1302004 Informal Interpretation

Verne. B. Michael
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Mike and Kate -
Tuesday, February 12, 2013 2:51 PM
Verne, B. Michael; Walsh, Kathryn
I tem 8 -- Foreign Person's Prior Acqu is itions of Fo reign Entities
I have a question about Item 8 on which I've been unable to find any prior informal advice, perhaps
because it results from relatively recent changes to the form and rules.
Item 5 is limited to U.S. operations and sales into the U.S. , and the Item 5 data is the basis for
identifying overlapping NAICS codes. 	It is clear from Item 7 that the information called for there
likewise is limited to U.S. operations and revenues.
Since Items 5 and 7 drive Item 8, it seems logical that in responding to Item 8 you should not need to
consider prior acquisitions by a foreign person of foreign entities if those entities have no U.S.
reven!Je that is counted for Item 5 purposes (that is, they themselves have. no sales in or into the
U.S.). 	.
Prior to the 2011 changes to the form and rules, it was clear that Item 8 did not cover foreign
acquisitions, as former Rule 803.2(c)(1) limited responses to Items 5, 7 and 8 to information "with
respect to operations conducted within the United States." See Notice of Proposed Rulemaking, 75
Fed. Reg. 57110 (Sept. 17, 201 0). While that provision was deleted, the NOPR makes clear that the
only non-U.S. information now required involves foreign entities that have U.S. operations or
revenues. 	See id. at 57111, 57117, 57121. (The only change made to Item 8 was to include non-
corporate interests, id. at 57119.)
That continuing limitation is evident from the Item 5 instructions, the PNO website's resource sheets
for Items 5 and 6 and the text of Item 7. 	However, because it is not expressly stated in the Item 8
instructions, I wanted to confirm with you that Item 8 is limited to a foreign person's prior acquisitions
of entities having U.S. revenues reported in Item 5 (as well as being subject to the other cut-offs in
those Instructions).
Thanks as always for your help. ~~ ':> 	\ s 	c.. 0 f'V'-'C.. <-\
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