The Blurring of Corporate Investor Nationality and Complex Ownership Structures

24 Pages Posted: 10 Jul 2019

See all articles by Eleonora Alabrese

Eleonora Alabrese

University of Warwick, Students

Bruno Casella

United Nations - Conference on Trade and Development (UNCTAD)

Multiple version iconThere are 2 versions of this paper

Date Written: April 15, 2019

Abstract

Recent years have seen a significant increase in complexity of multinational enterprises (MNEs) ownership structures. Complex corporate structures raise concerns on the effectiveness of national and international investment policies, based on the notion of investors' nationality. This motivates this research effort aimed at analysing the ownership structures of some 700 thousand foreign affiliates (FAs). A new methodology, the bottom-up approach, is introduced. The main objective is to empirically map the "shareholder space" of FAs, along the vertical dimension, from the direct shareholders to the ultimate owners. We find that FAs are often part of transnational investment chains; more than 40% of foreign affiliates have direct and ultimate shareholders in different jurisdictions ("double or multiple passports"). Based on shareholders' nationality, we then propose and empirically analyse the salient features of four main archetypes of FAs ownership structure: plain foreign, conduit structures, round-tripping and domestic hubs. Each poses specific challenges to the policy-maker.

Keywords: multinational enterprises, ownership structures, firm-level, investors' nationality

JEL Classification: F23, G32, H87

Suggested Citation

Alabrese, Eleonora and Casella, Bruno, The Blurring of Corporate Investor Nationality and Complex Ownership Structures (April 15, 2019). Available at SSRN: https://ssrn.com/abstract=3372329 or http://dx.doi.org/10.2139/ssrn.3372329

Eleonora Alabrese (Contact Author)

University of Warwick, Students ( email )

United Kingdom

Bruno Casella

United Nations - Conference on Trade and Development (UNCTAD) ( email )

Palais des Nations
Office E 8074
Geneva, 1211
Switzerland

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