1. COICOP 2018 Implementation
Item 5.1 of agenda Standards Working Group Meeting July Luxembourg
Ana Franco
Eurostat, Unit B.5
Data and Metadata Services and Standards

2. Background COICOP was revised!
The revision was conducted by a Technical Sub-group of the United Nations Expert Group on International Statistical Classifications and was chaired by Eurostat.
Consultations:
2 global (worldwide) consultations,
consultation of the Standards Working Group,
consultation and agreement of Expert Group on International Statistical Classifications
COICOP 2018 was endorsed by the 49th Session of the Statistical Commission (March 2018)
COICOP 2018 is much better suited to classify current consumer expenditures (specifically on communication and information services) than COICOP 1999

3. Documents available
United Nations COICOP revision webpage
Documents available:
Introductory guidelines,
Structure and explanatory notes,
correspondence tables between COICOP 1999 and COICOP 2018 and vice versa and
the optional 6 digits structure for food goods

4. Major changes introduced in COICOP – more detail
The new COICOP introduces a 4th level denominated sub-class (5 digits)
More detail compared with COICOP 1999 but similar level of detail compared with ECOICOP (Divisions 1-12/1-13)
Level
COICOP 1999
ECOICOP 2012
COICOP 2018 XX 12 13
XX.Y 47 52
XX.Y.Z
117
146
XX.Y.Z.A
N/A
303
298

5. Major changes introduced in COICOP – more detail
An expansion at six digits for Division 01 (270 6-digit codes), fully consistent with the 5 digits classification, is provided as an official Annex to the COICOP because:
The consumption on food and beverages in the household consumption is very important (from 21% of the total household consumption to 54% among the World countries) and it was considered important to have more detailed information on this area.

6. COICOP ISCED ICHA CPC/CPA
Major changes introduced in COICOP – better correspondence with other classifications
Division 06 Health
Division 10 Education
COICOP
ISCED
ICHA
A better consistence between CPC and COICOP was considered relevant to analyse product flow. Therefore the possibility of linking COICOP and CPC were analysed and some changes introduced were based on a better consistence between the 2 classifications. However a full consistence between the 2 classifications is impossible taking into account that COICOP classifies individual consumption by purpose and when a product is produced it can be used for different purposes.
Division 06 Health was completely restructured according to a proposal from the World Health Organisation. The new structure allows an alignment of COICOP with the International Classification for Health Accounts (ICHA) and its family of classifications.
Division 10 Education services was also revised to cope with the new International Standard Classification of Education (ISCED 2011)
CPC/CPA

7. Major changes introduced in COICOP – Separation between goods and services
The new COICOP includes the distinction between goods and services whenever this is possible and new classes or sub-classes were created systematically for services like repair, maintenance, installation or renting of goods.
However this separation is not always possible:
Restaurant services, reparations, inpatient care services : goods and service are often charged together
On-line services: products like downloads of music and books in a technical perspective could be viewed as a service, but serve the same purpose as products traditionally viewed as goods
Bundles of goods and services (telecommunication bundles)

8. Major changes introduced in COICOP – Classification by durability
A majority of countries supports the distinction of goods in Durable, Semi-Durable and Non-Durable and Services for analytical purposes.
The distinction was made at the level of classes and sub-classes.

9. Major changes introduced in COICOP – Changes at division level
The highest level of the classification remained unchanged for most of the Divisions to avoid breaks in the time-series.
Division 08 and 09 were considerably reorganised and now break down as Information and communication (Division 08) and Recreation, sport and culture (Division 09).
Division 07 Transport that previously was dedicated to the transport of individuals includes now the transport of goods also
Division 12 was split into 2 divisions:
Division 12 Insurance and financial services
Division 13 Personal care, social protection and miscellaneous goods and services

10. Major changes introduced in COICOP – Modernization
The list of inclusions and exclusions of all classes was carefully revised to include goods and services that didn't exist when the previous version of the classification was drafted.
Products that do not exist anymore in the market were also excluded from the list of inclusions.

11. Is COICOP 2018 very different from ECOICOP?
ECOICOP is not fully consistent with the COICOP 2018
At 4 digit level, COICOP 2018 is more detailed than ECOICOP ( classes)
But at 5 digit ECOICOP is more detailed ( sub-classes)

12. Is COICOP 2018 very different from ECOICOP?
1-to-1 correspondences:
135 Subclasses in eCOICOP correspond exactly to each one Subclass in COICOP 2018 and vice-versa;
n-to-1 correspondences:
20 cases, where each two or more Subclasses in eCOICOP correspond to one Subclasses in COICOP 2018;
1-to-m correspondences:
14 cases, where each one Subclass in eCOICOP is split into two or more Subclasses in COICOP 2018;
n-to-m correspondences:
134 cases, where each two or more Subclasses in eCOICOP correspond to two or more Subclasses in COICOP 2018.

13. Legal matters HICP PPP National accounts HBS Regulation (EU) 2016/792
ESA 2010 Regulation
PPP
National accounts
HBS

14. Legal matters - HICP
ECOICOP is defined in Annex I of the new HICP/HPI framework regulation
Article 4(3) of this Regulation says:
“The Commission shall be empowered to adopt delegated acts in accordance with Article 10 for the amendment of Annex I, in order to ensure comparability of the harmonised indices at international level in accordance with changes to the UN COICOP.”
COICOP 2018 could in principle be introduced by delegated act.

15. Legal matters - PPP ECOICOP is used in the PPP exercise since 2016
ECOICOP was introduced in the PPP program by means of Commission Regulation (EU) 2015/1163.
This is a regulation implementing the PPP basic act of 2007 (Regulation (EU) 1445/2007).
Further changes to the classification used for PPPs could be adopted in principle in the same way.

16. Legal matters – National accounts
COICOP 1999 is used in SNA 2008 at 3 digit level
Article 2(2) of the Regulation states: “The Commission shall be empowered to adopt delegated acts in accordance with Article 7, concerning amendments to the ESA 2010 methodology in order to specify and improve its content for the purpose of ensuring a harmonised interpretation or to ensure international comparability provided that they do not change its underlying concepts, do not require additional resources for producers within the European Statistical System for their implementation, and do not cause a change in own resources.”
Is this article sufficient for an amendment of COICOP by delegated act, or a revision of the Regulation itself is needed?

17. Legal matters – Household budget survey
No legal act for HBS
Data is collected every 5 years
ECOICOP was first used for the 2015 round
The HBS is, at national level, an important source of information for the household expenditure weights that are necessary for HICP and PPP

18. Calendar of implementation of the new classification
use a classification that better reflects consumption patterns
adaptation of national production systems

19. Discussion
Should the revised ECOICOP be identical to COICOP 2018 or an adaptation for European purposes would be needed?
Should data be collected and delivered at 6 digit level for the food part?
What would be the calendar of implementation of the new classification in each relevant statistical domain?