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15.84.        The European Union FATS Recommendations Manual provides further indications as to how this item could be compiled. It states that “only active units which had turnover or employment at any time during the reference period should be included. Dormant (temporarily inactive) and inactive units are excluded. This statistic should include all units active during at least a part of the reference period” (box I.19).  It also indicates that not only separate legal entities that are dependent on foreign enterprises but also  “local units (branches) which do not constitute a separate legal entity and which are dependent on foreign enterprises…” (ibid.) should be included. In other words, if they are considered to be branches (i.e. they meet the branch criterion; see, for example, chapter 14, on construction) then their operations in the country of establishment should be reflected in FATS and they should be counted. But if they do not considered branches, then those operations should not be accounted for in FATS, and its sales will be recorded as imports/exports under the relevant BOP services item. The Manual also states that, in the context of outward FATS, the number of enterprises is a characteristic that, in principle, is obtained by counting the units in the target population, although, in practice, there can be collection problems when a resident parent enterprise supplies information on the activity of many affiliates abroad. The respondent may, for example, group affiliates located in the same foreign country as a single enterprise.

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