Introduction 1

Part one
Introduction

Chapter I
Overview

1. The International Standard Industrial Classification of All Economic Activities (ISIC) consists of a
coherent and consistent classification structure of economic activities based on a set of internationally agreed
concepts, definitions, principles and classification rules. It provides a comprehensive framework within which
economic data can be collected and reported in a format that is designed for purposes of economic analysis,
decision-taking and policy-making. The classification structure represents a standard format to organize detailed
information about the state of an economy according to economic principles and perceptions.
2. In practice, the classification is used for providing a continuing flow of information that is indispensable
for the monitoring, analysis and evaluation of the performance of an economy over time. In addition to its
primary application in statistics and subsequent economic analysis, where information needs to be provided for
narrowly defined economic activities (also referred to as “industries”), ISIC is increasingly used also for
administrative purposes, such as in tax collection, issuing of business licenses etc. An important gain for the
statistical system in the administrative use of the same classification of economic activity is that this option
strengthens the articulation with administrative records (Business Registers), which is of great value for the
rationalization of statistical production, as it facilitates the collection of information from companies and the use
of other data sources.
3. This fifth revision of ISIC enhances the relevance of the classification by better reflecting the current
structure of the world economy, recognizing new industries and new activities that have emerged over the past
15 years and facilitating international comparison through increased alignment with existing regional
classifications.
Main features of the classification
4. The scope of ISIC in general covers productive activities, i.e., economic activities within the production
boundary of the System of National Accounts (SNA). A few exceptions have been made to allow for the classification
of activities beyond the production boundary but which are of importance for various other types of statistics.1
5. These economic activities are subdivided in a hierarchical, four-level structure of mutually exclusive
categories, facilitating data collection, presentation and analysis at detailed levels of the economy in an
internationally comparable, standardized way. The categories at the highest level are called sections, which are
alphabetically coded categories intended to facilitate economic analysis. The sections subdivide the entire spectrum
of productive activities into broad groupings, such as “Agriculture, forestry and fishing” (section A),
“Manufacturing” (section C) and “Accommodation and food service activities” (section I). The classification is then
organized into successively more detailed categories, which are numerically coded: two-digit divisions; three-digit
groups; and, at the greatest level of detail, four-digit classes.
6. The classification is used to classify statistical units, such as establishments or enterprises, according to the

1 See para. 29 below.

2 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
economic activity in which they mainly engage. At each level of ISIC, each statistical unit is assigned to one and only
one ISIC code, as set out below. The set of statistical units that are classified into the same ISIC category is then often
referred to as an industry, such as “the furniture manufacturing industry”, which would refer to all units classified in
ISIC division 31 (Manufacture of furniture), or the “construction industry”, which would refer to all units classified
in ISIC section F (Construction). This standardized categorization or subdivision of the complete set of producing
units in an economy makes ISIC an important tool for socio-economic statistics that need to be arranged in accordance
with the productive system of the economy.

Principles, definitions and classification rules

7. All categories at each level of the classification are mutually exclusive. The principles and criteria that have
been used to define and delineate these categories have not changed from previous versions of ISIC and are based on
the inputs of goods, services and factors of production; the process and technology of production; the characteristics
of outputs; and the use to which the outputs are put. Economic activities that are similar in respect of these criteria
have been grouped together in the categories of ISIC. At the most detailed level of the classification, preference has
been given to the process and technology of production to define individual ISIC classes, particularly in the classes
related to services. At higher levels, characteristics of outputs and the use to which outputs are put become more
important to create analytically useful aggregation categories. For many analytical purposes and for reasons of
historical continuity, a strict application of these criteria has not proven useful. The weight that has been applied to
each of these criteria will therefore invariably change throughout the classification. In addition, practical
considerations, such as the organization of economic production in most countries and the need for stability of the
classification, are factors that have also influenced the way categories have been defined at different levels of the
classification.
8. The content and scope of each category in the classification is defined through a detailed explanatory note,
which also highlights boundary issues by providing examples of activities that may appear similar but are classified
elsewhere in ISIC.
9. In order to apply the classification to a particular statistical unit, information on the activity in which the
unit engages has to be obtained. This information is then used to find the category in ISIC that corresponds to this
activity, based on the definitions provided in the explanatory notes.
10. In practice, it will often be the case that a statistical unit (no matter how narrowly defined) engages in a
variety of activities, which may be linked to each other or be completely independent. In order to arrive at a single
ISIC code for these units, ISIC provides a set of rules that have to be applied in the process of classifying a given unit.
Section II.C below outlines these rules and gives examples for their application in special cases.

Harmonization with other statistical classification systems and international statistical frameworks
11. ISIC has a central position among existing classifications of economic activities, as well as other economic
classifications, such as those for products. ISIC provides the internationally accepted standard for categorizing
producing units within an economy, which allows for data comparison at the national and international levels. During
the revision process of ISIC, Rev.5, special attention was paid to improving the links between existing activity
classifications, especially at the regional level, to facilitate future international data comparison. In the course of this
revision, a review of other activity classifications was undertaken, and subsequent changes to ISIC were introduced
to further harmonize these existing classifications with ISIC..
12. Harmonization of ISIC with other statistical frameworks that have conceptual linkages to some part or all
of the economic structure has also been considered in the process of developing ISIC, Rev.5. This applies in particular
to the System of National Accounts, the System of Environmental Economic Accounting 2012 — Central Framework,
and the International Standard Classification of Education (ISCED 2011).

Aggregates of ISIC
 Introduction 3
13. ISIC disaggregates the economy into the more detailed levels of classes and groups, as well as the more
aggregated levels of divisions and sections. It can be used to examine particular industries or industry groups or to
analyse the economy as a whole by disaggregating it to different levels of detail. For analytical purposes, it is important
to implement ISIC at its lower levels of detail to be able to observe and analyse the economic interactions taking place
between the different activities, allowing understanding of the interlinkages of the production of an economy.
14. The categories of ISIC (especially higher-level categories) have become an accepted way of subdividing the
overall economy into useful coherent industries that are widely recognized and used in economic analysis, and as
such they have become accepted groupings for data used as indicators of economic activity.
15. While ISIC provides a standard way of grouping economic activities, there is sometimes a need to provide
data on other sets of economic activities that may cross the boundaries of existing high-level ISIC categories but have
become of interest to the statisticians, economists and policy makers. An example of this is the interest in measuring
the information economy, which includes activities from a wide range of ISIC sections, including section C
(Manufacturing), section J (Publishing, broadcasting, and content production and distribution activities), section K
(Telecommunications, computer programming, consultancy, computing infrastructure, and other information service
activities) and others. Since such groupings cannot be built into the existing ISIC structure, additional alternative
aggregations can be created to serve these special data needs and provide a standard way of presenting such data.

International acceptance of ISIC

16. ISIC was developed with rigorous consultation and collaboration among all stakeholders—national
statistical offices, international and regional organizations, academia and others. Through this inclusive revision
process, it has been possible to include features in ISIC that make it useful and attractive for the majority of countries
around the world. ISIC has been recommended to countries as an international standard and model in the
development and/or adaptation of their national activity classifications.
17. While ISIC was developed with a view to categorizing economic activities for national accounts and other
economic analysis purposes, its use extends to data collection, tabulation, analysis and presentation for a variety of
social and environmental applications, such as the link between the economy, education and health sectors and the
environment at the national and international levels. Moreover, at the national level, ISIC and its national versions are
increasingly used for administrative and business purposes, such as the categorization of revenues and expenditures.
It may be interesting to consider that this type of use results in gains in the quality and effectiveness of the articulation
of information systems, as well as valuable support for the decisions and actions of the State.
18. Previous versions of ISIC have been used—either directly or through compatible national adaptations—by
the majority of countries around the world. It is expected that ISIC, Rev.5 will continue to play this role as the only
fully internationally accepted activity classification. Apart from the increasing number of countries that have adapted
their national activity classifications or can provide statistical series according to ISIC, the classification is used by
many international organizations when publishing and analysing statistical data by economic activity. Those
organizations include the United Nations and its specialized agencies, the International Labour Organization (ILO),
the Food and Agriculture Organization of the United Nations (FAO), the United Nations Educational, Scientific and
Cultural Organization (UNESCO), the United Nations Industrial Development Organization (UNIDO), the
International Monetary Fund (IMF), the World Bank and other international bodies.
19. In its function as the internationally accepted reference classification for economic activities and its strong
link to other existing activity classifications, ISIC can be viewed as an effective tool for the harmonization of economic
statistics.

Structure of this publication

20. The present ISIC publication is organized into four parts, as follows:
Part one describes the underlying principles that are used in constructing the classification. Apart from
facilitating the understanding of the current classification structure, the principles may assist in developing national
4 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
classifications by applying criteria consistent with those of ISIC. Part one also describes the application rules that allow
for the correct and consistent classification of any given production unit in ISIC. It concludes with a description of the
relationship between ISIC and other classifications.
Part two shows the complete structure of the classification in a condensed form, allowing for easy viewing of
the format in which ISIC subdivides economic activities.
Part three provides a detailed description of the classification, with full explanatory notes that describe the
content of each ISIC category.
Part four outlines the major changes in ISIC, Rev.5 as compared to the previous version (ISIC, Rev.4), covering
both methodological and major structural changes.
21. While it may be intuitive to immediately use the detailed definitions of part three of this publication, users
are strongly encouraged to first familiarize themselves with the application rules set out in part one so as to correctly
understand and use the classification.
 Introduction 5

Chapter II
The underlying principles
of the classification

A. Purpose and nature of the classification

1. General considerations
22. In the study of economic phenomena, taking all elements into account simultaneously is not always
possible. For the purposes of analysis, certain elements need to be chosen and grouped according to particular
characteristics. Thus, all economic phenomena that are to be described in the form of statistics require systematic
classification. Classifications are, so to speak, the system of languages used in communication about, and statistical
processing of, the phenomena concerned. They divide the universe of statistical data into categories that are as
homogeneous as possible with respect to those characteristics that are the objects of the statistics in question.
23. ISIC is intended to be a standard classification of productive activities. Its main purpose is to provide a
set of activity categories that can be utilized for the collection and presentation of statistics according to such
activities. Therefore, ISIC aims to present this set of activity categories in such a way that entities can be
classified according to the economic activity they carry out. Defining the categories of ISIC is as much as possible
linked with the way the economic process is organized in units and the way in which this process is described in
economic statistics.
24. ISIC provides categories for the classification of units based on the activities carried out by these
units, but it does not per se provide categories for specific types of units. This conceptual underpinning has been
retained in the fifth revision for two reasons. First, naming actual units may be ambiguous if the same title or name
is used differently across countries. For example, a “board of education” may have completely different functions
and carry out completely different activities in different countries. Another example is the use of the term “Internet
café”. In some cases, this term refers to a restaurant that provides (wired or wireless) Internet access to its customers
as an amenity; in other cases it refers to a business service centre renting time on PCs along with Internet access
and related activities; while in still other cases, it refers to a unit providing entertainment services by offering
games that can be played over the Internet. Such terminology may change from country to country or region to
region. Therefore, creating categories for “board of education” or “Internet café” might lead to the classification
of units in the same class that should not be compared. Second, the name or title of a unit may not reflect the activity
carried out by the unit. For example, a shipyard is usually engaged in the building of ships. However, the same
infrastructure can be used for the dismantling of ships. If such a shipyard carries out mostly the dismantling of
ships, it should not be combined in the same class with other units that build ships. Therefore, classifying a unit
based on its characteristic as being a “shipyard” (e.g., based on existing capital equipment) would be ambiguous.
Another example is gas stations that also operate convenience stores. A class “gas station with convenience store”
would allow an easy classification of such units based on their appearance, but it would not reflect the actual activity
carried out. In ISIC, such a unit would be classified according to its principal activity (see sect. III.C below), which
could place it in “retail sale of automotive fuels” or “retail sale in non-specialized stores with food, beverages or
tobacco predominating”. While both options may have merits, the consistent approach of classifying according to
activities carried out has been followed in ISIC. Notwithstanding the above, in some cases a unit-type description
has been employed, such as in new ISIC classes that exceed the previous scope of the classification.
25. In this context, it would be best if there were as many categories in ISIC as there are possible activities or
if each production unit carried out only one activity, so that a unit could be unequivocally classified in a certain
6 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
category. For practical reasons, however, ISIC can have only a limited number of categories. Carrying out only one
activity may often be in conflict with the organization of activities and, as a result, with bookkeeping practices. In
addition, for units undertaking several economic activities, some types of data, such as financial data, are often only
available for the unit as a whole, which consequently is not homogeneous in respect of economic activity. Another
aspect of homogeneity is the distribution in geographical areas, which is particularly important for regional
statistics. Although the geographical aspect has, in principle, little to do with the activity classification, it does affect
the formation of statistical units. Therefore, the homogeneity of units relates to both activity and location.
26. The requirements for homogeneity and data availability are sometimes in conflict with each other because
the smaller or more homogeneous the unit, the less likely that the required data are available. It is suggested (see
sect. III.B below) that this problem be solved by using different units for different statistics, defined in such a way
that each larger unit consists of a number of complete smaller units. As a result, comparisons can be made between
the various statistics even when they use different units.
27. The detail required in the classification of data by kind of economic activity differs from country to
country. Differences in the geographical and historical circumstances and in the degrees of industrial development
and organization of economic activities result in differences in the degree of elaboration with which various
countries find it necessary or feasible to classify their data according to kind of economic activity. National analysis
often requires greater detail than is required or possible for international comparison purposes. Section IV below
explains how ISIC can be used or adapted for national purposes.

Scope of the classification

28. ISIC is a classification according to kind of economic activity and therefore its scope has historically been
restricted to the classification of units engaged in economic production as defined by SNA, which states: “Economic
production is an activity carried out under the control and responsibility of an institutional unit that uses inputs of
labour, capital, and goods and services to produce outputs of goods and services” (2008 SNA, para. 6.24).
29. The scope of the present version of ISIC is defined by the production boundary of the System of National
Accounts, with one exception—activities in ISIC class 9820 (Undifferentiated services-producing activities of private
households for own use). This type of activity, in combination with class 9810 (Undifferentiated goods-producing
activities of private households for own use), is used for measuring subsistence activities of households that cannot
otherwise be captured in the classification. These categories, however, cover only a subset of all households, because
households with clearly identifiable economic activities (whether market or for own final use) are classified in other
parts of ISIC. These two categories have been created for special purposes, such as labour-force surveys, to cover
combinations of household activities that would otherwise be difficult or impossible to assign to a single ISIC
category. These two categories are generally not used in business surveys.

2. Differences from other types of classifications

30. ISIC is a classification according to kind of productive activity, and not a classification of goods and
services. The activity carried out by a unit is the type of production in which it engages. This is the characteristic of
the unit according to which it will be grouped with other units to form industries. An industry is defined as the set
of all production units engaged primarily in the same or similar kinds of productive activity.
31. ISIC is distinctively different in nature and purpose from the classifications of goods and services,
ownership, institutional units or other types of classifications.
32. As it is in general not possible to establish a one-to-one correspondence between activities and products,
ISIC is not designed to measure product data at any detailed level. For this purpose, a separate classification exists,
namely, the Central Product Classification (CPC). Although each category in CPC is accompanied by a reference to
the ISIC class in which the goods or services are mainly produced (criterion of industrial origin), this does not imply
that all units producing these goods or services are classified here. By contrast, the classification of products is based
 Introduction 7
on the intrinsic characteristics of the goods or the nature of the services rendered (see also sect. IV.C below), which
results in a classification structure that is different from that used for ISIC.
33. Notwithstanding the above, it is often possible to use the classification of outputs in CPC as a tool for
identifying the principal activity of a unit.
34. ISIC does not draw distinctions according to kind of ownership of a producing unit or type of legal
organization because such criteria do not relate to the characteristics of the activity itself. Units engaged in the same
kind of economic activity are classified in the same category of ISIC, irrespective of whether they are unincorporated
enterprises, (part of) incorporated enterprises or government units, foreign controlled or have a parent enterprise
that consists of more than one establishment. Therefore, a strict link between ISIC and the Classification of
Institutional Sectors in SNA does not exist.
35. Similarly, manufacturing units are classified according to the principal kind of economic activity in which
they engage, whether the work is performed by power-driven machinery or by hand, or whether it is done in a
factory or in a household. The distinction between modern and traditional production methods is not a criterion for
ISIC, although that distinction may be useful in some statistics. Special considerations are necessary in cases where
a unit sells manufactured goods under its own name but has the actual production (fully on in part) outsourced to
other units. Guidelines for these cases are described in section III.C.5 below.
36. In addition, ISIC does not distinguish between formal and informal or between legal and illegal
production. Classifications according to kind of legal ownership, kind of organization or mode of operation may be
constructed independently of the classification according to kind of economic activity. Cross-classification with ISIC
can provide useful extra information.
37. In general, ISIC does not differentiate between market and non-market activities. However, it should be
emphasized that this distinction continues to be an important feature of SNA. A breakdown of economic activities
according to this principle is useful wherever data on value added are collected for activities that take place on both
a market and a non-market basis. This criterion should then be cross-classified with the categories of ISIC. Non-
market services are most frequently provided by government organizations or non-profit institutions serving
households in the field of education, health, social work etc.

B. Principles used in constructing the classification

38. The principles and criteria used to define and delineate classification categories at any level depend on
many factors, such as the potential use of the classification and the availability of data. These criteria will also change
depending on the level of aggregation considered. In an activity classification, the criteria for detailed levels of the
aggregation will inevitably consider similarities in the actual production process, while at more aggregated levels of
the classification, this is largely irrelevant.
39. ISIC is built on a production-oriented or supply-based conceptual framework that groups producing
units into detailed industries based on similarities in the economic activity, taking into account the following
characteristics of the activity as given in 2008 SNA para. 5.5:
 Type of goods and services produced as outputs
 Type of inputs used or consumed
 Technique of production employed
 Ways in which the outputs are used
40. The weights assigned to these types of criteria may vary from one category to another and between
different levels of the classification. The criteria were intended to ensure that it will be practical most of the time to
use the classes of ISIC for the industrial classification of establishments, and that the units falling into each class will
be as similar as is feasible in respect of the kind of activity in which they engage.
8 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
41. In general, the fifth revision of ISIC has tried to apply a more consistent approach, namely the use of
the production process to define categories at the most detailed level. Thus, activities that share a common
process in producing goods or services and use similar technologies are grouped together. As in many other
cases, however, the strong need for continuity, i.e., comparability with previous versions of the classification, may
override changes in the classification that could be made from the viewpoint of a consistent application of such a
rule.
42. In addition, in a number of instances, such as the production of machinery and equipment with
additive manufacturing machinery (3D printing) instead of traditional manufacturing methods, or intermediation
service activities via an online platform or through other means, the various aspects of activities are so highly
correlated that it’s practically very difficult to classify those activities by using the technology of production
as a primary criterion.
43. Since there is also a strong interest in relating activities and their outputs, the classes of ISIC are
defined so that as far as possible the following two conditions are fulfilled:
(a) The production of the category of goods and services that characterizes a given class accounts for the bulk
of the output of the units classified to that class;
(b) The class contains the units that produce most of the category of goods and services that characterize it.
These conditions are required in order that establishments or similar units may be classified according to kind
of economic activity uniquely and easily, and in order that the units included in a given class will be as similar to
each other as is feasible.
44. The two conditions set limits to the detail of classification that may be achieved in the classes of
ISIC. These classes must be defined in terms of the activities in which establishments customarily engage in
various countries of the world. Establishments may, in practice, carry out a number of different activities, and
the range of these activities will differ from one unit to another even though they engage in the same general kind
of economic activity. These differences will exist in the case of establishments within one country and will be
more pronounced in the case of establishments in different countries. It should be emphasized that the fact that
the organization of production differs from country to country makes it likely that the classes of ISIC do not
reflect the structure in each individual country.
45. Another major consideration in forming categories in ISIC was the relative importance of the activities
to be included. In general, separate classes are provided for kinds of activity that are prevalent in most countries, or
that are of particular importance in the world economy or at regional level.
46. Unlike for ISIC classes, the actual production process and technology used become less important as a
criterion for grouping activities at more aggregated levels. At the section, division and group levels, not only the
general characteristics of the goods and services produced but also the potential use of the statistics, for instance
in the SNA, become more important. Attention was also given to the range of kinds of activity frequently carried
out under the same ownership or control and to potential differences in scale and organization of activities and in
capital requirements and finance that exist between enterprises. Finally, existing patterns of categories at various
levels of national classifications have been used as additional criteria in establishing divisions and groups in ISIC.
47. In general, technology is not a main criterion for defining economic activities in ISIC. In ISIC, it does not
matter if an activity is carried out by means of traditional or modern production techniques. For instance, fintech
activities, which provide, improve or increase access to financial services through the extensive use of digitalization,
were already carried out in the past, albeit with less advanced technical instruments than those existing today. As
these activities are already defined in ISIC, no additional groups or classes related to financial technology (fintech)
were introduced in ISIC Rev.5.
48. ISIC Rev.5 does not longer make any difference as to how goods are distributed. The ISIC structure is based
on the product sold, no matter whether the good is sold in a shop, online, via stalls and markets or via vending
machines.
 Introduction 9

C. Structure and coding system of the classification

49. The fifth revision of ISIC provides substantially more detail at all levels than the previous versions
of the classification. This increased detail responds to requests by both producers and users of statistics. However,
the basic coding system of the classification has not been changed.
50. As in the previous revision of ISIC where the number of sections exceeds 10, the use of capital letters
for coding the sections was continued in order to avoid having to change the ISIC coding structure to a five-level
structure.
51. The names given to the different levels in ISIC, Rev.5 remain unchanged from those in the
previous revision. The tabulation categories, identified by letters, are called “sections”, the 2-digit categories
“divisions”, the 3-digit categories “groups” and the 4-digit categories “classes”. As in the previous version of ISIC,
the use of letters for the section level of the classification is complemented by the use of a purely numerical system
at the division (2-digit), group (3-digit) and class (4-digit) levels.2
52. While some of the categories in ISIC have remained unchanged from the previous revision, others have
been split to give appropriate weight to new activities, often elevating the level of existing categories.
53. At the highest level of ISIC, some sections can be compared to the previous version of the classification.
Correspondence tables to assist in this process will be provided separately.
54. The divisions are coded consecutively. Some “gaps” have been provided to allow countries to introduce
division-level categories without a complete change of the ISIC coding. These gaps have been introduced in
sections where the need for additional divisions at the national level is most likely to arise. For this purpose, the
following division code numbers have been left unused: 04, 34, 40, 44, 45, 48, 54, 57, 67, 76, 83 and 89.
55. While the sections are assigned capital letters, the Arabic numbers assigned to a given category of ISIC may
be read as follows: the first and second digits, taken together, indicate the division in which the category is included;
the first three digits identify the group; and all four digits indicate the class. ISIC now comprises 22 sections,
which are then further subdivided into a total of 87 divisions, 258 groups and 463 classes. the number of categories
remain relatively stable compared with ISIC, Rev.4.
56. Whenever a given level of the classification is not divided into categories of the next more detailed level
of classification, “0” is used in the code position for the next more detailed level. For example, the code for the
group “Remediation and other waste management service activities” is 390 since the division “Remediation
and other waste management service activities” (code 39) is not divided into either groups or classes. Again, the
code for the class “Manufacture of tobacco products” is 1200 because the division “Manufacture of tobacco
products” (code 12) is divided neither into groups nor into classes. The class “Manufacture of pulp, paper and
paperboard” is coded as 1701 since the division “Manufacture of paper and paper products” (code 17) is not divided
into groups but the group “Manufacture of paper and paper products” (code 170) is divided into classes.

2 It is recognized that the connection between sections, on the one hand, and divisions, groups and classes, on the other, is
not very intuitive, but it does allow the preservation of a four-level ISIC structure. The current system uses letters only for the
high-level sections, while coding and data entry are carried out completely with a numerical system. Other options considered,
such as a purely numerical coding system or a system that combines section and class codes (e.g., “A0111”), would either
expand the coding system to more levels, expand the code itself to a 5-digit code or create mixed alphanumerical codes that
might be difficult to use in basic data entry.
10 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4

Chapter III
Application of the classification

A. Principal, secondary and ancillary activities

57. In ISIC, the expression “activity” is used to identify productive activities. These activities are defined
as the use of inputs (e.g., capital, labor, energy and materials) to produce outputs. The outputs that result from
undertaking activities can be transferred or sold to other units (in market or non-market transactions),
placed in inventory or used by the producing units for own final use.
58. Some activities separately identified in ISIC are simple processes that convert inputs to outputs, such
as dyeing of fabric, while other activities are characterized by highly complex and integrated steps, such as
automobile manufacturing or computer system integration.
59. The principal activity of an economic entity is the activity that contributes most to the value added
of the entity, as determined by the top-down method (see sect. III.C below). As a result of the top-down
method, it is not necessary that the principal activity account for 50 per cent or more of the total value added
of an entity or even that its generated value added exceed that of all other activities carried out by the unit,
although in practice it will do so in the majority of cases. Products resulting from a principal activity are either
principal products or by-products. By-products are products that are necessarily produced together with
principal products (for example, hides produced when producing meat by slaughtering animals). In section
III.C below, it will be explained how, in practice, the principal activity of a statistical unit should be
determined when classifying according to ISIC.
60. A secondary activity is each separate activity that produces products eventually for third parties
and that is not the principal activity of the entity in question. The outputs of secondary activities are
secondary products. Most economic entities produce at least some secondary products.
61. Principal and secondary activities cannot be carried out without the support of a number of ancillary
activities, such as bookkeeping, transportation, storage, purchasing, sales promotion, cleaning, repair and
maintenance, security etc. At least some of these activities are found in every economic entity. Thus, ancillary
activities are those that are undertaken to support the main productive activities of an entity by providing
goods or services entirely or primarily for the use of that entity.
62. A distinction should be made between principal and secondary activities, on the one hand, and
ancillary activities on the other. The output of principal and secondary activities, which are consequently
principal and secondary products, is produced for sale on the market or for other uses that are not prescribed
in advance; for example, they may be stocked for future sale or for further processing. Ancillary activities are
undertaken in order to facilitate the principal or secondary activities of the entity.
63. There are a number of characteristics of ancillary activities that can generally be observed in
practice and that help to identify them. The output is always intended for intermediate consumption within
the same entity and is therefore usually not recorded separately. Although most ancillary activities produce
services, some goods-producing activities may, by exception, be regarded as ancillary. The goods thus produced,
however, may not become a physical part of the output of the main activity (examples are tools, scaffolding
 Introduction 11
etc.). Ancillary activities are usually fairly small-scale compared with the principal activity they support.
64. If an establishment undertaking ancillary activities is statistically observable, in the sense that
separate accounts for the production it undertakes are readily available, or if it is in a geographically different
location from the establishments it serves, it may be desirable and useful to consider it as a separate unit
and allocate it to the industrial classification corresponding to its principal activity. However, it is
recommended that statisticians not make extraordinary efforts to create separate establishments for these
activities artificially in the absence of suitable basic data being available.
65. Under the definition given in paragraph 61 above, the following activities are not to be considered
ancillary:
(a) Producing goods or services as part of fixed capital formation. The type of units most affected
are those doing construction work on the account of their parent unit. This approach is in
accordance with the classification in ISIC of own-account construction units for which data
are available to the construction industry;
(b) Producing output which, although also used as intermediate consumption by the principal or
secondary activity, is for the greater part sold on the market;
(c) Producing goods that become a physical part of the output of the principal or secondary
activity (for example, the production of boxes, tin cans or the like by a department of an
enterprise as packaging for its own products);
(d) Research and development activities, which are considered part of fixed capital formation
in the context of SNA.

B. Statistical units
1. General remarks
66. Economic statistics describe the activities of economic transactors and the transactions that
take place between them. In the real world, economic entities engaged in the production of goods and
services vary in their legal, accounting, organizational and operating structures. To create statistics that
are consistent across entities and internationally comparable, it is necessary to define and delineate standard
statistical units (whether as observation units or analytical units) that are suitable for data compilation and
aggregation. The comparability of statistics is greatly enhanced when the units about which statistics are
compiled are similarly defined and classified.
67. Economic entities have numerous characteristics and a variety of data are required about them
that may be classified in many ways, among the most important of which are classification by (a) institutional
sector, (b) activity and (c) location. The need to classify statistical units by these characteristics requires that
they be as homogeneous as possible with respect to institutional sector, economic activity or location, and this
plays an important role in their definition.
68. Statistical units may be defined as the entities about which information is sought and about which
statistics are ultimately compiled. These may be identifiable legal or physical entities or statistical constructs.
69. Statistical units may be defined following many criteria, namely: legal, accounting or
organizational criteria; geographical criteria; and economic criteria. The relative importance of these
criteria depends on the type of unit concerned. A legal or institutional criterion helps to define units that are
recognizable and identifiable in the economy. In some cases, legally separate units need to be grouped together
because they are not sufficiently autonomous in their organization. In order to define some types of units,
accounting or financial criteria also have to be applied. The availability of accounting criteria requires that an
institutional unit maintain a complete set of accounts. In the case of the organizational criteria of an
enterprise, the defining characteristic is that the organizational unit should have an appreciable degree of
12 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
autonomy.
70. A unit can also be geographically identified. Observational and analytical units are defined in such
a way as to permit data to be compiled for local, regional and national economies. The rule regarding
geographical criteria is helpful in order to permit consolidation and avoid omissions or duplications of units.
71. Activity criteria suggest that entities engaged in similar economic activities be grouped together
because this makes it easier to analyse goods and services produced in the economy using a homogeneous
production technology.
72. Economic statistics are required by different users for various types of analysis. The System of
National Accounts (SNA) is a principal user and it has particular requirements, but there are also other users,
including policy analysts, business analysts and businesses that use economic data for studying industrial
performance, productivity, market share and other issues. Since different units within an economic entity are
suitable for the compilation of different types of data, the type of data that are required is another factor that
influences the definition and delineation of statistical units.

(a) Legal entities

73. Most societies provide for the legal recognition of economic entities, under laws that enable them to
define and register themselves as legal entities. Legal entities are recognized by law or society, independently
of the persons or institutions that own them. The characteristics of a legal entity are: they own goods or assets,
they incur liabilities and they enter into contracts. The legal unit always forms, either by itself or sometimes
in combination with other legal units, the legal basis for the statistical unit.
74. An example of a legal entity is a corporation that owns or manages the property of the
organization, enters into contracts, receives and disposes of its income, and maintains a complete set of accounts,
including profit and loss accounts and balance sheets.

(b) Institutional units

75. Institutional units are the core unit of SNA. All subsequent definitions embody the definition of
this basic unit. Institutional units are transactors in the SNA and must therefore be capable of engaging in the
full range of transactions in their own right and on their own behalf.
76. An institutional unit is defined as an economic entity that is capable, in its own right, of owning
assets, incurring liabilities and engaging in economic activities and transactions with other entities. It may own
and exchange goods and assets, is legally responsible for the economic transactions that it carries out and
may enter into legal contracts. An important attribute of the institutional unit is that a set of economic
accounts exists or can be compiled for the unit. This set of accounts includes consolidated financial accounts
and/or a balance sheet of assets and liabilities.
77. Institutional units include persons or groups of persons in the form of households and legal or
social entities whose existence is recognized by law or society independently of the persons or other entities
that may own or control them.

2. Statistical units in the System of National Accounts

78. The systematic description of the economy, as represented by SNA, analyses two interrelated
types of transactors and transactions that require two levels of statistical units. The establishment, in
combination with ISIC and CPC, is used for the analysis of transactions in goods and services and for
compilation of the production account. The enterprise is used as the statistical unit for compilation of income
accounts, accumulation accounts and balance sheet accounts, as well as in the institutional sector classification
of economic entities.
 Introduction 13
(a) Enterprise
79. An institutional unit in its capacity as a producer of goods and services is known as an enterprise.
An enterprise is an economic transactor with autonomy in respect of financial and investment decision-
making, as well as authority and responsibility for allocating resources for the production of goods and
services. It may be engaged in one or more productive activities.
80. An enterprise may be a corporation (or quasi-corporation), a non-profit institution or an
unincorporated enterprise. Corporate enterprises and non-profit institutions are complete institutional
units. On the other hand, the term “unincorporated enterprise” refers to an institutional unit—a household
or government unit— only in its capacity as a producer of goods and services.
81. The enterprise is the level of statistical unit at which all information relating to its transactions,
including financial and balance-sheet accounts, are maintained, and from which international transactions,
an international investment position (when applicable), consolidated financial position and net worth can
be derived.

(b) Establishment
82. SNA describes the statistical unit to be defined and delineated for industrial or production
statistics as the establishment. The establishment is defined as an enterprise or part of an enterprise that is
situated in a single location and in which only a single (non-ancillary) productive activity is carried out or in
which the principal productive activity accounts for most of the value added.
83. ISIC is designed for grouping units engaged in similar activities for the purpose of analysing
production and compiling production statistics. Although it is possible to classify enterprises according to their
principal activity using ISIC and to group them into industries, some of the resulting industries are likely to be
very heterogeneous when enterprises have secondary activities that are very different from their principal
activities. It therefore becomes necessary to partition large and complex enterprises into more homogeneous
units, for which production data can be compiled. This is particularly important for enterprises that account
for a large proportion of the value added of particular industries or the economy as a whole.
84. Although the definition of an establishment allows for the possibility that there may be one or more
secondary activities carried out, they should be small in magnitude compared with the principal activity.
If a secondary activity within an establishment is as important, or nearly as important, as the principal activity,
then the unit is more like a local unit (see paras. 86 and 87 below). It should be subdivided so that the secondary
activity is treated as taking place within an establishment separate from that in which the principal activity
takes place.
85. In the case of most small and medium-sized businesses, the enterprise and the establishment will be
identical. Large and complex enterprises that are engaged in many economic activities belonging to different
ISIC industries will be composed of more than one establishment, provided that smaller, more homogeneous
production units can be identified for which production data can be compiled.

3. Other statistical units

86. The concept of the establishment combines both a kind-of-activity dimension and a locality
dimension. The concept is based on the assumption that the aim of the statistical programme is to compile data
that is classified both by activity and by geographical region. In circumstances in which precision in either the
geographic or the activity dimension is not required, there are other units that may be used as statistical units
for the compilation of production or production-related statistics.

(a) Kind-of-activity unit

87. A kind-of-activity unit is an enterprise or part of an enterprise that engages in only one kind of
 14 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
productive activity or in which the principal productive activity accounts for most of the value added.
Compared with the establishment, in the case of such a unit, there is no restriction on the geographic area in
which the activity is carried out but it is characterized by homogeneity of activity.

(b) Local unit

88. Enterprises often engage in productive activity at more than one location, and for some purposes
it may be useful to partition them accordingly. Thus, a local unit is defined as an enterprise or a part of an
enterprise (for example, a workshop, factory, warehouse, office, mine or depot) which engages in productive
activity at or from one location. The definition has only one dimension, in that it does not refer to the kind of
activity that is carried out.
89. When the criterion of kind-of-activity unit and the local unit are combined, the resulting concept
corresponds to the operational definition of the establishment.

(c) Unit of homogeneous production

90. Units that are defined to be optimal for a particular type of analysis are described as analytical
units. Establishments are designed to be units that are more suitable for analysis of production in which the
technology of production plays an important role. However, the appropriate analytical unit for the
purposes of input-output analysis is a unit of homogeneous production that is defined as a production unit
in which only a single (non-ancillary) productive activity is carried out. Units of homogeneous production are
independent of the location of the activity.
91. If it is desired to compile production accounts and input-output transaction tables by region, it is
necessary to treat units of homogeneous production located in different places as separate units even though
they may be engaged in the same activity and belong to the same institutional unit.

4. Delineating statistical units

92. The universe of economic entities is composed of large and complex enterprises engaged in many
different activities, whether horizontally or vertically integrated, that may be undertaken at or from many
geographical locations, as well as small enterprises engaged in one or very few activities that are undertaken
at or from a single geographical location.
93. Enterprises have production units at which or from which they undertake the economic activity of
producing goods and services. Production can take place at a particular location—for example, at a mine, a
factory or a farm, or in the case of production of services from a certain location. For example, either
transportation services deliver the product from the farm or factory gate to the purchaser or the product is
delivered by means of a network that operates over a wide geographical area. Either way, it is assumed that
the service originates from a certain location. Similarly, other services, such as those of engineering consultants,
originate at a certain location from which they may be delivered to the location of the customer.
94. The need to delineate statistical units arises for large and complex economic entities whose activities
fall into different classes of ISIC or whose production units are located in different geographical areas.
95. In large and complex entities, the units at which or from which production takes place are grouped
for management, administrative and decision-making purposes into hierarchical structures. Higher-level
organizational units own, control or manage the lower-level production units where production decisions are
made or production takes place. Management of the financial affairs of the business usually occurs at a higher
organizational level than does management of production operations. The accounting systems of businesses
usually reflect this management structure by mirroring the hierarchy of management responsibility for the
operations of the business. The accounts required to support the management and decision-making
functions, whether financial or production, are usually maintained for the corresponding level of management
responsibility.
 Introduction 15
96. Enterprises also have a legal structure that may constitute units or groups of units that form the
legal base of the business. An enterprise derives its autonomy from the common ownership and control of its
resources, irrespective of the number of legal units under which it registers them.
97. In small enterprises, the operational and legal structures often coincide and may even be embodied
in a single unit. For large enterprises, the operational structure may be different from the legal structure,
coinciding with it only at the highest level of the business. In such cases, the organizational and production
units of the enterprise’s operational structure may differ from the units of their legal structure.
98. The statistical units of large and complex institutional units may be delineated through a process
referred to as profiling. Profiling identifies the enterprise, its legal structure, its operating structure, and the
production and organizational units that are used to derive the statistical units. Once identified, the enterprise
and its constituent establishments comprise the statistical units of the statistical structure. In delineating
the statistical structure, functional or other groups in the organizational structure may be ignored and the
constituent units regrouped to form the units of the statistical structure. For multi-establishment enterprises,
the statistical structure may not coincide with the legal structure in which ownership of assets is registered.
99. The source of information for production statistics and income statistics is often the management
and cost accounts of businesses. These accounts record operating revenues earned from the sale of goods and
services produced and the associated costs, wages and salaries, depreciation and operating profits. Countries
that are more interested in the higher level of autonomy in the structure of enterprises than in the
geographical location of the activity may prefer to delineate and use the kind-of-activity unit. On the other
hand, if they are more interested in compiling comprehensive production statistics at a subnational level of
geographic detail, then it will be necessary to delineate the smallest unit (a) that is as homogeneous as possible
in terms of activity and geography, and (b) for which statistics on revenues from the sale of goods and services,
associated costs, value added and gross fixed capital formation undertaken can be compiled or estimated. This
is the level at which the establishment (local kind-of-activity unit) is delineated as the statistical unit.
100. Whenever the legal structure and the statistical construct based on production units do not
coincide, statistical agencies will need to articulate the statistical structure and compile data with the help of
surveys. The legal structure may consist of units created purely for tax purposes that are completely irrelevant
to the producing units of the enterprise. However, if it is necessary to draw on tax records for the required
data or if survey data need to be supplemented with tax data, statistical agencies will have to decide whether (a)
they can find a way to map the legal and statistical structure of the enterprise, or (b) they prefer to use the legal
structure selectively as a proxy for the statistical structure.
101. The statistical structure delineates and identifies the units about which data are to be compiled.
However, the data may have to be collected from higher- or lower- level units, which are then described as
collection entities. As a result of globalization, some multinational global enterprises are keeping integrated
accounting records at the global or the regional levels only; it may thus be increasingly difficult to separate and
extract complete accounts for all the activities taking place within each domestic economy if such data are not
obtained from the main or regional head office of the global enterprise.

5. National differences in selecting statistical units

102. An establishment undertakes an activity at or from a particular location. Thus, the concept of
the establishment combines two dimensions—an activity dimension and a locality dimension. The concept is
based on the assumption that the aim of the statistical programme is to compile data that is classified both
by activity and by location, e.g., by geographical region. However, ISIC can be used to classify many other
variables needed to analyse production and industrial performance. In examining the accounting and operating
structures of enterprises, it is possible that producing units with differing levels of homogeneity with respect to
activities and geographical precision will be found and that they may be suitable for the compilation of data
on selected variables, such as number of persons employed; they may even be suitable for the compilation of
production statistics if all the information needed with respect to meaningful operating profit is available.
 16 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
103. Many different factors play a role in defining the best statistical unit for a given form of data
collection, such as the structure of the legal system in a country, including regulations for the organization
of businesses; the particular structure of the industries involved; the type of data collection involved; and the
purpose and targeted level of data collection. The statistical units discussed in this section can be taken to
serve as models, but the actual choice of the type of statistical unit to be used by countries would depend upon
national specifics and the type and the purpose of data collection involved.
104. Finally, it should be noted that in order to ensure reliability and comparability of data in
delineating statistical units, such units should be defined in a consistent manner. The consistent definition of
these units is equally as important as their accurate classification.

C. Classification of statistical units

1. General guidelines
105. In the following paragraphs, a number of general rules of interpretation are given that should be
followed when classifying more complex statistical units. It should be noted that the explanatory notes to some
sections and divisions of ISIC (see part three below) also indicate how to treat such cases.
106. A unit may perform one or more economic activities falling into one or more categories of ISIC,
Rev.4. Units are classified according to their principal activity. In practice, the majority of production units
perform activities of a mixed character. The identification of a principal activity is necessary to allocate a unit
to a particular ISIC, Rev.4 category.
107. The activity classification of each unit is determined by the ISIC class in which the principal
activity—or range of activities—of the unit is included. All activities are considered when determining the
principal activity, but only the principal activity is used to classify a unit. The principal activity of the unit in
general can usually be determined from the goods that it sells or ships or the services that it renders to other
units or consumers. However, the descriptions and explanatory notes of the individual classes in ISIC (see part
three below) should be used to determine the activities carried out in terms of ISIC categories, using not only
the output structure but also the input structure and most importantly the production process.
108. Ideally, the principal activity of the unit should be determined with reference to the value added
to the goods and services produced. The relevant valuation concept is gross value added at basic prices,
defined as the difference between output at basic prices and intermediate consumption at purchaser’s prices.

(a) Value-added substitutes

109. In order to determine the principal activity of a unit, the shares of value added by that unit to
the activities falling into different categories of ISIC, Rev.5 have to be known. In practice, however, it is often
impossible to obtain the information on value added of the different activities performed and the activity
classification has to be determined by using substitute criteria, such as:
(a) Substitutes based on output, such as:
(i) The gross output of the unit that is attributable to the goods or services associated with each
activity;
(ii) The value of sales or shipments of those groups of products falling into each category of
activity;
(b) Substitutes based on input, such as:
(i) Wages and salaries attributable to the different activities;
(ii) Hours worked attributable to the different activities;
(iii) Employment according to the proportion of people engaged in the different activities of the unit;
(iv) Capital intensity attributable to the different activities.
 Introduction 17
110. Such substitute criteria can be used as proxies for the unknown value-added data to obtain the
best approximation possible compared to the result which would have been obtained on the basis of the
value-added data. The use of substitute criteria does not change either the methods used to determine the
principal activity or the rules of the top-down method. Substitutes are only operational approximations of
value added.
111. The simple use of the above listed substitute criteria may sometimes be misleading, however;
this will always be the case when the structure of the substitute criteria is not directly proportional to the
(unknown) value added.

(b) Problems with output substitutes

112. When using sales (turnover) or shipments as a proxy for value added, it immediately becomes
evident that in certain cases turnover and value added are not proportional. For example, trade turnover
usually has a much lower share of value added than a manufacturing activity. Other examples are
turnover of forwarding agents or of general contractors. Even within manufacturing, the relation between
sales and the resulting value added may vary between and within activities. If a significant portion of
production goes into inventory and is therefore not sold within the same reporting period, the value of sales
may grossly underestimate the value added. In addition, in some cases a turnover figure makes no sense
or does not exist, e.g., for financial intermediation activities or insurance activities. Similar
considerations should be borne in mind when using gross output data as substitute criteria.
113. Many units perform trade and other activities. In such cases, trade turnover figures are the most
unsuitable indicators for the unknown value-added share of the trade activity. A much better indicator is the
gross margin (difference between the trade turnover and purchases of goods for resale adjusted by changes in
stocks). The trade margins may vary within a single wholesale or retail trade activity, however, and may also
vary between trade activities. In addition, the specific classification rules for retail trade should be considered
as set out below.
114. Sales (turnover) as a proxy for value added is not appropriate when the principal activity
is provided free of charge or at reduced prices and sales can be attributed to other activities. For
example, a business providing online services that sells advertising space may have no sales
attributed to the online service. Using sales as proxy would result in the business being classified to
advertising. However most of the employment, wages, and capital (i.e. IP and infrastructure) will
be used to provide the online service, therefore the principal activity of the business is the online
service.

(c) Problems with input substitutes

115. Similar precautions have to be considered when input-based substitute criteria are applied. The
proportionality between wages and salaries or employment and value added is not reliable if the capital
intensity of the various activities is different. Higher capital intensity normally implies higher depreciation and
a lower share of wages and salaries in the gross value added. Capital intensity varies substantially between
different economic activities and also between activities of the same ISIC, Rev.5 class. For example, the
activity of producing items by hand will have a lower capital intensity than the mass production of the same
item in an industrial plant; both activities, however, fall in the same ISIC, Rev.5 class.
2. Treatment of mixed activities
116. Instances may arise in which considerable proportions of the activities of a unit are included in
more than one class of ISIC. These cases may result from the vertical integration of activities (for example, tree
felling combined with sawmilling or the manufacture of textiles with subsequent production of wearing
apparel); the horizontal integration of activities (for example, the manufacture of hides and skins in
slaughterhouses); or any combination of activities that cannot be separated at the level of the statistical unit. In
 18 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
such situations, the unit should be classified according to the rules set out below.
117. Although typically applied at the class level, the rules set out below are valid for applying the
classification at any level of the coding structure.

(a) Treatment of independent multiple activities

118. If a unit is engaged in several types of independent activities but cannot itself be segregated into
separate statistical units (when, for example, manufacture of bakery products is combined with manufacture of
chocolate confectionery), the unit should be classified according to the activity that contributes most to the value
added of the unit (i.e., the principal activity), as determined by the “top-down” method described in paras.
125–133 below.
119. The “top-down” method also applies wherever a unit performs only one activity or one activity
accounts for more than 50 per cent of the value added. However, in such cases the classification of the unit is
rather straightforward and no step-by-step application of the “top-down” method is necessary. In such cases, the
unit will be classified to the single ISIC category representing the activity carried out, or in the latter case, to the
ISIC category that represents the activity that accounts for more than 50 per cent of the value added.

(b) Treatment of vertical integration

120. The vertical integration of activities occurs wherever the different stages of production are carried out
in succession by the same unit and the output of one process serves as input to the next. Examples of common
vertical integration include tree felling and subsequent on-site sawmilling, a clay pit combined with a brickworks or
production of synthetic fibres in a textile mill.
121. ISIC, Rev.5 treats vertical integration in the same manner as ISIC, Rev. 4 and as any other form of
multiple activities. In consequence, a unit with a vertically integrated chain of activities should be classified to the
class corresponding to the principal activity within this chain, i.e., the activity accounting for the largest share of
value added, as determined by the top-down method. It should be noted that the term “activity” in this context is
used for each step in the production process that is defined in a separate ISIC class, even though the output of
each step may not be intended for sale.
122. If value added or substitutes for the individual steps in a vertically integrated process cannot be
determined directly from accounts maintained by the unit itself, comparisons with other units (e.g., based on
market prices for intermediate and final products) could be used. The same precautions for using substitutes as
listed above apply here. If it is still impossible to determine the share of value added (or its substitutes) for the
different stages in the chain of production activities, default assignments for typical forms of vertical integration
can be applied.
(c) Treatment of horizontal integration
123. Horizontal integration occurs when an activity results in end-products with different
characteristics. This could theoretically be interpreted as activities carried out simultaneously using the same
factors of production, in which case it would often be impossible to separate such activities statistically into
different processes, assign them to different units or generally provide separate data for them, nor would rules
relying on allocation of value added or similar measures be applicable. Alternative indicators, such as gross
output, might sometimes be applicable, but there is no general rule for identifying the single activity that best
represents the mix included in this horizontal integration. Since patterns of horizontal integration have been
considered in the preparation of the classification, in many cases commonly integrated activities are
included in the same class of ISIC even though their outputs have quite different characters.
124. For example, the production of crude glycerol is classified in ISIC class 2023 (Manufacture of
soap and detergents, cleaning and polishing preparations, perfumes and toilet preparations), while the
production of synthetic glycerol is classified in class 2011 (Manufacture of basic chemicals). Crude glycerol is a
by-product of soap manufacturing and therefore the production process of crude glycerol cannot be separated
from the production process of soap; as a result, both productive activities have to be classified in the same ISIC
 Introduction 19
class, even though their physical output is quite different. On the other hand, the production of synthetic glycerol
is a chemical process quite distinct from the production of crude glycerol and these two activities are classified
separately even though their physical output is quite similar. Another example would be the production of
electricity through a waste-incineration process. The activity of waste disposal and the activity of electricity
production cannot be separated in this case and ISIC assigns them, by convention, to class 3821.
125. In some cases, activities are carried out using the same factors of production but the activities also
exist independently, i.e., neither one provides input into the other nor could it be considered as producing
a by-product of the other activity. An example would be the combined transport of passengers and freight.
Since both activities independently have a substantial size in most economies and are separately of interest for
analytical purposes, they have not been combined in a single ISIC class. In this case, value-added substitutes
should be used to determine the primary activity of the unit in question if both activities are carried out
simultaneously.

(d) The “top-down” method

126. The top-down method follows a hierarchical principle: the classification of a unit at the lowest level
of the classification must be consistent with the classification of the unit at the higher levels. To satisfy this
condition the process starts with the identification of the relevant category at the highest level and
progresses down through the levels of the classification in the following way:
Step 1. Identify the section that has the highest share of the value added.
Step 2. Within this section, identify the division that has the highest share of the value added.
Step 3. Within this division, identify the group that has the highest share of the valued added (see below
for exception in the case of wholesale and retail trade activities).
Step 4. Within this group, identify the class that has the highest share of value added.

Box 1
Example: Identifying the principal activity of a unit using the top-down method

A reporting unit may carry out the following activities:

Share of
value added
Section Division Group Class Description of the class (percentage)
25 251 2512 Manufacture of tanks, reservoirs and containers of metal 7
281 2816 Manufacture of lifting and handling equipment 8
2821 Manufacture of agricultural and forestry machinery 3

C 28 Manufacture of metal-forming machinery and machine

2822 21
282 tools
Manufacture of machinery for mining, quarrying and
2824 8
construction
29 293 2930 Manufacture of parts and accessories for motor vehicles 5
461 4610 Wholesale on a fee or contract basis 7
G 46
465 4659 Wholesale of other machinery and equipment 28
Architectural and engineering, and related technical
N 71 711 7110 13
consultancy activities

The principal activity is then determined as follows:

Step 1. Identify the section

Section C Manufacturing 52
20 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
Section G Wholesale and retail trade 35
Section N Professional, scientific and technical activities 13

Step 2. Identify the division (within section C)

Division 25 Manufacture of fabricated metal products, except machinery and equipment 7

Division 28 Manufacture of machinery and equipment n.e.c. 40
Division 29 Manufacture of motor vehicles, trailers and semi-trailers 5

Step 3. Identify the group (within division 28)

Group 281 Manufacture of general-purpose machinery 8

Group 282 Manufacture of special-purchase machinery 32

Step 4. Identify the class (within group 282)

Class 2821 Manufacture of agricultural and forestry machinery 3

Class 2822 Manufacture of metal-forming machinery and machine tools 21
Class 2824 Manufacture of machinery for mining, quarrying and construction 8

The principal activity is therefore 2822 (Manufacture of metal-forming machinery and

machine tools), although the class with the biggest share of value added is class 4659
(Wholesale of other machinery and equipment).
If a “bottom-up” approach is used, the reporting unit would be classified to wholesale trade in
class 4659 (Wholesale of other machinery and equipment), based on the single largest share
of value added at the class level. This would result in a reporting unit with a value added share
in manufacturing of 52 per cent being classified outside of manufacturing.

The top-down method may apply to only a small part of the statistical universe, depending on the
selection of the statistical unit, especially if the selected units are defined so that they carry out only one
activity.
127. If none of the ISIC classes accounts for at least 50 per cent of the value added, in the case of
wholesale and retail trade activities, additional steps are being considered in step 3 of the above process,
which can be considered to correspond to additional levels in the classification. For practical reasons, these
levels have not been reflected as separate levels in the classification structure itself but rather consist of
clusters of ISIC, Rev.5 groups. For wholesale activities, these additional steps relate to (a) the distinction
between commission and own-account trade and (b) the distinction between specialized and non-specialized
trade. For retail trade activities, these additional steps relate to (a) the distinction between specialized and non-
specialized trade and (b) the distinction between own-account retail trade and intermediation service activities
for retail sale. These distinctions must be considered as additional levels (within step 3) and must be applied
when using the top-down method. After determining the correct group in step 3, the determination of the class
representing the principal activity is carried out in accordance with step 4 above.
128. Following the additional criteria provided above, the following figure represents the decision
tree to be used for the allocation of a unit within ISIC division 46 (Wholesale trade):

Division 46

Wholesale trade on own account Wholesale trade on a fee or contract basis

 Introduction 21
462–469 461

Non-specialized Specialized wholesale

wholesale trade trade
469 462-467

462 463 464 465 466 467

(further subdivided according to
the range of products sold)

129. Following the additional criteria provided in paragraph 124 above, the following figure
represents the decision tree to be used for the allocation of a unit within ISIC division 47 (Retail trade):

Division 47

Retail trade in stores Retail trade not in stores

471–478 479

Specialized Non-specialized Via stalls and markets Others

472–478 471 479

472 473 474 475 476 477 478

(further subdivided according to the range of
products sold)
22 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
130. No attempt is made to reflect other possible aspects of retail activity, such as the kind of
service (e.g., traditional service or self-service), outlets run by voluntary services or purchasing
associations, or to distinguish between cooperative and other retail trade. Units whose main activity in
terms of value added is obviously retail trade are classified based on the types of goods being traded in
division 47.
131. When choosing between specialized retail trade in ISIC groups 472–478 and non-specialized
retail trade in ISIC group 471, the outcome will depend on the number of ISIC, Rev.4 classes involved,
irrespective of the group-level importance. The following rules apply to make that determination (similar
considerations apply to specialized vs. non-specialized wholesale trade activities):
(a) If the products sold comprise up to four classes in ISIC, Rev.5 groups 472 to 478, none of
which accounts for a share of 50 per cent or more in terms of value added but each of which
represents 5 per cent or more of value added, a specialized trade is still involved. It is then
necessary only to determine the focus of the activities on the basis of value added. Selecting
first the main group and then the class within that group will determine the allocation of
the principal activity;
(b) If the products sold comprise five or more classes in groups 472 to 478, each representing
5 per cent or more of value added but none of which accounts for a share of 50 per cent or
more, the unit should be classified as a non-specialized store and allocated to group 471. If
food, beverages and tobacco represent at least 35 per cent of value added, allocation will be
made to ISIC, Rev.4 class 4711. In all other cases, allocation should be to class 4719;
(c) The above allocation rules are always based exclusively on the retail activity of the unit. If, in
addition to its retail trade, a unit has a secondary activity that also provides services or
produces goods, the allocation of the unit to the appropriate class of division 47 is determined
only by the composition of its retail activity. In other words, the 5 per cent rule provided
above applies to 5 per cent of the value added of all retail sale activities, not 5 per cent of the
value added of all activities of the unit.
[Example: Identifying the principal activity of a unit using the top-down method within
wholesale and retail trade] – to be developed

132. If value added cannot be determined for the activities involved, approximations as set out
above can be used, provided that their application to the different activities is consistent.
133. The top-down method satisfies the principle that at the lower levels the activity classification
is in conformity with the principal activity of the unit from the point of view of the upper levels of the
activity classification. At lower levels of the classification, the share of value added of the category of
ISIC, Rev.5 that results from using the top-down method will not necessarily account for more than 50
per cent of total valued added of that unit. The more one proceeds from the upper to the lower levels of
the hierarchical structure of ISIC Rev.4, the more often will this be the case. Theoretically, at the highest
hierarchical level of ISIC, Rev.4 no section might account for more than 50 per cent of the value added of
a unit.
134. In principle, the top-down method permits determination of the principal activity of a unit
down to the lowest level of the hierarchical activity classification; in practice, it is only necessary to apply
the method to the lowest level that is actually used in a specific application, such as the division or group
level, depending on the respective rules of the specific application. Whatever the case, the top-down
method ensures that the classification of the unit is consistent at every level.
 Introduction 23
3. E-commerce
135. Production units receive orders and transact the sale of goods and services produced by a
variety of means, such as by telephone, fax, television or over the Internet. Many countries have chosen
to describe as e-commerce any business transaction that transfers the ownership of the goods or service
through the Internet or by other electronic means.
136. There are three stages in the transfer of the ownership of a good or service: (a) the placement
of the order, (b) the payment and (c) the delivery of the good or service. E-commerce transactions may
be defined to include situations where only the first stage, only the first and second stages, or all three
stages are conducted through the Internet or by other electronic means.
137. For many production units, e-commerce is just one of a variety of means by which sales are
transacted. The rules for the classification of such units in ISIC remain unchanged: they are classified to
the industry of their principal activity. Increasingly, however, business units that sell goods and supply
services exclusively through the Internet are coming into existence. Such units should also be classified
to the industry of their principal activity. Production units engaged in e-commerce will therefore be
found in any industry of ISIC.

4. Repair and maintenance

138. No single high-level category exists that would cover all repair activities. Based on the type of good
repaired, the activities are classified as follows:
(a) Repair and maintenance of machinery and equipment is classified in division 33;
(b) Repair of buildings and civil engineering works in division 43;
(c) Repair and maintenance of computers, personal and household goods, and motor vehicles and
motorcycles is classified in division 95;
139. Units that engage in factory rebuilding or overhaul of aircraft, locomotives, railroad cars and
ships are not included in division 33. Instead, they are classified in division 30, in the same classes as the
units that manufacture them.

5. Outsourcing / activities on a fee or contract basis

140. In some cases, units sell goods or services under their own name but the actual production, such
as the physical transformation process in the case of manufacturing, is carried out fully or in part by others
through specific contractual arrangements. This section describes how units involved in such arrangements
should be classified in ISIC.
141. In this section, the following terminology is applied:
(a) The principal3 is a unit that enters in a contractual relationship with another unit (here called
contractor) to carry out some part (or all) of the production process;
(b) The contractor4 is a unit that carries out a specific production process based on a contractual
relationship with a principal. The activities performed by the contractor are denominated “on a fee or contract
basis”.
(c) Outsourcing is a contractual agreement according to which the principal requires the contractor
to carry out a specific production process. The term “subcontracting” is sometimes used as well. In this
context, the production process also includes supporting activities.

3 Elsewhere sometimes known as “contractor” or “converter”.

4 Elsewhere sometimes known as the “subcontractor”.
24 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
142. The principal and the contractor may be located in the same economic territory or in different
economic territories. The actual location does not affect the classification of either one of these units.

(a) Classification of the contractor

143. Contractors, i.e., units carrying out an activity on a fee or contract basis, are usually classified in
the same ISIC category as units producing the same goods or services for their own account. Exceptions to
this rule exist for trade activities, for which separate categories for such outsourced activities exist.
(b) Classification of the principal

Outsourcing of parts of the production process

144. If only part of the production process is outsourced, the principal is classified to the class that
corresponds to the activity representing the complete production process, i.e., it is classified as if it were
carrying out the complete process, including the contracted work, itself.
145. This applies not only to the outsourcing of support functions in the production process, such
as accounting or computing activities, but also to the outsourcing of parts of the core production process,
such as parts of a manufacturing process.
Outsourcing of the complete production process
146. In general, if the principal outsources the complete production process of a good or service, it
is classified as if it were carrying out the production process itself. This applies in particular to all service-
producing activities, including construction. In the case of manufacturing, however, the following special
considerations apply.
147. In manufacturing, the principal provides the contractor with the technical specifications of the
manufacturing activity to be carried out on the input materials. The input materials (raw materials or
intermediate goods) can either be provided (owned) by the principal or not.
148. A principal who completely outsources the transformation process should be classified into
manufacturing if and only if it owns the input materials to the production process including the intellectual
property products (IPP)—and therefore owns the final output. In the case of factoryless good producers
(FGPs), in addition to the technical specifications for the manufacturing activity to be carried out, the
principal provides the intellectual property products (IPP) as well. The criteria for defining the FGPs should
cover some aspects of the control of the transformation process including quality control, oversight of the
production process etc. The distinction between affiliates and non-affiliates is not a relevant criterion in the
definition and classification of FGPs.
149. The importance of separately identify FGPs has been long recognised, however, based on the
current practices and the feedback collected, it is difficult at this stage to separately classify FGPs in ISIC.
As a result, ISIC, Rev. 5 continues to classify FGPs in Section C in the same class where they would have
been classified if they carried out the manufacturing process themselves. In addition, countries are
encouraged to develop approaches to identify FGPs, so that this issue can be reconsidered as part of the
research agenda for the next revision of ISIC.
150. A principal who completely outsources the transformation process but does not own the input
materials is in fact buying the completed good from the contractor with the intention to re-sell it. Such an
activity is classified in section G (Wholesale and retail trade), specifically according to the type of sale and
the specific type of good sold.5

5The final classification of the principal may also depend on other activities that are carried out in the same
unit.
 Introduction 25

6. Outsourcing of other production and service producing processes

151. If a principal sub-contracts construction work to other units, but remains overall responsible
for the construction process, both the principal and the contractor are classified in section F (Construction),
specifically to the class that corresponds to the construction activities carried out.
152. When a principal carries out the whole or a part of the production process (of a good or a
service) but delegates to a contractor certain support, or ancillary, functions (such as accounting or
computer services) which are not part of the production process and do not directly lead to the final good
or service, but support the general functioning of the principal as a production unit, the activities of the
principal are classified to the same ISIC code as the one that represents the core production process. The
contractor is classified according to the specific activity he is carrying out, e.g., class 6920 “Accounting,
bookkeeping and auditing activities; tax consultancy”, class 6220 “Computer consultancy and computer
facilities management activities” etc.
153. A principal outsourcing a part of the goods production process in Section A “Agriculture,
forestry and fishing”, Section B “Mining and quarrying”, Section D “Electricity, gas, steam and air
conditioning supply” and Section E “Water supply; sewerage, waste management and remediation
activities” is classified as if he is covering the whole production process. The activity of the contractor is
classified with units producing the same goods for their own account.
154. A principal outsourcing the whole production process of Section A “Agriculture, forestry and
fishing”, Section B “Mining and quarrying” and Section E “Water supply; sewerage, waste management
and remediation activities” is classified in Division 46 “Wholesale trade” (depending on the activity and
the specific good sold). The contractor is classified with units producing the same goods for their own
account
155. A principal outsourcing the whole production process of Section D “Electricity, gas, steam and
air conditioning” is classified in Section D as per the activity and the specific good sold.
156. Concerning the outsourcing of services, the principal who outsources a part of the service-
producing activities must be classified as if he were provisioning the whole service process. The contractor
is classified according to the portion of the services provision he is undertaking. If the principal sub-
contracts the whole services activity, both the principal and the contractor are classified as if they were
carrying out the complete services activity.

7. Intermediation services
157. Intermediation activities have increased enormously due to the technological advances
through digital platforms. The UN Expert Group of International Statistical Classifications evaluated in
past years the treatment of intermediation activities within ISIC Rev. 46 , indicating how the use of such
services related to service transactions could be addressed in ISIC. However, companies continued to be
codified in Statistical Business Registers based on national rules or reflections.
158. In the framework of the revision of ISIC Rev. 4 and the update of NACE Rev 2, it was agreed
to define non-financial intermediation services activities as activities that facilitate transactions between
buyers and sellers for the ordering and/or delivering of goods and services for a fee or commission,
without supplying the services or taking ownership of the goods that are intermediated. These activities
can be carried out on digital platforms or through non-digital channels. Revenue for the intermediation
activities can include other sources of income, such as revenues from sale of advertising space. This
definition excludes financial and insurance service activities, which are classified in section L “Financial

6 https://unstats.un.org/unsd/classifications/expertgroup/egm2017/ac340-10.PDF
26 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
and insurance activities”
159. To reflect these activities in the classification, separate groups or classes have been created in
the divisions where these goods and services are produced (see chapter 4.2.1). Thus, those new categories,
combined with previously dedicated categories, can identify all non-financial intermediation services
which are now a significant component in the delivery of the underlying good or service of the respective
divisions. A dedicated class 8240 was created to include all intermediation services that are not elsewhere
classified (except financial intermediation and intermediation service activities for telecommunications
activities).

8. Financial activities
160. In recent years, there have been various innovations in the provision of financial services. Some
examples of these innovations include increase in the use of digital technologies to facilitate the provision
of or access to financial services, the expansion in many financial markets by units other than the traditional
banks, and a greater number of financial activities provided by the traditional units that are engaged in
financial activities. The provision of financial intermediation services facilitated by information and
communication technology (digital technologies) is as well integrated in Section L “Financial and insurance
activities”.
161. No new groups and classes have been created for the classification of activities carried out by
financial technology companies (fintechs) that are using digital techniques to provide, improve or increase
access to financial services. Such activities will be integrated in the existing structure of NACE, since these
are not actually viewed as new activities, but just being provided via a new modality. Fintech companies
are classified based on their principal economic activity. Thus, a fintech unit principally active in financial
intermediation will be classified in Section L, whereas a unit whose principal activity is to provide digital
technology that supports the provision of a financial service will be classified in Section K. Digital
technology provision activities include, for example, provision of software used by financial services firms
to digitise and improve their compliance structures, risk management procedures, regulatory monitoring,
regulatory reporting, financial investigations and sanctions, provision of information technology
infrastructure (including hardware and software) and analytics to support insurance as underwriting,
distribution, pricing, and claims processing.
162. Section L contains two groups, 642 “Activities of holding companies and financial conduits”
and 643 “Activities of trusts, funds and similar financial entities”, which classify units that usually generate
little or no value added or do not employ staff. Sometimes some of these units are called "brass plates",
"post boxes", "empty boxes" or "special purpose entities“ (SPEs), as they have just a name and an address.
163. These two groups are different from all other group in ISIC, Rev.5, in the sense that the units in
the two groups are recognized institutional units in an economy, yet they have little or no employment,
physical presence, or physical production. The two group are also different from each other in the following
manner:
(a) group 642 "Activities of holding companies and financing conduits" refers to the activities of
holding companies, whose principal activity is owning the group, and that do not administer
or manage the group;
(b) group 643 "Activities of trusts, funds and similar financial entities" covers the activities of legal
entities organised to pool securities or other financial assets, without managing them, on behalf
of shareholders or beneficiaries;
164. The principal activity of a unit performing several activities among those just mentioned
should be identified, as usual, based on the value added principle. It should be kept in mind that capital
gains do not constitute value added, and therefore should not be considered.
 Introduction 27

9. Government activities

165. ISIC does not make any distinction regarding the institutional sector to which a statistical unit
belongs. For instance, there is no category that would describe all activities carried out by a government as
such. Activities carried out by government units that are specifically attributable to other areas of ISIC
should be classified in the appropriate class of ISIC and not in section P or division 84 (Public administration
and defence; compulsory social security). For instance, public hospitals run by a government unit will be
classified in class 8610, together with hospitals run by private organizations, by non-profit organizations,
and military-base and prison hospitals. Units carrying out activities at national, regional or local levels that
are specifically attributable to other areas of ISIC are classified in the appropriate section. For example, the
activities of a secondary school administered by the central or local government are allocated to group 853
“Secondary and post-secondary non-tertiary education” and those of a public hospital are allocated to class
8610 “Hospital activities”. On the other hand, not only government bodies are classified in section P: private
units performing typical "public administration activities" are also classified here.
166. It is true that ISIC division 84 includes activities of a governmental nature that are normally
carried out by the public administration, including the enactment and judicial interpretation of laws and
their pursuant regulation; the administration of programmes based on them; legislative activities; taxation;
national defense; public order and safety; immigration services; foreign affairs; and the administration of
government programmes. Nevertheless, the legal or institutional status is not, in itself, the determining
factor for an activity to belong in that division.

10. On-site installation

167. Units principally engaged in the installation or assembly of items or equipment in buildings
for their functioning are classified in the construction section (see division 43).
168. Installation of machinery and other equipment other than those linked to the functioning of
buildings (or civil engineering works) is classified in group 332 "Installation of industrial machinery and
equipment".

11. Individual entrepreneurs

169. Individual entrepreneurs are classified according to the economic activity/activities they
perform, based on what they do and not according to their professional position.

12. Classification of enterprises

170. Since the activities of an enterprise sometimes cover a large variety of ISIC groups or classes, it
may be appropriate for certain statistics to classify them at the division level only. In any case, when such
a unit is to be classified at a lower level of the classification, the top-down approach, as set out in paragraphs
125–133 above, should be used.
171. The classification of a multi-activity enterprise should be determined by the value added
generated by its constituent units. In other words, the ISIC category should be selected according to the
kinds of activity of the constituent units that account for the principal share of value added, following the
top-down method.

13. Classification of households

28 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
172. ISIC includes a category for the classification of households when they are employers of
domestic personnel. This includes households employing maids, gardeners, cooks etc. As employment is
generated, data on these units have been collected for various statistics, usually outside of general business
statistics, i.e., using sample frames with households as collection units rather than businesses as collection
units.
173. Outside this existing category, the need to describe activities of households for own use has
emerged in data collections, such as in labour-force surveys. While market activities should generally be
described according to existing rules for identifying the correct ISIC code for an activity, the application of
these rules for activities producing goods and services for own use has proved difficult. These activities
might combine a mix of activities undertaken by household enterprises, such as agricultural activities,
construction, textile manufacturing, repair and other service activities. In general, it is not possible to assign
value-added ratios to these activities and reasonably identify a principal activity. To provide a place for
these mixed activities in the classification, two groups in division 98 (Undifferentiated goods- and services-
producing activities of private households for own use) have been designated. This division will not
normally be relevant to business statistics but rather applies to data collections covering household and
subsistence activities.

14. Changes in the classification of units

174. Units can change their principal activity either at once or gradually over a period of time. The
principal activity may change within the year from one statistical period to the next, either because of
seasonal factors or because of a management decision to vary the pattern of output. In each case, there will
have been a fairly sudden change in the balance of activities. Alternatively, a change in the pattern of output
or sales may take place gradually over several years. While all these cases call for the classification of the
unit to be changed, if made too often such changes distort statistics to the extent of making interpretation
extremely difficult.
175. To avoid frequent changes it is necessary to have a stability rule. Without such a rule, there
would be apparent changes in the economic demography of the business population that would be no
more than statistical artifacts. Such a stability rule is intended for units that engage in a mix of activities that
are almost balanced and are thus subject to increased risk of changes for the principal activity resulting
from only small changes in the ratio of the activities involved. In such cases, the ratio of activities over the
past two to three years should be taken into account when determining the principal activity of the unit.
176. Changes in the classification of units for the purpose of statistical inquiries are made not more
than once a year, either at fixed dates or as information becomes available. More frequent changes would
result in inconsistency between short-term (monthly and quarterly) and longer-term statistics.

D. Capturing information about the activity of units and coding it

according to ISIC
177. The quality and comparability of the statistics produced according to ISIC will depend largely
on the correctness of the codes assigned to the statistical units. In turn, the correctness of the codes will
depend on the information available for determining them and the tools and procedures used.
178. To some extent, the quality of the information will depend upon the type of statistical source.
The quality of information collected for administrative registrations will depend on the extent to which that
information has a function in the administrative procedures for which the registrations are being made. It
will also depend on what kind of distinctions that function will require, such as, whether tax rules, social
security regulations, the rules for investment credits or the services provided by employment agencies will
require precise registration of the type of activity undertaken. The statistical offices will therefore frequently
 Introduction 29
need to collect directly from the units the information needed to determine the activity codes of the units,
even when the register used as the basis for their surveys is derived from, or developed in cooperation
with, one or more of the administrative agencies.
179. Given the nature of ISIC, the information that is needed to code for the register as well as the
surveys will have to describe the main inputs, processes and outputs of the units’ productive activities. For
units with a wide range of products, information about them will also be necessary to determine their
contributions to the value added or other relevant factors by which to determine their main activity. This
information must be obtained from the units and care must be taken to ensure that the individuals who
provide the information on behalf of the units understand the type of information needed so that they can
obtain it from the records of the units or their own knowledge. Thus, the testing of question formulations
is as important for establishment surveys as it is for household surveys. For the registers as well as for the
two types of surveys, finding the correct codes on the basis of product information will be greatly facilitated
by a well-organized and comprehensive coding index.
30 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4

Chapter IV
Other topics

A. Use of ISIC in establishing related national classifications

180. As an international standard classification, ISIC is the primary tool for collecting and presenting
internationally comparable statistics by economic activity. It is therefore of great importance that data collected
at the national level, and therefore the classifications used at the national level, are compatible with ISIC.
181. The need for international comparability does not, however, imply that countries must adopt ISIC
as a whole, without modification. The intention is rather to have countries use ISIC as a guide in adapting their
national classifications to the international standard. Countries may choose to either use ISIC directly for their
national purposes or develop their own national classification. Wherever countries lack the infrastructure
required to develop and maintain their own activity classification, they may adopt ISIC as their national activity
classification with little or no modification. This is often done by extending or collapsing the detail of ISIC while
maintaining its general structure. Other countries may have historically developed a classification that suits
their particular needs. Those countries should make efforts to adapt their classification in a way that allows for
the provision of data according to ISIC without substantial loss of information.
182. In order to attain international comparability, it is suggested that all countries adopt, as far as
individual requirements permit, the same general principles and definitions in their industrial classification
schemes (for the principles and definitions that were developed for this purpose and are embodied in ISIC, see
sect. II above). As a result, it should be feasible to rearrange and combine entire categories of national
classifications so that they correspond to one or more categories of ISIC, although this may not always be
possible since certain categories at the most detailed level of ISIC may not be distinguished in the industrial
classifications of some countries.
183. Adapting ISIC to the specifics of the national economy while maintaining international
comparability requires the observation of a number of rules as set out below.

1. Aggregation and disaggregation of ISIC

184. When adapting ISIC to national circumstances, its categories may be aggregated or further detailed
to better reflect the structure of the national economy of the country. If a particular economic sector is
economically of great importance or has developed important specializations that are not separately identified
in ISIC, the relevant part of the classification can be further disaggregated. If some other sector of the economy
does not exist or is still undeveloped or unimportant in the economy as a whole, the relevant part of the
classification can be treated at a more aggregated level. It is not the intention to suggest data collection for categories,
which would require all kinds of artificial or arbitrary splits of the existing statistical units. The calculation of
homogeneity ratios may serve as a tool in determining the feasibility and usefulness of more detailed categories of
 Introduction 31
the classification.7

185. In order to make a national activity classification convertible to ISIC, the categories at the most
detailed level of classification in the national scheme should on the whole coincide with, or be subdivisions of,
the individual classes of ISIC. In other words, any most detailed category of the national classification should
not cover selected portions of two or more classes of ISIC. When national categories have to represent
combinations of two or more entire classes of ISIC, the classes should be part of the same group. In this way,
the convertibility of the national classification to ISIC would not be affected by the position or the manner of
grouping of the categories at the detailed level of the classification in the national scheme.

186. To serve national purposes, categories in the ISIC structure may be disaggregated by subdividing
the relevant classes into subclasses. This may be done by appending decimal places to the four-digit code that
identifies each class of ISIC. Alternatively, the subdivision of groups into classes in ISIC may be expanded by
replacing the existing classes with a greater number of more detailed categories. In order to preserve
comparability with the classes of ISIC, the more detailed classes should be delineated so that they may be
aggregated to classes.

187. Extending the four-digit codes of ISIC may be unnecessary if, to meet national requirements, the
only classes to be subdivided are those that are identical to groups. These classes of ISIC are identified by four-
digit codes ending in “0” and may be replaced by as many as nine classes, identified by specific four-digit codes.

188. ISIC categories may be aggregated, for example, by combining the classes of selected groups into
fewer less detailed classes or by entirely telescoping classes into groups. It may even, in certain instances, be
desirable or necessary to have categories at the most detailed level of the national classification that combine
classes of ISIC. This may be because the kinds of activity segregated by selected classes of ISIC are not important
enough in a given country. Or it may be due to a much smaller degree of specialization in the activities of the
statistical units than is required in order to use certain classes of ISIC in the national scheme. For example, some
countries may not establish categories in their national classifications that are similar to the individual
categories of divisions 26 to 28 (Manufacture of machinery), inasmuch as the majority of establishments
engaging in activities of class X also carry out the activities of class Y and vice versa, thereby making it
impractical to separate these activities in the national classification. They may need to combine some or all of
the groups or classes into single categories at the most detailed level of their national classification.

189. It should be kept in mind that combining classes into higher aggregates, either at the group level or
elsewhere, will limit the comparability of data at the international level to that level or to even higher
aggregates. The latter can occur if countries decide to aggregate some of the four-digit classes within, for
example, group 281. If two countries aggregate classes within group 281, the comparability of their data may
not be available at their respective aggregated levels but only at the higher level of group 281. The combining
of classes should therefore be carefully considered in respect of its possible impact on the comparability of data
compiled according to these new categories.

2. Level of international comparability

190. Ideally, countries would be able to provide data according to ISIC at all levels of the classification
for the purposes of international comparability. As mentioned above, however, not all detailed categories of
the classification may be suitable for all countries and countries may wish to develop national classifications
based on their own priorities. Still, the problem of international comparability remains and countries should
make effort to use a classification that is as much as possible compatible with ISIC and for which data can be
collected and reported.

7For a more detailed discussion of homogeneity ratios, see Companion Guide to ISIC and CPC (United Nations
publication, forthcoming).
32 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
191. At its thirty-seventh session, the United Nations Statistical Commission recommended that
countries adapt their national classifications in a way that allows them to report data at least at the two-digit
level of ISIC, Rev.4 without loss of information. It is clear that the interest in more detailed internationally
comparable information will remain, especially for specific studies.

B. Use of different levels of the classification for the presentation of

statistics
192. It may be desirable to utilize less detailed classification categories of kind of economic activity for
some types of statistics than for other series, and the number and size of the categories for which reliable
statistics are presented may depend on both their source and confidentiality considerations. For example, it
may not be feasible to present data on employment gathered in household inquiries in as great detail as data
on employment obtained from establishment inquiries. Or it may not be necessary to present data according to
kind of economic activity in as great detail in national accounting as in industrial statistics. By providing for
four levels of classification (sections, divisions, groups and classes), ISIC furnishes a framework for comparable
classifications of data at different levels of detail. It is important to note, however, that the fact that a category
has been defined at the class level in ISIC will not prevent it from being larger in a particular national economy
than a category defined at the group level or even at the level of division or section, as will be the case, for
example, for class 8531 (General secondary education) versus division 03 (Fishing and aquaculture) in many
countries.

193. Similarly, for specialized surveys on a limited number of industries, the detail provided by ISIC,
even at its most detailed level, will often not be sufficient for the required analysis. In such cases, ISIC classes
can be further subdivided for specific purposes, as necessary. It is suggested, however, that the new detailed
categories still be aggregated to the existing ISIC classes for comparability reasons.

C. Relationship with other classifications

1. General remarks
194. At its nineteenth session, the Statistical Commission had requested the Secretariat to prepare a set
of classifications that together would form an integrated system for classifying activities, goods and services
and could be used in different kinds of economic statistics. Using the Integrated System of Classifications of
Activities and Products (SINAP) as a basis, the work resulted in the revision of ISIC and SITC and the
development of CPC. These three classifications are strongly interrelated. ISIC represents the activity side of
the system, CPC is the central instrument for classifying goods and services and SITC is the aggregated
classification of transportable goods for international trade statistics for analytical purposes. Both CPC and SITC
use the headings and subheadings of the Harmonized Commodity Description and Coding System (HS) as
building blocks for their categories. Subsequently, relationships with other classifications that may require a
degree of comparability with ISIC have been added to these considerations.

2. Relationship with product classifications: CPC, HS and SITC

195. The relationship between ISIC, on the one hand, and the product classifications HS, CPC and SITC,
on the other, is based on the fact that the product classifications in principle combine in one category goods or
services that are normally produced in only one industry as defined in ISIC. In HS, this origin criterion was
respected as far as possible at the time of its development. In some cases – for instance, when it seemed
impossible that a customs officer could make the distinction – the principle was not applied. Still, most headings
and subheadings of HS contain goods that are generally produced in only one ISIC category. There are frequent
 Introduction 33
exceptions in some areas, however, where outputs do not enter international trade to a large degree. For
instance, raw and processed agricultural products may be combined in HS since the international trade of raw
and unprocessed products is negligible. Still, raw and processed products are outputs of distinct industries in
ISIC, which makes a strict link between these classifications impossible. In addition, the arrangement of
headings and subheadings of HS follows criteria that are quite different from industrial origin and the structure
of CPC or SITC.

196. The differences between CPC, HS and SITC result from the fact that they were created for different
purposes. HS is the detailed classification for international trade of transportable goods, while SITC is a more
aggregated classification for analytical purposes, with the same scope as HS. The scope of CPC exceeds that of
HS and SITC, in that it is intended to cover the production, trade and consumption of all goods and services.
Both CPC and SITC regroup HS categories, albeit in different ways. SITC follows a traditional order in which
the materials used, the stage of processing and the end-use are the main considerations. CPC arranges its
categories in groups that are similar to ISIC categories. This does not mean, however, that all goods are grouped
according to their industrial origin.

197. Although origin had been an important criterion when developing CPC, it was produced as a
classification in its own right – one in which classification is based on the physical characteristics and intrinsic
nature of goods or on the nature of the services rendered. For example, while meat and hides are both outputs
of slaughterhouses (ISIC class 1010, “Processing and preserving of meat”), they appear in different sections of
CPC. However, each type of good or service distinguished in CPC is defined so that it is normally produced by
only one activity as defined in ISIC. As far as practically possible, an attempt is made to establish a
correspondence between the two classifications, each category of CPC being accompanied by a reference to the
ISIC class in which the good or service is mainly produced.

3. Other derived and related activity classifications

198. The work on the fifth revision of ISIC has been driven by a strong desire to improve comparability
among activity classifications around the world. In the process, the experiences obtained during recent or still
ongoing revisions of national and regional classifications have been taken into account. It is clear, however, that
needs for detail and structure, especially at the lower levels of the classification, differ from country to country
and from region to region. The work of the Expert Group on International Statistical Classifications has
continued these harmonization efforts in its work on the International Family of Statistical Classifications. The
need to converge existing activity classifications has been stressed again by the Statistical Commission and will
be a key element in future work on these classifications.

199. The need for convergence does not diminish the need for regional classifications. The work on
improved and tailored regional activity classifications, based on the reference classification as the international
standard, is an important way to further the application of ISIC. These regional classifications should be derived
from ISIC and adjusted to the regional specifics of a group of countries. They will allow for data comparability
within the region and serve as more tailored guidelines for the development of national classifications.

(a) Derived classifications

200. The revision of the General Industrial Classification of Economic Activities within the European
Communities (NACE) has been developed based on the fifth revision of ISIC, continuing the strong relation
between these two classifications. Categories at all levels of NACE have been defined to be either identical or
to form subsets of single ISIC categories.

201. In addition, the coding systems used in classifications of the United Nations and the European
Community are as far as possible the same. As a result, the data of both intergovernmental organizations have
become widely compatible. ISIC and NACE are identical up to the two-digit level (divisions) of the
34 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
classification. At lower levels, NACE has created more detail suitable for European users of the classification.
The additional detail created can always be aggregated to ISIC categories at the three- and four-digit levels,
within the same structure.

202. Work to create similar derived classifications is also being carried out in other regions.

(b) Related classifications

203. The North American Industry Classification System (NAICS) was developed in the mid-1990s and
has undergone some changes to increase comparability among the three custodians of this classification. The
research work carried out during the development of NAICS has been a major input into the ISIC revision
process. The review of the NAICS structure and concepts by other countries has not only resulted in the desire
to reflect some of the NAICS top-level categories, such as “Information” in ISIC, but has also initiated reviews
of ISIC principles and encouraged detailed discussions on criteria to be applied for boundary decisions between
existing categories.

204. Work on the development of a common top-level structure for both classifications has shown
limitations in this effort arising from specific country needs; the desire to maintain continuity in each of the
classifications; and the cost/benefit analysis of a complete change of the classifications involved. As a result, the
structures of ISIC and NAICS seem substantially different. However, definitions of individual categories have
been designed in a way that statistical data collected according to NAICS can be reaggregated into the two-
digit divisions of ISIC, Rev.5, ensuring the comparability of data as described in paragraph 192 above. In many
cases, more detailed links are possible.

205. The Australian and New Zealand Standard Industrial Classification (ANZSIC) was revised in 2006
and broadly aligns with ISIC at the higher levels. As for ISIC, the conceptual approach for ANZSIC has been
re-evaluated. The revised ANZSIC takes into account activities within Australian and New Zealand economic
units. The ANZSIC structure broadly follows the ISIC structure, so that categories at the division and more
detailed levels can be aggregated into the two-digit categories of ISIC.

4. Relationship of other international classifications with ISIC

206. The following classifications developed by the United Nations or its subsidiary organs have some
relationship with ISIC or make use of parts of ISIC in defining their own scope or categories; whether describing
statistics on occupations, employment, expenditures, education, tourism or the environment: the Classification of
the Functions of Government (COFOG), the International Standard Classification of Education (ISCED),8 the
International Standard Classification of Occupations (ISCO),9 the activity classification of the Tourism Satellite
Account (TSA)10 and the International Classification of Non-Profit Organizations (ICNPO).11
207. COFOG, which was developed by the former Statistical Office of the United Nations Secretariat
mainly for use in the System of National Accounts, was first published in 1980 and revised in 2000. The criteria
of classification—function in the case of COFOG and activity for ISIC—are conceptually rather similar. COFOG is
more appropriate than ISIC for classifying government expenditures, however, because the COFOG list of functions
is more detailed than the ISIC list of activities, having been drawn up specifically to take account of the range
and diversity of government activities. Although there are similarities between the criteria of the two classifications,

8 International Standard Classification of Education (ISCED 1997) (Paris, UNESCO, November 1997).
9 International Standard Classification of Occupations (ISCO-1988) (Geneva, ILO, 1988).
10 Commission of the European Communities, Organisation for Economic Co-operation and Development, United

Nations and World Tourism Organization, Tourism Satellite Account: Recommended Methodological Framework,
Statistical Papers, Series F, No. 80 (United Nations publication, Sales No. E.01.XVII.9).
11 See Annex A1 of the Handbook of National Accounting: Handbook on Non-Profit Institutions in the System of

National Accounts, Statistical Papers, Series F, No. 91 (United Nations publication, Sales No. E.03.XVII.9).
 Introduction 35
problems may arise when comparing data collected according to ISIC and COFOG. For instance, COFOG covers
not only direct outlays on government-owned schools but also the subsidizing of privately owned schools and
outlays on subsidiary services to education, such as school transport, food and lodging for students etc.
208. ISCED was developed by UNESCO as an instrument for assembling, compiling and presenting
statistics of education, both within individual countries and internationally, and was last updated in 2011. It is a
multi-purpose classification of educational programmes to be used for statistics on student enrolment and
human or financial resources invested in education, as well as on the educational attainment of the population as
obtained, for example, from population censuses or labour-force surveys. The statistical unit as classified in ISCED
at the lowest level is the programme or programme group.
209. Educational institutions are classified according to ISCED on the basis of the type of programmes that
they provide. In principle, these institutions may be considered equivalent to the basic units to be classified by ISIC.
The definitions of the ISIC categories for education services have been defined in line with the changes applied in
the last ISCED revision.
210. The International Standard Classification of Occupations (ISCO) has been developed by the
International Labour Organization (ILO). It provides a basis for comparing occupational statistics for different
countries and communicating other occupational information, such as for the recruitment or admission of migrant
workers. It also serves as a model for countries when they develop their national occupational classifications or
revise their existing ones.
211. The primary units to be classified to ISCO are jobs. Jobs are classified to ISCO on the basis of the type
of work performed, that is, the task and duties to be carried out. Since ISIC and ISCO have entirely different
functions and conceptual foundations – in other words, they measure very different aspects of the economy – there
is no need to harmonize their structures. However, when similarities and differences between certain groups in
ISCO are based on the type of distinctions that are reflected in ISIC (i.e., between the type of products, namely,
goods and services, that are being produced or sold), the ISCO groups are defined in a manner that is generally
consistent with the definition of these goods and services in ISIC and CPC.

D. Indexes to the classification

212. Alphabetical and numerical indexes are very useful tools for further detailing classification
categories and greatly simplify their application. The indexes are designed to be of assistance in adapting ISIC to the
classification requirements of individual countries, comparing national classifications to ISIC and classifying data
according to ISIC. They should also provide a guide to the correct classification of statistical units.
213. New interpretations of the classification, usually related to new activities, can be easily reflected in the
index, while no change in the classification or its related texts is usually necessary. Indexes for this new version of
ISIC will be available in machine-readable form only, published in the Classifications Registry on the United Nations
Statistics Division website

E. Correspondence tables

214. Correspondence tables are an important tool for comparing statistical data that have been collected and
presented using different classifications. They become necessary when the classification changes over time or when
different underlying frameworks do not allow classifications to be closely related. Correspondence tables between
different versions of the same classification are used to describe the detailed changes that have taken place in the
revision process. A complete detailed correspondence between ISIC, Rev.5 and ISIC, Rev.4 is available electronically
but is not included in the present publication.
36 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
215. Since ISIC has been used for the collection and presentation of statistics in many areas, there has been a
strong need for correspondence tables between ISIC and other classifications. When drafting ISIC, Rev.5, and
simultaneously CPC, Ver.3, a strong link was established between the two classifications. By rearranging the CPC
categories according to their industrial origin and using the link between CPC, SITC and HS, a detailed
correspondence table between HS, SITC, CPC and ISIC was established.

216. These and other correspondence tables are available in electronic format only and can be accessed at the
United Nations Statistics Division website

F. Alternative aggregations for ISIC

217. Economic analysis and the presentation of statistics on specific subjects often require aggregation of data,
collected according to ISIC, in ways that are different from the aggregation provided by the ISIC structure. For these
special purposes, standard aggregations have been created to meet these demands, such as those presented in part
four of this publication. These alternative aggregations may use either complete ISIC classes; only parts of ISIC classes
(if the underlying concept for the aggregation is not comparable with the principle used in ISIC); or a standardized
subdivision of existing ISIC classes to improve the application of ISIC for their specific purposes (for more detailed
information, see part four below).
 Changes in ISIC, Rev.4 37

Part Five
Changes in ISIC, Rev.5
I. Methodological changes
218. Although the structure of ISIC, Rev.5 is different from its predecessor, the methodological aspects
underpinning the scope, development and application of the classification remain largely unchanged. Some of
the perceived changes are actually clarifications of the concepts or rules already used in previous versions of
ISIC.
219. The criteria for delineating categories within ISIC remain the same, although the weights with
which these criteria have been applied have changed (for more details, see part one, sect. II.B above).
220. In the rules for the application of the classification, only one explicit change has been made. In
the case of multiple activities, the use of value added as the determining criterion is now universally applied to all
cases; in other words, the exception for the treatment of vertically integrated activities has been eliminated.
221. Other general application rules, such as the use of the top-down-method to determine the principal
activity of a unit, remain unchanged.
222. It should be noted, however, that the application rules provided in ISIC, Rev.5 are the same as in ISIC
Rev.4.

II. Structural changes

223. The fifth revision of ISIC has responded to a large number of requests from countries that have
ultimately changed the overall structure and detail of the classification in very substantial ways. New concepts at
the highest level of the classification have been introduced and new detail has been created to reflect different forms
of production and newly emerging industries. At the same time, efforts have been made to maintain the
structure of the classification in all areas that do not explicitly require change based on new concepts.
224. The detailed changes to ISIC, Rev.5 are too numerous to be listed here in their entirety. The reason for
most of these changes, however, can be roughly divided into three categories: (a) the introduction of new concepts
at higher levels (e.g., “information and communication” or “waste management and remediation activities”);
(b) necessary changes to regroup activities that are residuals of the previous type of changes; and (c) smaller
adjustments and clarifications of concepts at lower levels, typically driven by efforts to enhance comparability.

Intermediation service activities

225. To reflect the increasing importance of intermediation service activities, the following new classes
have been created in the ISIC Rev.5 Divisions where these goods and services are produced (see also chapter
3.3.2).
 3540 “Activities of brokers and agents for electric power and natural gas”
 4340 “Intermediation service activities for specialised construction services”
290 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
 4790 “Intermediation service activities for retail sale”
 5231 “Intermediation service activities for freight transportation”
 5232 “Intermediation service activities for passenger transportation”
 5330 “Intermediation service activities for postal and courier activities”
 5540 “Intermediation service activities for accommodation”
 5640 “Intermediation service activities for food and beverage services activities”
 6120 “Telecommunication reselling activities and intermediation service activities for
telecommunication”
 6821 “Intermediation service activities for real estate”
 7491 “Patent brokering and marketing service activities”
 7751 “Intermediation service activities for rental and leasing of cars, motorhomes and
trailers”
 7752 “Intermediation service activities for rental and leasing of other tangible goods and
non-financial intangible assets”
 8240 “Intermediation service activities for business support service activities n.e.c., except
financial intermediation”
 8561 “Intermediation service activities for courses and tutors”
 8691 “Intermediation service activities for medical, dental and other human health services”
 8791 “Intermediation service activities for residential care activities”
 9540 “Intermediation service activities for repair and maintenance of computers, personal
and household goods, and motor vehicles and motorcycles”
 9640 “Intermediation service activities for personal services”
Section A: Agriculture, forestry and fishing

226. Creation of a new group 033 “Support activities for fishing and aquaculture” and a new class 0330
“Support activities for fishing and aquaculture”.
Section C: Manufacturing

227. Split of class 1079 into two classes: 1076 “Processing of coffee and tea” and 1079 “Manufacture of
other food products n.e.c.”

228. Split of class 1103 into two classes: 1103 “Manufacture of beer” and 1104 “Manufacture of malt”.

229. Split of class 2610 into two classes: 2611 “Manufacture of solar cells, solar panels and photovoltaic
inverters” and 2619 “Manufacture of other electronic components and boards”.

230. Split of group 310 “Manufacture of furniture” into classes 3101 “Manufacture of wooden furniture”
and 3102 “Manufacture of other furniture”.
Section D: Electricity, gas, steam and air conditioning supply

231. Restructuring of group 351 “Electric power generation, transmission and distribution”: creation of
new classes 3511 “Electric power generation activities from non-renewable sources”, 3512 “Electric power
generation activities from renewable sources” and 3513 “Electric power transmission and distribution
activities”.
Section E: Water supply; sewerage, waste management and remediation activities
 Changes in ISIC, Rev.4 39
232. The scope of class 3900 “Remediation and other waste management services activities” is
extended by making explicit reference to carbon capture and storage activities in the explanatory
notes.
Section G: Wholesale and retail trade

233. The distinction at group and class level between in-store and online retail trade has been eliminated
in ISIC Rev. 5. As a consequence, groups 478 “Retail sale via stalls and markets” and 479 “Retail trade not in
stores, stalls or markets” of ISIC Rev. 5 have been dropped.

234. Division 45 “Wholesale and retail trade and repair of motor vehicles and motorcycles” has been
eliminated to achieve a consistent application of classification rules within section G. This means that the
wholesale activities of motor vehicles have been moved to Division 46 “Wholesale trade”, the activities of retail
trade of motor vehicles to division 47 “Retail trade” and the activities of maintenance and repair of motor
vehicles and motorcycles to division 95 “Repair and maintenance of computers, personal and household goods,
and motor vehicles and motorcycles” in Section T.
Section H: Transportation and storage

235. Group 49.1 “Transport via railways” has been split into two classes 49.11 “Passenger rail transport,
interurban” and 49.12 “Freight rail transport”.
Former Section J: Information and communication

236. ISIC Rev. 4 Section J has been split into two new sections: Section J “Publishing, broadcasting, and
content production and distribution activities” and Section K “Telecommunications, computer programming,
consulting, computing infrastructure and other information service activities”.

237. The first section (for which code J will be re-used), “Publishing, broadcasting, and content
production and distribution activities”, includes the existing divisions 58, 59 and 60, as well as news agencies
and post-production recording conversion services to streaming formats, formerly in division 63; the second
section new section (for which code K will be re-used) “Telecommunications, computer programming,
consulting, computing infrastructure, and other information service activities”, includes existing divisions 61,
62 and part of 63.

238. Creation of a new group 603 “News agency and other content distribution activities” composed of
classes 6031 “News agency activities” (moved from ISIC Rev.4 Class 6391) and 6039 “Other content distribution
activities” (new class).

239. Removal of the distinction at the group level between wired, wireless, and satellite
telecommunications activities. Groups 611, 612 and 613 have been merged into one only group 611 “Wired,
wireless and satellite telecommunication activities” containing a single class 6110 “Wired, wireless and satellite
telecommunication activities”.

240. Class 6201 “Computer programming activities” has been transformed in Class 6211 “Development
of video games, video game software, and video game software tools” and class 6219 “Other computer
programming activities”.

241. Classes 6202 “Computer consultancy activities and computer facilities management activities”
have been transformed into one new group 622 “Computer consultancy and computer facilities management
activities” containing a single class 6220 “Computer consultancy and computer facilities management
activities”.
290 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
242. Class 6209 “Other information technology and computer service activities” has been transformed
in a new group 629 “Other information technology and computer service activities” containing a single class
6290 “Other information technology and computer service activities”.

243. Group 631 “Data processing, hosting and related activities; web portals” has been split into Group
591 “Motion picture, video and television programme activities”, Group 631 “Computing infrastructure, data
processing, hosting and related activities” and Group 639 “Web search portals activities and other information
service activities.

244. The new group 631 “Computing infrastructure, data processing, hosting and related activities”
contains a single class 6310 “Computing infrastructure, data processing, hosting and related activities” to
include activities such as cloud infrastructure and platform provision (IaaS, PaaS) and cloud computing (except
software publishing and computer systems design) whether or not in combination with infrastructure
provision, distributed ledger (blockchain) technology data processing activities and technical infrastructure
provisioning services related to streaming.

245. The new group 639 “Web search portal activities and other information service activities” contains
a single classes: 6390 “Web search portal activities and other information service activities”. This class has been
created to cover activities of web sites that use a search engine to generate and maintain extensive databases of
Internet addresses and content in an easily searchable format (known as Web search portals).

246. Cybersecurity activities will be integrated in activities of software development, programming,

consultancy activities and incident/information management under the new classes 6219 “Other computer
programming activities”, 6220 “Computer consultancy and computer facilities management activities” and
6290 “Other information technology and computer service activities”. Cybersecurity software publishing will
be added to group 582 “Software publishing”.
Section L (former Section K): Financial and insurance activities

247. ISIC Rev.4 Section K has been renamed to Section L.

248. Group 642 “Activities of holding companies” has been split into class 6421 “Activities of holding
companies” and 6422 “Activities of financing conduits”.

249. Group 643 “Activities of trusts, funds and similar financial entities” has been split into class 6431
“Activities of money market”, class 6432 “Activities of non-money market investments funds” and class 6433
“Activities of trust, estate and agency accounts”.
Section M (former Section L): Real estate activities

250. ISIC Rev.4 Section L has been renamed to Section M.

251. Activities of “Development of building projects” has been moved out of Section F Construction to
group 681 “Real estate activities with own property or leased property”).
Section N (former Section M: Professional, scientific and technical activities

252. ISIC Rev.4 Section M has been renamed to Section N.

253. ISIC Rev.4 Group 702 “Management consultancy activities ” has been split into group 702
“Business and other management consultancy activities” containing a single class 7020 “Business and other
management consultancy activities” and a new group 733 “Public relations activities” containing a single class
7330 “Public relations activities”.
 Changes in ISIC, Rev.4 41
254. Group 749 “Other professional, scientific and technical activities n.e.c.” has been split into a new
group 743 “Translation and interpretation activities” containing a single class 7430 “Translation and
interpretation activities” and group 749 “Other professional, scientific and technical activities n.e.c.” containing
a new class 7491 “Patent brokering and marketing service activities” and a residual class 7499 “All other
professional, scientific and technical activities n.e.c.”
Section O (former Section N): Administrative and support service activities

255. ISIC Rev.4 Section N has been renamed to Section O.

256. Class 7722 “Rental of video tapes and disks” has been dropped and its content move to class 7729
“Rental and leasing of other personal and household goods”.

257. Group 783 “Other human resources provision” has been dropped and its content moved to group
782 “Temporary employment agency activities and other human resource provisions” containing a single class
7820 “Temporary employment agency activities and other human resource provisions”.

258. Groups 802 “Security systems service activities” and 803 “Investigation activities” have been
integrated into group 801 “Investigation and security activities”, which itself has been restructured to new
classes 8011” Investigation and private security activities” and 8019 “Security activities n.e.c.”.

259. The scope of class 8130 “Landscape service activities ” is extended by making explicit reference
to activities on managing and conserving ecosystem and biodiversity in the explanatory notes.

Section P (former Section O): Public administration and defence; compulsory social security

260. ISIC Rev.4 Section O has been renamed to Section P.

261. Class 8412 “Regulation of the activities of providing health care, education, cultural services and
other social services, excluding social security” has been split into class 8412 “Regulation of the activities of
providing health care, education, cultural services and other social services, excluding social security and
environment” and class 8413 “Regulation of the activities of providing environmental services”.
Section Q (former Section P): Education

262. ISIC Rev.4 Section P has been renamed to Section Q.

263. The content of this section was adapted to the new ISCED classification by splitting group 851 “Pre-
primary and primary education” into a new group 851 “pre-primary education” containing a single class “pre-
primary education” and group 852 “primary education” containing a single class “primary education”. The
ISIC Rev.4 group 852 “Secondary education” is coded and renamed as ISIC Rev.5 Group 853 “Secondary and
post-secondary non-tertiary education”, extended with a new class 8533 “Post-secondary non-tertiary
education”.
Section R (former Section Q): Human health and social work activities

264. ISIC Rev.4 Section Q has been renamed to Section R.

265. Group 86.9 “Other human health activities” has been split into 2 classes: 8691 “Intermediation
service activities for medical, dental, and other human health services” and 8699 “Other human health activities
n.e.c.”.
290 International Standard Industrial Classification of All Economic Activities (ISIC), Revision 4
Section S (former Section R): Arts, sports and recreation

266. ISIC Rev.4 Section R has been renamed to Section S “Arts, sports and recreation”.

267. Division 90 is renamed to “Arts creation and performing arts activities”, with a complete
restructuring of the division with definition of new groups 901 “Arts creation activities”, 902 “Activities of
performing arts” and 903 “Support activities to arts creation and performing arts” with the corresponding new
classes.

268. Division 91 is renamed to “Libraries, archives, museums and other cultural activities “, with a
complete restructuring of the division with definition of new groups: 911 “Library and archive activities”, 912
“Museums, collections, historical sites and monuments activities”, 913 “Conservation, restoration and other
support activities for cultural heritage” and 914 “Botanical and zoological garden and nature reserve activities”
with the corresponding new classes.
Section T (former Section S): Other service activities

269. ISIC Rev.4 Section S has been renamed to Section T.

270. Merger of ISIC Rev.4 classes 9511 “Repair of computers and peripheral equipment” and 9512
“Repair of communication equipment” in the new class 9510 “Repair and maintenance of computers and
communication equipment”.

271. Integration of a new group 953 “Repair and maintenance of motor vehicles and motorcycles”
containing two classes 9531 “Repair and maintenance of motor vehicles” and 95.32 “Repair and maintenance
of motorcycles” (both moved from division 45).

272. Complete restructuring of Division 96 “Personal service activities” with upgrade of previous
classes to groups resulting in the definition of new groups: 961 “Washing and cleaning of textile and fur
products”, 962 “Hairdressing, beauty treatment, day spa and similar activities”, 963 “Funeral and related
activities”, 964 “Intermediation service activities for personal services” and 969 “Other personal service
activities n.e.c.” with the corresponding new classes.
Section U (former Section T): Activities of households as employers; undifferentiated goods- and
service-producing activities of households for own use

273. ISIC Rev.4 Section T has been renamed to Section U.

Section V (former Section U): Activities of extraterritorial organisations and bodies

274. ISIC Rev.4 Section U has been renamed to Section V.