Act Now To Meet BE-10 Reporting Deadlines

The due dates for filing the BE-10 Report, “Benchmark Survey: U.S. Direct Investment Abroad,” for fiscal years ending in 2024 are May 30 and June 30. This survey (comprised of multiple forms) is conducted once every five years by the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA) and is mandatory for certain U.S. individuals and entities with foreign investments. According to the BEA’s website, survey data is used to produce statistics on the scale and effects of U.S.-owned business activities abroad. Business leaders use these statistics to inform decisions about hiring and investing. Policymakers and researchers use these metrics to analyze the impact of direct investment on jobs, wages, productivity, and taxes.

Complying with this mandatory filing contributes to the accurate assessment of international trade and investment impacts on the U.S. economy and mitigates the risk of monetary and criminal penalties.

Who must file a BE-10 Report?

Filing a BE-10 Report is required for any U.S. person that directly or indirectly owned or controlled at least 10% of the voting stock of an incorporated foreign business enterprise, or an equivalent interest in an unincorporated foreign business enterprise, including a branch, at the end of the U.S. person’s 2024 fiscal year.

A U.S. person is any person in the United States or subject to the jurisdiction of the United States, including individuals, branches, partnerships, associated groups, associations, estates, trusts, corporations, and other organizations.

A foreign business enterprise encompasses ownership of commercial real estate, subject to limited exclusions, and residential real estate outside of the United States.

The filing obligation for a U.S. person that has investments in a foreign business enterprise (also known as a U.S. Reporter) applies broadly. For example, not-for-profit organizations and governments are subject to the filing obligation as appropriate. Consolidated corporate groups may file on a consolidated basis, and some information can be consolidated by country rather than individual entity in certain circumstances.

While a de minimis exception based on the size or value of the investment does not exist, exceptions apply in the case of certain private funds, real estate held exclusively by a U.S. person for personal use, and foreign business enterprises that were sold or liquidated during the U.S. person’s 2024 fiscal year. However, sales or liquidation amounts still must be reported on the BE-10 Report.

What is the process for filing?

A BE-10 Report consists of various forms for each foreign affiliate depending on multiple factors, such as whether the foreign affiliate is majority-owned or minority-owned and the foreign affiliate’s total sales, net income, or assets, including:

• Form BE-10A for the U.S. person
• Form BE-10B
• Form BE-10C
• Form BE-10D

When is the BE-10 Report due?

The due date for filing the BE-10 Report for fiscal year 2024 varies based on the number of forms that are required to be filed.

• For U.S. Reporters required to file fewer than 50 forms, the due date is May 30, 2025.
• For U.S. Reporters required to file 50 or more forms, the due date is June 30, 2025.

Consequences of not timely filing

Failure to timely file a BE-10 Report can result in enforcement action, including potential civil and criminal penalties. Specifically, nonwillful failure to report can lead to civil penalties ranging between $5,911 and $59,114. The BEA also has the authority to seek injunctive relief commanding compliance. Criminal penalties include fines up to $10,000 and imprisonment for willful violations.

Crowe observation

Certain U.S. reporters might receive a notification from the BEA informing them of their filing obligation. However, all U.S. persons with foreign investments that meet the reporting criteria are required to comply, regardless of whether they receive such a notification from the BEA.

Action steps

U.S. entities and individuals with foreign investments should consider the following action steps:

• Identify whether BE-10 reporting obligation applies.
• If BE-10 reporting is required, gather and prepare documentation on foreign investments, including ownership details and financial data.
• Meet the applicable deadline: Ensure timely submission of the BE-10 Report by the applicable deadline to avoid penalties.

Looking ahead

The BE-10 Report filing can be complex and burdensome, resulting in a significant compliance obligation for U.S. entities and individuals subject to reporting. Given the significant consequences of noncompliance, U.S. persons with foreign investments should consult their advisers to carefully assess whether they have a BE-10 Report filing obligation.