Related party transactions

12 Months Ended

Dec. 31, 2021

For the purpose of these consolidated financial statements, transactions with related parties mainly comprise transactions between subsidiaries of the Group and the related parties of the Group.

Transactions with entities with significant influence over the group

Transactions with TCCC

TCCC exerts significant influence over the Group, as defined by IAS 24, “Related Party Disclosures”. As at 31 December 2021, 19.3% of the total outstanding Shares in the Group were owned by European Refreshments, a wholly owned subsidiary of TCCC. The Group is a key bottler of TCCC products and has entered into bottling agreements with TCCC to make, sell and distribute products of TCCC within the Group’s territories. The Group purchases concentrate from TCCC and also receives marketing funding to help promote the sale of TCCC products. The Group’s agreements with TCCC in each territory are for 10 years terms and each contains the right for the Group to request a 10 years renewal. The existing bottling agreements expire no earlier than 1 September 2025. Additionally, two of the Group’s 17 Directors are nominated by TCCC.

The Group and TCCC engage in a variety of marketing programmes to promote the sale of TCCC products in territories in which the Group operates. The Group and TCCC operate under an incidence based concentrate pricing model and funding programme across most territories, the terms of which are tied to the bottling agreements. In certain API territories, the Group operates under a fixed price model with marketing rebates and support.

TCCC makes discretionary marketing contributions under shared marketing agreements to CCEP’s operating subsidiaries. Amounts to be paid to the Group by TCCC under the programmes are generally determined annually and are periodically reassessed as the programmes progress. Under the bottling agreements, TCCC is under no obligation to participate in the programmes or continue past levels of funding in the future. The amounts paid and terms of similar programmes with other franchises may differ.

Marketing support funding programmes granted to the Group provide financial support principally based on product sales or on the completion of stated requirements and are intended to offset a portion of the costs of the programmes.

Payments from TCCC for marketing programmes to promote the sale of products are classified as a reduction in cost of sales, unless the presumption that the payment is a reduction in the price of the franchisors’ products can be overcome. Payments for marketing programmes are recognised as product is sold.

The following table summarises the transactions with TCCC that directly impacted the consolidated income statement for the years presented:


	31 December 2021	31 December 2020	31 December 2019
	€ million	€ million	€ million
Amounts affecting revenue(A)	50	50	66
Amounts affecting cost of sales(B)	(3,056)	(2,555)	(2,962)
Amounts affecting operating expenses(C)	9	8	(22)
Total net amount affecting the consolidated income statement	(2,997)	(2,497)	(2,918)

(A)Amounts principally relate to fountain syrup and packaged product sales.

(B)Amounts principally relate to the purchase of concentrate, syrup, mineral water and juice, as well as funding for marketing programmes.

(C)Amounts principally relate to certain costs associated with new product development initiatives. In 2021 and 2020, amounts also include the reimbursement of certain marketing expenses.

The following table summarises the transactions with TCCC that impacted the consolidated statement of financial position for the periods presented:


	31 December 2021	31 December 2020
	€ million	€ million
Amounts due from TCCC	135	146
Amounts payable to TCCC	189	167

Acquisition of Coca-Cola Amatil Limited

In May 2021, CCEP acquired the 30.8% interest held by TCCC in Coca-Cola Amatil Limited pursuant to a Co-operation and Sale Deed with TCCC. Cash consideration paid to TCCC was A$893 million and USD1,046 million. Refer to Note 4 for further detail regarding the Acquisition.

Following the Acquisition of Coca-Cola Amatil Limited, TCCC continued to hold a 29.4% ownership interest in
PT Coca-Cola Bottling Indonesia. Subsequent to the Acquisition, CCEP and TCCC completed a return of capital in
PT Coca-Cola Bottling Indonesia, which resulted in a payment of €62 million to TCCC.

As at 31 December 2021 the Group is in a process of selling to TCCC certain non-alcoholic ready to drink brands that were acquired as part of the Acquisition. These brands are classified as assets held for sale in our consolidated statement of financial position as of the year ended 31 December 2021. We expect the sale to be consummated during the first half of 2022. Refer to Note 27 for further details.

Terms and conditions of transactions with TCCC

Outstanding balances on transactions with TCCC are unsecured, interest free and generally settled in cash. Receivables from TCCC are considered to be fully recoverable.

Transactions with Cobega companies

Cobega, S.A. (Cobega) exhibits significant influence over the Group, as defined by IAS 24, “Related Party Disclosures”. As at 31 December 2021, 20.5% of the total outstanding Shares in the Group were indirectly owned by Cobega through its ownership interest in Olive Partners, S.A. Additionally, five of the Group’s 17 Directors, including the Chairman, are nominated by Olive Partners, three of whom are affiliated with Cobega.

The principal transactions with Cobega are for the purchase of packaging materials, and maintenance services for vending machines. The following table summarises the transactions with Cobega that directly impacted the consolidated income statement for the years presented:


	31 December 2021	31 December 2020	31 December 2019
	€ million	€ million	€ million
Amounts affecting revenue(A)	1	1	1
Amounts affecting cost of sales(B)	(49)	(43)	(68)
Amounts affecting operating expenses(C)	(11)	(8)	(10)
Total net amount affecting the consolidated income statement	(59)	(50)	(77)

(A)Amounts principally relate to packaged product sales.

(B)Amounts principally relate to the purchase of packaging materials and concentrate.

(C)Amounts principally relate to certain costs associated with maintenance and repair services.

The following table summarises the transactions with Cobega that impacted the consolidated statement of financial position for the periods presented:


	31 December 2021	31 December 2020
	€ million	€ million
Amounts due from Cobega	2	4
Amounts payable to Cobega	19	14

Terms and conditions of transactions with Cobega

Outstanding balances on transactions with Cobega are unsecured, interest free and generally settled in cash. Receivables from Cobega are considered to be fully recoverable.

Other related parties

Transactions with associates, joint ventures and other related parties

Joint venture investments relate to interests in a manufacturer of alcoholic beverages, a service provider supporting the operation of container refund schemes in certain Australian states and a PET recycling plant in Indonesia.

Associate investments relate to interests in deposit scheme coordinators and a holding company of container deposit schemes in certain Australian states and territories. Associate investments also include the Group’s equity interests in early stage development companies as part of CCEP Ventures.

Other related parties include coordinators of container deposit schemes in certain Australian states over which significant influence is held.

In addition, a 45% ownership interest in each of Made (Aust) Pty Ltd, Made Manufacturing Pty Ltd and Made Brands Pty Ltd, included as part of the Acquisition, was sold subsequent the Acquisition to the controlling shareholders for total cash consideration of €21 million. No gain or loss was recorded on the transaction.

The following table summarises the transactions with associates, joint ventures and other related parties:


	31 December 2021	31 December 2020	31 December 2019
	€ million	€ million	€ million
Net amounts affecting consolidated income statement - Associates(A)	(49)	—	—
Net amounts affecting consolidated income statement – Joint Ventures(B)	(9)	—	—
Net amounts affecting consolidated income statement – Other related parties(A)	(52)	—	—
Total net amount affecting the consolidated income statement	(110)	—	—

(A)Amounts principally relate to container deposit scheme charges in Australia.

(B)Amounts principally relate to the purchase of finished products.

The following table summarises the balances with associates, joint ventures and other related parties:


	31 December 2021	31 December 2020
	€ million	€ million
Net amounts receivable / (payable) – Associates	6	—
Net amounts receivable / (payable) – Joint Ventures	(2)	—

Terms and conditions of transactions with associates, joint ventures and other related parties

Outstanding balances on transactions are unsecured, interest free and generally settled in cash. Receivables are considered to be fully recoverable.

Refer to Note 28 for a listing of associates, joint ventures and other related parties.

Transactions with key management personnel

Key management personnel are the members of the Board of Directors and the members of the Executive Leadership Team. The following table summarises the total remuneration paid or accrued during the reporting period related to key management personnel:


	31 December 2021	31 December 2020	31 December 2019
	€ million	€ million	€ million
Salaries and other short-term employee benefits(A)	22	20	35
Post-employment benefits	—	1	1
Share-based payments	7	6	9
Termination benefits	—	5	—
Total	29	32	45

(A)Short-term employee benefits include wages, salaries and social security contributions, paid annual leave and paid sick leave, paid bonuses and non-monetary benefits.

The Group did not have any loans with key management personnel and was not party to any other transactions with key management personnel during the periods presented.