International Services Surveys: BE-120 Benchmark Survey of Transactions in Selected Services and Intellectual Property With Foreign Persons, 52863-52868 [2017-24422]

Agencies

• DEPARTMENT OF COMMERCE
• Bureau of Economic Analysis

[Federal Register Volume 82, Number 219 (Wednesday, November 15, 2017)]
[Proposed Rules]
[Pages 52863-52868]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-24422]


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DEPARTMENT OF COMMERCE

Bureau of Economic Analysis

15 CFR Part 801

[170322303-7303-01]
RIN 0691-AA87


International Services Surveys: BE-120 Benchmark Survey of 
Transactions in Selected Services and Intellectual Property With 
Foreign Persons

AGENCY: Bureau of Economic Analysis, Commerce.

ACTION: Notice of proposed rulemaking.

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SUMMARY: This proposed rule would amend regulations of the Department 
of Commerce's Bureau of Economic Analysis (BEA) to renew reporting 
requirements for the mandatory BE-120 Benchmark Survey of Transactions 
in Selected Services and Intellectual Property with Foreign Persons. 
This survey will apply to the 2017 fiscal reporting year. The benchmark 
survey covers the universe of transactions in selected services and 
intellectual property and is BEA's most comprehensive survey of such 
transactions. For the 2017 benchmark survey, BEA proposes several 
changes in the data items collected, the design of the survey form, and 
the reporting requirements for the survey. This mandatory survey would 
be conducted under the authority of the International Investment and 
Trade in Services Survey Act.

DATES: Comments on this proposed rule will receive consideration if 
submitted in writing on or before 5:00 p.m. January 16, 2018.

ADDRESSES: You can submit comments, identified by RIN 0691-AA87, and 
referencing the agency name (Bureau of Economic Analysis), by any of 
the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments. For Keyword or ID, 
enter ``EAB-2017-0002.''
     Email: christopher.stein@bea.gov.
     Fax: Christopher Stein, Chief, Services Surveys Branch, 
Balance of Payments Division, (301) 278-9507.
     Mail: Christopher Stein, Chief, Services Surveys Branch 
(BE-50), Balance of Payments Division, Bureau of Economic Analysis, 
U.S. Department of Commerce, 4600 Silver Hill Rd., Washington, DC 
20233.
     Hand Delivery/Courier: Christopher Stein, Chief, Services 
Surveys Branch (BE-50), Balance of Payments Division, Bureau of 
Economic Analysis, U.S. Department of Commerce, 4600 Silver Hill Rd., 
Suitland, MD 20746.
    Written comments regarding the burden-hour estimates or other 
aspects of the collection-of-information requirements contained in the 
proposed rule should be sent to both BEA through any of the methods 
above and to the Office of Management and Budget (OMB), OIRA, Paperwork 
Reduction Project 0608-0058, Attention PRA Desk Officer for BEA, via 
email at jpark@omb.eop.gov, or by fax at 202-395-7245.
    Public Inspection: All comments received are a part of the public 
record and will generally be posted to https://www.regulations.gov 
without change. All personal identifying information (for example, 
name, address, etc.) voluntarily submitted by the commenter may be 
publicly accessible. Do not submit confidential business information or 
otherwise sensitive or protected information. BEA will accept anonymous 
comments (enter N/A in required fields if you wish to remain 
anonymous). Attachments to electronic comments will be accepted in 
Microsoft Word, Excel, or Adobe portable document file (pdf) formats 
only.

FOR FURTHER INFORMATION CONTACT: Christopher Stein, Chief, Services 
Surveys Branch (BE-50), Balance of

[[Page 52864]]

Payments Division, Bureau of Economic Analysis, U.S. Department of 
Commerce, 4600 Silver Hill Rd., Washington, DC 20233; email 
christopher.stein@bea.gov or phone (301) 278-9189.

SUPPLEMENTARY INFORMATION: The BE-120 Benchmark Survey of Transactions 
in Selected Services and Intellectual Property with Foreign Persons is 
a mandatory survey and is typically conducted once every five years by 
BEA under the authority provided by the International Investment and 
Trade in Services Survey Act (22 U.S.C. 3101-3108), hereinafter, ``the 
Act.'' The Act provides that data reported to BEA on this survey are 
confidential and may be used only for analytical and statistical 
purposes. Without prior written permission from the survey respondent, 
the information cannot be presented in a manner that allows it to be 
individually identified. An individual respondent's report cannot be 
used for purposes of taxation, investigation, or regulation. Copies 
retained by BEA are immune from legal process. Per the Cybersecurity 
Enhancement Act of 2015, a respondent's data are protected from 
Cybersecurity risks through security monitoring of the BEA information 
systems.
    Unlike most other BEA surveys conducted pursuant to the Act, a 
response would be required from persons subject to the reporting 
requirements of the BE-120, whether or not they are contacted by BEA, 
to ensure complete coverage of services and intellectual property 
transactions between U.S. persons (any individual or organization 
subject to the jurisdiction of the United States) and foreign persons.
    In 2012, BEA established regulatory guidelines for collecting data 
on international trade in services and direct investment (77 FR 24373; 
April 24, 2012). This proposed rule, unlike most annual or quarterly 
BEA surveys conducted pursuant to the Act, would amend those 
regulations to require a response from persons subject to the reporting 
requirements of the BE-120, whether or not they are contacted by BEA.
    The benchmark survey is intended to cover the universe of selected 
services and intellectual property transactions with foreign persons 
and is BEA's most comprehensive survey of such transactions. In 
nonbenchmark years, the universe estimates covering these transactions 
are derived from the sample data reported on BEA's BE-125 Quarterly 
Survey of Transactions in Selected Services and Intellectual Property 
with Foreign Persons. The BE-125 collects similar information but at a 
more aggregated level of detail by type of service. The data are 
collected from a sample of respondents. BEA uses cutoff sampling for 
the BE-125, meaning that respondents must only report on the BE-125 if 
they have transactions that surpassed a designated reporting threshold; 
greater than $6 million for sales and/or greater than $4 million for 
purchases. The same reporters that file on a quarterly basis throughout 
fiscal year 2017 will also be required to report on the 2017 BE-120 
survey. The BE-120 survey is conducted to reconcile reported quarterly 
data at an annual level for those respondents filing on the BE-125 
survey, and also to collect data from companies not subject to filing 
on an ongoing quarterly basis.
    The benchmark data, including data from respondents not subject to 
filing on an ongoing quarterly basis, will be used, in conjunction with 
quarterly data collected on the companion BE-125 survey, to produce 
estimates of selected services components for BEA's international 
transactions accounts (ITAs), national income and product accounts, and 
industry accounts. If this information was not collected on the BE-120 
survey, BEA would need to expand the scope of the BE-125 quarterly 
survey by collecting additional data items and reducing reporting 
thresholds, resulting in an increased number of respondents and a 
measurable impact on the reporting burden each quarter. The data are 
needed to monitor U.S. trade in services, to analyze the impact on the 
U.S. economy and on foreign economies, to compile and improve the U.S. 
economic accounts, to support U.S. commercial policy on trade in 
services, to conduct trade promotion, and to improve the ability of 
U.S. businesses to identify and evaluate market opportunities.
    A full list of the services and intellectual property covered by 
the BE-120 survey can be found in the regulatory text for new Sec.  
801.11 at the end of this document.
    This proposed rule would amend 15 CFR part 801 by adding new Sec.  
801.11 to set forth the reporting requirements for the BE-120 Benchmark 
Survey of Transactions in Selected Services and Intellectual Property 
with Foreign Persons.

Description of Changes

    The proposed changes would amend the regulations and the survey 
form for the BE-120 benchmark survey. These amendments include changes 
in data items collected, the design of the survey form, and the 
reporting requirements for those not subject to reporting on the 
mandatory schedule(s) of the survey.
    BEA proposes to change the reporting requirements for reporters 
with transactions in covered services below the threshold for mandatory 
reporting on the schedule(s) of the survey ($2 million in combined 
sales or $1 million in combined purchases for fiscal year 2017). While 
responding to benchmark surveys is always mandatory, for the previous 
BE-120 survey, reporters with transactions below these thresholds were 
required only to provide a figure for total sales and/or total 
purchases for all covered transactions. These reporters had the option 
of providing additional detail for each covered transaction by 
transaction type, by country, and by affiliation; such additional 
detail was voluntary rather than required. For the 2017 BE-120, 
however, all reporters, regardless of the amount of their transactions 
in covered services will be required to provide a total dollar amount 
for their sales and purchases, as applicable, by transaction type. This 
information will allow BEA to improve the accuracy of the trade 
statistics.
    This change will impose minimal additional burden for reporters 
because the additional information to be reported is information that 
respondents would have needed to compile or estimate previously in 
order to apply the reporting requirements. Under the prior approach, 
reporters would have needed to compile or estimate the dollar amount of 
their sales to and purchases from foreigners by transaction type in 
order to determine if their transactions met the threshold for 
mandatory reporting on the schedules. Under the new approach, BEA is 
simply requiring that respondents report those transaction totals.
    BEA proposes to add and modify some items on the benchmark survey 
form. Most of the additions are proposed in response to suggestions 
from data users and would allow BEA to more closely align with 
international guidelines, and publish more information on U.S. trade in 
services. Some additions and modifications will allow BEA to align the 
ITAs more closely with international economic accounting guidelines.
    The following items would be added to the benchmark survey:
    (1) Mandatory questions will be added to collect information on 
contract manufacturing services. On the 2011 BE-120 survey, respondents 
were requested to provide information on transactions related to 
contract manufacturing services on a voluntary basis. The 2017 BE-120 
survey will

[[Page 52865]]

collect information on contract manufacturing services on a mandatory 
basis. Reporters will be required to provide a description of both the 
materials provided or received for further processing and the 
manufactured (finished) goods. Additionally, the reporter will be 
required to provide: (1) Country-level detail on sales and purchases to 
foreign persons, (2) the cost of materials received or provided for use 
in the manufacturing process, (3) the primary country of origin of the 
inputs used, (4) the final value of the product returned after the 
manufacturing service was completed, and (5) the primary country of 
destination of the finished product.
    (2) Mandatory questions will be added to collect information on 
trade in services by the location of the U.S. and foreign transactors 
when the services were supplied. For transactions in selected services, 
respondents will be required to provide information about the location 
of the transactors when the services were supplied: (1) Cross-border 
supply, where both the supplier and the consumer remain in their 
respective territories; (2) consumption abroad, where the consumer 
consumes the service outside his or her home territory, and (3) 
presence of natural persons, where an individual (either the service 
supplier himself, if he or she is a self-employed person, or his or her 
employee) is present abroad in order to supply a service.
    In addition, BEA proposes to make the following modifications to 
the survey form:
    (1) Mandatory Schedules A and B will be expanded to collect 
additional detail on intellectual property (IP) transactions. A U.S. 
person who engages in IP transactions with foreign persons will be 
required to distribute their receipts and/or payments according to the 
type of transaction and the type of IP. The covered transaction types 
are: (1) transactions for the rights to use IP, (2) transactions for 
the rights to reproduce and/or distribute IP, and (3) transactions for 
the outright sales or purchases of IP. Reporters will be required to 
identify the foreign country(ies) involved in the transaction(s) and to 
distribute the amounts reported for each country according to whether 
the foreign person is the U.S. person's foreign affiliate, part of the 
U.S. person's foreign parent group, or an unaffiliated foreign person. 
The BE-125 survey was modified in 2016 to align with international 
guidelines by collecting receipts and/or payments according to the 
above types of transactions and types of IP. Therefore, the proposed 
modification to the BE-120 is consistent with the change made to the 
BE-125 survey.
    (2) Research and development services will be broken out into two 
categories: (1) Provision of customized and non-customized R&D 
services, and (2) other R&D services, including testing. This will 
allow BEA to align the ITAs with international guidelines and will 
improve the measurement of investment in R&D in the national income and 
product accounts.
    (3) Engineering, architectural, and surveying services will be 
broken out into three categories: (1) Architectural services; (2) 
engineering services; (3) surveying, cartography, certification, 
testing, and technical inspection services. The current category of 
industrial engineering services will be dropped and captured within 
engineering services.
    (4) Management, consulting, and public relation services will be 
broken out into three categories: (1) Market research services; (2) 
public opinion polling services; and (3) other management, consulting, 
and public relations services. Trade exhibition and sales convention 
services would be collected separately.
    (5) Database and other information services would be broken out 
into two components: (1) News agency services, and (2) other 
information services.
    (6) Computer services would be expanded into three categories: (1) 
Computer software, including end-user licenses and customization 
services; (2) cloud computing and data storage services; and (3) other 
computer services.
    (7) Several service categories previously collected under ``Other 
selected services'' will be collected separately. These services 
include audiovisual services, artistic-related services, health 
services, heritage and recreational services, other personal services, 
disbursements for sales promotion and representation, photographic 
services (including satellite photography), and space transport 
services.
    (8) Mandatory Schedule C will be modified to only collect related 
goods details for construction services. On the 2011 BE-120 survey, 
exports (sales) of three service types are collected on a separate 
schedule, Schedule C, to allow for reporting of information on the 
gross operating revenues and related goods exports and foreign 
expenses. The three categories are: (1) Construction services; (2) 
engineering, architectural, and surveying services; and (3) mining 
services. On the 2017 BE-120, only construction services will be 
collected on Schedule C. Mining services as well as the three new 
categories that will replace engineering, architectural, and surveying 
services will be collected on Schedule A.
    (9) The identification of transaction types and voluntary reporting 
of additional detail will be streamlined. On the 2011 BE-120, reporters 
were sent through a series of check boxes to identify which of the 
covered transactions (sales or purchases) they had with foreign 
persons, and to determine if they had amounts which met the thresholds 
for reporting on the mandatory schedules. Based on the results of this 
box-checking, reporters were then required to report transactions by 
country and by affiliation on the mandatory schedule(s), or were given 
multiple options to voluntarily report this information. This approach 
resulted in an inefficient use of space on the survey and caused 
confusion among reporters. With the 2017 BE-120, BEA will streamline 
the process for identifying which transactions the reporter had and for 
reporting country and affiliation information. All reporters, 
regardless of the amount of their transactions in covered services will 
be required to provide a total dollar amount for their sales and 
purchases, as applicable, by transaction type. Reporters with 
transactions below the threshold will then have the option to 
voluntarily report information on transactions by country and by 
affiliation on the standard reporting schedules.
    In addition, BEA proposes to redesign the format and wording of the 
survey. The new design would incorporate improvements made to other BEA 
surveys as well as enhancements from a recent cognitive review 
conducted with selected survey respondents. Survey instructions and 
data item descriptions would be changed to improve clarity and ensure 
the benchmark survey form is more consistent with other BEA surveys.

Executive Order 12866

    This proposed rule has been determined to be significant for 
purposes of E.O. 12866.

Executive Order 13132

    This proposed rule does not contain policies with Federalism 
implications sufficient to warrant preparation of a Federalism 
assessment under E.O. 13132.

Executive Order 13771

    This rule is not subject to the requirements of E.O. 13771 because 
this rule results in no more than de minimis costs.

[[Page 52866]]

Paperwork Reduction Act

    This proposed rule contains a collection-of-information requirement 
subject to review and approval by the Office of Management and Budget 
(OMB) under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3520 
(PRA). The requirement will be submitted to OMB for approval as a 
reinstatement, with change, of a previously approved collection for 
which approval has expired under OMB control number 0608-0058. Surveys 
were collected for the 2011 BE-120 in calender years 2012 and 2013. No 
survey submissions were solicited by BEA after the expiration and 
discontinuance of the collection in October of 2014.
    Notwithstanding any other provisions of law, no person is required 
to respond to, nor shall any person be subject to a penalty for failure 
to comply with, a collection of information subject to the requirements 
of the PRA unless that collection displays a currently valid OMB 
control number.
    The BE-120 survey, as proposed, is expected to result in the filing 
of reports from approximately 15,500 respondents. Approximately 11,500 
respondents would report mandatory data on the survey, and 
approximately 4,000 would file exemption claims. The respondent burden 
for this collection of information would vary from one respondent to 
another but is estimated to average (1) 23 hours for the 5,000 
respondents that file mandatory or voluntary data by country and 
affiliation for relevant transaction types on the mandatory schedules; 
(2) 4 hours for the 6,500 respondents that file mandatory data by 
transaction type but not by country or affiliation--including time for 
reviewing instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information; and (3) 1 hour for other responses. Thus the 
total respondent burden for this survey is estimated at 145,000 hours, 
or about 9.5 hours (145,000 hours/15,500 respondents) per response, 
compared to 105,000 hours, or about 7 hours (105,000/15,000) for the 
previous BE-120 benchmark survey in 2011. The increase in burden hours 
is due to an increase in the size of the respondent universe as well as 
changes to the content and reporting requirements of the survey.
    As part of its continuing effort to reduce paperwork and respondent 
burden, the Department of Commerce invites the general public and other 
Federal agencies to comment on proposed and/or continuing information 
collections, as required by the PRA. Comments are requested concerning: 
(a) Whether the proposed collection of information is necessary for the 
proper performance of the functions of the agency, including whether 
the information will have practical utility; (b) the accuracy of the 
burden estimate; (c) ways to enhance the quality, utility, and clarity 
of the information collected; and (d) ways to minimize the burden of 
the collection of information on the respondents, including the use of 
automated collection techniques or other forms of information 
technology.
    Written comments regarding the burden-hour estimates or other 
aspects of the collection-of-information requirements contained in the 
proposed rule should be sent to both BEA and OMB following the 
instructions given in the ADDRESSES section above.

Regulatory Flexibility Act

    The Chief Counsel for Regulation, Department of Commerce, has 
certified to the Chief Counsel for Advocacy, Small Business 
Administration, under the provisions of the Regulatory Flexibility Act, 
5 U.S.C. 605(b), that this proposed rulemaking, if adopted, will not 
have a significant economic impact on a substantial number of small 
entities. The changes proposed in this rule are discussed in the 
preamble and are not repeated here.
    A BE-120 report would be required of any U.S. person that had sales 
to, or purchases from, foreign persons in any of the types of selected 
services or intellectual property listed above. While the survey would 
not collect data on total sales or other measures of the overall size 
of the respondents to the survey, historically the respondents to the 
existing quarterly survey of transactions in selected services and 
intellectual property and to the previous benchmark surveys have been 
comprised mainly of major U.S. corporations. A completed benchmark 
survey, as proposed, would be required from U.S. persons who had 
transactions in any of the covered services and intellectual property 
with foreign persons. For U.S. persons who have transactions that 
exceeded $2 million in combined sales or $1 million in combined 
purchases for fiscal year 2017, a completed benchmark survey would 
include data on total sales and/or purchases of each of the covered 
types of services and intellectual property transactions with totals 
disaggregated by country and by relationship to the foreign transactor 
(foreign affiliate, foreign parent group, or unaffiliated). For U.S. 
persons who have transactions that fall below $2 million in sales or $1 
million in purchases for fiscal year 2017, a completed benchmark would 
include total sales and/or purchases for each type of transaction in 
which they engaged. This exemption level would exclude most small 
businesses from mandatory reporting of detail by country and by 
affiliation. Any small businesses that may be required to report would 
likely have engaged in a small number of covered transactions, and are 
therefore expected to be below the expected average burden of 9.5 hours 
per response. Even if the responses for small businesses took the 
expected average burden of 9.5 hours per response, that would not 
constitute a significant impact on any small business or other entity. 
Because this rule would not have a significant impact on any small 
entities, an Initial Regulatory Flexibility Analysis is not required 
and none has been prepared.

List of Subjects in 15 CFR Part 801

    Economic statistics, Foreign trade, International transactions, 
Penalties, Reporting and recordkeeping requirements.

    Dated: November 2, 2017.
Brian C. Moyer,
Director, Bureau of Economic Analysis.
    For reasons set forth in the preamble, BEA proposes to amend 15 CFR 
part 801 as follows:

PART 801--SURVEY OF INTERNATIONAL TRADE IN SERVICES BETWEEN U.S. 
AND FOREIGN PERSONS AND SURVEYS OF DIRECT INVESTMENT

0
1. The authority citation for 15 CFR part 801 continues to read as 
follows:

    Authority:  5 U.S.C. 301; 15 U.S.C. 4908; 22 U.S.C. 3101-3108; 
E.O. 11961 (3 CFR, 1977 Comp., p. 86), as amended by E.O. 12318 (3 
CFR, 1981 Comp. p. 173); and E.O. 12518 (3 CFR, 1985 Comp. p. 348).
0
2. Revise Sec.  801.3 to read as follows:


Sec.  801.3  Reporting requirements.

    Except for surveys subject to rulemaking in Sec. Sec.  801.7, 
801.8, 801.9, 801.10, and 801.11, reporting requirements for all other 
surveys conducted by the Bureau of Economic Analysis shall be as 
follows:
    (a) Notice of specific reporting requirements, including who is 
required to report, the information to be reported, the manner of 
reporting, and the time and place of filing reports, will be published 
by the Director of the Bureau of Economic Analysis in the Federal 
Register prior to the implementation of a survey;
    (b) In accordance with section 3104(b)(2) of title 22 of the United 
States

[[Page 52867]]

Code, persons notified of these surveys and subject to the jurisdiction 
of the United States shall furnish, under oath, any report containing 
information which is determined to be necessary to carry out the 
surveys and studies provided for by the Act; and
    (c) Persons not notified in writing of their filing obligation by 
the Bureau of Economic Analysis are not required to complete the 
survey.
0
3. Add Sec.  801.11 to read as follows:


Sec.  801.11  Rules and regulations for the BE-120 Benchmark Survey of 
Transactions in Selected Services and Intellectual Property with 
Foreign Persons--2017.

    The BE-120 Benchmark Survey of Transactions in Selected Services 
and Intellectual Property with Foreign Persons will be conducted 
covering fiscal year 2017. All legal authorities, provisions, 
definitions, and requirements contained in Sec. Sec.  801.1 through 
801.2 and Sec. Sec.  801.4 through 801.6 are applicable to this survey. 
Specific additional rules and regulations for the BE-120 survey are 
given in paragraphs (a) through (e) of this section. More detailed 
instructions are given on the report form and in instructions 
accompanying the report form.
    (a) Response required. A response is required from persons subject 
to the reporting requirements of the BE-120 Benchmark Survey of 
Transactions in Selected Services and Intellectual Property with 
Foreign Persons--2017, contained herein, whether or not they are 
contacted by BEA. Also, a person, or its agent, that is contacted by 
BEA about reporting on this survey, either by sending a report form or 
by written inquiry, must respond in writing pursuant to this section. 
This may be accomplished by:
    (1) Completing and returning the BE-120 by the due date of the 
survey; or
    (2) If exempt, by completing the determination of reporting status 
section of the BE-120 survey and returning it to BEA by the due date of 
the survey.
    (b) Who must report. A BE-120 report is required of each U.S. 
person that had sales to foreign persons or purchases from foreign 
persons in the services and intellectual property categories covered by 
the survey during its 2017 fiscal year.
    (c) What must be reported. (1) A U.S. person that had combined 
sales to foreign persons that exceeded $2 million or combined purchases 
from foreign persons that exceeded $1 million in the services and 
intellectual property categories covered by the survey during its 2017 
fiscal year, on an accrual basis, is required to provide data on total 
sales and/or purchases of each of the covered types of services and 
intellectual property transactions and must disaggregate the totals by 
country and by relationship to the foreign transactor (foreign 
affiliate, foreign parent group, or unaffiliated). The $2 million 
threshold for sales and the $1 million threshold for purchases should 
be applied to services and intellectual property transactions with 
foreign persons by all parts of the consolidated domestic U.S. 
Reporter. Because the $2 million threshold for sales and $1 million 
threshold for purchases apply separately to sales and purchases, the 
mandatory reporting requirement may apply only to sales, only to 
purchases, or to both. The determination of whether a U.S. company is 
subject to this reporting requirement may be based on the judgment of 
knowledgeable persons in a company who can identify reportable 
transactions on a recall basis, with a reasonable degree of certainty, 
without conducting a detailed manual records search.
    (2) A U.S. person that had combined sales to foreign persons that 
were $2 million or less or combined purchases from foreign persons that 
were $1 million or less in the intellectual property or services 
categories covered by the survey during its 2017 fiscal year, on an 
accrual basis, is required to provide the total sales and/or purchases 
for each type of transaction in which they engaged. The $2 million 
threshold for sales and the $1 million threshold for purchases should 
be applied to services and intellectual property transactions with 
foreign persons by all parts of the consolidated domestic U.S. 
Reporter. Because the $2 million threshold for sales and $1 million 
threshold for purchases apply separately to sales and purchases, the 
mandatory reporting requirement may apply only to sales, only to 
purchases, or to both.
    (i) Voluntary reporting of sales. If, during fiscal year 2017, 
combined sales were $2 million or less, on an accrual basis, the U.S. 
person may, in addition to providing the required total for each type 
of transaction, report sales at a country and affiliation level of 
detail on the applicable mandatory schedule(s).
    (ii) Voluntary reporting of purchases. If, during fiscal year 2017, 
combined purchases were $1 million or less, on an accrual basis, the 
U.S. person may, in addition to providing the required total for each 
type of transaction, report purchases at a country and affiliation 
level of detail on the applicable mandatory schedule(s). Provision of 
this additional detail is voluntary. The estimates may be judgmental, 
that is, based on recall, without conducting a detailed records search.
    (3) Exemption claims. Any U.S. person that receives the BE-120 
survey form from BEA, but is not subject to the reporting requirements, 
must file an exemption claim by completing the determination of 
reporting status section of the BE-120 survey and returning it to BEA 
by the due date of the survey. This requirement is necessary to ensure 
compliance with reporting requirements and efficient administration of 
the Act by eliminating unnecessary follow-up contact.
    (d) Covered types of services. Services transactions covered by 
this survey consist of sales and purchases related to certain 
intellectual property rights (see paragraphs (d)(1) through (18) of 
this section for a list of intellectual property-related transactions 
covered by this survey) and sales and purchases of selected services 
(see paragraphs (d)(19) through (59) of this section for a list of 
services covered by this survey). The transactions (sales or purchases) 
between U.S. companies and foreign persons covered by the BE-120 survey 
are:
    (1) Rights related to the use of a patent, process, or trade secret 
to produce and/or distribute a product or service;
    (2) Outright sales of proprietary rights related to patents, 
processes, and trade secrets;
    (3) Rights to use books, music, etc., including end-user rights 
related to digital content;
    (4) Rights to reproduce and/or distribute books, music, etc.;
    (5) Outright sales of proprietary rights related to books, music, 
etc.;
    (6) Rights to use trademarks;
    (7) Outright sales of proprietary rights related to trademarks;
    (8) Rights to use recorded performances and events, including end-
user rights related to digital content;
    (9) Rights to reproduce and/or distribute recorded performances and 
events;
    (10) Outright sales of proprietary rights related to recorded 
performances and events;
    (11) Rights to broadcast and record live performances and events;
    (12) Rights to reproduce and/or distribute general use computer 
software;
    (13) Outright sales of proprietary rights related to general use 
computer software;
    (14) Fees associated with business format franchising;
    (15) Outright sales of proprietary rights related to business 
format franchising;
    (16) Rights to use other intellectual property;

[[Page 52868]]

    (17) Rights to reproduce and/or distribute other intellectual 
property;
    (18) Outright sales of proprietary rights related to other 
intellectual property;
    (19) Accounting, auditing, and bookkeeping services;
    (20) Advertising services;
    (21) Auxiliary insurance services;
    (22) Computer software, including end-user licenses and 
customization services;
    (23) Cloud computing and data storage services;
    (24) Other computer services;
    (25) Construction services;
    (26) News agency services (excludes production costs related to 
news broadcasters);
    (27) Other information services;
    (28) Education services;
    (29) Architectural services;
    (30) Engineering services;
    (31) Surveying, cartography, certification, testing and technical 
inspection services;
    (32) Financial services;
    (33) Maintenance services;
    (34) Installation, alteration, and training services;
    (35) Legal services;
    (36) Market research services;
    (37) Public opinion polling services;
    (38) Other management, consulting, and public relations services;
    (39) Merchanting services (net receipts);
    (40) Mining services;
    (41) Operational leasing;
    (42) Trade-related services, other than merchanting services;
    (43) Artistic-related services;
    (44) Premiums paid on primary insurance;
    (45) Losses recovered on primary insurance;
    (46) Provision of customized and non-customized research and 
development services;
    (47) Other research and development services;
    (48) Telecommunications services;
    (49) Health services;
    (50) Heritage and recreational services;
    (51) Audiovisual and production services;
    (52) Contract manufacturing services;
    (53) Disbursements for sales promotion and representation;
    (54) Photographic services (including satellite photography 
services);
    (55) Space transport services;
    (56) Trade exhibition and sales convention services;
    (57) Agricultural services;
    (58) Waste treatment and depollution services; and
    (59) Other selected services n.i.e. (not included elsewhere).
    (e) Types of transactions excluded from the scope of this suvey. 
(1) Sales and purchases of goods. Trade in goods involves products that 
have a physical form, and includes payments or receipts for 
electricity.
    (2) Sales and purchases of financial instruments, including stocks, 
bonds, financial derivatives, loans, mutual fund shares, and negotiable 
CDs. (However, securities brokerage is a service).
    (3) Income on financial instruments (interest, dividends, capital 
gain distributions, etc).
    (4) Compensation paid to, or received by, employees.
    (5) Penalties and fines and gifts or grants in the form of goods 
and cash (sometimes called ``transfers'').
    (f) Due date. A fully completed and certified BE-120 report, or 
qualifying exemption claim with the determination of reporting status 
section completed, is due to be filed with BEA not later than June 29, 
2018 (or by July 30, 2018 for respondents that use BEA's eFile system).

[FR Doc. 2017-24422 Filed 11-14-17; 8:45 am]
 BILLING CODE 3510-06-P