Foreign affiliates (foreign-controlled enterprises)

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 European economy. 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.

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

When the two data collections (inward and outward FATS) were set-up, the data collection exercises were based on gentlemen's agreements between Eurostat and the Member States.

Regulation (EC) No. 716/2007 of the European Parliament and the Council of 20 June 2007 on Community statistics on the structure and activity of foreign affiliates (FATS-Regulation - see right-hand frame for a hyper-link) foresees the availability, at an 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.