Archive:Foreign-controlled enterprises

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Statistics on the structure and activity of foreign affiliates (FATS) provide information that can be used to assess the impact of foreign-controlled enterprises on the economy of the European Union (EU). The data may also be used to monitor the effectiveness of the internal market and the gradual integration of economies within the context of globalisation.

Main findings

• In general, foreign-controlled enterprises are few in number, but due to their larger than average size they have a significant economic impact.

• In all countries participating, foreign-controlled enterprises accounted on average for less than 1 % of the total enterprise population within the non-financial business economy in 2006, but usually generated more than 15 % of value added and contributed more than 10 % of total employment.

• When ranking countries according to the contribution of foreign-controlled enterprises, the highest shares were registered in Hungary, Slovakia and Estonia, where foreign-controlled enterprises accounted for about 40-45 % of the value added that was generated in the non-financial business economy.

• The activity (at the NACE Rev. 1.1 section level) where foreign-controlled enterprises generated their highest proportion of total value added was the manufacturing sector, while hotels and restaurants and the construction sector reported the lowest shares. The mining and quarrying sector recorded one of the lowest shares in terms of value added but one of the highest in terms of employment, which in part reflected the exclusion of confidential figures for Romania from the EU average for value added.

• In 2006 foreign affiliates of enterprises originating from Belgium, the Czech Republic, Germany, Greece, Italy, Latvia, Austria, Portugal, Slovakia, Finland and Sweden employed almost 8.2 million people and generated a combined turnover (excluding data for Sweden) of about EUR 2 300 billion.

Inward FATS

A foreign affiliate as defined in inward FATS statistics is an enterprise resident in a country which is under the control of an institutional unit not resident in the same country. Control is determined according to the concept of the 'ultimate controlling institutional unit' (UCI). The UCI is the institutional unit, proceeding up a foreign affiliate’s chain of control, which is not controlled by another institutional unit. Note that commercial presence in the territory of another country is only one of the modes of delivery of economic activities abroad. Data on inward FATS has been collected on a voluntary basis since reference year 1996. Currently, some 21 countries participate in this data collection exercise.

Outward FATS

Outward FATS are statistics describing the activity of foreign affiliates abroad controlled by UCIs located in the declaring country. In total, 13 countries provide these data on a voluntary basis, for some the first reference year dates back to 1995.

Legislative developments

Regulation 716/2007 of 20 June 2007 on Community statistics on the structure and activity of foreign affiliates ('FATS Regulation') foresees the availability, at EU level, of annual data on foreign affiliates from reference year 2007 onwards - covering all statistics on foreign affiliates - in other words, both inward and outward FATS.

Methodological background

The FATS recommendations manual provides the definitions and guidelines for national compilers and ensures meaningful and harmonised statistics at an EU level. Further information on methodology is available in the SDMX metadata for inward FATS and for outward FATS.

See also

• Foreign affiliates statistics - FATS
• Balance of payment statistics
• Globalised businesses
• Structural business statistics - theme navigation page
• Structural business statistics introduced - background article

Further Eurostat information

Publications

• Foreign-controlled enterprises in the EU - Statistics in focus 30/2008
• Foreign AffiliaTes Statistics (FATS) - Recommendations Manual

Database

• Structural business statistics, see:

Foreign controlled EU enterprises - inward FATS (fats)

Foreign control of enterprises - NACE Rev. 2 (from 2008 onwards) (fats_08)

Foreign control of enterprises - NACE Rev. 1.1 (2003-2007) (fats_03)

Foreign control of enterprises - NACE Rev. 1.1 (1996-2002) (fats_96)

Foreign affiliates of EU enterprises - outward FATS (fats_out)

Foreign affiliates of EU enterprises - NACE Rev.2, from 2010 onwards (fats_out_r2)

Foreign affiliates of EU enterprises - NACE Rev.1, 2004-2009 (fats_out_r1)

Dedicated section

• Structural business statistics

Methodology / Metadata

• Foreign controlled EU enterprises - inward FATS (ESMS metadata file — fats_esms)

Source data for tables and figures (MS Excel)

• Tables and figures on foreign controlled enterprises

Other information

• Globalised businesses
• Regulation 716/2007 of 20 June 2007 on Community statistics on the structure and activity of foreign affiliates
• Regulation 364/2008 of 23 April 2008 implementing Regulation 716/2007 as regards the technical format for the transmission of foreign affiliates statistics and the derogations to be granted to Member States
• Regulation 747/2008 of 30 July 2008 amending Regulation 716/2007 on Community statistics on the structure and activity of foreign affiliates, as regards the definitions of characteristics and the implementation of NACE Rev. 2