82 FR 27546 - Proposed Collection; Comment Request

DEPARTMENT OF THE TREASURY

Federal Register Volume 82, Issue 114 (June 15, 2017)

The Department of the Treasury, as part of its continuing effort to reduce paperwork burdens, invites the general public and other Federal agencies to comment on revisions in 2017 of a currently approved information collection that is proposed for approval by the Office of Management and Budget. The Office of International Affairs within the Department of the Treasury is soliciting comments concerning the revision of the Annual Report of U.S. Ownership of Foreign Securities, including Selected Money Market Instruments. The next such collection is an annual survey to be conducted as of December 31, 2017.

[Federal Register Volume 82, Number 114 (Thursday, June 15, 2017)]
[Notices]
[Pages 27546-27547]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-12361]



[[Page 27546]]

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 DEPARTMENT OF THE TREASURY


Proposed Collection; Comment Request

ACTION: Notice and request for comments.

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SUMMARY: The Department of the Treasury, as part of its continuing 
effort to reduce paperwork burdens, invites the general public and 
other Federal agencies to comment on revisions in 2017 of a currently 
approved information collection that is proposed for approval by the 
Office of Management and Budget. The Office of International Affairs 
within the Department of the Treasury is soliciting comments concerning 
the revision of the Annual Report of U.S. Ownership of Foreign 
Securities, including Selected Money Market Instruments. The next such 
collection is an annual survey to be conducted as of December 31, 2017.

DATES: Written comments should be received on or before August 14, 2017 
to be assured of consideration.

ADDRESSES: Direct all written comments to Dwight Wolkow, International 
Portfolio Investment Data Systems, Department of the Treasury, Room 
5422 MT, 1500 Pennsylvania Avenue NW., Washington, DC 20220. In view of 
possible delays in mail delivery, you may also wish to send a copy to 
Mr. Wolkow by email ([email protected]) or FAX (202-622-2009). 
Mr. Wolkow can also be reached by telephone (202-622-1276).

FOR FURTHER INFORMATION CONTACT: Copies of the proposed form and 
instructions are available at Part II of the Treasury International 
Capital (TIC) Forms Web page ``Forms SHL/SHLA & SHC/SHCA'', at: https://www.treasury.gov/resource-center/data-chart-center/tic/Pages/forms-sh.aspx#shc. The proposed forms (called schedules) are unchanged from 
the previous survey that was conducted as of December 31, 2016 
(SHC(2016)). The ``Current Actions'' below are changes in the previous 
instructions. Requests for additional information should be directed to 
Mr. Wolkow.

SUPPLEMENTARY INFORMATION: 
    Title: Treasury International Capital (TIC) Form SHC/SHCA ``U.S. 
Ownership of Foreign Securities, including Selected Money Market 
Instruments.''
    OMB Control Number: 1505-0146.
    Abstract: Form SHC/SHCA is part of the Treasury International 
Capital (TIC) reporting system, which is required by law (22 U.S.C. 
3101 et seq.; E.O. 11961; 31 CFR 129) and is used to conduct annual 
surveys of U.S. residents' ownership of foreign securities for 
portfolio investment purposes. These data are used by the U.S. 
Government in the formulation of international financial and monetary 
policies, and for the computation of the U.S. balance of payments 
accounts and of the U.S. international investment position. These data 
are also used to provide information to the public and to meet 
international reporting commitments. The SHC/SHCA survey is part of an 
internationally coordinated effort under the auspices of the 
International Monetary Fund to improve data on securities worldwide. 
Most of the major industrial and financial countries conduct similar 
surveys.
    The data collection includes large benchmark surveys conducted 
every five years, and smaller annual surveys conducted in the non-
benchmark years. The data collected under an annual survey are used in 
conjunction with the results of the preceding benchmark survey and of 
recent SLT reports to make economy-wide estimates for that non-
benchmark year. Currently, the determination of who must report in the 
annual surveys is based primarily on the data submitted during the 
preceding benchmark survey and on data submitted on SLT reports around 
June of the survey year. The data requested in the annual survey will 
generally be the same as requested in the preceding benchmark report. 
Form SHC is used for the benchmark survey of all significant U.S.-
resident custodians and end-investors regarding U.S. ownership of 
foreign securities. In non-benchmark years Form SHCA is used for the 
annual surveys of primarily the very largest U.S.-resident custodians 
and end-investors.
    Current Actions: No changes in the forms (called schedules) are 
made from the previous survey that was conducted as of December 31, 
2016. The proposed changes in the instructions are:
    (1) Because the next survey is an annual survey (SHCA), section 
II.A in the instructions, ``Who Must Report'', is changed to begin with 
the following paragraph ``All U.S.-resident entities that have been 
contacted by the Federal Reserve Bank of New York to report must file 
the SHCA report. (See Section II.C, Exemptions.) All other entities are 
exempt from reporting.'' Elsewhere in the instructions, all references 
to ``SHC'' (the benchmark survey of 2016) are changed to ``SHCA''.
    (2) In section II.A.(2) ``Who Must Report/End-Investors'', the list 
is edited to show ``Intermediate Holding Companies'' (IHCs), which are 
defined by Regulation YY, 12 CFR 252, to clarify that IHCs should 
follow the same consolidation rules that are applicable to Bank Holding 
Companies (BHCs), Financial Holding Companies (FHCs), and Savings and 
Loan Holding Companies. In addition, IHCs are mentioned in the line-by-
line instructions for Schedule 1 (section IV.A.8.5) and Schedule 2 
(section IV.B.15.6).
    (3) In section II.A.2 ``End-Investors'' and in section III.C.3.(a) 
under the subsection ``How to Report Hedge Funds and other alternative 
investment vehicles'', the list of legal entities is expanded to 
include fund ``administrators''.
    (4) The section II.A.2 ``End-Investors'', section III.A 
``Reportable Foreign Securities/Equity Interests'', section III.C.1 
``Funds and Related Holdings'' and the new section III.C.3.(c) ``Direct 
investment exception for certain private funds'' are all revised to 
list out separately ``certain private funds'', which are a subgroup of 
the class of financial entities defined by the Securities and Exchange 
Commission as private funds on Form PF: ``any issuer that would be an 
investment company as defined in section 3 of the Investment Company 
Act of 1940 but for section 3(c)(1) or 3(c)(7) of . . . [that] Act.''. 
In cooperation with the Bureau of Economic Analysis (BEA) effective for 
TIC reports beginning as of January 2017 and afterwards, reporters of 
investments in certain private funds that meet the definition of direct 
investment (that is, ownership by one person of 10 percent or more of 
the voting interest of a business enterprise) but display 
characteristics of portfolio investment (specifically, investors who do 
not intend to control or influence the management of an operating 
company) are required to report through the Treasury International 
Capital (TIC) reporting system, where other related portfolio 
investments are already being reported, and not to report on BEA's 
direct investment surveys. Specifically, cross-border investments by or 
into private funds are included in TIC reports regardless of ownership 
share if they meet BOTH of the following two criteria: (i) The private 
fund does not own, directly or indirectly through another business 
enterprise, an ``operating company''--i.e., a business enterprise that 
is not a private fund or a holding company--in which the U.S. parent 
owns at least 10 percent of the voting interest, and (ii) If the 
private fund is owned indirectly (through one or more other business 
enterprises), there are no ``operating companies'' between the U.S. 
parent and the indirectly-owned private fund. Direct

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investment in operating companies, including investment by and through 
private funds, will continue to be reported to BEA. Guidance on the 
decision to report investments in certain private funds or between 
entities of certain private funds in the TIC system or in BEA surveys 
can be found at: https://www.bea.gov/privatefunds; use the tool labeled 
``U.S. Investments in Foreign Private Funds''. This change in reporting 
requirements aligns the U.S. direct investment and portfolio investment 
data more closely with the intent of the investment with respect to 
management control. In addition, it reduces burden for respondents, 
many of whom previously reported both to the TIC reporting system and 
to BEA's direct investment reporting system. Note: this change applies 
also to these other TIC forms if the reporting requirements of the form 
are met: BC, BL-1, BL-2, BQ-1, BQ-2, BQ-3, D, S, SLT, and SHL/SHLA.
    (5) Section III.G ``Direct Investment'' has been, in effect, 
expanded to be equal to the detailed description of direct investment 
in the TIC GLOSSARY.
    (6) In the ``Line-by-Line Instructions for Schedule 1'' (section 
IV.A in the instructions), the phrase in parentheses in line 20 is 
clarified and reads ``(records with Schedule 2, Item 12 = security 
types 1, 2, 3, or 4)''.
    (7) In the ``Line-by-Line Instructions for Schedule 1'' (section 
IV.A in the instructions), the phrase in parentheses in line 21 is 
clarified and reads ``(records with Schedule 2, Item 12 = security 
types 5, 6, 7, 8, 9, 10, or 11)''.
    (8) In the ``Line-by-Line Instructions for Schedule 1'' (section 
IV.A in the instructions), the phrase in parentheses in line 22 is 
clarified and reads ``(records with Schedule 2, Item 12 = security 
types 6, 7, 8, 9, 10, or 11)''.
    (9) In the ``Line-by-Line Instructions for Schedule 1'' (section 
IV.A in the instructions), the phrase in parentheses in line 23 is 
clarified and reads ``(records with Schedule 2, Item 12 = security type 
12)''.
    (10) In the ``Line-by-Line Instructions for Schedule 2'', the third 
part of the note for Type 8 in line 8 is changed to read ``(3) Short-
term sovereign debt securities should be reported as type 11; and (4) . 
. .''
    (11) In the ``Line-by-Line Instructions for Schedule 2'', the note 
for ``Type 11'' in line 11 is changed to read ``Type 11 should include 
all debt other than asset-backed securities that is not covered in 
types 5-10, including short-term sovereign debt securities.''
    (12) In the ``Line-by-Line Instructions for Schedule 3'' (section 
IV.C in the instructions), subpart 3 ``Custodian Code'' is expanded to 
add the last line with bullet items ``If you are not required to submit 
Schedule 2 records, please submit up to two additional Schedule 3 
reports:
     Using custodian code 77, submit summary data on foreign 
securities held directly with foreign resident custodians, including 
foreign-resident offices of U.S. banks or U.S. broker/dealers, and with 
foreign-resident central securities depositories.
     Using custodian code 88, submit summary data on foreign 
securities held directly, managed directly, or held with U.S.-resident 
central securities depositories (and for which no U.S.-resident 
custodian is used).''
    In addition, codes 77 and 88 are included in Appendix F: ``List of 
Custodian Codes''.
    (13) Some other clarifications may be made in other parts of the 
instructions.
    The changes will improve overall survey reporting.
    Type of Review: Revision of currently approved data collection.
    Affected Public: Business/Financial Institutions.
    Form: TIC SHC/SHCA, Schedules 1, 2 and 3 (1505-0146).
    Estimated Number of Respondents: An annual average (over five 
years) of 306, but this varies widely from about 785 in benchmark years 
(once every five years) to about 190 in other years (four out of every 
five years).
    Estimated Average Time per Respondent: An annual average (over five 
years) of about 174 hours, but this will vary widely from respondent to 
respondent. (a) In the year of a benchmark survey, which is conducted 
once every five years, it is estimated that exempt respondents will 
require an average of 17 hours; custodians of securities providing 
security-by-security information will require an average of 361 hours, 
but this figure will vary widely for individual custodians; end-
investors providing security-by-security information will require an 
average of 121 hours; and end-investors and custodians employing U.S. 
custodians will require an average of 41 hours. (b) In a non-benchmark 
year, which occurs four years out of every five years: Custodians of 
securities providing security-by-security information will require an 
average of 546 hours (because only the largest U.S.-resident custodians 
will report), but this figure will vary widely for individual 
custodians; end-investors providing security-by-security information 
will require an average of 146 hours; and reporters entrusting their 
foreign securities to U.S. custodians will require an average of 49 
hours. The exemption level, which applies only in benchmark years when 
filing schedules 2 or 3 or both, for custodians and for end-investors 
is the holding of less than $200 million in reportable foreign 
securities owned by U.S. residents. For schedule 2, end-investors 
should exclude securities that are held with their unaffiliated U.S.-
resident custodians.
    Estimated Total Annual Burden Hours: An annual average (over five 
years) of 53,260 hours.
    Frequency of Response: Annual.
    Request for Comments: Comments submitted in response to this notice 
will be summarized and/or included in the request for Office of 
Management and Budget approval. All comments will become a matter of 
public record. The public is invited to submit written comments 
concerning: (a) Whether the Survey is necessary for the proper 
performance of the functions of the Office of International Affairs 
within the Department of the Treasury, including whether the 
information collected will have practical uses; (b) the accuracy of the 
above estimate of the burdens; (c) ways to enhance the quality, 
usefulness and clarity of the information to be collected; (d) ways to 
minimize the reporting and/or record keeping burdens on respondents, 
including the use of information technologies to automate the 
collection of the data requested; and (e) estimates of capital or 
start-up costs of operation, maintenance and purchase of services to 
provide the information requested.

Dwight Wolkow,
Administrator, International Portfolio Investment Data Systems.
[FR Doc. 2017-12361 Filed 6-14-17; 8:45 am]
 BILLING CODE 4810-25-P