"Cross-Border Investments and New Reporting Requirements for Private Funds: TIC Form SLT"

The Department of the Treasury has implemented a new reporting requirement that requires long-term foreign investments, defined as long-term U.S. investments in foreign securities and/or long-term foreign investments in securities issued by U.S. residents, to be reported to the Federal Reserve.  Such investments will be reported on the new Treasury International Capital ("TIC") Form SLT ("Form SLT").  Three types of entities are eligible to report as holders of foreign investments: (1) U.S.-resident custodians of securities (including U.S.-resident central depositories), (2) U.S.-resident issuers of U.S. securities purchased by foreign residents, and (3) U.S.-resident end-investors.

Form SLT is relevant for private funds as holders of covered securities.  For example, if a U.S. fund entity owns non-U.S. securities, the U.S. investment manager may be required to report such ownership.  Additionally, in a typical master-feeder fund structure, the U.S. investment manager of a U.S. feeder fund that holds interests in an offshore master fund may be required to report the U.S. feeder fund's ownership of the interests in the master fund as a U.S. end-investor (regardless of whether the Cayman Islands master fund owns any U.S. securities).