March 30, 2015

VIA EMAIL

Mr. Christopher Stein

Chief, Services Surveys Branch (BE-50)

Balance of Payments Division

Bureau of Economic Analysis

U.S. Department of Commerce

Washington, DC 20230

Mr. Paul Bugg

PRA Desk Officer for BEA

Office of Management and Budget

725 17th Street, NW

Washington, DC 20503

Re: International Services Surveys: BE-180, Benchmark Survey of Financial 

Services Transactions Between U.S. Financial Services Providers and 

Foreign Persons; RIN 0691–AA84

Dear Messrs. Stein and Bugg:

The Asset Management Group of the Securities Industry and Financial Markets 

Association (“AMG”) appreciates the opportunity to provide comments to the Bureau of 

Economic Analysis (“BEA”) on the proposed changes to its regulations regarding the BE180 Benchmark Survey of Financial Services Transactions between U.S. Financial 

Services Providers and Foreign Persons.1 The main change proposed by BEA is to make 

the BE-180 survey mandatory for all U.S. financial service providers that meet the survey 

criteria, regardless of whether they are specifically contacted by BEA, in order to “ensure 

complete coverage” of transactions within the scope of the survey. We respectfully 

submit that this change would not advance BEA’s mission and would impose an undue 

reporting burden on asset managers.

The AMG’s members represent U.S. asset management firms whose combined 

assets under management exceed $30 trillion. The clients of AMG member firms include, 

among others, registered investment companies, investment advisers, endowments, state 

and local government pension funds, private sector Employee Retirement Income Security 

Act of 1974 pension funds and private funds such as hedge funds and private equity funds. 

AMG has a demonstrated ability to prescribe solutions for complex issues that regulators 

 

1

80 Fed. Reg. 4228 (BEA Jan. 27, 2015).
Messrs. Stein and Bugg

March 30, 2015

Page 2 of 9

and industry participants alike classify as critical. With its diverse membership, AMG is 

well-placed to provide a unique perspective on the securities industry and how the 

proposed rule will affect the industry and BEA’s survey results.

BEA has requested comments on the following subjects:

(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.

As described in more detail below, we believe that the BE-180 survey should not 

be made mandatory. This change is not necessary or beneficial for the proper 

performance of BEA’s functions, and it would exacerbate the reporting burden on 

respondents. In the alternative, we suggest that the $3 million reporting threshold be 

substantially increased, in order to target major financial service providers while 

minimizing the information collection burden on respondents. In any event, we believe 

that BEA must issue detailed instructions and guidance for asset managers to complete the 

BE-180 survey in order to ensure the quality and utility of information collected. Finally, 

we provide comments on the accuracy of BEA’s estimated hours burden.

1. The BE-180 Should Not Be Mandatory For all Eligible Reporters

We respectfully submit that BEA should maintain its current reporting requirement 

for the BE-180 survey, such that persons are only required to respond to the survey if 

contacted by BEA. This approach would be consistent with the BE-185 quarterly survey 

of international financial services transactions,2and with most other BEA surveys.3 

 

2

See BE–185: Quarterly Survey of Financial Services Transactions Between U.S. Financial Services 

Providers and Foreign Persons, 80 Fed. Reg. 12,447 (BEA Mar. 9, 2015) (“Entities required to report 

will be contacted individually by BEA. Entities not contacted by BEA have no reporting 

responsibilities.”).

3

See 80 Fed. Reg. at 4229 (“If the proposed rule is made final, unlike most other BEA surveys 

conducted pursuant to the Act, persons subject to the reporting requirements of the BE-180 would be 

required to respond whether or not they are contacted by BEA.”) (emphasis added).
Messrs. Stein and Bugg

March 30, 2015

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BEA’s proposed rule does not provide any reason for making the BE-180 survey 

mandatory, and we do not see any compelling reason that doing so would advance BEA’s 

mission.

As the proposed rule indicates, during non-benchmark years, BEA adequately 

estimates of the volume of these transactions from sample data reported in BE-185 

quarterly survey responses. Moreover, the response rate for the 2009 benchmark survey 

was over 80% with a survey size of about 6,200 firms.4 This is a very high response rate, 

which is also about the same as the response rate for the BE-185 quarterly survey. 

Accordingly, it is not necessary to make the survey mandatory in order to ensure complete 

coverage of the target transactions.

It is also important to consider the additional burden of a mandatory BE-180 

survey in the context of other BEA reporting requirements recently imposed on asset 

managers. The BE-13 foreign direct investment survey was reactivated on a mandatory 

basis in November 2014 (with the first surveys due in January 2015), after being dormant 

since 2009. The BE-10 benchmark survey of outbound foreign investment is also due in 

2015 on a mandatory basis. These two surveys were released in short order before the 

BE-180 and imposed substantive new reporting obligations on many asset managers. Due 

to their range of activities and global operations, many asset managers are in a unique 

position of having a significant number of complex transactions to report on these three 

BEA surveys. The cumulative burden of the BE-10, BE-13, and BE-180 surveys imposed 

on asset managers within one year is substantial. This burden is in addition to required 

financial reporting to other U.S. government agencies under the same statutory mandate 

and for similar purposes. We also understand that relatively few of SIFMA’s asset 

manager members have been subject to BE-180 reporting requirements in the past. To 

make the BE-180 survey mandatory would in fact broaden the survey respondent base in a 

substantive way to cover all asset managers.

Moreover, despite the fact that BEA has recently made the BE-10 and BE-13 

surveys mandatory, it does not follow that the BE-180 should be made mandatory as well. 

The foreign direct investment surveys are broader than the international services surveys, 

and apply to various types of transactions and entities throughout the U.S. economy. It 

may arguably be useful to make these foreign direct investment surveys mandatory 

because BEA would not necessary know which entities were involved in recent reportable 

investment transactions in order to obtain a representative sample. However, the universe 

of financial services providers is smaller and well-known to BEA. Accordingly, the 

existing sampling system remains adequate.

Also, the BE-180 survey overlaps to a large extent with the U.S. Department of the 

Treasury’s mandatory Treasury International Capital (“TIC”) reports. In particular, the 

 

4 A Guide to BEA’s Services Surveys at 12, available at http://www.bea.gov/surveys/pdf/surveysu.pdf.
Messrs. Stein and Bugg

March 30, 2015

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TIC-B form covers U.S. financial institutions’ liabilities to, and claims on, foreign 

residents. The TIC reports are collected under the same statutory authority as BEA’s 

surveys, and gather data on international financial services transactions for similar 

purposes. We submit that BEA should look to the comprehensive information that is

already collected by the U.S. government from asset managers on a regular basis. This 

would be a more efficient and less burdensome approach than increasing the reporting 

requirements for U.S. asset managers.

Finally, if BEA decides to make the BE-180 mandatory in its final rule, we 

respectfully request that the response deadline be postponed or that the mandatory filing 

requirement take effect for the next benchmark reporting cycle in 2020. The final rule and 

actual survey will not be published for several more months, while the survey response is 

currently due by October 1, 2015. This schedule allows insufficient time for respondents 

– especially first time respondents – to collect and prepare the necessary data. As 

described further below, AMG members may need to implement new processes and 

systems in order to full comply with the BE-180 requirements. Based on our experience 

to date with the BE-10 and BE-13 surveys (the latter of which required multiple new 

reports within a short time after the final rule was published), it will require a great deal of 

time and resources to respond to this newly-imposed reporting requirement. Accordingly, 

it would be most beneficial for BEA and respondents to make the survey mandatory in the 

next five-year cycle, or at the very least to delay the deadline until six months after the 

final rule is published. 

2. The Monetary Threshold for Reporting Should be Raised

If BEA revises its existing approach and makes the BE-180 survey mandatory, we 

submit that BEA should raise the $3 million monetary reporting threshold. The existing 

$3 million level in the proposed rule risks imposing inappropriate reporting obligations on 

smaller entities, potentially inundating BEA with smaller filers that would not provide 

data that advances BEA’s mission, and skewing the aggregated data that BEA receives. 

A higher reporting threshold would still ensure coverage of a significant range of 

financial services providers, while avoiding excessive coverage of smaller entities. For 

example, the U.S. Census Bureau reports that there were over 470,000 U.S. firms 

characterized as financial services providers in 2012 under NAICS Code 52, which BEA 

cites in its definitions for the BE-180 survey.5 The U.S. Securities and Exchange 

Commission (“SEC”) oversees over 25,000 market participants (including nearly 12,000 

 

5 U.S. Census Bureau, Finance and Insurance: Industry Series: Preliminary Summary Statistics for the 

U.S.: 2012 Economic Census of the United States, available at 

http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2012_US_52I1

&prodType=table.
Messrs. Stein and Bugg

March 30, 2015

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investment advisers)6and currently there are over 25,000 federally or state registered 

investment advisers.7 An investment adviser is required to have at least $100 million in 

assets under management in order to register with the SEC.8 At the same time, the 

Investment Company Institute (“ICI”), represents over 16,900 investment companies with 

over $18.6 trillion in assets.9 Considering the global nature of markets today, it is likely 

that a very high percentage of these thousands of investment advisers and investment 

companies – in addition to many other hedge funds, private equity funds, pension funds, 

and other financial services providers – would cross the current $3 million reporting 

threshold. 

In previous versions of the BE-180 survey, the respondent base was “comprised 

mainly of major U.S. corporations.”10 Because a mandatory survey based on a $3 million 

reporting threshold would significantly broaden the respondent universe, the value of any 

comparisons over time would be greatly diminished. As such, the low threshold would 

impair BEA’s ability to provide useful guidance on policy formation, accurately gauge the 

impact of relevant policy changes, and support the competitiveness of U.S. industry. 

Raising the monetary threshold for reporting would enable BEA to maintain a generally 

consistent respondent base of major U.S. corporations. 

Moreover, in the proposed rule BEA stated that the $3 million “exemption level 

would exclude most small businesses from mandatory coverage.”11 We respectfully 

believe that this assumption is inaccurate. It is more likely to exclude mainly individuals. 

The scope of the BE-180 survey is broad and captures a wide range of financial services 

that are provided by entities of various sizes. Because of the variety of transactions 

captured, it would be relatively easy for even a small financial services provider to reach 

the $3 million aggregate level. The problem is compounded by the fact that the $3 million 

level applies to total sales or purchases by the U.S. reporter on a consolidated basis: a 

large number of small transactions of various types could easily subject an entity to 

reporting requirements, while the data provided may not accurately reflect important 

 

6

SEC, FY 2016 Congressional Budget Justification, FY 2016 Annual Performance Plan; FY 2014 

Annual Performance Report at 4, available at

http://www.sec.gov/about/reports/secfy16congbudgjust.pdf.

7

SEC, Investment Adviser Public Disclosure, available at http://www.sec.gov/answers/iapd.htm. 

8

See 17 C.F.R. § 275.203A-1.

9

ICI, 2014 Annual Report to Members, available at http://www.ici.org/pdf/14_ici_annual.pdf. 

10 80 Fed. Reg. at 4230.

11 Id.
Messrs. Stein and Bugg

March 30, 2015

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trends in financial services transactions of which BEA should be aware. The low 

threshold, which has not been revised in recent years, therefore imposes a significant 

reporting burden on relatively small entities given the breadth of reportable services.

Raising the exemption level would also establish a benchmark consistent with 

various TIC reports. For example, the annual TIC SHCA report, which collects 

information on U.S. ownership of foreign securities, establishes a reporting minimum of 

$100 million for Schedules 2 and 3. Likewise, the TIC Form S, related to cross-border 

ownership of securities, must be completed if total reportable transactions in purchases or 

sales of long-term securities amount to $350 million or more during a single month. 

Finally, the BE-180 survey’s $3 million exemption level is inconsistent with the 

reporting thresholds of other BEA surveys. As an entity’s information-gathering burden 

increases, the reporting threshold similarly increases. For example:

 The BE-13 Survey of New Foreign Direct Investment in the United States 

requires reporting when the total cost of a single covered transaction is 

greater than $3 million. 

 The minimum reporting threshold for a complete BE-12 Benchmark 

Survey of Foreign Direct Investment in the United States report is $20 

million. Below this level, only selected data items are required to be 

reported. 

 The minimum reporting threshold for a complete BE-10 Benchmark 

Survey of U.S. Direct Investment Abroad report (as well as the BE-11 

annual report) is $25 million. Below this level, only selected data items are 

required to be reported. 

 The minimum reporting threshold for a complete BE-577 Quarterly Survey 

of U.S. Direct Investment Abroad is $60 million.

Accordingly, a higher minimum reporting threshold would produce data more 

useful to BEA while relieving smaller institutions of burdensome information collection 

obligations.

3. BEA Must Provide Guidance for Asset Managers in Order to Obtain 

Meaningful Survey Data

AMG also respectfully submits that BEA must issue guidance on how to apply the 

BE-180 survey to the asset management and securities industry in order to ensure that it 

obtains consistent and meaningful survey data. This industry is complex and varied, and 
Messrs. Stein and Bugg

March 30, 2015

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different from traditional financial institutions. As such, and given that this reporting 

requirement is new for many of our members, the application of the BE-180 survey to 

many asset management situations is unclear. Accordingly, we request that the BE-180 

survey not be made mandatory until BEA issues formal guidance that may be discussed 

with the industry. 

Not only would detailed and focused guidance aid eligible reporters, but it is 

necessary to advance BEA’s statutory mandate of gathering and assessing accurate data. 

In the absence of industry-specific guidance, asset managers are likely to make 

inconsistent (and possibly inaccurate) determinations as to which services are reportable. 

Uncertainty and inconsistency would adversely affect the reliability and utility of BEA’s 

data collection, undermining its mission.

For example, AMG members have raised several questions about the proper 

interpretation of the BE-180 survey to our industry. Below is just a sample of issues that 

are not clearly addressed by the 2009 survey and instructions, and for which directed 

guidance would be useful.

 A foreign person may hire a U.S. investment adviser to manage its assets, and that 

adviser hires a U.S. sub-adviser to manage certain assets in this portfolio. Does the 

U.S. sub-adviser need to report a sale of services to the foreign principal, or is the 

U.S. investment adviser considered the purchaser of its services?

 Investment advisers often place trades through a broker-dealer and pay a 

commission. The broker-dealer may have affiliates around the world. How does 

the investment adviser determine which entity is the supplier of the brokerage 

services (e.g., the affiliate with which it placed the order, the affiliate that 

conducted the trade, the affiliate that charged the commission, etc.)?

 While interest is generally not considered a financial service, would the carried 

interest received by a general partner be considered a reportable fee received for 

providing management services to the limited partnership?

 Is the fee paid by a fund to a director that is a foreign person considered a 

reportable payment for management services?

 Are other payments related to financial management (e.g., monitoring fee, breakup fee, loan commitment fee) considered reportable financial services transactions? 

If so, how should they be reported?
Messrs. Stein and Bugg

March 30, 2015

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Finally, by way of illustration, we note that the instructions for BEA’s prior BE180 survey comprised seven pages, and BEA provided a few FAQs that were not specific 

to any industry. By contrast, the TIC-B reports include a 76-page instruction document, 

and the Treasury Department issued additional FAQs and made a number of presentations 

to industry groups. In its proposed rule, BEA stated that “[s]urvey instructions and data 

item descriptions would be changed to improve clarity . . . .”12 We respectfully request 

that the instructions be expanded significantly to provide meaningful guidance to the asset 

management and securities industry before significantly expanding the survey through 

mandatory application.

4. BEA’s Burden Estimate Is Vastly Understated

We also appreciate this opportunity to comment on the accuracy of the burden 

estimate for this information collection. BEA estimates that, while the respondent burden 

may vary, it would take an average of ten hours to provide a complete response, 

“including time for reviewing instructions, searching existing data sources, gathering and 

maintaining the data needed, and completing and reviewing the collection of 

information.”13 We respectfully submit that this estimate is vastly understated.

If a firm qualifies for mandatory reporting, even based on the current $3 million 

exemption level, that firm is likely to have engaged in significant cross-border financial 

service activity. Asset managers in particular engage in numerous international 

transactions just with affiliated parties, as asset managers conduct business through 

various entities and funds organized in jurisdictions around the world.

The BE-180 survey covers ten distinct categories of financial services, many of 

which apply to a single U.S. reporter even if different services are handled by different 

parts of the corporate group. That reporter would have to research, aggregate, and review 

data on various transactions from multiple entities and business units. These data and 

reporting methodologies are then often reviewed by internal and external compliance 

personnel and legal counsel. A more accurate estimated hour burden for any mandatory 

reporter would be at least an order of magnitude larger than ten hours. In fact, most of our 

members have already spent more than ten hours reviewing the instructions from BEA’s 

2009 survey. We believe that the reporting burden will be so great that BEA’s proposed 

rule is inconsistent with its statutory obligation to “give due regard to the costs incurred by 

persons supplying such information . . . .”14

 

12 80 Fed. Reg. at 4229.

13 Id.

14

 22 U.S.C. § 3103(g).
Messrs. Stein and Bugg

March 30, 2015

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We would welcome the opportunity to discuss these issues further at your 

convenience. If you have any questions about these comments, or if we can provide any 

additional information, please contact Lindsey Keljo at 202-962-7312 or by email at 

lkeljo@sifma.org. 

Respectfully,

Timothy W. Cameron, Esq.

Managing Director

Asset Management Group – Head

Securities Industry and Financial Markets 

Association

Lindsey Weber Keljo, Esq.

Vice President and Assistant General Counsel

Asset Management Group 

Securities Industry and Financial Markets 

Association

cc: Mario Mancuso, Esq.

Fried, Frank, Harris, Shriver & Jacobson LLP