To ensure comparability of national statistics in the EU, two classification systems are in force: European System of Accounts 2010 (ESA 2010) and Statistical Classification of Economic Activities in the European Community (hereinafter, NACE) whereby institutional units and sectors of the economy can be classified.
NACE defines a productive economic activity, stipulating that its characteristic features are as follows: input of commodities or services, process of production or service, and supply of output or services. Where a statistical unit performs several activities, all activities are listed according to their share in/contribution to the created total value added, and the statistical unit is classified according to the activity producing the largest share of value added.
NACE Rev. 2 has been drafted and approved by Regulation (EC) No 1893/2006 of the European Parliament and of the Council of 20 December 2006 establishing the statistical classification of economic activities NACE Revision 2 and amending Council Regulation (EEC) No 3037/90 as well as certain EC Regulations on specific statistical domains.
NACE comprises four levels and one intermediate level:
– a first level consisting of headings identified by an alphabetical code (sections);
– an intermediate level consisting of headings identified by a two-letter alphabetical code (sub-sections);
– a second level consisting of headings identified by a two-digit numerical code (divisions);
– a third level consisting of headings identified by a three-digit numerical code (groups);
– a fourth level consisting of headings identified by a four-digit numerical code (classes).
The economic activity is assigned an appropriate NACE level starting from the top level (e.g. in the case of financial and insurance activity it is Section K; see Table "Financial and insurance activities") and further broken down by division, group and class (e.g. Class 64.91 – Financial leasing).