DEPARTMENT OF THE TREASURY

Office of the Assistant Secretary for Economic Policy

31 CFR Part 129

Benchmark Survey of U.S. Ownership of Foreign Long-Term Securities as of March
31, 1994

AGENCY: Departmental Offices, Department of the Treasury.

ACTION: Notice of reporting requirements and availability of survey forms and
instructions.

SUMMARY: By this Notice, the Department of the Treasury is informing the
public that it is conducting a mandatory survey to measure the magnitude,
aggregate market value, and character of foreign long-term securities owned by
United States persons (defined below) for portfolio investment purposes. The
current survey is the first comprehensive attempt to evaluate U.S. long-term
portfolio investment abroad since May 1943. The data that will be collected on
this survey will be used to improve the measurement of official balance of
payments and national income accounts and the international investment
position of the United States.

The survey has been designed to collect accurate and complete information on
the ownership of foreign long-term securities by United States persons as of
March 31, 1994 while keeping reporting requirements to a minimum. For the
purposes of this survey, foreign long-term securities include all foreign
equities, including subscription rights and warrants, and all foreign debt
securities whose term-to-maturity from date of issue (i.e., original maturity)
is more than one year. More detailed instructions on what securities to report
(and what not to report) on this survey are provided in the Survey Forms and
Instructions.

This Notice constitutes legal notification to all United States persons
(defined below) who meet the reporting requirements set forth in the section
below on Who Must Report that they must respond to, and comply with, this
survey. United States persons who meet the reporting requirements but who do
not receive a set of the survey forms and instructions should contact the
Department of Treasury at (202) 622Ä2240 to obtain a copy.

DATES: All United States persons who receive a set of survey forms and
instructions must acknowledge their receipt by December 31, 1993 or 30 days
after receipt, whichever is later. More detailed instructions on how to
acknowledge receipt of the Survey Forms and Instructions are provided in the
ACTION GUIDE to the Department of the Treasury Benchmark Survey of U.S.
Ownership of Foreign Long-Term Securities as of March 31, 1994, which is
contained in the survey forms and instructions booklet. All reports, including
applications to file for an exemption from reporting on this survey, must be
mailed to the Department of the Treasury by June 30, 1994.

ADDRESSES: All reports, including acknowledgements of receipt of the Survey
Forms and Instructions as well as applications to file for an exemption from
reporting on this survey, should be mailed to: Department of the Treasury,
Outbound Portfolio Investment Survey Project, room 5438 Main Treasury
Building, 1500 Pennsylvania Avenue, NW., Washington, DC.

FOR FURTHER INFORMATION CONTACT: Milton Pappas, Director of the Outbound
Portfolio Investment Survey, Office of the Assistant Secretary for Economic
Policy, Department of the Treasury, Washington, DC 20220, Telephone (202)
622Ä2240, FAX (202) 622Ä1294.

SUPPLEMENTARY INFORMATION: The International Investment and Trade in Services
Act (22 U.S.C. 3101 et. seq., [the Act]), as amended, and E.O. 11961 of
January 19, 1977 (42 FR 4321), as amended, authorizes the Department of
Treasury to conduct a regular data collection program, including such studies
and surveys as may be necessary and feasible, to secure current information on
international portfolio investment, including (but not limited to) such
information as may be necessary for computing and analyzing the balance of
payments and international investment position of the United States.
Regulations 31 CFR part 129  governing the current survey were published in
the Federal Register, May 27, 1993, 58 FR 30707Ä30708. It was stated in the
Supplementary Information section that notice of specific surveys, including
applicable report forms and instructions, would be published separately in the
Federal Register.

Definitions

For purposes of reporting requirements on this survey:

(a) "Direct investment'' means the ownership or control, directly or
indirectly, by one person of 10 percent or more of the voting securities of an
incorporated business enterprise or an equivalent interest in an
unincorporated business enterprise.

(b) "Foreign'', when used in a geographic sense, means that which is situated
outside the United States or which belongs to or is characteristic of a
country other than the United States. International organizations such as the
International Bank for Reconstruction and Development (IBRD), or World Bank,
and the Inter-American Development Bank (IDB) are also considered to be
foreign even if they are physically located in the United States.

(c) "Foreign person'' means any person (defined below), including a United
States citizen, resident outside the United States or subject to the
jurisdiction of a country other than the United States.

(d) "Foreign security'' means a security that is issued by legal entities
organized under the laws and subject to the jurisdiction of the courts of a
foreign country, such as a foreign business enterprise or government, and a
security that is issued by an international organization such as the IBRD or
the IDB. The types of foreign securities to report on this survey include all
foreign equities, including subscription rights and warrants, and all foreign
debt securities whose term-to-maturity from date of issue (i.e., original
maturity) is more than one year.

(e) "Person'' means any individual, branch, partnership, associated group,
association, estate, trust, corporation, or other organization (whether or not
organized under the laws of any State), and any government (including a
foreign government, the United States Government, a State or local government,
and any agency, corporation, financial institution, or other entity or
instrumentality thereof, including a government-sponsored agency).

(f) "Portfolio investment'' means any investment that is not direct
investment.

(g) "United States'', when used in a geographic sense, means the several
States, the District of Columbia, the Commonwealth of Puerto Rico, and the
territories and possessions of the United States.

(h) "United States parent'' means any United States person who owns or
controls, directly or indirectly, 10 percent or more of the voting securities
of an incorporate United States business enterprise, or an equivalent interest
in an unincorporated United States business enterprise.

(i) "United States person'' means any person (defined above), including a
foreign citizen, resident in the United States or subject to the jurisdiction
of the United States.

Who Must Report

All United States persons who manage the custody or safekeeping of foreign
long-term securities for themselves and/or on behalf of other United States
persons, if the total market value of these securities aggregated over all
accounts, including own custody accounts is at least $20 million on an actual
settlement-date basis as of March 31, 1994.

All United States persons who own foreign long-term securities and/or who have
the authority to purchase or sell these types of securities on behalf of other
United States persons, if the total market value of owned securities
aggregated over all United States funds under their management is at least $5
million on an actual settlement-date basis as of March 31, 1994.

Any other United States persons who receive a set of survey forms and
instructions.

How To Report

Respondents may file either single reports based on the consolidated business
operations of the parent company and all its affiliates in the United States;
or, if their normal business practice dictates, the parent company and its
individual affiliates in the United States may file separate reports based on
their respective business operations. Respondents who maintain multiple
systems to manage the safekeeping of foreign long-term securities may file
separate reports for each system.

Respondents who are submitting multiple reports for the same parent company
should inform survey staff members at (202) 622Ä2240 that separate reports are
being prepared and should obtain different control numbers for each
submission. However, respondents must consolidate their own accounts and the
accounts of all their affiliates in the United States to determine whether
they are exempt from reporting on this survey. More detailed instructions on
how to report on this survey, along with applicable report forms, are provided
in the Survey Forms and Instructions.

Enforcement Provided by Law

Respondents are advised that United States persons who meet the reporting
requirements set forth in this Notice and who fail to respond to, and to
comply with, this survey may be subject to civil and/or criminal penalties
provided by law, including injunctive relief ordering such person to comply;
and, if an individual, to imprisonment not to exceed one year; any officer,
director, employee, or agent of any corporation who knowingly participates in
such failure to comply, upon conviction, may also be punished by a like fine,
imprisonment, or both (22 U.S.C. 3105).

Dated: December 14, 1993.

Alicia H. Munnell,

Assistant Secretary for Economic Policy.

[FR Doc. 93Ä31241 Filed 12Ä27Ä93; 8:45 am]

BILLING CODE 4810Ä25ÄM

Office of Foreign Assets Control 31 CFR Part 500

Foreign Assets Control Regulations; Participation in International
Institutions' Development Projects in Vietnam

AGENCY: Office of Foreign Assets Control, Treasury.

ACTION: Final rule; amendments.

SUMMARY: This rule amends the Foreign Assets Control Regulations to announce
the availability of a general license permitting participation by persons
subject to U.S. jurisdiction in development projects in Vietnam formally
proposed, approved, executed, funded or sponsored by an international
institution listed in a new appendix A to the regulations, subject to certain
registration and reporting requirements. Specific licenses may be issued to
permit co-financing of or lending to such development projects. A further
general license is added to permit banking institutions subject to U.S.
jurisdiction to process transactions of the named international institutions
with respect to Vietnam.

EFFECTIVE DATE: December 23, 1993.

FOR FURTHER INFORMATION CONTACT: Steven I. Pinter, Chief of Licensing (tel.:
202/622Ä2480), Dennis P. Wood, Chief of Compliance Programs (tel.:
202/622Ä2490), or William B. Hoffman, Chief Counsel (tel.: 202/622Ä2410),
Office of Foreign Assets Control, Department of the Treasury, Washington, DC
20220.

SUPPLEMENTARY INFORMATION:

Electronic Availability

This document is available as an electronic file on The Federal Bulletin Board
the day of publication in the Federal Register. By modem dial 202/512Ä1387 or
call 202/512Ä1530 for disks or paper copies. This file is available in
Postscript, WordPerfect 5.1 and ASCII.

Background

In support of the President's decision of September 13, 1993, to recognize the
recent steps taken by the Vietnamese government and encourage further progress
on achieving the fullest possible accounting on U.S. prisoner of war and
missing in action cases from the Vietnam war, the Office of Foreign Assets
Control ("FAC'') is amending the Foreign Assets Control Regulations, 31 CFR
part 500 (the "FACR''), to add  500.576, which generally authorizes the
participation by persons subject to U.S. jurisdiction in development projects
in Vietnam formally proposed or approved for execution, funding or sponsorship
by certain international institutions, such as the International Bank for
Reconstruction and Development (the "World Bank''), the Asian Development
Bank, the United Nations Development Program, and the World Health
Organization. A list of qualified international institutions appears in new
appendix A to the FACR.

Once a project (or a feasibility study for a project) has been formally
proposed or approved by a qualified international institution for execution,
funding or sponsorship by that institution (hereinafter referred to as a
"Qualified Project''), persons subject to U.S. jurisdiction may, upon
registration with FAC, provide both goods and services in relation to the
Qualified Project, as contractors, subcontractors, or suppliers of related
goods or services. An initial registration and annual reports are required to
be filed with FAC with respect to the authorized transactions, as provided in
 500.576(d) and (e). No specific funding level on the part of qualified
international institutions is required. This authorization also permits equity
participation with qualified international institutions in Qualified Projects,
as well as equity participation by persons subject to U.S. jurisdiction in
entities in Vietnam, such as joint venture corporations, established
exclusively to participate in Qualified Projects. Co-financing of or lending
to Qualified Projects in Vietnam may be authorized by specific license on a
case-by-case basis. Certain preparatory transactions may be undertaken by
persons subject to U.S. jurisdiction with respect to proposed projects under
specific licenses issued pursuant to FACR  500.574, concerning executory
contracts in which Vietnam or a Vietnamese national has an interest.

The authorization in  500.576 does not permit performance of contracts or
participation in development projects or feasibility studies for development
projects prior to the formal proposal or approval of the projects or studies
by a qualified international institution. Such participation is prohibited
unless otherwise authorized, for example, by  500.574 with respect to certain
executory contracts in which Vietnam or a Vietnamese national has an interest.
Section 500.413 is added to provide examples interpreting the scope of the
authorization contained in this section.

Exports or reexports to Vietnam of goods and technical data or of the direct
products of technical data (regardless of U.S. content), in connection with
activities authorized by FAC with respect to Qualified Projects may require
additional authorization from the U.S. Department of Commerce pursuant to the
Export Administration Regulations, 15 CFR parts 768Ä799.

The FACR are also amended to add  500.577, authorizing by general license
banking institutions subject to United States jurisdiction to process all
transactions of qualified international institutions with respect to Vietnam.

Because the FACR involve a foreign affairs function, Executive Order 12866 and
the provisions of the Administrative Procedure Act, 5 U.S.C. 553, requiring
notice of proposed rulemaking, opportunity for public participation, and delay
in effective date, are inapplicable. Because no notice of proposed rulemaking
is required for this rule, the Regulatory Flexibility Act, 5 U.S.C. 601 et
seq., does not apply.

This rule is being issued without prior notice and public procedure pursuant
to the Administrative Procedure Act. For this reason, the collection of
information contained in FACR  500.576(c) has been reviewed and, pending
receipt and evaluation of public comments, approved by the Office of
Management and Budget under control number 1501Ä****. Comments concerning the
average annual burden and suggestions for reducing this burden should be
directed to the Office of Management and Budget, Paperwork Reduction Project,
Washington, D.C. 20503, with copies to the Office of Foreign Assets Control,
U.S. Department of the Treasury, 1500 Pennsylvania Avenue, NW Annex,
Washington, DC 20220. Any such comments should be submitted not later than
February 28, 1994.

The collection of information in this rule is contained in FACR  500.576(d)
and (e). This information is required by the Office of Foreign Assets Control
for compliance and enforcement purposes. This information will be used to
determine the identity of organizations availing themselves of the general
license in  500.576, to determine whether persons subject to the FACR are in
compliance with applicable requirements, and to determine whether and to what
extent enforcement action is appropriate. The likely respondents are
businesses.

Estimated total annual reporting and or recordkeeping burden: 600 hours.

The estimated annual burden per respondent/recordkeeper is expected to be 4
hours.

The estimated number of respondents and/or recordkeepers: 150.

Estimated annual frequency of responses: 1.

List of Subjects in 31 CFR Part 500

Administrative practice and procedure, Banks, Banking, Blocking of assets,
Cambodia, Communist countries, Currency, Exports, Finance, Foreign Claims,
Foreign investment, Foreign trade, International organizations, North Korea,
Penalties, Reporting and recordkeeping requirements, Securities, Services,
Telecommunications, Travel restrictions, Vietnam.

For the reasons set forth in the preamble, 31 CFR part 500 is amended as
follows:

PART 500 FOREIGN ASSETS CONTROL REGULATIONS

1. The authority citation for part 500 continues to read as follows:

Authority: 50 U.S.C. App. 1Ä44; E.O. 9193, 3 CFR, 1938Ä1943 Comp., p. 1174;
E.O. 9989, 3 CFR, 1943Ä1948 Comp., p. 748.

Subpart D Interpretations

2. Section 500.413 is added to subpart D to read as follows:

 500.413 Participation in certain development projects in Vietnam.

The following examples illustrate the scope of the authorization in  500.576
for dealings in property in which Vietnam or a Vietnamese national has an
interest with respect to development projects in Vietnam formally proposed or
approved for execution, funding or sponsorship by a qualified international
institution listed in appendix A to this part ("Qualified Projects'').

Example ñ 1: The Government of Vietnam ("Vietnam'') approaches a U.S.
financial consulting firm (the "U.S. Consulting Firm'') for advice on building
cement plants in Hanoi and Ho Chi Minh City. The project might be eligible for
funding by the Asian Development Bank (the "ADB''), and Vietnam wants the U.S.
Consulting Firm's assistance in conducting a feasibility study for submission
to the ADB. Since the project has not yet been formally proposed or approved
for funding by the ADB, no involvement of the U.S. Consulting Firm is
authorized pursuant to  500.576. However, had the ADB formally proposed the
project in its monthly ADB Business Opportunities as a project being
considered for funding, or had it funded the feasibility study,  500.576
would authorize the U.S. Consulting Firm's transactions.

Example ñ 2: Upon ADB approval of funding for the cement plant project, a U.S.
company (the "U.S. Company'') forms a joint venture with a Vietnamese company
to bid on construction of the cement plants in Hanoi and Ho Chi Minh City. The
joint venture's bid is successful, and it purchases construction equipment
from the United States, financed by a U.S. bank and insured by a U.S. company.
Several items are sourced from the United States during construction,
including cement equipment, which is covered by a ten-year service and
maintenance agreement. The joint venture agreement calls for the continued
management and operation of the plants by the U.S. Company after completion,
and for the insurance of the plants by a U.S. insurance company. Each of these
transactions with respect to the Qualified Project is authorized by  500.576.

Example ñ 3: The International Finance Corporation ("IFC'') offers equity
investment in a Vietnamese company to finance environmental safeguards for
drilling operations in offshore oil fields. Various U.S. investors, including
venture capital companies, brokerage firms, and investment banks contribute
capital and receive shares in the Vietnamese company. This equity investment
in a Qualified Project is authorized by  500.576. The U.S. companies
purchasing these shares as part of the IFC-sponsored development project may
hold or resell them, including resale to other persons subject to U.S.
jurisdiction. Shares acquired by entities not subject to U.S. jurisdiction may
not then be purchased or repurchased by a person subject to U.S. jurisdiction.

Example ñ 4: (a) An Indonesian company (the "Contractor'') is a successful
bidder on a Qualified Project, and hires a U.S. law firm to represent it in
contract negotiations with Vietnam to build a fish processing and canning
facility in Vietnam funded by the World Bank. The law firm may represent the
Contractor throughout the course of the project pursuant to  500.576, once
the project has been formally proposed or approved for funding by the World
Bank.

(b) Once the Qualified Project is underway, the Contractor purchases equipment
manufactured in France by a French company. The long-term servicing of the
equipment, however, will be provided by the French company's U.S. subsidiary.
The service transactions are authorized pursuant to  500.576.

(c) After the processing facility is completed, Vietnam hires a U.S. marketing
firm to develop marketing strategies for the product worldwide. It further
asks the marketing firm to execute the strategies it devises and to represent
the product in South-East Asia, including the domestic market in Vietnam. The
marketing firm in turn would hire the brokerage services of a U.S. citizen
domiciled in Thailand for the sale of the product to that country. These
transactions are outside the scope of  500.576, and violate  500.201,
because they are not directly incident to the Qualified Project funded by the
World Bank.

Subpart E Licenses, Authorizations, and Statements of Licensing Policy

3. Section 500.576 is added to subpart E to read as follows:

 500.576 Authorization of transactions concerning certain development
projects in Vietnam.

(a) All transactions by persons subject to U.S. jurisdiction in connection
with participation in development projects in Vietnam formally proposed or
approved for execution, funding or sponsorship by the international
institutions listed in appendix A to this part ("Qualified Projects'') are
authorized. For purposes of this section, Qualified Projects include
investment projects, structural adjustment lending, sector adjustment lending,
International Monetary Fund balance-of-payments support, and general
development assistance including grants, technical assistance, and loans.

(b) Persons subject to U.S. jurisdiction may provide both goods and services
to any party contracting to participate in a Qualified Project pursuant to the
authorization contained in this section.

(1) Services may include financial, legal, consulting, insurance, shipping and
other services.

(2) Persons subject to U.S jurisdiction may participate in Qualified Projects
as suppliers, contractors, or subcontractors, and through joint ventures with
third-country nationals and Vietnamese nationals.

(3) Persons subject to U.S. jurisdiction may finance, or guarantee the
performance of, activities of U.S. participants in a Qualified Project;
co-financing of or lending to the Qualified Project itself by a person subject
to U.S. jurisdiction may be authorized by specific license pursuant to 
500.801.

Illustrative examples of transactions covered by this section are set forth in
 500.413.

(c) Except as otherwise authorized, persons subject to U.S. jurisdiction may
not participate in development projects in Vietnam that are bilaterally funded
and administered, or in projects or feasibility studies prior to formal
proposal or approval by a qualified international institution for its
involvement in the project or study. If a qualified international institution
formally proposes but thereafter rejects, terminates, or abandons a project,
the project shall no longer constitute a Qualified Project for purposes of
this section. Except as otherwise specifically authorized pursuant to this
part, persons subject to U.S. jurisdiction may not enter into any new
commitments with respect to the project after the date of such rejection,
termination, or abandonment. In addition, this section does not authorize:

(1) the importation of Vietnamese-origin goods into the United States, except
as required to honor service or warranty contracts associated with Qualified
Projects;

(2) offshore transactions of persons subject to U.S. jurisdiction involving
the sale of Vietnamese-origin goods between Vietnam and third countries, or
among third countries;

(3) flights into or out of Vietnam by aircraft owned or controlled by persons
subject to U.S. jurisdiction, except when such persons transport, on aircraft
they own, only passengers or cargo associated with a Qualified Project in
which such persons are participating pursuant to this section;

(4) the use in Vietnam of credit cards issued by a U.S. banking institution;
or

(5) a debit to a blocked account.

Example: A Vietnamese highway project feasibility study financed by a
third-country development agency is not a Qualified Project for purposes of
this section. However, the feasibility study would be a Qualified Project,
notwithstanding the bilateral funding, if the International Development
Association had formally proposed the highway project as one under
consideration for funding in its Monthly Operational Summary of World Bank and
IDA Proposed Projects.

(d) Within 10 business days after entering into an agreement for goods,
services, financing, investment, or other participation in or related to a
Qualified Project, the person(s) subject to U.S. jurisdiction entering into
the agreement must register with the Office of Foreign Assets Control,
Compliance Division, U.S. Department of the Treasury, 1500 Pennsylvania
Avenue, NW Annex, Washington, DC 20220. The registration shall reference the
fact that the agreement was entered into pursuant to 31 CFR 500.576(a), and
shall provide:

(1) the name, address, telephone and facsimile numbers, and nationality of the
person(s) subject to U.S. jurisdiction;

(2) if the reporting party is not an individual, the name, address, telephone
and facsimile numbers of the individual to contact for further information,

(3) the name of the international institution listed in appendix A formally
proposing, approving, executing, funding, or sponsoring the project;

(4) the name and a brief description of the project in Vietnam (with any
contract, project, request for bid, or other identifying number);

(5) a brief description of the activity covered by the agreement, and the
contract value; and

(6) if the reporting party is a subcontractor, the prime contractor's name,
address, and nationality, and those of all intermediate subcontractors.

Registration is not required of agencies of the Federal Government
participating in Qualified Projects.

(e) Upon registration meeting the requirements of paragraph (d) of this
section, the Office of Foreign Assets Control will assign a registration
number to the contract involved. This number should be referenced in all funds
transfers and other banking transactions that take place through banks subject
to U.S. jurisdiction, and in all U.S. export documents, in connection with the
Qualified Project in Vietnam in order to avoid the blocking of such funds and
to facilitate export transactions.

(f) Annual reports must be filed with the Office of Foreign Assets Control on
the anniversary of the issuance of a contract registration number, briefly
describing the status of the project and any material changes in the
information originally provided.

Note to  500.576: Exports or reexports to Vietnam of goods and technical
data, or of the direct products of technical data (regardless of U.S.
content), in connection with activities licensed by FAC may require
authorization from the U.S. Department of Commerce pursuant to the Export
Administration Regulations, 15 CFR parts 768Ä799.

4. Section 500.577 is added to subpart E read as follows:

 500.577 Authorization of bank transactions with respect to Vietnam by
certain international organizations.

All transactions by banking institutions subject to U.S. jurisdiction
incidental to the processing of transactions of the international institutions
identified in appendix A with reference to Vietnam are authorized.

Example: A transfer to Vietnam or a Vietnamese national of funds from the U.S.
account of a qualified international institution listed in appendix A to this
part, for a program, rent or salary payment, is not blocked under this part.

5. Appendix A is added to the end of part 500 read as follows:

Appendix A to Part 500 Qualifying International Institutions

Asian Development Bank (ADB)

Food and Agricultural Organization (FAO)

International Bank for Reconstruction and Development (IBRD, the "World
Bank'')

International Civil Aviation Organization (ICAO)

International Development Association (IDA)

International Finance Corporation (IFC)

International Fund for Agricultural Development (IFAD)

International Labor Organization (ILO)

International Maritime Organization (IMO)

International Monetary Fund (IMF)

Multilateral Investment Guarantee Association (MIGA)

UN Capital Development Fund (UNCDF)

UN Children's Fund (UNICEF)

UN Development Fund for Women (UNDFW)

UN Development Program (UNDP)

UN Economic & Social Commission for Asian and the Pacific (UNESCAP)

UN Education, Scientific and Cultural Organization (UNESCO)

UN Environment Program (UNEP)

UN Food Program (UNFP)

UN Industrial Development Organization (UNIDO)

UN International Drug Control Program (UNIDCP)

UN Population Fund (UNPF)

World Health Organization (WHO)

World Meteorological Organization (WMO)

Dated: December 17, 1993.

R. Richard Newcomb,

Director, Office of Foreign Assets Control.

Approved: December 20, 1993.

John P. Simpson,

Deputy Assistant Secretary (Regulatory, Tariff and Trade Enforcement).

[FR Doc. 93Ä31749 Filed 12Ä23Ä93; 10:35 am]

BILLING CODE 4810Ä25ÄF