BE-10 Report: A New Overlooked International Reporting Form

The Bureau of Economic Analysis (BEA) is an agency of the U.S. Department of Commerce and is currently conducting a benchmark BE-10 survey which entails the filing of a BE-10 report by any U.S. person that directly or indirectly owned or controlled a foreign affiliate at any time during the 2014 fiscal year.

A BE-10 form must be filed with the US Bureau of Economic Affairs by all U.S. persons who owned at least 10% of a foreign corporation, trust, estate or other unincorporated entity, at any time during the 2014 year. U.S. persons can refer to anyone who is a resident of the United States or subject to its jurisdiction, including expatriates, limited liability companies, partnerships and corporations.

Form BE-10 is a benchmark survey that provides data regarding U.S. investment abroad to provide a complete and comprehensive picture of the global impact of U.S. investment on the worldwide economy. The form is unrelated to taxes. It is part of the US Department of Commerce’s efforts to conduct surveys every five years of US direct involvement in foreign business enterprises. In previous surveys, a US person only had to complete the form if they were requested to do so by the BEA. But a recent and unpublicized change in the law now requires that all US persons meeting the reporting requirements must complete the form whether or not the BEA contacts them.

The information obtained and filed pursuant to this survey is confidential and is used only for analytical and statistical purposes. The BEA is prohibited from granting another agency access to the data for tax, investigative, or regulatory purposes. The information reported on this form cannot be disclosed to the Internal Revenue Service for tax compliance purposes.

The BE-10 report was due no later than May 29, 2015 for U.S. persons required to file less than 50 forms. However, the BEA recently granted an extended due date of June 30, 2015 for all filers who have not previously filed a BE-10 report.

Failure to file can result in civil and criminal penalties. Civil penalties can range from fines of $2,500 to $25,000, in addition to injunctive relief requiring compliance. Willful failure to file can result in a penalty of no more than $10,000 and up to one year in prison for an individual filer, or both.

Below are answers to some frequently asked questions concerning the BE-10 report.

Why haven’t I heard about the BE-10 form before?

Previously, the BE-10 form was only mandatory for those U.S. persons who were directly contacted by the BEA. A recent change in the law now requires that the form is mandatory for every U.S. person who owned or controlled a foreign affiliate at any time during the 2014 fiscal year, even if they are not contacted.

Do I have to file a BE-10 report if I own real estate that generates rental income in a foreign country?

Yes, unless there is a unique exception in your individual case. As discussed above, a BE-10 report must be filed by any U.S. person which owns or controls a foreign affiliate. For the purpose of the survey, real estate located in a foreign country is considered a foreign affiliate. However, if the real estate in question is held exclusively for personal use then a BE-10 does not need to be filed. For example, a primary residence abroad that is leased to others while the owner is a U.S. resident, but which the owner intends to reoccupy, is considered real estate held for personal use.

How do I calculate my ownership interest in a foreign affiliate?

Ownership interest can be directly held and indirectly held. Your ownership is directly held if you directly hold the ownership interest in a foreign affiliate. Your ownership is indirectly held if you hold ownership interest in another foreign affiliate that owns that primary foreign affiliate.

What if multiple U.S. persons own more than a 10% interest in the same foreign affiliate?

For example, if eight U.S. persons each own 12.5% of a U.S. limited liability company that, in turn, owns 100% of a foreign affiliate, then the U.S. limited liability company will file the complete BE-10 report, and each of the eight U.S. members of the U.S. limited liability company will file a partial BE-10 report in accordance with the instructions, making proper reference to the U.S. limited liability company’s complete BE-10 report consistent with the rules discussed in the preceding question and answer.

If I own an interest in a U.S. entity that owns an interest in a foreign affiliate, do I have to file a BE-10 report?

If you own more than 50% of a U.S. entity that, in turn, owns a foreign affiliate, then the U.S. business, not you personally, must file the BE-10 report. However, on its BE-10 report, the U.S. business will be required to disclose your direct investments in the foreign affiliate.

If you own 50% or less of a U.S. entity that, in turn, owns a foreign affiliate, then both you and U.S. entity will be required to separately file appropriate BE-10 reports.

What is a U.S. domestic consolidated business enterprise?

U.S. corporation that is a U.S. person must file a BE-10 report on a consolidated basis with its entire U.S. domestic consolidated business enterprise. In other words, the parent corporation is not owned by another U.S. person by more than 50%. It must file a BE-10 report on its own behalf and a BE-10 report on the behalf of each U.S. business enterprise that is part of the ownership chain of the parent corporation whose voting securities are more than 50% owned by the business preceding it in the chain of ownership.

It is recommended that a U.S. limited liability company or partnership follow these same consolidation rules even though the instructions only refer to a U.S. corporation being subject to these rules.

What should I do if I am unable to complete the BE-10 report or I do not have the information necessary to accurately complete the BE-10 report?

You should file for an extension of the filing deadline. Extension requests must be received by the BEA no later than June 30, 2015 and enumerate substantive reasons necessitating the extension. The BEA will provide a written response to such requests.

In addition, the instructions to the BE-10 report specifically provide that the data disclosed on the BE-10 reports may be comprised of reasonable estimates based upon the informed judgment of persons in the responding organization, sampling techniques, pro rations based on related data, etc. The instructions require that the U.S. reporter consistently apply estimating procedures used on all BEA surveys.

Once I complete the BE-10 report, will I have any reporting obligations on a moving-forward basis?

Yes. You may have an obligation to report to the BEA on a quarterly basis, annual basis, or every five years, depending on the value of the foreign affiliates that were reported on your BE-10 report. Once you file the BE-10 report, the BEA will send you a list of all follow-up reports required with applicable deadlines.

Do executors or trustees have any reporting obligations?

Yes. Executors of US estates, as well as trustees, beneficiaries and settlors U.S. and foreign trusts may have a BE-10 reporting obligation if the estate or trust in question owns reportable interests in non-US business enterprises.

Any questions about the BE-10 report should be directed to an experienced counsel to better understand the applicable reporting requirements, as well as to ensure proper completion of all applicable BE-10 reports. Patel Law Offices has significant experience with international compliance matters and can assist individuals in ensuring the proper completion of the BE-10 report.

The instructions to the BE-10 report can be found at  The BE-10 report and the answers to other Frequently Asked Questions can be found at

Patel Law Offices offers a strategy session to discuss how to resolve your legal problem. Conveniently schedule online today with our online scheduler and questionnaire.