An institutional unit is a resident unit when it has a center of economic interest in the economic territory of a country.
1. Economic territory is defined as a geographic territory administrated by a government, including airspace, territorial waters, continental shelf, territory enclaves elsewhere (embassies and military bases abroad), and free zones (offshore enterprises).
2. An institutional unit has a center of economic interest within a country when there exists some location, dwelling, or place of production from which the unit engages and intends to continue engaging in economic activities and transactions on a significant scale over either an indefinitely or a finite but long period of time. A one year period is a suggested guideline to what is a long period, but this rule is flexible.
3. Ownership of land and structures located within a country's economic territory is sufficient qualification for the owner to have a center of economic interest in the country. Land and structure are always resident where they are located, with the exception of embassies etc.
All economic activity performed by resident institutional units should in principle be included in the national accounts.
The treatment of residency is consistent with the treatment in the Balance of Payments Manual Rev.5.
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