General
Information
Last Update:
March 1, 2012
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21 – Other provisions

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2011

 

2010

Million €

 

Thereof short-term

 

 

Thereof short-term

Restoration obligations

983

18

 

869

5

Environmental protection and remediation costs

659

150

 

665

192

Employee obligations

1,876

1,395

 

2,043

1,380

Sales and purchase risks

665

651

 

730

692

Restructuring measures

198

180

 

234

214

Legal, damage claims, guarantees and related commitments

190

90

 

249

125

Other

1,974

726

 

1,886

716

 

6,545

3,210

 

6,676

3,324

Restoration obligations primarily relate to the estimated costs for the filling of wells, the removal of production equipment after the end of production and the removal of natural gas pipelines. The increase in long-term provisions for restoration obligations is primarily a result of provisions added in connection with the construction of natural gas pipelines and the expansion of natural gas storage facilities in Germany.

Provisions for environmental protection and remediation costs cover expected costs for rehabilitating contaminated sites, recultivating landfills, removal of environmental contamination at existing production or storage sites and similar measures. In addition, provisions are recognized in connection with the allocation of emissions certificates from the German Emissions Trading Authority or other similar bodies in the European Union.

Provisions for employee obligations include obligations for the granting of long-service bonuses and anniversary payments, variable compensation including the associated social security contributions, and other accruals as well as provisions for early retirement programs for employees nearing retirement.

The decrease in the long-term employee obligation provisions resulted primarily from the utilization of provisions for the BASF stock price-based compensation program (long-term incentive program).

The sales and purchase risks provisionsinclude warranties, product liability, customer rebates, payment discounts and other price reductions, sales commissions and provisions for expected losses on committed purchases as well as provisions for onerous contracts.

The restructuring measures provisions include severance payments to employees as well as expected costs for site closures, including the costs for demolition and similar measures.

Provisions for legal, damage claims, guarantees and related commitments include the expected costs of litigation, obligations under damage claims, and other guarantees. Other includes long-term tax provisions as well as further present obligations and accruals.

The following table shows the development of other provisions by category. Other changes relate to changes in the scope of consolidation, currency effects and the transfer of obligations to liabilities, where these obligations have become more concrete as to their amount and timing.

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Development of other provisions in 2011 (million €)

 

 

 

January 1, 2011

Additions

Interest compounding

Utilization

Reversals

Other changes

December 31, 2011

Restoration obligations

869

100

41

(16)

(16)

5

983

Environmental protection and remediation costs

665

142

1

(165)

(19)

35

659

Employee obligations

2,043

1,302

17

(1,322)

(115)

(49)

1,876

Sales and purchase risks

730

409

1

(318)

(91)

(66)

665

Restructuring measures

234

98

(115)

(18)

(1)

198

Legal, damage claims, guarantees and related commitments

249

72

11

(32)

(106)

(4)

190

Other

1,886

804

1

(534)

(177)

(6)

1,974

 

6,676

2,927

72

(2,502)

(542)

(86)

6,545

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