BEA Form BE-180, 2024 Benchmark Survey For Financial Services Transactions, is due by July 31st

The Bureau of Economic Analysis (BEA) Form BE-180, the 2024 Benchmark Survey of Financial Services Transactions Between U.S. Financial Services Providers and Foreign Persons, is due by July 31, 2025 (but extensions may be obtained), and may apply to many hedge fund managers/general partners. Form BE-180 is required every five years. The purpose of Form BE-180 is for the BEA to obtain analytical data regarding financial services transactions between U.S. and foreign persons. This newsletter first discusses general aspects regarding the application of Form BE-180 and then more specifically discusses how Form BE-180 applies to hedge fund managers and hedge funds.

Form BE-180 In General

When Form BE-180 applies. Form BE-180 is mandatory for U.S. financial services providers and intermediaries who had financial service transactions with foreign entities in 2024. Form BE-180 requires applicable U.S. financial services providers to report their sales and purchases of foreign financial services and to report the countries where the services were sold to or purchased from for 2024.

U.S. financial services providers and intermediaries are required to report sales to and/or purchases from foreign persons for each type of service transaction for which they are engaged in the financial service categories covered by Form BE-180. BE-180 is required to be filed if there are any such purchases and/or sales; there is not a de minimis threshold amount filing requirement.

Additional information, including total sales and/or purchases by country and by relationship with the foreign person, is required to be reported if, on an accrual basis, the U.S. financial serviced provider (i) had combined sales of financial services to foreign persons in excess of $3 million; or (ii) had combined purchases of financial services from foreign persons in excess of $3 million. The $3 million threshold applies separately to sales and purchases).

BE-180 is a form that is due every 5 years. Form BE-180 is a survey form that is taken every five years and the next one will be taken in 2030 with respect to fiscal year 2029. Based on the filing of Form BE-180, a person may be notified that they are required to file other BE forms more frequently.

Financial services provider. The instructions provide a comprehensive list of what types of persons (which includes, but is not limited to, individuals, branches, partnerships and corporations) are considered financial services providers and what is considered a financial service for purposes of Form BE-180. The definition of financial services provider includes investment advisors and managers, portfolio management, investment advice, and all other financial investment activities, and other investment pools and funds (including open-ended investment funds).

Financial services. Financial services include: (i) brokerage services related to equity transactions, (ii) other brokerage services, (iii) underwriting and private placement services related to equity and debt transactions, (iv) financial management services, (v) credit related services, (vi) credit card services, (vii) financial advisor and custody services, (viii) securities lending services, (ix) electronic funds transfer services, and (x) other financial services. Receipt and payment of interest and dividends, gains from the sale of equity and debt instruments, and foreign currency exchange transactions are not considered financial services transactions.

Due date. Form BE-180 is due by July 31, 2025. The U.S. reporter can request an extension on the BEA’s efile system at www.bea.gov/efile.

Noncompliance. Penalties exist for U.S. reporters required to file Form BE-180 who do not file.

Confidentiality. Information gathered on Form BE-180 is confidential and may only be used for analytical and statistical purposes by the BEA. The information reported on Form BE-180 cannot be used for purposes of taxation, investigation, or regulation.

Filing Method. Form BE-180 can be filed electronically, by mail or by fax.

Finding Form BE-180. The BEA webpage for Form BE-180, which includes the form and instructions, can be found at www.bea.gov/ssb/be180/.

Application to U.S. hedge fund managers and U.S. hedge funds

Unlike many of the BEA forms and TIC forms, the application of Form BE-180 seems to be more applicable to hedge fund managers and hedge funds.

Consolidated basis. U.S. managers should file, if required, Form BE-180 on a consolidated basis with related U.S. general partners and U.S. funds that they manage.

Fees/Allocations received. There is a filing requirement if the U.S. investment manager receives management fees from offshore funds, offshore master funds or other offshore persons (such as managed accounts for offshore persons) in 2024. Fees, for this purpose, seem to include incentive allocations and carried interests.

Fees/Allocations paid. Fees paid include payments by the domestic funds, the U.S. investment manager and the U.S. general partner to foreign persons such as foreign brokers, foreign advisors or investment managers (as well as amounts paid to foreign subadvisors, branches or a parent of the investment manager). Fees, for this purpose, seem to include incentive allocations and carried interests.

Domestic funds managed by offshore managers. Form BE-180 could also apply to domestic funds managed by offshore investment managers and general partners.

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If you have any questions regarding Form BE-180 or other BEA or TIC forms, please contact your primary Kleinberg Kaplan attorney or a member of our Tax Practice.