TIC Form SHC Deadline Approaching to Report U.S. Ownership of Foreign Securities

by Proskauer - Not for Profit/Exempt Organizations
Contact

Form Deadline Is March 3, 2017

Introduction
The U.S. Department of the Treasury recently released a revised Form SHC (with corresponding instructions), which is part of the Treasury International Capital (TIC) data reporting system. Form SHC is the mandatory five-year benchmark survey of the ownership of foreign securities (including selected money market instruments) by U.S. residents. The report is due to the Federal Reserve Board of NY (the FRBNY) by March 3, 2017 for data reportable as of December 31, 2016. U.S. persons who meet the reporting thresholds are required to file Form SHC even if they have not otherwise been contacted by the FRBNY.

Who Must Report
Form SHC must be filed by all U.S. persons (including U.S. person affiliates of foreign entities) who are:

  • U.S.-resident end-investors who invest for their own portfolios (such as pension plans, foundation, endowments and other institutional investors) and/or invest on behalf of others (such as investment managers and fund sponsors) at least $200 million of reportable foreign securities as of the close of business on December 31, 2016;
  • U.S.-resident custodians who hold in safekeeping at least $200 million of reportable foreign securities for U.S. persons as of the close of business on December 31, 2016; or
  • U.S.-resident end-investors and custodians who receive a letter from the FRBNY requiring them to report, even if the recipient of the letter does not meet the $200 million reporting threshold. The FRBNY has recently begun sending such letters to certain U.S. persons who are required to report on Form SHC.

In general, reportable securities include foreign equity securities, short-term debt securities (including selected money market instruments), long-term debt securities and asset-backed securities. Equity interests or other securities issued by foreign-resident funds or similar investment vehicles (e.g., interests issued by a non-U.S. master fund to a U.S. feeder fund) qualify as reportable securities. Reportable foreign securities do not include, among other things, direct investments (ownership of 10% or more of the voting securities of an entity); derivatives; loans and loan participation certificates; bank deposits; foreign securities temporarily acquired under reverse repurchase, borrowing or lending arrangements; the underlying security of a depositary receipt; or any U.S. securities.

In the case of an organization, reports should be filed on a consolidated basis by the top U.S.-resident parent entity in the organization and should include all reportable securities held or managed by all U.S.-resident parts of the organization, including all U.S.-resident branches, offices and subsidiaries. Generally, a U.S.-resident investment adviser that is subject to the reporting obligation will be required to file one consolidated report covering the reportable securities for all U.S.-resident parts of its own organization and for all U.S.-resident funds that it manages or sponsors. Furthermore, a U.S.-resident fund managed by a foreign-resident investment adviser that meets the reporting threshold will be required to submit a report.

Information Required by Form SHC
Form SHC is comprised of three schedules:

  • Schedule 1 requests identifying information from the U.S. reporter and a summary of Schedules 2 and 3 (if applicable). Schedule 1 must be filed by all U.S. reporters that (i) meet the reporting threshold or (ii) were contacted by the FRBNY to report on Form SHC.
  • Schedule 2 requests position-level data from a U.S. reporter on foreign securities for which (i) the U.S. reporter manages safekeeping for itself or its U.S.-resident clients or (ii) a U.S.-resident custodian does not otherwise manage the safekeeping (which includes, for the avoidance of doubt, foreign securities safe-kept directly at a foreign-resident sub-custodian or U.S.-resident or foreign-resident central securities depositories (“CSDs”)). A U.S. reporter must file a separate Schedule 2 for each reportable security. A U.S. reporter is exempt from reporting on Schedule 2 if the total fair value of foreign securities reportable on Schedule 2 is less than $200 million.
  • Schedule 3 is used to report summary amounts for all foreign securities entrusted to an unaffiliated U.S.-resident custodian (excluding those entrusted to a U.S.-resident CSD). A U.S. reporter (including a U.S.-resident end-investor) must file a separate Schedule 3 for each U.S.-resident custodian with which the reporter has holdings of foreign securities that exceed $200 million, aggregated over all accounts with such custodian.

Confidentiality
Completed reports may be submitted to the FRBNY on paper or electronically through the Federal Reserve Reporting Central System. The information collected on Form SHC reports may be used only for analytical and statistical purposes and to enforce the International Investment and Trade in Services Survey Act. The information may only be accessed by officials and employees (including consultants, contractors and their employees) designated to perform functions under such Act. Aggregate data obtained from reports on Form SHC will be publicly disclosed, but only in a manner that will not reveal information as reported by any individual respondent.

Additional information and guidance, including a copy of Form SHC and the Instructions, are available here. .

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Proskauer - Not for Profit/Exempt Organizations | Attorney Advertising

Written by:

Proskauer - Not for Profit/Exempt Organizations
Contact
more
less

Proskauer - Not for Profit/Exempt Organizations on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.