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Finnish affiliates abroad: documentation of statistics

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2.5.2023 valid documentation

Basic data of the statistics

Data description

The statistics describe the global location of Finnish enterprises’ activities and the significance of these activities abroad. The statistics produce data that can be used to assess the degree of globalisation of the Finnish economy, the impact of the European Union’s internal market on Finnish business and the competitiveness of Finnish-owned enterprises in the world. The statistics are based on Regulation (EC) No 2019/2152 of the European Parliament and of the Council.

Statistical population

The statistics provide annual data on the number, activities and location of Finnish enterprises’ affiliates and branches abroad. Data on the turnover, number of persons employed, personnel costs and gross investments of the affiliates or branches are available by country or group of countries, and by industry. Furthermore, data on value added and imports and exports of goods and services, both intra-group and in total, have been collected for 2007 as a one-off action. Most of the data collected for the statistics are required by EU Regulation. The basic data are confidential.

Statistical unit

The statistical unit is a branch or an affiliate of a Finnish enterprise located abroad. These are defined further as follows:
An affiliate of a group is an enterprise in which the parent company holds more than 50 per cent of the voting rights, either directly or indirectly.
A branch refers to a local unit without a separate legal identity, which is dependent on a foreign-owned enterprise. A branch is treated as a quasi-corporation and has a permanent establishment (cf. a foreign corporation).

Unit of measure

The statistics are published in EUR million. The number of employees is the annual average.

Base period

The data are specific for each year. The statistics on Finnish affiliates abroad are not index-based.

Reference period

The reference period for the statistics on Finnish affiliates abroad is a calendar year. The data concern the financial year ending during the statistical reference year. The data are released approximately 17 months after the end of the reference year.

Reference area

The statistics cover all countries (excluding Finland) where Finnish enterprises have affiliates. The data are released by country or group of countries, by taking into account data confidentiality.

Sector coverage

The statistics on Finnish affiliates abroad produce annual data on the number, activities and location of Finnish enterprises’ affiliates and branches abroad. The statistics cover all size categories and industries. The statistics are published by main industry, and by manufacturing industry at a slightly more detailed level, by taking into account data confidentiality.

Time coverage

The statistics have been published since the 2007 statistical refence year.
Comparable data are available from 2007 to 2012. With the introduction of the new statistical system, business statistics were harmonised. This caused a break in the time series in 2013. Data are comparable from 2013 onwards. New regulation 2021 onwards doesn't cause significant changes in statistics' data.
Between 1996 and 2006, the Bank of Finland was responsible for the collection of data on the turnover and number of employees of Finnish enterprises’ affiliates located abroad. Since 2007, Statistics Finland has been responsible for collecting these data as part of the statistics on Finnish affiliates abroad. The data of the Bank of Finland and Statistics Finland are not fully comparable, because the Bank of Finland data do not cover affiliates with a balance sheet total of less than EUR 8.4 million between 1996 and 1999 or affiliates with a balance sheet total of less than EUR five million between 2000 and 2006. No corresponding thresholds are applied in the data published by Statistics Finland.
Regulation (EC) No 2019/2152 lays down provisions on the compilation of European business statistics. The statistics on Finnish affiliates abroad describe the activities of Finnish affiliates abroad. Correspondingly, the statistics on foreign affiliates in Finland describe the activities of foreign affiliates located in Finland. Together, these statistics provide a comprehensive picture of the global networking of enterprises located in Finland. The statistics on foreign affiliates in Finland are available at https://tilastokeskus.fi/til/ulkoy/index_en.htm.

Frequency of dissemination

The statistics on Finnish affiliates abroad are published once a year on Statistics Finland’s website.

Concepts

Branch

Branches are local units without separate legal identity, which are dependent on foreign-owned enterprises. A branch is treated as a quasi-enterprise and has a fixed establishment (cf. foreign corporation).

Control

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

Country of location

Country of location is the country of registration of an institutional unit. The country of location is often, but not always, the same as the nationality of an institutional unit.

Direct investment

Direct investment is defined as investment by a resident entity in one economy in an enterprise resident in another country with the objective of obtaining a lasting interest in the enterprise and an effective voice in its management. In practice, an investment is classified as direct investment if the resident enterprise owns 10% or more of the shares or voting power of the foreign enterprise.

Direct relationship

In the Enterprise Group Register, direct relationship describes the direct ownership and/or control relationship between two enterprises belonging to the same group.

FATS

The acronym FATS comes from the words Foreign Affiliate Statistics and refers to statistics on foreign affiliates. This may mean either foreign affiliates abroad controlled by the compiling economy (Outward FATS), or foreign affiliates resident in the compiling economy (Inward FATS).

FATS, Inward

The concept of Inward FATS comes from the words Inward Statistics on Foreign Affiliates. In Finland, these statistics go by the name Foreign-owned Enterprises and they describe the activities of foreign-owned enterprises in Finland.

FATS, Outward

The concept of Outward FATS comes from the words Outward Statistics on Foreign Affiliates. The concept refers to statistics describing the activity of Finnish-owned enterprises abroad.

Foreign affiliate

Foreign affiliate means an enterprise resident in the compiling country over which an institutional unit not resident in the compiling country has control, or an enterprise not resident in the compiling country over which an institutional unit resident in the compiling country has control.

Foreign control

Foreign control means 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.
Control means the ability to determine the general policy of an enterprise by choosing appropriate directors as needed.

Enterprise A is deemed to be controlled by 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-owned enterprise

Foreign-owned enterprises are enterprises where more than 50 per cent of equity or voting shares are directly or indirectly held by one foreign party.

Gross investments in tangible assets

Gross investments include all additions, alterations, improvements and renovations which prolong the service life or increase the productive capacity of capital goods. Goods acquired through company restructuring (such as mergers or take-overs) are excluded.
Purchased goods are valued at purchase price, i.e. transport and installation charges, fees, taxes and other costs of ownership transfer are included. Own produced tangible assets are valued at production cost. The value of goods acquired via financial lease corresponds to the market value of the goods if they have been purchased in the year of acquisition.
Investments are recorded when the ownership is transferred to the affiliate.
Gross investments in tangible assets do not include running maintenance costs or the value and overhead expenditure on capital goods used under rental and operational lease contracts. Annual payments for assets used under financial leasing should be excluded.
Gross investments in tangible assets also exclude investments in intangible and financial assets.

Group nationality

In the Enterprise Group Register, group nationality is determined by the country of residence of the Ultimate Beneficial Owner (UBO). If the UBO of an enterprise group is resident in Finland the group's nationality is Finnish.

Indirect control

Indirect control means that enterprise X has control in enterprise A through another affiliate B which has control over enterprise A.

Number of employees (annual average)

The number of employees is defined as those persons who work for the affiliate and who have a contract of employment and receive compensation in the form of wages, salaries, fees, gratuities, piecework pay or remuneration in kind. All persons for whom payments are booked under the heading personnel costs in the profit and loss accounts of the affiliate should be included even if in some cases no contract of employment exists.
The number of employees includes part-time workers, seasonal workers, persons on strike or on short-term leave, but excludes persons on long-term leave.
Temporary workers from an employment agency are not included in the number of employees.
The number of personnel is measured as an annual average using at least data for each quarter of the year.

Personnel costs

Personnel costs are made up of wages and salaries and employer's social security costs.
Payments for agency workers are not included in personnel costs.
All remunerations paid to the personnel during the accounting period are included, incl. all gratuities, workplace and performance bonuses, ex gratia payments, 13th month pay (and similar fixed bonuses), payments made to employees in consideration of dismissal, lodging, transport, cost of living, and family allowances, commissions, attendance fees, overtime, night work, etc., as well as taxes, social security contributions and other amounts owed by the employees and retained at source by the employers.
Also included are the social security costs of the employer. These include employer's social security contributions to schemes for retirement pensions, sickness, maternity, disability, unemployment, occupational accidents and diseases, family allowances as well as other schemes. These costs are included regardless of whether they are statutory, collectively agreed, contractual or voluntary in nature.

Subsidiary company

A subsidiary company of a group is an enterprise in which the group head holds direct or indirect over 50 per cent of voting rights.

Turnover (external and internal sales)

The turnover of an affiliate comprises all market sales of goods or services supplied to third parties irrespective of whether the customers are external to the group or companies belonging to the same group.
The total turnover (100%) should be reported even if the group does not exercise full ownership over the affiliate.
Turnover comprises sales profits from the actual activity of the affiliate, after deduction of granted discounts and rebates, value added tax and other taxes based directly on sales volume. Turnover also includes all other charges (transport, packaging, etc.) passed on to the customer.
Income classified as other operating income, financial income and extra-ordinary income and revenue from the use by others of enterprise assets yielding interest, royalties and dividends and other income according to the International accounting standards (IAS/IFRS) is excluded from turnover. Operating subsidies received from public authorities or the institutions of the European Union are also excluded.

UCI

Ultimate controlling institutional unit of a foreign affiliate. An institutional unit that is at the top the ownership chain of a foreign-owned enterprise and is not controlled by any other institutional unit.

Ultimate beneficial owner

An institutional unit that is at the top the ownership chain of a foreign-owned enterprise and is not controlled by any other institutional unit.

Classifications

Px code list of countries

Accuracy, reliability and timeliness

Overall accuracy

The statistics represent total data, with the following notes: (1) Reporting units, i.e. parent companies located in Finland, are retrieved from Statistics Finland’s Enterprise Group Register, which can be considered comprehensive concerning enterprises that have had numerous affiliates abroad already for a longer period of time. On the other hand, the coverage is slightly weaker for smaller groups with only a few affiliates or more recent groups. Smaller groups (measured by the number of affiliates located abroad) and more recent groups are typically displayed in the Enterprise Group Register after a couple of years. The significance of this under-coverage of smaller and more recent enterprise groups is almost negligible at an aggregated level (number of employees, personnel costs, gross investments in tangible assets and turnover). (2) The completion and revision of missing or otherwise incomplete data is a particular challenge in these statistics, because the statistical units, i.e. affiliates and branches, are located in many different countries and operate in many different industries. The accuracy of the data has been checked by comparing the characteristics with the corresponding data from previous years and the data published in annual reports. Imputation has not been used in statistics. However, the response rate of statistics is remarkably high, so there is no significant under-coverage in this respect.

The reliability of the statistics is influenced by the quality of the data collected by the electronic survey. The survey was improved through usability tests aimed at respondents during 2009/2010, which examined the ambiguity of the survey questions and the usability of the electronic application.

Timeliness

The statistics are published once a year. The statistics cover Finnish enterprises’ affiliates and branches abroad during the reference period. As a rule, the characteristics describe the period of one year according to the accounting periods of the enterprises.

The data for the 2018/2019 reference year were published 17 months after the end of the reference year. The released data are final data, and preliminary data are not published.

Punctuality

There is no delay in the publication of the statistics on Finnish affiliates abroad. The statistics are published in accordance with the release calendar.

Comparability

Comparability - geographical

The data cover all countries (excluding Finland) where Finnish enterprises have affiliates.
The data of the statistics on Finnish affiliates abroad are based on the guidelines in the Eurostat “Foreign Affiliates Statistics (FATS) Recommendations Manual”.
The data transmitted to Eurostat are internationally comparable.

Comparability - over time

The statistics on Finnish affiliates abroad are comparable from 2013 onwards, following the commissioning of the YTY enterprise data system. However, comparable data are available from 2007 to 2012. Their comparability over time is weakened by changes in the industry structure, for example.

Coherence - cross domain

Statistics Finland has renewed the production of its business statistics. The reform covered more than ten statistics and harmonised the production of business statistics. The most significant changes related to the handling of industrial classification, enterprise data (e.g. turnover and personnel data) and corporate restructuring. The concepts, definitions and classifications of the statistics are consistent with other business statistics from the 2013 reference year onwards.
The reference period of the statistics is usually 12 months. However, it should be noted that the reference year of the statistics on Finnish affiliates abroad is not always the same as the calendar year.

The number of employees is the annual average. Turnover includes both internal and external turnover. The definition of “investments” also differs slightly from that commonly used in other statistics: investments only include gross investments in tangible assets.

Coherence - internal

The data of the statistics on Finnish affiliates abroad are internally coherent.

Source data and data collections

Source data

The data are collected through data collection that is addressed to all parent companies in Finland with affiliates or branches abroad.

Data collection

The statistical population is formed by retrieving Finnish affiliates abroad and their controlling entities from Statistics Finland’s Enterprise Group Register. The statistical unit is a branch or affiliate located abroad, i.e. an enterprise that has been directly or indirectly controlled by an enterprise located in Finland during the reference period. The reporting entity is the group parent, which is located in Finland, and which is not controlled by any other entity located in Finland. The parents are identified based on Statistics Finland’s Enterprise Group Register.

The data of the statistics are collected using an online survey that is addressed to all group parents located in Finland, which have an affiliate or a branch abroad, and which are not controlled by any other entity located in Finland. The parent replies to the survey for each entity abroad they control either directly or indirectly.

Frequency of data collection

The data collection is carried out annually.

Methods

Data compilation

Neither imputation nor inflations are used in the statistics.

Data validation

The data are analysed and checked at the level of units and aggregates by comparing them with previous year’s data, affiliates' annual reports and other source material.

Principles and outlines

Contact organisation

Statistics Finland

Contact organisation unit

Economic Statistics

Legal acts and other agreements

The compilation of statistics is guided by the Statistics Act. The Statistics Act contains provisions on collection of data, processing of data and the obligation to provide data. Besides the Statistics Act, the Data Protection Act and the Act on the Openness of Government Activities are applied to processing of data when producing statistics.

Statistics Finland compiles statistics in line with the EU’s regulations applicable to statistics, which steer the statistical agencies of all EU Member States.

Further information: Statistical legislation

The statistics are based on Regulation (EU) No 2152/2019 of the European Parliament and of the Council on European business statistics and commission implementing regulation (EU) 2020/1197. Eurostat has published a recommendation on the compilation of the statistics. See: Foreign Affiliates Statistics (FATS) Recommendations Manual, 2012, https://ec.europa.eu/eurostat/en/web/products-manuals-and-guidelines/-/KS-RA-12-016

Confidentiality - policy

The data protection of data collected for statistical purposes is guaranteed in accordance with the requirements of the Statistics Act (280/2004), the Act on the Openness of Government Activities (621/1999), the EU's General Data Protection Regulation (EU) 2016/679 and the Data Protection Act (1050/2018). The data materials are protected at all stages of processing with the necessary physical and technical solutions. Statistics Finland has compiled detailed directions and instructions for confidential processing of the data. Employees have access only to the data essential for their duties. The premises where unit-level data are processed are not accessible to outsiders. Members of the personnel have signed a pledge of secrecy upon entering the service. Violation of data protection is punishable.

Further information: Data protection | Statistics Finland (stat.fi)

Release policy

Statistics Finland publishes new statistical data at 8 am on weekdays in its web service. The release times of statistics are given in advance in the release calendar available in the web service. The data are public after they have been updated in the web service.

Further information: Publication principles for statistics at Statistics Finland

Data sharing

The statistics on Finnish affiliates abroad are published on Statistics Finland’s website at https://tilastokeskus.fi/til/stu/index_en.html (first release: 17 September 2009). The data are published by industry, country or group of countries so that data on individual enterprise groups cannot be deduced. At a customer’s request, Statistics Finland may also make special compilations using the data in the statistics. It is also possible to transmit data in encrypted form for use in scientific studies and surveys to Statistics Finland’s Research Laboratory. For more information, see http://tilastokeskus.fi/tup/tutkimusaineistot/index_en.html.

The data of the statistics are transmitted at aggregate level, following the principle of confidentiality, to the Statistical Office of the European Union (Eurostat), the OECD and the UN. Organisations publish the data of the statistics in several print and online publications. Eurostat also compiles comparable statistics concerning Member States. The corresponding statistics, “outward statistics on foreign affiliates, outward FATS”, are produced in all EU Member States. Data at EU level are published centrally by Eurostat.

Accessibility and clarity

Statistical data are published as database tables in the StatFin database. The database is the primary publishing site of data, and new data are updated first there. When releasing statistical data, existing database tables can be updated with new data or completely new database tables can be published.

In addition to statistical data published in the StatFin database, a release on the key data is usually published in the web service. If the release contains data concerning several reference periods (e.g. monthly and annual data), a review bringing together these data is published in the web service. Database tables updated at the time of publication are listed both in the release and in the review. In some cases, statistical data can also be published as mere database releases in the StatFin database. No release or review is published in connection with these database releases.

Releases and database tables are published in three languages, in Finnish, Swedish and English. The language versions of releases may have more limited content than in Finnish.

Information about changes in the publication schedules of releases and database tables and about corrections are given as change releases in the web service.

Data revision - policy

Revisions – i.e. improvements in the accuracy of statistical data already published – are a normal feature of statistical production and result in improved quality of statistics. The principle is that statistical data are based on the best available data and information concerning the statistical phenomenon. On the other hand, the revisions are communicated as transparently as possible in advance. Advance communication ensures that the users can prepare for the data revisions.

The reason why data in statistical releases become revised is often caused by the data becoming supplemented. Then the new, revised statistical figure is based on a wider information basis and describes the phenomenon more accurately than before.

Revisions of statistical data may also be caused by the calculation method used, such as annual benchmarking or updating of weight structures. Changes of base years and used classifications may also cause revisions to data.

Quality assessment

The quality of the statistics on Finnish affiliates abroad is examined as the data accumulate. At aggregate level, the data are compared with the previous year and the biggest differences are explained. In addition, Eurostat also assesses the quality of the statistics in connection with data transmission.

Quality assurance

Quality management requires comprehensive guidance of activities. The quality management framework of the field of statistics is the European Statistics Code of Practice (CoP). The quality criteria of Official Statistics of Finland are compatible with the European Statistics Code of Practice.

Further information: Quality management | Statistics Finland (stat.fi)

User access

Data are released to all users at the same time. Statistical data may only be handled at Statistics Finland and information on them may be given before release only by persons involved in the production of the statistics concerned or who need the data of the statistics concerned in their own work before the data are published.

Further information: Publication principles for statistics

Unless otherwise separately stated in connection with the product, data or service concerned, Statistics Finland is the producer of the data and the owner of the copyright. The terms of use for statistical data.

No data are disclosed before the release date. The data are transmitted to Eurostat and the OECD at agreed times.