What is a class and why is it the most detailed level?

A class is the fourth and most detailed level of NACE, identified by a four digit numerical code, inside one group. The EUR-Lex summary states that classes are identified by four digits, as the lowest level of the four level structure. A class note therefore carries the finest distinctions in the classification, and it is the level at which the explanatory notes are most detailed.

How is a class code formed, and how many classes are there?

A class code is formed from the group code by appending one digit. The manual example is division 20, group 20.5, class 20.51 for manufacture of liquid biofuels. The class code shows the full path: the first two digits are the division, the third digit is the group digit, and the fourth digit is the class digit. The dot after the second digit separates the division part from the group and class part. A class code with a zero as its final digit, such as 75.00, can still be a class, where the division is not split and the group and class carry the same heading as the division, with zeros appended at each level.

The adopted structure has 651 classes (FIXED, as adopted), inside 287 groups, 87 divisions and 22 sections. Those counts come from the manual table comparing NACE Rev. 2 and NACE Rev. 2.1, which gives 651 classes for NACE Rev. 2.1 against 615 classes for NACE Rev. 2, a difference of 36. The class count is a count of categories in the classification, not a count of businesses, and not a count of activities in the economy. A single class can cover many activities, and a single business can carry out activities described in several classes, while being assigned to one class for its principal activity in a statistical register.

Level	Identifier	Count in NACE Rev. 2.1, as adopted
Section	One letter	22
Division	Two digits	87
Group	Three digits	287
Class	Four digits	651

What criteria define a class?

The manual states that the criteria concerning the way activities are combined in, and allocated among, production units are central to the definition of classes. Activities are grouped together when they share a common process for producing goods or services. At the lowest level, preference has been given to the process and technique of production to define individual classes, particularly in classes related to services. The manual also states two conditions that classes are defined to fulfil: the output of the category characterising a class represents a major part of the output of the units whose principal activity is classified in that class, and the class contains the units that produce most of the category of goods and services that characterise it.

Those conditions are about the design of the classification, not about a decision for a particular unit. They explain why classes are drawn where they are: so that units in the same class are similar, and so that a class can be used to classify the activity of a unit uniquely and easily. The manual adds that separate classes are generally provided for activities prevalent in most European Union member states, or of particular importance in the world economy, and that certain additional classes of importance only for certain member states have been introduced. A class therefore reflects both a production process and a judgement about prevalence and importance, as recorded in the manual.

What does a class note contain that higher notes do not?

A class note contains lists of included activities, often with examples, and exclusions that point to other classes. The manual states that the content and scope of each position is defined through detailed explanatory notes, which highlight boundary issues by providing examples of activities that may appear similar but are classified elsewhere. At class level, those lists are the working detail. A class note for growing of cereals, for example, lists the cereals, leguminous crops and oil seeds included, and excludes growing of rice, sweetcorn, fodder crops, and oleaginous fruits, each with a cross reference to the class where it is classified. That level of list does not appear at section level, where the note states the broad scope and the main boundaries only.

The class note is also the level at which the NACE index entries attach. The manual states that the entries in the NACE index are an integral part of the explanatory notes, and that the index is disseminated online through ShowVoc, where it is designed to evolve and be regularly revised. An index entry lists a detailed activity and points to the class where it is classified. The index therefore helps a reader move from a named activity to a class note, but the note remains the definition, and the index entry must be read with the note, not instead of it.

What does a class not decide?

A class does not decide the entry for a business, even though it is the level at which a unit is assigned in a statistical register. The manual states that one NACE code is assigned to each unit recorded in statistical business registers, according to its principal economic activity, and that all activities are considered when determining the principal activity, while only the principal activity is used to classify a unit. That assignment is made by the institute or register that holds the record, using the notes, the index, and the classification rules, including the top down method where no single activity accounts for more than half of value added. A reader who finds a class note that describes an activity has found a category that describes that activity for statistical purposes. That reader has not determined the principal activity of a unit, and must not present the class as the unit’s code.

Read the class code to find its group and division, read the class note for its inclusions and exclusions, and confirm any entry with the national statistical institute or the business register that holds the record.