Foreign controlled EU enterprises - inward FATS (fats)

Reference Metadata in Euro SDMX Metadata Structure (ESMS)

Compiling agency: Eurostat, the statistical office of the European Union


Eurostat metadata
Reference metadata
1. Contact
2. Metadata update
3. Statistical presentation
4. Unit of measure
5. Reference Period
6. Institutional Mandate
7. Confidentiality
8. Release policy
9. Frequency of dissemination
10. Accessibility and clarity
11. Quality management
12. Relevance
13. Accuracy
14. Timeliness and punctuality
15. Coherence and comparability
16. Cost and Burden
17. Data revision
18. Statistical processing
19. Comment
Related Metadata
Annexes (including footnotes)



For any question on data and metadata, please contact: EUROPEAN STATISTICAL DATA SUPPORT

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1. Contact Top
1.1. Contact organisation

Eurostat, the statistical office of the European Union

1.2. Contact organisation unit

G2: Structural business statistics and global value chains

1.5. Contact mail address

2920 Luxembourg LUXEMBOURG


2. Metadata update Top
2.1. Metadata last certified 19/05/2015
2.2. Metadata last posted 19/05/2015
2.3. Metadata last update 19/05/2015


3. Statistical presentation Top
3.1. Data description

Foreign Affiliates Statistics (FATS) measure the commercial presence through affiliates in foreign markets. Inward FATS describe the overall activity of foreign affiliates resident in the compiling economy.

Inward FATS deliver information on the following characteristics of foreign affiliates:

  • 11110 Number of enterprises (expressed in units)
  • 12110 Turnover (millions of €)
  • 12120 Production value (m€)
  • 12150 Value added at factor cost (m€)
  • 13110 Total purchases of goods and services (m€)
  • 13120 Purchases of goods and services purchased for resale in the same condition as received (m€)
  • 13310 Personnel costs (m€)
  • 15110 Gross investment in tangible goods (m€)
  • 16110 Number of persons employed (units)
  • 16130 Number of employees on a voluntary basis or if 16110 is not available (units)
  • 22110 Total intra-mural R&D expenditure (from 2009 onwards, biennial, m€)
  • 22120 Total number of R&D personnel (from 2009 onwards, biennial, units)

From reference year 2007 onwards, inward FATS data has been collected according to the Regulation (EC) No 716/2007 of the European Parliament and the Council on Community statistics on the structure and activity of foreign affiliates (the FATS Regulation - consolidated version). Data for reference years 1996-2006 were collected on a voluntary basis and thus they were not complete in terms of country coverage and the methodology of data compilation was not harmonised. From 2007, the FATS Recommendations Manual lays down detailed guidelines for the methodology, collection and compilation in the European Union.

3.2. Classification system

Both of the classifications used, namely the NACE activity classification and the country list are standard lists used in Eurostat statistics.

From reference year 2010, the aggregate for total business economy B-N_S95_X_K includes S95 (Repair of computers and personal and household goods) in order to be coherent with the coverage of structural business statistics. The details on the activity breakdown of the NACE Rev.2 classification as well as the country list of FATS UCIs (see definition below) can be found in the FATS Recommendations Manual (2012 edition). For reference years 2008 and 2009, section S95 is not included in this aggregate, except for Bulgaria for 2009.

The detailed activity breakdown used for reference years 2003-2007 can be seen in the 2007 edition of the FATS Recommendations Manual (Table II.3). Data collection for reference years 1997-2007 covered NACE Rev. 1.1 sections C to K, whereas the 1996 data collection covered NACE Rev. 1 sections G to K.

3.3. Coverage - sector

In general, the economic activity breakdown currently covers NACE Rev. 2 Sections B to N plus division S95. Data on section K of NACE Rev. 2 (financial sector) is provided only for two variables (Number of enterprises and Number of persons employed) and partially for another two variables (divisions K65 and K66 for Turnover and division K64 for Production value) and they are not included in the total business activity aggregate (the BUS aggregate; currently B-N_S95_X_K = BUS).

3.4. Statistical concepts and definitions

Inward Foreign Affiliates Statistics (Inward FATS) are describing the overall activity of foreign affiliates resident in the compiling economy.

Foreign affiliate in the framework of inward FATS shall mean an enterprise resident in the compiling country over which an institutional unit not resident in the compiling country has control.

Control shall mean the ability to determine the general policy of an enterprise by choosing appropriate directors, if necessary. Enterprise A is deemed to be controlled by an institutional unit B when B controls - directly or indirectly - more than half of the shareholders' voting power or more than half of the shares.

Foreign control shall mean that the controlling institutional unit is resident in a different country from the one where the institutional unit over which it has control is resident.

FATS data published by Eurostat are generally broken down by country of ultimate controlling institutional unit (UCI) of a foreign affiliate, which shall mean the institutional unit, proceeding up a foreign affiliate's chain of control, which is not controlled by another institutional unit.

According to the FATS Regulation (consolidated version) two inward FATS datasets are to be compiled, one is broken down by a detailed economic activity and a selection of countries considered most relevant countries of residence of the UCIs. These countries are all the EU Member States as well as Australia, Canada, Switzerland, China, Hong Kong, Israel, Iceland, Japan, Liechtenstein, Norway, New Zealand, Russian Federation, Turkey, the United States and an aggregated figure for the Offshore Financial Centres. The other dataset is broken down by more than 220 countries of the world with a less detailed breakdown by economic activity (i.e. only the total sum for the non-financial business economy, which can also be expressed as B-N_S95_X_K = BUS).

Ten characteristics are collected on an annual basis, while two characteristics are collected every second year:

  1. Number of enterprises 11110 (i.e. number of foreign controlled enterprises resident in the compiling economy)
  2. Turnover 12110 (market sales of goods and services supplied to third parties, including non-deductible taxes, duties and charges, rebates and discounts)
  3. Production value 12120 (amount actually produced, based on sales, including changes in stocks and resale of goods and services)
  4. Value added at factor cost 12150 (gross income from operating activities after adjusting for operating subsidies and indirect taxes)
  5. Total purchases of goods and services 13110 (value of all goods and services purchased during the accounting period for resale or consumption in the production process, excluding capital goods)
  6. Purchases of goods and services purchased for resale in the same condition as received 13120 (purchases of goods for resale to third parties without further processing, output from service activities, rights to use predetermined services or physical supports for services)
  7. Personnel costs 13310 (total remuneration payable including taxes and social contributions paid by the employer and the employee)
  8. Gross investment in tangible goods 15110 (investment in existing or new tangible capital goods including land)
  9. Number of persons employed 16110 (average yearly headcount of persons employed and paid by the observation unit including unpaid workers and persons absent for a short time)
  10. Number of employees 16130 on a voluntary basis or if 16110 is not available (average yearly headcount of persons having a contract of employment with the observation unit and receiving compensation)
  11. Total intra-mural R&D expenditure 22110 (from 2009 onwards, every second year)
  12. Total number of R&D personnel 22120 (from 2009 onwards, every second year)

For more detailed definitions of these characteristics, please see SBS implementing Regulation No 250/2009 (annual characteristics) and the FATS Regulation No 716/2007 as amended (biennieal R&D characteristics).

3.5. Statistical unit

The statistics refer to enterprises and branches under foreign control. More information on the definition of the statistical unit can be found in the FATS Recommendations Manual (under I.1.1.4 and I.2.1.1).

3.6. Statistical population

The statistical population is all enterprises and branches in the data compiling economy that are under foreign control. To be able to compare with the whole business economy, the nationally controlled enterprises are also included in the statistical population.

3.7. Reference area

From reference year 2007, the data collection is mandatory for Member States of the European Union, Norway and Iceland.

Until reference year 2006 (included), inward FATS data are available only for countries that sent them on a voluntary basis.

3.8. Coverage - Time

The data collection is mandatory starting with reference year 2007. Luxembourg was granted a derogation and provided data from reference year 2009 onwards.

3.9. Base period

Not applicable


4. Unit of measure Top
  • Monetary data are expressed in millions of euro. See annex for annual average exchange rates vis-à-vis the euro (section "Annexes" at the end).
  • Employment variables are expressed in units for individual countries.
  • Per unit values are expressed in thousands of euro per unit.
  • Ratios of monetary variables are expressed in percentages.


5. Reference Period Top

Data refers to the calendar year, which in most cases corresponds to the fiscal year.


6. Institutional Mandate Top
6.1. Institutional Mandate - legal acts and other agreements

From reference year 2007 onwards, data are collected according to the FATS Regulation (consolidated version) which provides a legal basis for the data collection. All the data are covered by the confidentiality rules in force in the EU.

For reference years 1996-2006, data were collected under a gentlemen's agreement within the context of the development of Structural Business Statistics (SBS).

6.2. Institutional Mandate - data sharing

Eurostat makes available all non-confidential data on its dissemination website.


7. Confidentiality Top
7.1. Confidentiality - policy

Regulation (EC) No 223/2009 on European statistics (consolidated version) of 11 March 2009 (OJ L 87, p. 164), stipulates in recital 24 and Article 20(4) the need to establish common principles and guidelines ensuring the confidentiality of data used for the production of European statistics and the access to those confidential data with due account for technical developments and the requirements of users in a democratic society.

7.2. Confidentiality - data treatment

Confidentiality - in cases of statistical confidentiality (i.e. where the contribution of a concrete enterprise to the published figures can be identified) Member States put a confidentiality flag on the respective data cell. Such cells are published empty with an appropriate symbol :(c). Also all other data cells which could be used to indirectly derive the value of the confidential data cell are suppressed and published empty with the same symbol. They are identified and flagged by Member States during the secondary confidentiality treatment.


8. Release policy Top
8.1. Release calendar

Not applicable.

8.2. Release calendar access

Not applicable.

8.3. Release policy - user access

In line with the Community legal framework and the European Statistics Code of Practice Eurostat disseminates European statistics in the online database on Eurostat's website (see item 10 - 'Accessibility and clarity' below) respecting scientific independence and in an objective, professional and transparent manner in which all users are treated equitably. The detailed arrangements are governed by the Eurostat protocol on impartial access to Eurostat data for users.


9. Frequency of dissemination Top

Annual.


10. Accessibility and clarity Top
10.1. Dissemination format - News release

None.

10.2. Dissemination format - Publications

None.

10.3. Dissemination format - online database

Please consult free data online.

10.4. Dissemination format - microdata access

Not available.

10.5. Dissemination format - other

Release of new data is normally not accompanied by a press release.

Additional information may be found on the dedicated webpage of Eurostat's unit G2 (Structural Business Statistics & Global Value Chains), section Foreign Affiliates (foreign-controlled enterprises), and in Eurostat's Statistics Explained website (http://ec.europa.eu/eurostat/statistics-explained/index.php/Foreign_affiliates_statistics_-_FATS).

10.6. Documentation on methodology

The FATS Recommendations Manual outlines the methodology to be used for the production of FATS data in the national statistical authorities (National Statistical Institutes or National Central Banks). The FATS manual goes beyond the provisions laid down in the FATS Regulation to make further progress towards a harmonised methodology by identifying and recommending the best practices.

10.7. Quality management - documentation

None.


11. Quality management Top
11.1. Quality assurance

From reference year 2007, Member States have been providing Eurostat with annual quality reports covering most of the categories of the ESS standards for quality reports (see the ESS handbook for quality reports, 2014 edition). Eurostat is responsible for the preparation of a summary quality report, which provides an overview of findings across Member States and is discussed in the FATS Working Group.

11.2. Quality management - assessment

According to the information available in the quality reports, inward FATS data are of very good or good quality for most of the countries.


12. Relevance Top
12.1. Relevance - User Needs

Users of inward FATS are: European Commission services, international organisations, ministries, chambers of commerce, trade unions, journalists, researchers etc. User needs go beyond what data compilers can provide.

12.2. Relevance - User Satisfaction

Not available.

12.3. Completeness

The FATS Regulation (consolidated version) was drafted to obtain data from all Member States of the European Union. The calculation of the European aggregates is essential for the main users of these statistics. The first European aggregates were published for reference year 2009. One remaining problem is that not all economic sectors can be covered. Additional effort is necessary in many Member States to cover the economic activities (NACE Rev. 2) in section K, as well as in sections P, Q and R and division S96, which are currently not covered by the FATS Regulation.


13. Accuracy Top
13.1. Accuracy - overall

The general problem is that the true weight of foreign-controlled affiliates may not be known. The data raised to population totals are less representative for rare owners. This problem is substantially reduced at higher aggregated levels, such as intra-EU and extra-EU.

13.2. Sampling error

Inward FATS data are compiled on the basis of the structural business statistics survey in most EU Member States; the sampling error is therefore the same. An overall sampling error for SBS is not yet available.

13.3. Non-sampling error

The main problem for most of the national data compilers is the precise identification of the Ultimate Controlling Institutional unit (UCI) necessary for establishing the geographical breakdown of inward FATS data. Incorrect attribution of UCI leads to a misclassification problem. The extent of this problem is rather limited as partly proven by the very rare use of the geographical codes of the type 'not allocated'. The EuroGroups Register (EGR) delivers more and more reliable information on European enterprise groups which will lead to a further improvement in this respect.

Non-response errors differ from country to country. For most of the countries they are small as inward FATS are often compiled within SBS which is collected in a compulsory survey in most of the cases. Missing data are estimated or imputed based on a variety of methods.


14. Timeliness and punctuality Top
14.1. Timeliness

In accordance with the FATS Regulation (consolidated version) data providers send the data within 20 months after the end of the reference year. Data are published by Eurostat around two years after the end of the reference year.

14.2. Punctuality

Most of the Member States provide data on time.


15. Coherence and comparability Top
15.1. Comparability - geographical

Data from reference year 2007 onwards is comparable across EU Member States as the legal basis and harmonised methodology was adopted with the FATS Regulation in 2007. Until reference year 2006, FATS data compilation was voluntary. Thus, data prior to that date must be treated as experimental and cannot be directly compared between the countries.

In a number of Member States size thresholds are applied to the survey population, i.e. only larger enterprises are surveyed exhaustively; smaller units are sampled or not included at all. If size thresholds are applied, the missing part of the population should be estimated, based on the information obtained from the sample survey or another source. Without estimations the data published may be significantly undervalued and skewed in favour of large enterprises. Such data cannot be directly compared with those of other Member States. Estonia and Poland have applied size thresholds without any form of estimation or imputation of the missing part of information on smaller units.

Another important feature is the application of the UCI principle which is obligatory in FATS from reference year 2007. It consists in assigning the control over the foreign-controlled domestic enterprise to the country of the last unit proceeding up the control chain.

For comparisons it is important to keep in mind that some Member States take indirect links of control into account, whilst most do not. This has a limited impact on final data.

15.2. Comparability - over time

In 2010, a break in series for several countries was recorded as the NACE division S95 was included in the total activity aggregate (B-N_S95_X_K = BUS). In addition, a break of series for the number of enterprises can be observed for Slovakia as they started using the administrative data, too.

Comparisons of data up to reference year 2007 should be prudent as before 2007, the FATS data compilation methodology was not harmonised. Individual countries started to apply the agreed common methodology including the UCI approach at different reference years between 2003 and 2007.

In addition to this, the activity breakdown of the data for reference years up to 2007 was based on the classification NACE Rev. 1.1, whereas for data from reference year 2008 onwards, the NACE Rev. 2 is applied. Due to that, for Inward FATS a separate table was created in the database as from the reference year 2008. Comparison of these data with those prior to 2008 must take into account changes to the classification. Direct comparison is possible only on the total activity level (BUS) and for NACE sections and divisions where no components changed.

15.3. Coherence - cross domain

Consistency with structural business statistics is checked. Differences are in general quite insignificant. They may occur for the 'Total world' aggregate in cases of different data collection methods in SBS and FATS and additional data sources used in FATS.

15.4. Coherence - internal

N/A


16. Cost and Burden Top

This information is not available.


17. Data revision Top
17.1. Data revision - policy

In general data are revised - if necessary - with the data publication of the next reference year. In exceptional cases of substantial errors or considerable new information available, data may be corrected between regular data publications. 

17.2. Data revision - practice

Inward FATS are in general final data. A limited number of revisions are made with data published for the next reference year.


18. Statistical processing Top
18.1. Source data

Data are compiled by matching different data sources according to the survey strategy adopted nationally, taking into account the costs, the quality and the response burden on enterprises. The main data source for economic data is SBS, while the main data sources used for the attribution to the country of ultimate control are Business Registers, FDI register, dedicated surveys and EuroGroups Register.

Further information on various data sources used can be found in chapter I.2.2 of the FATS Recommendations Manual.

18.2. Frequency of data collection

Annual

18.3. Data collection

Statistical surveys are the main method of data collection in Inward FATS. Questionnaires are sent either to all enterprises or to a sample of enterprises. Very often, samples are used for smaller enterprises while large enterprises are all surveyed (with a size threshold for the census part based on employment or financial characteristics of the respondent).

18.4. Data validation

At Eurostat level, country data are validated before publishing. A number of arythmetic and logical checks are performed and the consistency between both inward FATS datasets and inward FATS and SBS is checked as well.

18.5. Data compilation

Data compilation is performed by Member States.

Eurostat is responsible for calculating European aggregates. They are available as from reference year 2009, when data for all Member States are available (a derogation for Luxembourg was valid up to reference year 2008).

In order to protect confidential data at the national level, some of the EU aggregates were rounded (in the data dissemination tables these aggregates are marked with an "i"). This way the confidential data at national level can only be determined with a very high error margin, the EU aggregates are however still acceptably accurate. A consequence of this method to hide confidential national data is that the breakdown of the data for a certain activity level into more detailed activities does not correspond fully with the figure provided for this activity level.

18.6. Adjustment

Countries provide the data in national currency. For non-euro countries, the national currency is converted in euro on the basis of euro exchange rates. No correction for purchasing power parities is made.


19. Comment Top

First aggregated data at the European level were calculated for reference year 2009 inward FATS, published on Eurostat's website in July 2012.


Related metadata Top
fats_out_esms - Foreign affiliates of EU enterprises - outward FATS
sbs_esms - Structural business statistics


Annexes Top
Exchange rates from 1995 to 2013