OECD Benchmark Definition of Foreign Direct Investment

The OECD Benchmark Definition of Foreign Direct Investment provides operational guidelines on how foreign direct investment (FDI) activity should be measured and sets the world standard for direct investment statistics.

A fourth edition of the Benchmark Definition was completed in April 2008 by the Investment Committee's Working Group on International Investment Statistics. The revision has required several years of work and consultations with data compilers (statisticians) and data users. It improves existing concepts and definitions in the light of national practical experiences and incorporates concepts and definitions on elements missing from the previous edition (such as, cross-border mergers and acquisitions, special purpose entities, ultimate investing country).

The Benchmark Definition provides:

• a single point of reference for compilers and users of FDI statistics;
• clear guidance for individual countries compiling direct investment statistics as they develop or change their statistical systems;
• international standards for FDI taking into account the effects of globalisation;
• an international standard that provides the basis for economic analysis, especially for international comparisons and for identifying  national deviations that impact on the comparison;
• practical guidance to users of direct investment statistics including the relationship of FDI to other measures of globalisation; and
• an objective basis for measuring methodological differences that may exist between national statistics that need to be taken into account both for cross-country and industry analysis of FDI.

The Benchmark Definition is fully compatible with the underlying concepts and definitions of the International Monetary Fund’s (IMF) Balance of Payments and International Investment Positions Manual, 6th edition (BPM6) and the general economic concepts set out by the United Nation’s System of National Accounts (SNA).

Documentation and links

• OECD Benchmark Definition of Foreign Direct Investment, 4th Edition, April 2008 [ English / français ]
• Survey of Implementation of Methodological Standards for Direct Investment (SIMSDI)
  Based on the concepts and definitions of the 3rd edition of the Benchmark Definition of Foreign Direct Investment, SIMSDI is a comprehensive study on the metadata for foreign direct investment (FDI) statistics. It provides information on methodological practices of individual countries as well as the data sources they use and their data collection and dissemination methods. SIMSDI has proved to be an indispensable working tool for the harmonisation, comprehension, and interpretation of FDI statistics.
• Foreign Direct Investment Statistics: How Countries Measure FDI
• IMF web page on the Revision of the Fifth Edition of the IMF's Balance of Payments Manual www.imf.org/external/np/sta/bop/iss.htm
• OECD Benchmark Definition of Foreign Direct Investment, 3rd Edition, 1996 [ English / Russian ]
• OECD Glossary of Foreign Direct Investment Terms