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EMPLOYEE BENEFIT PLANS
 12 Months Ended
Dec. 31, 2021
EMPLOYEE BENEFIT PLANS  
EMPLOYEE BENEFIT PLANS

18.EMPLOYEE BENEFIT PLANS

a.    Defined Benefit Plans

Retirement benefit obligation result all from the German pension plan after the completion of the acquisition of DH as this pension plan is the most significant defined benefit plan in the Group.

The Group is required to recognize the funded status of the pension plan, which is the difference between the fair value of plan assets and projected benefit obligations, in the consolidated balance sheets and make corresponding adjustments for changes in the value through accumulated other comprehensive income(loss), net of taxes.

The following table presents the projected benefit obligation, fair value of plan assets, funded status and accumulated benefit obligation for the plans during the years ended December 31, 2020 and 2021:

​

​

​

​

​

​

​

    

Year Ended December 31, 

Change in Projected Benefit Obligation:

​

2020

    

2021

Begin of the year

 

147

​

193

Current service cost

 

5

​

5

Interest cost

 

1

​

0

Contributions by plan participants

 

1

​

1

Actuarial loss (gain)

 

38

​

(14)

Foreign currency translation

 

3

​

(19)

Benefits paid

 

(7)

​

(9)

Settlements

 

(1)

​

—

Administrative Expenses, Taxes and Premiums Paid

 

0

​

0

Curtailments

 

(1)

​

—

Acquisitions

​

—

​

0

Effect of other economic events

 

7

​

—

End of the year

 

193

​

157

​

​

​

​

​

​

​

    

Year Ended December 31, 

​

​

2020

    

2021

Change in Plan Assets:

 

​

​

  

Begin of the year

 

32

​

6

Actual return (loss) on plan assets

 

(2)

​

0

Foreign currency translation

 

1

​

(0)

Employer contributions

 

9

​

1

Employee contributions

 

1

​

0

Benefits paid

 

(8)

​

(2)

Acquisitions

​

—

​

0

Other economic events

 

(27)

​

—

End of the year

 

6

​

5

Excess of defined benefit obligation over the fair value of plan assets

 

187

​

152

Accumulated benefit obligation

 

193

​

157

​

Amounts recognized in the consolidated balance sheets consisted of the following:

​

​

​

​

​

​

​

    

As of December 31, 

​

​

2020

    

2021

Salary and welfare payables

 

8

​

8

Retirement benefit obligation

 

179

​

144

Liability in the balance sheet

 

187

​

152

​

The net amount recognized in accumulated other comprehensive gain or loss was RMB27 loss and RMB13 gain for the year ended December 31, 2020 and 2021, respectively.

The net periodic pension cost (credit) and the estimated unrecognized prior service cost and net loss that will be amortized into net periodic pension cost (credit) during the years ended December 31,2020 and 2021 is immaterial.

The principal actuarial assumptions used were as follows:
​

​

​

​

​

​

​

​

​

    

As of December 31,

 

​

​

2020

    

2021

​

Discount rate- Germany

​

0.33

%

0.89

%

Discount rate- other

 

0.12

%

0.39

%

Inflation rate

 

1.00

%

1.00

%

Future salary increases

 

1.50

%

2.17

%

Future pension increases

 

1.80

%

1.69

%

​

The investment objectives for the various plans are preservation of capital, current income and long-term growth of capital. All plan assets are managed by outside investment managers. Asset allocations are reviewed periodically by the investment managers.

Expected long-term returns on plan assets are determined using historical performance for debt and equity securities held by the Group’s plans, actual performance of plan assets and current and expected market conditions. Expected returns are formulated based on the target asset allocation. The target asset allocation for the plan, as a percentage of total plan assets, as of December 31, 2021 was 26 percent in funds that invest in equity securities and 29 percent in funds that invest in debt securities.

The following tables present the fair value hierarchy of total plan assets measured at fair value by asset category as of December 31, 2020 and 2021:
​

​

​

​

​

​

​

​

    

As of December 31, 

​

​

2020

​

2021

Level 1

 

​

    

  

Equity funds

 

1

​

1

Bond funds

 

2

​

2

Property

 

2

​

1

Other

 

1

​

1

Total

 

6

​

5

​

The Group expect to contribute approximately RMB1 to the plan in 2022.

As of December 31, 2021, the benefits expected to be paid in the year ended December 31, 2022 are RMB9.

b. Defined Contribution Plans

Full time employees of the Group in the PRC participate in a government-mandated defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. PRC labor regulations require the Group to accrue for these benefits based on a certain percentage of the employees’ salaries. The total contribution for such employee benefits were RMB413, RMB283 and RMB544 for the years ended December 31, 2019, 2020 and 2021, respectively. The Group has no ongoing obligation to its employees subsequent to its contribution to the PRC plan. In an attempt to mitigate the adverse financial effects of the COVID-19 pandemic on employers, the Chinese Government had announced temporary reductions in, and exemptions from, the payment of contributions in 2020. The supportive policies have been gradually reduced in 2021.

Furthermore, the Group pays contribution to governmental and private pension insurance organizations based on legal regulations in some countries out of China. The contributions are recognized as expense and amount RMB129 and RMB55 for the years ended December 31, 2020 and 2021.