The Benchmark Definition of Foreign Direct Investment was developed to address the need to measure this specific form of cross-border investment. It was first published in 1983 and this release of the revised Benchmark Definition in 2025 represents its fifth edition. The global economy has changed considerably over that time, yet the need to understand cross-border direct investment remains just as relevant now as it was 42 years ago.
The foundation of the Benchmark Definition is that of cooperation, collaboration and knowledge sharing. The OECD has also worked with the International Monetary Fund and United Nations to promote consistency and harmonised approaches to the foreign direct investment (FDI) elements of the Integrated Balance of Payments and International Investment Position Manual, Seventh Edition (BPM7), and 2025 System of National Accounts (2025 SNA). Having these agreed international standards for FDI statistics is a way of promoting consistent approaches, definitions and methods that are comparable between economies and with other international statistical accounts. This is crucial for informing analysis and policy making.
Producing statistics is not a discrete event; it is a continual process of development and understanding. This fifth edition builds on the principles included in the previous edition to capture the evolving needs for official statistics. Our previous considerations looking to the top of corporate structures for inward FDI have been updated to reflect what we have learned. To this, we have added further detail on how to compile statistics covering a wide range of other topics. This includes looking down ownership chains of outward FDI, differentiating FDI that increases the host economy’s productive capacity from changes in ownership of existing assets, and identifying resident special purpose entities within ownership chains and measuring the FDI that passes through them. We also clarify concepts for recording FDI income, such as dividends and reinvested earnings, among others.
The OECD Working Group on International Investment Statistics acknowledges everyone that has contributed to the revision of the Benchmark Definition. We hope that the resulting fifth edition continues to represent a valuable tool for compilers and users of FDI statistics and that the implementation of the revised standards further contributes to improving the comparability of FDI statistics across economies.