General structure of the FATS Survey

General structure of the FATS General structure of the FATS SurveySurvey

Main recommendations:Main recommendations:1.1. Manual on Statistics of International Trade in Manual on Statistics of International Trade in

Services Services 2.2. Handbook of Economic Handbook of Economic GlobalisationGlobalisation

IndicatorsIndicators

Statistics compiledStatistics compiled::

1.1. International trade globalisationInternational trade globalisation2.2. Activities of Multinational EnterprisesActivities of Multinational Enterprises


Groups of Multinational companiesGroups of Multinational companies

1.1. Inward companiesInward companies – Domestic companies – Domestic companies controlled by foreign parentscontrolled by foreign parents

2.2. Outward companiesOutward companies – Domestic companies – Domestic companies controlling foreign affiliatescontrolling foreign affiliates

3.3. Inward-Outward companiesInward-Outward companies – Domestic – Domestic companies having foreign subsidiaries and companies having foreign subsidiaries and also controlled by foreign parentsalso controlled by foreign parents


Majority ownership criterionMajority ownership criterion

1.1. Direct Inward/Outward companiesDirect Inward/Outward companies

2.2. Domestic Parent groupsDomestic Parent groups

3.3. Domestic Inward groupsDomestic Inward groups

4.4. Foreign Parent and CAs Groups (only partial)Foreign Parent and CAs Groups (only partial)


All relevant variables classified by:All relevant variables classified by:

CountriesCountries

Industries – ISIC – Two digits levelIndustries – ISIC – Two digits level

Population of the surveyPopulation of the survey

The MBR (Multinational Business The MBR (Multinational Business Register)Register)

A register of multinational A register of multinational enterprises operating in Israel was enterprises operating in Israel was created and the survey was based on the created and the survey was based on the population covered by the registerpopulation covered by the register


The MBR includesThe MBR includes::

• Direct Inward/Outward companiesDirect Inward/Outward companies

• Domestic companies linked upward or Domestic companies linked upward or downward to direct Outward companies downward to direct Outward companies by a +50% ownership (Domestic Parent by a +50% ownership (Domestic Parent Group)Group)


• Domestic companies linked downward to Domestic companies linked downward to direct Inward companies in the same way direct Inward companies in the same way (subsidiaries of direct Inward companies)(subsidiaries of direct Inward companies)

• Affiliates abroad, directly controlled by Affiliates abroad, directly controlled by domestic Outward companies and foreign domestic Outward companies and foreign parents of domestic Inward companiesparents of domestic Inward companies

It may be a lack of coverage of companies linked to direct It may be a lack of coverage of companies linked to direct Inward/Outward companies, specially regarding foreign Inward/Outward companies, specially regarding foreign enterprisesenterprises

Sources of dataSources of data

The Business Registry Office, where The Business Registry Office, where companies must register their names, main companies must register their names, main occupation and details on owners of sharesoccupation and details on owners of shares

CBS Central Business RegisterCBS Central Business Register Israel Securities AuthorityIsrael Securities Authority Tel-Aviv Stock ExchangeTel-Aviv Stock Exchange Companies engaged in business information Companies engaged in business information

and data bases, as D&B, BDI, etcand data bases, as D&B, BDI, etc Press informationPress information

FATS Variables – International FATS Variables – International TradeTrade

Total exports and imports of goods and Total exports and imports of goods and services, by Inward and Outward domestic services, by Inward and Outward domestic companies, classified by countries and companies, classified by countries and industries.industries.


International trade of Inward International trade of Inward companies, distributed according to companies, distributed according to trade partners abroad, as follows:trade partners abroad, as follows:

1.1. Foreign parent group2. Other affiliates abroad 3. Other (non-affiliates) foreign residents


International trade of Outward International trade of Outward companies, distributed according to companies, distributed according to trade partners, as follows:trade partners, as follows:

1. CAs abroad2. Other affiliates abroad 3. Other (non-affiliates) foreign residents


Sales of goods and services by Sales of goods and services by subsidiaries abroad of domestic subsidiaries abroad of domestic Outward companies, classified by Outward companies, classified by country of sales.country of sales.

FATS Variables – AMNEFATS Variables – AMNE

Value added Value added Output Output Employment Employment

All these variables related to Inward and All these variables related to Inward and Outward companies and classified by Outward companies and classified by industriesindustries

The sampleThe sample

The sample was based on :The sample was based on :

1.1. Industries according to ISIC two digits Industries according to ISIC two digits levellevel

2.2. Size of companies according to Size of companies according to turnoverturnover

Computation of estimatesComputation of estimates International TradeInternational Trade

1.1. Total exports and imports of Total exports and imports of goodsgoods

• Reports from companies in the sampleReports from companies in the sample

• Annual customs’ data on a company Annual customs’ data on a company basis of exports and imports of goods basis of exports and imports of goods – BOP adjusted– BOP adjusted

Computation of estimatesComputation of estimates2.2. Total exports and imports of servicesTotal exports and imports of services

• Reports from companies in the sampleReports from companies in the sample• Exports – Exempted VAT data revenues Exports – Exempted VAT data revenues

combined with customs’ data on exports of combined with customs’ data on exports of goods and analysis in a company level for goods and analysis in a company level for amounts exceeding a defined thresholdamounts exceeding a defined threshold

• Imports – ITRS data adjusted by preliminary Imports – ITRS data adjusted by preliminary total import figures of the EBOPS sample total import figures of the EBOPS sample surveysurvey

• End of year 2006: Results of the new EBOPS End of year 2006: Results of the new EBOPS survey are expectedsurvey are expected

Computation of estimatesComputation of estimates3.3. Intra-firm trade and trade with unaffiliated Intra-firm trade and trade with unaffiliated

foreigners foreigners

• Reports from the companies in the sample and Reports from the companies in the sample and grossing-up according to total exports and grossing-up according to total exports and imports in each industry and size groupimports in each industry and size group

4.4. Sales of goods and services by CAs abroadSales of goods and services by CAs abroad

• Reports from the companies in the sample Reports from the companies in the sample (additional request) and grossing-up by (additional request) and grossing-up by industry and turnover of parentsindustry and turnover of parents

Main findingsMain findingsOutward and Inward exports and imports from total

exports and imports

05

1015202530354045

Outwardexports

InwardExports

OutwardImports

InwardImports

%

Main findingsMain findingsOutward exports and CA sales abroad

0123456789

101112131415

Outwardexports

Sales ofsubsidiaries

abroad

US$

Bill

ion

Main findingsMain findings

Intra-firm trade

0102030405060708090

100

Outwardexports

Inwardexports

%

Main problems in data reportingMain problems in data reporting

Consolidated data excluding subsidiaries Consolidated data excluding subsidiaries abroadabroad

Imports by countriesImports by countries

Sales of goods and services by foreign Sales of goods and services by foreign subsidiariessubsidiaries

Recommendations for expansion in Recommendations for expansion in future surveysfuture surveys

Complementary data to FDIComplementary data to FDI

If expanding of CAs abroad is heavy financed by If expanding of CAs abroad is heavy financed by credit in host countries, instead of FDI:credit in host countries, instead of FDI:

FDI may not be well related to total activities of CAs FDI may not be well related to total activities of CAs abroadabroad

Additional indicator suggested: Additional indicator suggested:

Total assets of CAs abroad =Total assets of CAs abroad = Total foreign controlled assets by parent domestic Total foreign controlled assets by parent domestic

companiescompanies

Recommendations for expansion Recommendations for expansion in future surveysin future surveys

This last variable will be closer related to This last variable will be closer related to the level of subsidiaries’ activities abroad the level of subsidiaries’ activities abroad independently of the financing scheme independently of the financing scheme adopted by the enterpriseadopted by the enterprise

FDI results – Could be misleading in FDI results – Could be misleading in comparing:comparing:

Countries – Periods of time – Inward and Countries – Periods of time – Inward and Outward FDIOutward FDI


Additional use: Share of foreign Additional use: Share of foreign controlled assets financed by controlled assets financed by “external” as opposed to “external” as opposed to “internal’’ funds.“internal’’ funds.


Outsourcing of production abroadOutsourcing of production abroad

Only Outsourcing of production Only Outsourcing of production that is related to activities of that is related to activities of Inward or Outward companies are Inward or Outward companies are currently includedcurrently included

Some final remarksSome final remarks

Exclusion of variables that may be Exclusion of variables that may be estimated by administrative filesestimated by administrative files

Improvement in collection of data on other Improvement in collection of data on other variables, as UBO, additional activities of variables, as UBO, additional activities of subsidiaries abroad, total assets of these subsidiaries abroad, total assets of these subsidiaries, etc.subsidiaries, etc.

Thank youThank you

Computation of estimatesComputation of estimates

Activities of Multinational EnterprisesActivities of Multinational Enterprises

1.1. OutputOutput• Reports from companies in the sampleReports from companies in the sample• Income Tax dataIncome Tax data• VAT dataVAT data• Change in stocks of finished goods and Change in stocks of finished goods and

work-in-progress – Industry basis – CBS work-in-progress – Industry basis – CBS Business DepartmentBusiness Department


2.2. Value AddedValue Added

• Reports from the companies in the Reports from the companies in the sample and grossing-up according to sample and grossing-up according to industry and turnoverindustry and turnover

• Indirect taxes: On an industry basis Indirect taxes: On an industry basis according to averages from the CBS according to averages from the CBS Business DepartmentBusiness Department


3.3. EmploymentEmployment

• Reports from companies in the sampleReports from companies in the sample

• Data from the National Insurance Data from the National Insurance InstitutionInstitution

Documents

General structure of the FATS Survey