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➔ Note 50 - Commitments and contingencies
a) Specific commitments
Details of commitments related specifically to the following
transactions are provided in the corresponding notes:
- securitization of receivables by the manufacturing and sales
companies – note 22-a
- securitization of automobile loans by the finance companies – note 23-a
- supplementary pension, retirement and other post-retirement
obligations – note 46
- management of foreign exchange and interest rate risks – note 47.
b) Routine commitments
The Group had routine commitments in the following amounts as of
December 31, 2002, 2001 and 2000:
(in millions of euros) 2002 2001 2000
Capital commitments for
the acquisition of property,
plant and equipment 2,083 1,961 1,719
Orders for research and
development work 40 - -
Non-cancelable lease
commitments 416 363 308
Securities subscription and
purchase commitments (1) 217 - -
2,756 2,324 2,027
Financing commitments to
customers of finance
companies 1,012 789 715
Guarantees given 202 245 114
Pledged or mortgaged assets (2) 458 973 912
(1) In 2002, this commitment relates to the Chinese company Dongfeng Citroën
Automotive Corp. – DCAC, accounted for by the equity method.
(2) Details of pledged assets :
Value
(in millions of euros) Expiry of pledged Total
date assets assets %
Intangible assets N/A N/A
Property, plant
and equipment Indefinite 22
Investments 2003 47
2004 47
2005 18
2006 1
2007 145
2008 73
2009 87
> 2009 18
436
Total pledged assets 458 56,008 0.8
c) Tax audit risks
Group companies in France and in other countries are subject to
regular tax audits. Potential reassessments resulting from these audits
are reserved for. Reassessments by the tax authorities in the European
Union usually relate to transfer prices. The Group considers that any
such transfer price problems will be settled under the procedures
provided for in international tax treaties and it should therefore be
possible to avoid additional taxation.
d) End-of-life vehicles
European Directive 2000/53/EC of September 18, 2000 on end-of-life
vehicles provides that:
“Member States shall take the necessary measures to ensure that the
delivery of the vehicle to an authorized treatment facility (…) occurs
without any cost for the last holder and/or owner (…).
Member States shall take the necessary measures to ensure that producers
meet all, or a significant part of, the costs of the implementation of this
measure and/or take back end-of life vehicles (…),
- as from July 1, 2002 for vehicles put on the market as from this date,
- as from January 1, 2007 for vehicles put on the market before
July 1, 2002.”
As of December 31, 2002 only four countries had transposed this
Directive into national legislation:
- for Austria and Norway the impact for the Group is not material,
- for Germany a €6 million reserve has been booked representing the
discounted value of estimated residual costs for the Group. This takes
into account a €17 million saving due to the possibility of recycling
catalytic converters,
- for the Netherlands, a reserve of €37 million was booked at
December 31, 2002, corresponding to the discounted value of the net
residual cost potentially payable by the Group.
In Spain, the royal decree concerning the transposition of the European
Directive was signed on January 3, 2003. According to current
estimates, any residual costs payable by the Group are not expected to
be material.
As of December 31, 2002, France had not yet transposed the Directive
into national legislation. According to current estimates, based on the
latest available draft of the applicable decree, the final cost to the
Group will not be material.
Certain countries such as Belgium, Denmark and Sweden have applied
specific regulations concerning end-of-life vehicles for several years.
Current commitments under these regulations do not give rise to any
material residual costs for the Group.
The actual costs that will be incurred in the other European Union
countries cannot yet be reliably determined as no regulations are
currently available.
PSA PEUGEOT CITROËN - APPENDICES TO THE MANAGING BOARD REPORT 177