companies which are reportable on Forms BE-578B and BE_5781 respectively. Separate reports should be filed for each foreign branch. Where a reporter, or several affiliated American corporations, has (or have) branches operating in the same country, or a Joint interest in one or more branches, consolidated reports may be filed.

Form BE-35. United States motion picture producers or distributors may elect to file one Form BE-35 quarterly for each foreign subsidiary, affilate or branch, in lieu of Forms BE-577 or 578, as applicable. The instructions as to ownership and consolidations listed for Forms BE-577 and 578 also apply to filling on Form BE-35.

Form BE-578B. One Form BE-578B is to be filed quarterly for each foreign branch of a United States banking institution. Separate reports should be filed for each foreign branch; consolidated reports may however be filed where a United States bank has several branches operating in the same country.

Form BE-5781. One Form BE-5781 is to be filled annually for each foreign branch or subsidiary of a United States insurance firm. Separate reports should be filed for each foreign branch; consolidated reports may however be filed where a United States insurance company has several branches operating in the same country.

Form BE-577A. One Form BE-577A is to be filed annually covering the foreign organizations in which the reporter and its domestic affiliates own in excess of 10 percent, but less than 25 percent, of voting stock, or equivalent ownership in unincorporated foreign enterprises.

Form BE-577S. Reports covering transactions between primary and secondary foreign corporations (see § 803.6(a) for definitions) are to be filed on an annual basis. Separate reports should be filed for each secondary foreign corporation owned through a primary foreign corporation and its foreign affiliates for which the United States equity amounts to 25 percent or more of its voting securities. However, a reportable interest is deemed to exist only if the United States parent owns 50 percent or more of the voting stock of the primary foreign corporation and it in turn owns at least 50 percent of the voting stock of the secondary foreign organization. Transactions of domestic affiliated companies directly with such secondary foreign corporations should be treated as primary relationships, and are reportable on Form BE-577 on a quarterly basis. Combined reports may be filed where several secondary foreign corporations operating in the same country are owned by the same primary foreign corporation. (See also § 803.6(a) (2)).

(2) Foreign direct investments in the United States.

Form BE-605. One Form BE-605 is to be filed quarterly for each United States corporation 25 percent or more of whose voting stock is owned directly or indirectly by a

foreign person(s) or organization(s) and its United States or foreign affiliates.

Form BE-606. One Form BE-606 is to be filed quarterly for each United States branch of a foreign business organization, or for leaseholds, real property or other United States unincorporated business property owned directly by a foreign person or organization but excluding branch operations in the United States of foreign banks or insurance companies.

Form BE-606B. One Form BE-606B is to be filed quarterly for each United States branch of a foreign banking institution. Where a foreign bank has more than one United States branch, consolidated reports may be filed.

Form BE-6061. One Form BE-6061 is to be filed annually for each United States branch of a foreign insurance firm, or for United States insurance companies 25 percent or more of whose voting stock is held by foreign owners.

(3) International payments of royalties, fees, etc.

Form BE-93. One Form BE-93 is to be filed annually by each United States person or firm receiving from foreigners, or paying to foreigners, royalties, licensing fees, rentals, etc., arising from the use, purchase or sale of intangible assets or rights.

(b) Frequency of reports. Reports on Forms BE-577S, BE-577A, BE-5781, BE-6061 and BE-93 must be filed annually beginning with a report covering the calendar or fiscal year 1961; reports on Forms BE-577, BE-578, BE-35, BE578B, BE-605, BE-606 and BE-606B must be filed quarterly beginning with a report for the first calendar or fiscal quarter of 1962.

§ 803.3

Reporting by banks and insurance companies.

(a) United States banks, including agencies of foreign banks, reporting on Forms BE-577, 577A, 577S, 578B, 605 or 606B. In order to avoid duplication of claims or liabilities reported on Treasury Foreign Exchange Forms B-1 and B-2, intercompany or branch accounts reported on the Commerce forms listed above should exclude accounts with or investments in foreign branches or subsidiaries or accounts with a foreign parent organization and its affiliates, to the extent they are included in the Treasury foreign exchange forms. However, data covering earnings, income, fees or other charges remitted or credited, or permanent investments not includible in the Treasury forms, should be reflected in the Commerce forms.

(a) United States direct investments abroad. (1) Exemption based on value of property. A reporter whose property in foreign countries otherwise subject to reporting has an aggregate value of less than $2,000,000, at the beginning of the current calendar year based on the value of holdings of securities, equity in surplus accounts, and intercompany indebtedness or net branch investment in foreign countries, is not required to report. Value is to be determined by the book value as carried on the books of the foreign organization converted into United States dollars. Reports for individual foreign subsidiaries, affiliates, or branches (other than banks) which are inactive, or have a book value of less than $25,000 at the beginning of the calendar year, can be omitted with a note to that effect. For foreign branches of banks, reports are required if either (i) the book value exceeds $25,000, or (ii) the total assets exceed $2,000,000.

(2) Certain persons exempted regardless of the amount or kind of property. Report need not be made by any person who is within any of the following categories.

(i) Members of the Armed Forces of the United States serving outside continental United States;

(ii) Citizens of the United States who permanently reside in a foreign country;

(iii) Officers or employees of foreign governments and members of the immediate families of such persons, provided they are not citizens of the United States;

(iv) Religious bodies, charitable organizations and other nonprofit organizations, except for the interests of such groups in foreign organizations conducting business for profit.

(b) Foreign direct investments in the United States-(1) Exemption based on value. If the value of a business organization (other than a U.S. branch or agency of a foreign bank) otherwise required to report is less than $2,000,000 at the beginning of the current calendar year, such a person or business organi

The

zation is not required to report. value is to be determined by the book value of the foreign owner's holdings in the securities, surplus accounts, and liability accounts of the reporter. For banks, reports are required if total assets exceed $3,000,000.

(2) Certain property exempted. Reports are not required for foreign-owned assets in the United States not employed in connection with a United States business enterprise controlled abroad. Assets of religious bodies, charitable organizations or other non-profit organizations are exempt from reporting, except for the interest of such groups in United States enterprises primarily conducting business for profit. Real or personal property acquired for personal use or occupancy by a foreign owner is exempt from reporting. However, interests in real property in the United States acquired for business purposes by a foreign owner must be reported, except as otherwise exempted by this section.

(c) International receipts and payments of royalties, license fees, etc. Reports on Form BE-93 are not required if the respondent's annual foreign receipts and payments, combined, of the types covered by the form, are less than $25,000 in the year covered by the report. § 803.5 General definitions.

For the purpose of these reports, the following definitions are prescribed:

(a) Person. "Person" shall include an individual, partnership, association, corporation, estate or trust or other organization.

(b) Person subject to the jurisdiction of the United States. (1) Any person ordinarily residing in the United States.

(2) Any corporation or other organization created or organized under the laws of the United States or any State, territory, district, or possession thereof.

(3) Any other resident of the United States including branches of foreign organizations, real property, leaseholds, sole proprietorships and partnerships.

(c) United States. United States shall mean the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, and any territory or possession of the United States.

(d) Foreign. Foreign shall mean subject to the jurisdiction of a country other than the United States, and when applied to persons shall also mean not

ordinarily residing within the United States.

(e) Affiliates. (1) Any group of persons who ordinarily exercise their voting rights in a business organization as a unit.

(2) In relation to any corporation or other organization issuing stock or similar securities, any person who, directly or indirectly, owns, controls, or holds with power to vote, 10 percent or more of the outstanding voting securities thereof.

(3) As to any other organization, any person who owns or controls 10 percent or more of the comparable ownership rights therein.

Any corporation or other business organization of which a person was an affiliate also shall be deemed to be affiliates of each other.

(f) Control or controlling interest. Control or controlling interest shall mean, for the statistical purposes of these reports, the direct ownership and/ or indirect ownership through intermediaries or affiliates of 25 percent or more of the voting securities of a corporation or of other ownership equities in other types of organizations. Indirect control should be deemed to exist only if the United States parent owns 50 percent or more of the voting stock of the primary foreign corporation and it in turn owns at least 50 percent of the voting stock of the secondary foreign corporation.

(g) Parent. Parent shall mean any person or affiliated group of persons directly owning 25 percent or more of the voting securities of a corporation or of other ownership equities in other types of organizations. In some cases there may be more than one parent.

§ 803.6 Specific definitions.

(a) Terms relating to the reporting of United States direct investments abroad. (1) Primary foreign organizations shall include the following organizations located in or under the jurisdiction of a foreign country:

(i) Any foreign which

(a) The reporting organization owns 25 percent or more of the voting securities, or

(b) The reporting organization owns less than 25 percent of the voting securities but affiliates, either domestic or foreign, of the reporting organization

own additional voting securities which when added to the amount owned by the reporting organization total 25 percent or more, or

(c) The reporting organization owns none of the voting securities but does own bonds, notes, or other certificates of indebtedness or has direct dealings by exchange of merchandise or rendering services, and 25 percent or more of the voting securities are owned by affiliates (domestic or foreign) of the reporting organization.

(ii) Any partnership in which a person subject to the jurisdiction of the United States is one of the partners, whether general, special, limited, or otherwise.

(iii) Branch: The interest of any person subject to the jurisdiction of the United States in property in any foreign country allocated to or held in the name or for the use of any branch, depot, or office outside of the United States maintained by such person for the transaction of any of his business. Foreign operations conducted by United States corporations in their own names and not through foreign incorporated companies are to be reported as branch operations. (iv) Any business enterprise or real property owned outright by a resident of the United States.

(2) "Secondary foreign organization" shall include the following organizations:

(i) A foreign organization allied with the reporter through the ownership of at least 50 percent of its voting securities or other certificates of ownership by a primary foreign organization, which in turn is owned by the reporting organization to the extent of at least 50 percent of its voting stock, giving the U.S. reporter an ownership of at least 25 percent of the secondary foreign organization.

(ii) Branches of primary foreign organizations located in countries other than the primary organization have to be reported separately. However, branches or subsidiaries of a primary foreign organization located in the same country and engaged in the same type of business as the primary organization may be combined and one report submitted covering the activities of all of these organizations. The report must be a consolidated report showing the total activities of all organizations and not a report of the primary organization showing only the investment of the primary in the second

ary organizations. Provide a list of all organizations included in such consolidations.

(3) "Associated" foreign organization: The ownership of at least 10 percent but less than 25 percent of the voting securities of a corporation, or an equivalent interest in an unincorporated foreign organization, held directly by the reporter and its United States affiliates, shall constitute association with that organization for the purposes of these reports. Note that separate reports are required for each "associated foreign organization." (When the ownership of the foreign organization is 25 percent or more, either entirely by the reporter or in conjunction with affiliates, the foreign organization must be reported on Form BE-577.)

(b) Terms relating to the reporting of foregoing direct investment in the United States. (1) "Branch" shall mean an unincorporated business enterprise subject to the jurisdiction of the United States controlled by a foreign person or organization, including all assets or liabilities connected with the operations of such a branch.

(2) "Reporter" shall mean the business enterprise for which a report is required. If the enterprise is in the nature of a leasehold or real property not identifiable by name, the report may be filed on behalf of the reporter by an agent or representative of the foreign beneficial owner or by such owner. § 803.7

Estimates.

Every question on the reporting forms which a reporter is required to use in rendering his report must be answered. If the information is not available as specified in the form, a reasonable estimate should be entered, labeled as such. If there is no basis for such an estimate, state, "unknown" with an appropriate explanation. However, if and when the information becomes available, a supplementary report must be filed promptly with a full explanation.

§ 803.8 Space not needed.

Space not needed or inapplicable for supplying requested information should

Reports on Forms BE-577, BE-578, BE-35, BE-578B, BE-605, BE-606 and BE-606B shall be filed on a quarterly basis within 30 days of the close of the calendar or fiscal period used by the reporter except for the final quarter of the calendar or fiscal year when reports may be filed within 45 days. Reports on Form BE-577S, BE-577A, BE-5781, BE-6061 and BE-93 shall be filed on an annual basis within 90 days of the close of the calendar or fiscal year. Reports should be sent to the Department of Commerce, Office of Business Economics, BE-50, Washington 25, D.C. If additional time is needed to prepare the reports, a request for an extension of time should be addressed to the above office.

§ 803.12 Information regarding preparation of reports.

Anyone desiring information concerning these reports, or copies of forms, may apply directly to the United States Department of Commerce, Office of Business Economics, BE-50, Washington 25, D.C. Each reporting form contains the specific instructions needed for completion.