Related Parties

Related parties as defined in IAS 24 (Related Party Disclosures) are those legal entities and natural persons that are able to exert influence on Bayer AG and its subsidiaries or over which Bayer AG or its subsidiaries exercise control or joint control or have a significant influence. They include, in particular, nonconsolidated subsidiaries, joint ventures and associates included in the consolidated financial statements at cost of acquisition or using the equity method, and post-employment benefit plans, as well as the corporate officers of Bayer AG whose compensation is reported in the Note “Total compensation of the Board of Management and the Supervisory Board, advances and loans” and in the Compensation Report, which forms part of the Combined Management Report.

Transactions with nonconsolidated subsidiaries, joint ventures and associates included in the consolidated financial statements at cost of acquisition or using the equity method, and post-employment benefit plans are carried out on an arm’s-length basis.

The following table shows the volume of transactions with related parties included in the consolidated financial statements of the Bayer Group at amortized cost or using the equity method, and with post-employment benefit plans:

Related Parties

Goods and services in the amount of €524 million (2015: €609 million) were purchased from the associate PO JV, LP, Wilmington, United States, mainly in the course of day-to-day business operations.

Liabilities rose mainly with respect to Casebia Therapeutics Limited Liability Partnership, Ascot, United Kingdom, the newly established joint venture with CRISPR Therapeutics AG, Basel, Switzerland.

Intercompany profits and losses for companies accounted for in the consolidated financial statements using the equity method were immaterial in 2016 and 2015.

Bayer AG has undertaken to provide jouissance right capital (Genussrechtskapital) in the form of an interest-bearing loan with a nominal volume of €150 million (2015: €150 million) for Bayer-Pensionskasse VVaG. The entire amount remained drawn as of December 31, 2016. The carrying amount as of December 31, 2016, was €154 million (2015: €153 million). Loan capital was first provided to Bayer-Pensionskasse VVaG in 2008 for its effective initial fund. This capital had a nominal volume of €595 million as of December 31, 2016 (2015: €595 million). The carrying amount as of December 31, 2016, was €612 million (2015: €610 million). The outstanding receivables, comprised of different tranches, are each subject to a five-year interest-rate adjustment mechanism. Interest income of €18 million was recognized for 2016 (2015: €22 million).