Pensions and Other Post-employment Benefit Obligations (Tables)

12 Months Ended

Dec. 31, 2017

The principal actuarial assumptions used at December 31, 2017 and 2016 were as follows:


	At December 31, 2017				At December 31, 2016
	Rate of increase in salaries	Rate of increase in pensions		Discount rate	Rate of increase in salaries	Rate of increase in pensions		Discount rate
Switzerland	1.50%		—	0.65%	1.65%		—	0.60%
U.S.	—		—	—	3.80%		—	—
Hourly pension	2.20%		—	3.70%-3.75%	—		—	4.30%-4.35%
Salaried pension	3.80%		—	3.80%	—		—	4.45%
OPEB^(A)	3.80%		—	3.70%-3.85%	—		—	4.20%-4.60%
Other benefits	3.80%		—	3.60%-3.70%	—		—	4.05%-4.20%
France	1.50%-1.75%		2.00%	—	1.50%-1.75%		2.00%	—
Retirements	—		—	1.50%	—		—	1.60%
Other benefits	—		—	1.20%	—		—	1.30%
Germany	2.75%		1.70%	1.60%	2.75%		1.70%	1.65%

(A)	The other main financial assumptions used for the OPEB (healthcare plans, which are predominantly in the U.S.) were:

Medical trend rate: pre 65: 7.00% starting in 2018 decreasing gradually to 4.50% until 2026 and stable onwards and post 65: 6.00% starting in 2018 decreasing gradually to 4.50% until 2026 and stable onwards, and

Claims costs are based on individual company experience.

Summary of Amounts Recognized in the Consolidated Statement of Financial Position

Amounts recognized in the Consolidated Statement of Financial Position


	At December 31, 2017								At December 31, 2016
*(in millions of Euros)*	Pension Benefits			Other Benefits		Total			Pension Benefits			Other Benefits		Total
Present value of funded obligation		691			—		691			721			—		721
Fair value of plan assets		(387	)		—		(387	)		(391	)		—		(391	)

Deficit of funded plans		304			—		304			330			—		330
Present value of unfunded obligation		110			250		360			132			273		405

Net liability arising from defined benefit obligation		414			250		664			462			273		735

Details of Movement in Net Defined Benefit Obligations

Movement in net defined benefit obligations


	At December 31, 2017
	Defined benefit obligations									Plan Assets			Net defined benefit liability
*(In millions of Euros)*	Pension benefits			Other benefits			Total			Plan Assets			Net defined benefit liability
At January 1, 2017		853			273			1,126			(391	)		735

Included the Consolidated Income Statement
Current service cost		18			6			24			—			24
Interest cost / (income)		18			9			27			(9	)		18
Past service cost		(16	)		(4	)		(20	)		—			(20	)
Immediate recognition of gains arising over the period		—			—			—			—			—
Administration expenses		—			—			—			2			2

Included in the Statement of Comprehensive Income / (Loss)
Remeasurements due to:
—actual return less interest on plan assets		—			—			—			(36	)		(36	)
—changes in financial assumptions		23			14			37			—			37
—changes in demographic assumptions		—			(1	)		(1	)		—			(1	)
—experience (gains)/losses		—			—			—			—			—
Effects of changes in foreign exchange rates		(61	)		(29	)		(90	)		42			(48	)

Included in the Consolidated Statement of Cash Flows
Benefits paid		(38	)		(18	)		(56	)		33			(23	)
Contributions by the Group		—			—			—			(24	)		(24	)
Contributions by the plan participants		4			—			4			(4	)		—

At December 31, 2017		801			250			1,051			(387	)		664


	At December 31, 2016
	Defined benefit obligations									Plan Assets			Net defined benefit liability
*(In millions of Euros)*	Pension benefits			Other benefits			Total			Plan Assets			Net defined benefit liability
At January 1, 2016		802			261			1,063			(362	)		701

Included in the Consolidated Income Statement
Current service cost		20			6			26			—			26
Interest cost / (income)		21			10			31			(10	)		21
Past service cost		—			1			1			—			1
Immediate recognition of losses arising over the period		—			1			1			—			1
Administration expenses		—			—			—			2			2

Included in the Statement of Comprehensive Income / (Loss)
Remeasurements due to:
—actual return less interest on plan assets		—			—			—			(14	)		(14	)
—changes in financial assumptions		28			6			34			—			34
—changes in demographic assumptions		2			(3	)		(1	)		—			(1	)
—experience (gains)/losses		1			(4	)		(3	)		—			(3	)
Effects of changes in foreign exchange rates		12			8			20			(8	)		12

Included in the Consolidated Statement of Cash Flows
Benefits paid		(37	)		(17	)		(54	)		32			(22	)
Contributions by the Group		—			—			—			(26	)		(26	)
Contributions by the plan participants		4			1			5			(5	)		—

Other
Transfer		—			3			3			—			3

At December 31, 2016		853			273			1,126			(391	)		735

Details of Net Defined Benefit Obligations by Country

Net defined benefit obligations by country


	At December 31, 2017							At December 31, 2016
*(in millions of Euros)*	Defined benefit obligations		Plan assets			Net defined benefit liability		Defined benefit obligations		Plan assets			Net defined benefit liability
France		148		(3	)		145		144		—			144
Germany		142		(1	)		141		147		(1	)		146
Switzerland		251		(177	)		74		284		(181	)		103
United States		509		(206	)		303		550		(209	)		341
Other countries		1		—			1		1		—			1

Total		1,051		(387	)		664		1,126		(391	)		735

Details of Plan Asset Categories

Plan asset categories


	At December 31, 2017						At December 31, 2016
*(in millions of Euros)*	Quoted in an active market		Unquoted in an active market		Total		Quoted in an active market		Unquoted in an active market		Total
Cash and cash equivalents		3		—		3		4		—		4
Equities		160		—		160		158		—		158
Bonds		81		93		174		82		96		178
Property		8		29		37		10		31		41
Other		5		8		13		5		5		10

Total fair value of plan assets		257		130		387		259		132		391

Summary of Benefits Payments Expected Paid Either by Pension Funds or Directly to Beneficiaries

Benefits payments expected to be paid either by pension funds or directly by the Company to beneficiaries over the next years are as follows:


*(in millions of Euros)*	Estimated benefits payments
Year ended December 31,
2018		52
2019		52
2020		52
2021		55
2022		56
2023 to 2027		286

Actuarial assumption of discount rates [member]

Summary of Actuarial Assumptions

At December 31, 2017, impacts of the change on the defined benefit obligation of a 0.50% increase / decrease in the discount rates are calculated by using a proxy based on the duration of each scheme:


	0.50% increase in discount rates			0.50% decrease in discount rates
*(in millions of Euros)*	0.50% increase in discount rates			0.50% decrease in discount rates
France		(9	)		10
Germany		(9	)		10
Switzerland		(20	)		23
United States		(30	)		33

Total sensitivity on Defined Benefit Obligations		(68	)		76