23 – Other provisions

 

 

December 31, 2016

December 31, 2015

Million €

 

 

Thereof current

 

Thereof current

Restoration obligations

 

1,297

29

1,266

72

Environmental protection and remediation costs

 

588

116

538

59

Employee obligations

 

1,933

1,217

1,569

1,150

Obligations from sales and purchase contracts

 

928

919

775

763

Restructuring measures

 

208

161

196

165

Litigation, damage claims, warranties and similar commitments

 

109

37

86

29

Other

 

1,406

323

1,479

302

Total

 

6,469

2,802

5,909

2,540

Restoration obligations primarily relate to the estimated costs for the filling of wells and the removal of production equipment after the end of production in the Oil & Gas segment.

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.

Provisions for employee obligations primarily include obligations for the granting of long-service bonuses and anniversary payments, variable compensation including associated social security contributions, as well as provisions for early retirement programs for employees nearing retirement. The increase was primarily attributable to higher accruals for the long-term Incentive (LTI) program.

Obligations from sales and purchase contracts largely include obligations arising from rebates granted and other price discounts in the Agricultural Solutions segment, warranties and product liability, sales commissions, expected losses on contracts. The increase in provisions resulted from higher accruals for rebate programs.

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

Provisions for litigation, damage claims, warranties and similar commitments contain anticipated expenses from lawsuits in which BASF is the defendant party, as well as obligations under damage claims against BASF and fines.

Other largely includes noncurrent tax provisions.

The following table shows the development of other provisions by category. Other changes include changes in the scope of consolidation, acquisitions, divestitures, currency effects and the reclassification of obligations to liabilities when the amount and timing of these obligations become known.

Development of other provisions in 2016 (million €)

 

 

Jan. 1, 2016

Additions

Unwinding of the discount

Utilization

Reversals

Other changes

Dec. 31, 2016

Restoration obligations

 

1,266

118

27

(72)

(62)

20

1,297

Environmental protection and remediation costs

 

538

110

5

(65)

(10)

10

588

Employee obligations

 

1,569

1,561

3

(1,132)

(50)

(18)

1,933

Obligations from sales and purchase contracts

 

775

743

(575)

(59)

44

928

Restructuring measures

 

196

117

(84)

(27)

6

208

Litigation, damage claims, warranties and similar commitments

 

86

51

(30)

(13)

15

109

Other

 

1,479

317

1

(201)

(139)

(51)

1,406

Total

 

5,909

3,017

36

(2,159)

(360)

26

6,469