23 – Other provisions

 

 

December 31, 2017

December 31, 2016

Million €

 

 

Thereof current

 

Thereof current

Restoration obligations

 

1,296

17

1,297

29

Environmental protection and remediation costs

 

600

112

588

116

Employee obligations

 

2,173

1,553

1,933

1,217

Obligations from sales and purchase contracts

 

1,080

1,070

928

919

Restructuring measures

 

143

119

208

161

Litigation, damage claims, warranties and similar commitments

 

103

48

109

37

Other

 

1,312

310

1,406

323

Total

 

6,707

3,229

6,469

2,802

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 variable compensation components.

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 and for product liabilities.

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, 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 2017 (million €)

 

 

Jan. 1, 2017

Additions

Unwinding of the discount

Utilization

Reversals

Other changes

Dec. 31, 2017

Restoration obligations

 

1,297

108

29

(30)

(21)

(87)

1,296

Environmental protection and remediation costs

 

588

111

3

(60)

(5)

(37)

600

Employee obligations

 

1,933

1,720

2

(1,235)

(154)

(93)

2,173

Obligations from sales and purchase contracts

 

928

1,027

(681)

(66)

(128)

1,080

Restructuring measures

 

208

35

(65)

(22)

(13)

143

Litigation, damage claims, warranties and similar commitments

 

109

54

(24)

(24)

(12)

103

Other

 

1,406

264

1

(225)

(85)

(49)

1,312

Total

 

6,469

3,319

35

(2,320)

(377)

(419)

6,707