Definition: Foreign control / ownership

The definitions of "foreign control" and "foreign ownership" of a unit are based on the nationality of its group head or ultimate beneficial owner (UBO) respectively. Other ways of defining "foreign ownership", based, for example, on intermediate levels in control or ownership chains lead to misunderstandings: for example, a resident enterprise may be owned by residents of several foreign countries, which may be related or unrelated, or even owned themselves by national enterprises...

Whenever the geographical allocation of units is not based on the nationality of the group head or UBO, this should be clearly stated, and the procedure used to determine the nationality of the unit should be clearly explained.

Let us consider an enterprise located in France with the following allocation of capital:
45% are owned by a Japanese company A;
45% are owned by another Japanese company B, not related to A;
10% are owned by French shareholders.

It appears common sense that this is a "foreign enterprise". However, it is clear it is not majority-owned by a single foreign enterprise, and who really controls it has to be checked before deciding whether it is foreign controlled or not.
Source:
Eurostat
Created:
Updated:

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