Bank) — Transactions of a U.S. Affiliate, Except a U.S. Banking Affiliate, with Foreign Parent &  Bank, Transactions of U.S. Banking Affiliate with Foreign Parent
  • BE-15(LF) — Annual Survey of Foreign Direct Investment in the U.S.
  • BE-15(SF) — Annual Survey of Foreign Direct Investment in the U.S.
  • BE-15 Supplement C — Annual Survey of Foreign Direct Investment in the U.S. — Claim for Exemption from Filing a BE-15(LF) or BE-15(SF)
  • BE-22 — Annual Survey of Selected Services Transactions with Unaffiliated Foreign Persons
  • Ocean Freight Revenues and Foreign Expenses of U.S. Carriers, Foreign Airline Operators’ Revenues and Expenses in the U.S.
  • U.S. Airline Operators’ Foreign Revenues and Expenses
  • Annual Survey of Construction, Engineering, Architectural, and Mining Services Provided by U.S. Firms to Unaffiliated Foreign Persons
  • Annual Survey of Reinsurance and Other Insurance Transactions by U.S. Insurance Companies with Foreign Persons
  • BE-93 — Annual Survey of Royalties, License Fees, and Other Receipts and Payments for Intangible Rights Between U.S. and Unaffiliated Foreign Persons
  • BE-120 — Benchmark Survey of Selected Services Transactions with Unaffiliated Foreign Persons
  • 16 CFR 803—Appendix: Notification and Report Form for Certain Mergers and Acquisitions (this is the “Hart, Scott, Rodino Notification”)