General structure of the FATS
Survey
 Main recommendations:
1. Manual on Statistics of International Trade in
Services
2. Handbook of Economic Globalisation
Indicators
 Statistics compiled
:
1. International trade globalisation
2. Activities of Multinational Enterprises

General structure of the FATS
Survey
 Groups of Multinational companies
1. Inward companies – Domestic companies controlled by foreign parents
2. Outward companies – Domestic companies controlling foreign affiliates
3. Inward-Outward companies – Domestic companies having foreign subsidiaries and also controlled by foreign parents

General structure of the FATS
Survey
 Majority ownership criterion
1. Direct Inward/Outward companies
2. Domestic Parent groups
3. Domestic Inward groups
4. Foreign Parent and CAs Groups (only partial)

General structure of the FATS
Survey
All relevant variables classified by:
 Countries
 Industries – ISIC – Two digits level

Population of the survey
 The MBR (Multinational Business
Register)
A register of multinational enterprises operating in Israel was created and the survey was based on the population covered by the register

Population of the survey
 The MBR includes :
• Direct Inward/Outward companies
• Domestic companies linked upward or downward to direct Outward companies by a +50% ownership (Domestic Parent
Group)

Population of the survey
• Domestic companies linked downward to direct Inward companies in the same way
(subsidiaries of direct Inward companies)
• Affiliates abroad, directly controlled by domestic Outward companies and foreign parents of domestic Inward companies
It may be a lack of coverage of companies linked to direct
Inward/Outward companies, specially regarding foreign enterprises

Sources of data
 The Business Registry Office, where companies must register their names, main occupation and details on owners of shares
 CBS Central Business Register
 Israel Securities Authority
 Tel-Aviv Stock Exchange
 Companies engaged in business information and data bases, as D&B, BDI, etc
 Press information

FATS Variables – International
Trade
 Total exports and imports of goods and services, by Inward and Outward domestic companies, classified by countries and industries.

FATS Variables – International
Trade
 International trade of Inward companies, distributed according to trade partners abroad, as follows:
1. Foreign parent group
2. Other affiliates abroad
3. Other (non-affiliates) foreign residents

FATS Variables – International
Trade
 International trade of Outward companies, distributed according to trade partners, as follows:
1. CAs abroad
2. Other affiliates abroad
3. Other (non-affiliates) foreign residents

FATS Variables – International
Trade
 Sales of goods and services by subsidiaries abroad of domestic
Outward companies, classified by country of sales.

 Value added
 Output
 Employment
All these variables related to Inward and
Outward companies and classified by industries

 The sample was based on :
1.
Industries according to ISIC two digits level
2.
Size of companies according to turnover

 International Trade
1. Total exports and imports of goods
• Reports from companies in the sample
• Annual customs’ data on a company basis of exports and imports of goods
– BOP adjusted

2. Total exports and imports of services
• Reports from companies in the sample
• Exports – Exempted VAT data revenues combined with customs’ data on exports of goods and analysis in a company level for amounts exceeding a defined threshold
• Imports – ITRS data adjusted by preliminary total import figures of the EBOPS sample survey
• End of year 2006: Results of the new EBOPS survey are expected

Computation of estimates
3. Intra-firm trade and trade with unaffiliated foreigners
• Reports from the companies in the sample and grossing-up according to total exports and imports in each industry and size group
4. Sales of goods and services by CAs abroad
• Reports from the companies in the sample
(additional request) and grossing-up by industry and turnover of parents

25
20
15
10
5
0
45
40
35
30
Outward and Inward exports and imports from total exports and imports
Outward exports
Inward
Exports
Outward
Imports
Inward
Imports

Outward exports and CA sales abroad
7
6
5
4
3
2
1
0
15
14
13
12
11
10
9
8
Outward exports
Sales of subsidiaries abroad

Intra-firm trade
50
40
30
20
10
0
100
90
80
70
60
Outward exports
Inward exports

Main problems in data reporting
 Consolidated data excluding subsidiaries abroad
 Imports by countries
 Sales of goods and services by foreign subsidiaries

Recommendations for expansion in future surveys
 Complementary data to FDI
 If expanding of CAs abroad is heavy financed by credit in host countries, instead of FDI:
FDI may not be well related to total activities of CAs abroad
 Additional indicator suggested:
Total assets of CAs abroad =
Total foreign controlled assets by parent domestic companies

Recommendations for expansion in future surveys
 This last variable will be closer related to the level of subsidiaries ’ activities abroad independently of the financing scheme adopted by the enterprise
 FDI results – Could be misleading in comparing:
Countries – Periods of time – Inward and
Outward FDI

Recommendations for expansion in future surveys
 Additional use: Share of foreign controlled assets financed by
“external” as opposed to
“internal’’ funds.

Recommendations for expansion in future surveys
 Outsourcing of production abroad
Only Outsourcing of production that is related to activities of
Inward or Outward companies are currently included

Some final remarks
 Exclusion of variables that may be estimated by administrative files
 Improvement in collection of data on other variables, as UBO, additional activities of subsidiaries abroad, total assets of these subsidiaries, etc.

 Activities of Multinational Enterprises
1. Output
• Reports from companies in the sample
• Income Tax data
• VAT data
• Change in stocks of finished goods and work-in-progress – Industry basis – CBS
Business Department

2. Value Added
• Reports from the companies in the sample and grossing-up according to industry and turnover
• Indirect taxes: On an industry basis according to averages from the CBS
Business Department

3. Employment
• Reports from companies in the sample
• Data from the National Insurance
Institution