Revision of NACE and CPA

NACE Rev. 2 - CPA 2008

Welcome to the "NACE Rev. 2 - CPA 2008" web-site of Eurostat.

OPERATION 2007

Introduction and background

The statistical Classification of Economic Activities (NACE) and the statistical Classification of Products by Activity (CPA) in the European Community are part of the integrated system of statistical classifications, as illustrated in the following scheme:

A major revision of international and European classifications of economic activities and products, known as "Operation 2007", was finalised early 2009.

This revision concerned:

· ISIC and CPC: the UN statistical classifications of activities (ISIC), adopted by the UN Statistical Commission in March 2006. CPC, the UN Classification of products was finalised in January 2009.

· NACE: the European statistical classification of economic activities. The Regulation (EC) No 1893/2006 of the European Parliament and of the Council, establishing the statistical classification of economic activities NACE Revision 2 was adopted on 19 December 2006.

· CPA: the European statistical classification of products by economic activities. The Regulation (EC) No 451/2008 of the European Parliament and of the Council, establishing a new statistical classification of products by activity (CPA) was adopted on 23 April 2008.

· HS: the Harmonized Commodity Description and Coding System, managed by the World Custom Organisation was finalised in 2007.

· CN: the European statistical classification of goods used for the purpose of foreign trade statistics, which is revised annually. The versions 2007, 2008 and 2009 are consistent with HS 2007.

Other regional classifications of products and industries that were revised:

· NAICS: the North American Industry Classification System

· ANZSIC: the Australia-New Zealand system of classification and

· JSIC: Japan’s classification.

These revisions were driven by the need of adapting the classifications to the changes in the world economy. The revised classifications reflect the growing importance of service activities in the economies over the last fifteen years, mainly due to the developments in information and communication technologies (ICT).

A prime use of ISIC is for internationally comparable reporting of economic statistics by activity or industry in many statistical domains: for this reason, the new ISIC also reflects the outcome of a convergence exercise between NACE and NAICS, carried out during the years 2000 to 2003.

The revised ISIC (Rev.4) was adopted by the UN Statistical Commission in March 2006. NACE is a classification that is derived from ISIC. Eurostat (and other countries), has actively cooperated with the UN during the entire revision process.

Previous versions of NACE and CPA had been adopted in EU Member States through European Parliament and Council Regulations; therefore, changes to these classifications required the adoption of new Regulations.

Operation 2007 resulted in completely revised NACE and CPA classifications and has substantial impact on the work in many statistical areas at European as well as at national level. Considerable work has been done, specifically on the implementation of the revised classifications in the various statistical domains referring to NACE and/or CPA.

The implementation date in the EU statistical framework was agreed upon by the Statistical Program Committee (SPC) in May 2005: the first reference year for NACE Rev. 2 is 1 January 2008.

NACE

The structure and the content of NACE Rev. 2 are the outcome of a series of consultations that began in 2002, involving many stakeholders:

· National Statistical Institutes (via the delegates to the NACE/CPA Working Group)

· Directorates General of the European Commission

· European business and trade associations

NACE Rev. 2 is completely consistent with the ISIC Rev.4.

The NACE Rev, 2 structure, explanatory notes and introductory guidelines (forming part of the NACE Rev. 2 publication) as well as the correspondence tables (separate files) and are available in electronic format. The NACE Rev. 2 publication is also available in paper format (for ordering please refer to the “contact information”).

The following table illustrates the main changes - at section level - from the previous version of ISIC/NACE to the revised versions:

Broad correspondence between sections of NACE Rev. 1.1/ISIC Rev. 3.1 and NACE Rev. 2/ISIC Rev.4

ISIC Rev. 3.1 – NACE Rev. 1.1		ISIC Rev.4 – NACE Rev. 2
Section	Description	Section	Description
A	Agriculture, Hunting and Forestry	A	Agriculture, Forestry and Fishing
B	Fishing
C	Mining and quarrying	B	Mining and quarrying
D	Manufacturing	C	Manufacturing
E	Electricity, gas and water supply	D	Electricity, gas, steam and air conditioning supply
		E	Water supply, sewerage, waste management and remediation activities
F	Construction	F	Construction
G	Wholesale and retail trade: repair of motor vehicles, motorcycles and personal and household goods	G	Wholesale and retail trade; repair of motor vehicles and motorcycles
H	Hotels and restaurants	I	Accommodation and food service activities
I	Transport, storage and communications	H	Transportation and storage
		J	Information and communication
J	Financial intermediation	K	Financial and insurance activities
K	Real estate, renting and business activities	L	Real estate activities
		M	Professional, scientific and technical activities
		N	Administrative and support service activities
L	Public Administration and defense; compulsory social security	O	Public administration and defence; compulsory social security
M	Education	P	Education
N	Health and social work	Q	Human health and social work activities
O	Other community, social and personal services activities	R	Arts, entertainment and recreation
		S	Other service activities
P	Activities of private households as employers and undifferentiated production activities of private households	T	Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use
Q	Extraterritorial organizations and bodies	U	Activities of extraterritorial organizations and bodies

Note: ISIC Rev. 3.1/NACE Rev. 1.1 had 17 sections and 62 divisions. ISIC Rev.4/NACE Rev. 2 consists of 21 sections and 88 divisions.

An implementation plan for NACE Rev. 2 was elaborated in cooperation with the Task Force on the drafting of the revised NACE and CPA, composed by relevant Eurostat staff, experts from Member States and representatives of the European Central Bank. The implementation plan is based on the principle of a coordinated approach across countries and statistical domains.

In the process of elaborating the implementation plan, handbooks (as well as a Glossary) were drafted for:

· Setting up an implementation plan

· Implementation in the business registers

· Sampling and estimation

· Back casting

· Outsourcing

While providing a modern statistical infrastructure for the analysis of the current economy, the introduction of the revised classifications in the European Statistical System represents a complex and expensive project in all National Statistical Institutes and affects all surveys referring to NACE.

The changes of NACE/CPA have a strong impact particularly on the business registers, on the design of the enterprise surveys, on the production and dissemination processes. In addition, historical series have to be reconstructed for some statistics.

CPA

On 3 November 2006, the EU Commission presented to the European Council and Parliament the proposal for a regulation establishing the new CPA. It included the structure of CPA 2008.

CPA is the outcome of a number of meetings and consultations, involving many stakeholders:

· National Statistical Institutes (via the delegates to the NACE/CPA Working Group)

· The Task Force on the drafting of the revised NACE and CPA

· Commission services, the ECB, the European business and trade associations

Three broad consultations and calls for proposals took place in 2002, 2004 and 2005.

New concepts, such as originals and intellectual property products have been introduced, and further detail has been added to reflect new products and emerging services. Simultaneously, efforts have been made to maintain the structure of the classification in all areas that do not explicitly require change based on new concepts.

The detail has substantially increased, from 2.608 to 3.142 subcategories. For services this increase is visible at all levels, while for other activities, such as agriculture, the increase in detail primarily affected the lower level of the classification.

Since CPA 2008 is more detailed than CPA 2002 but the coding system remains the same, identical codes can be used in both versions of CPA but with different content, i.e. corresponding to different sections, divisions, groups, classes, categories and subcategories.

The CPA 2008 structure, explanatory notes, introductory guidelines as well as the correspondence tables are available in electronic format.

The following table illustrates the main changes - at section level - from the previous version of CPA to the revised version:

Broad correspondence between sections of CPA 2002 and CPA 2008

CPA 2002		CPA 2008
Section	Description	Section	Description
A B	Products of agriculture, hunting and forestry Fish and other fishing products; services incidental to fishing	A	Products of agriculture, forestry and fishing
C	Products from mining and quarrying	B	Mining and quarrying
D	Manufactured products	C	Manufactured products
E	Electrical energy, gas, steam and water	D E	Electricity, gas, steam and air conditioning Water supply; sewerage, waste management and remediation services
F	Construction work	F	Constructions and construction works
G	Wholesale and retail trade services; repair services of motor vehicles, motorcycles and personal and household goods	G	Wholesale and retail trade services; repair services of motor vehicles and motorcycles
H	Hotel and restaurant services	I	Accommodation and food services
I	Transport, storage and communication services	H J	Transportation and storage services Information and communication services
J	Financial intermediation services	K	Financial and insurance services
K	Real estate, renting and business services	L M N	Real estate services Professional, scientific and technical services Administrative and support services
L	Public administration and defence services; compulsory social security services	O	Public administration and defence services; compulsory social security services
M	Education services	P	Education services
N	Health and social work services	Q	Human health and social work services
O	Other community, social and personal services	R S	Arts, entertainment and recreation services Other services
P	Services of households	T	Services of households as employers; undifferentiated goods and services produced by households for own use
Q	Services provided by extra-territorial organisations and bodies	U	Services provided by extraterritorial organisations and bodies

The Regulation (EC) No 451/2008 of the European Parliament and of the Council, establishing a new statistical classification of products by activity (CPA) was adopted on 23 April 2008. The application of CPA 2008 will however be retroactive, i.e. on 1 January 2008, which also is the entry into force date of NACE Rev. 2.

Contact information

The NACE and CPA classifications are managed and maintained by the Statistical Office of the European Communities – Eurostat, Unit B-1 Quality; Classifications, with postal address: Jean Monnet Building, L-2920 Luxembourg, Luxembourg

For further information on these and other classifications please send an Email to: ESTAT-CLASSIFICATIONS or visit RAMON, Eurostat’s metadata server.