Other Provisions

12 Months Ended

Dec. 31, 2019

22	OTHER PROVISIONS

At December 31, this item includes:


	Total				Current				Non-current
	2018		2019		2018		2019		2018		2019
Legal contingencies		84,728		278,319		6,049		103,635		78,679		174,684
Contingent liabilities from the acquisition of subsidiaries		4,498		—		—		—		4,498		—
Provision for well closure (Note 5.1 d)		20,382		50,116		148		9,848		20,234		40,268

		109,608		328,435		6,197		113,483		103,411		214,952

Additions for legal claims correspond to:

Provision for civil reparation

As of December 31, 2019, the Group updated the present value of the estimated provision amounting to S/154 million (S/73.5 million as of December 31, 2018), corresponding to the legal contingency estimated by the Management for exposure of the Company and its subsidiaries to the probable imposition of an obligation to compensate the government in relation to their participation as minority partners in certain entities that developed infrastructure projects in Peru with companies belonging to the Odebrecht group and in projects associated with the Construction Club.

ii)

Class Action

Two class action lawsuits have been filed against the company and certain of our former officials in before the United States Court for the

Eastern District of New York during the first quarter of 2017 that were later consolidated into a single claim. The plaintiffs allege that during the class period the Company obtained equity investments from investors based on false and misleading statements that were made in breach of the Securities Act and that caused material losses to such investors In particular, it is complaint alleges that the defendant did not disclose, among other things, that: a) the Company knew that its partner Odebrecht was involved in illegal activities; and that, b) the Company profited from such activities in violation of its own corporate governance rules.

As of the date of this report, the Company has entered into term sheet with the plaintiffs’ counsel, whereby the parties undertake to ensure the termination of the class action, through the negotiation, conclusion and filing of the final settlement agreement before court. The amount stipulated for the termination of the class action equals to US $ 20 million. As of December 31, 2019, the Company has made a provision of S/49.8 million (US $ 15 million) and the surplus of US $ 5 million will be covered by a professional liability policy pursuant to settlement agreement entered with the insurer.

iii)

Other provisions

Other provisions correspond mainly to claims received from clients for S/46 million in the subsidiary GyM S.A.

The gross movement of other provisions is as follows:


Other provisions	Legal contingencies			Contingent liabilities resulting from acquisitions			Provision for well closure			Total
At January 1, 2017		15,732			8,125			17,216			41,073
Additions		9,510			—			—			9,510
Reversals of provisions		(235	)		(809	)		(412	)		(1,456	)
Payments		(1,680	)		—			—			(1,680	)
Translation adjustments		37			(67	)		—			(30	)

At December 31, 2017		23,364			7,249			16,804			47,417

Additions		75,369			—			3,578			78,947
Reversals of provisions		(4,875	)		(1,343	)		—			(6,218	)
Deconsolidation of subsidiaries		(2,340	)		—			—			(2,340	)
Reclasification liabilities classified as held for sale		—			(1,093	)		—			(1,093	)
Payments		(6,615	)		—			—			(6,615	)
Translation adjustments		(175	)		(315	)		—			(490	)

At December 31, 2018		84,728			4,498			20,382			109,608

Additions		197,721			—			30,998			228,719
Reversals of provisions		(3,122	)		(4,349	)		—			(7,471	)
Payments		(914	)		—			(1,264	)		(2,178	)
Translation adjustments		(94	)		(149	)		—			(243	)

At December 31, 2019		278,319			—			50,116			328,435