5 _393 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN 5 FINANCIAL PERFORMANCE 2023 consolidated financial statements 13.2 Intangible assets In 2023, additions to intangible assets, amounted to €276 million (2022: €278 million), breaking down as follows: ● software: €207 million; ● CO2 emission allowances: €44 million; ● other: €25 million. 13.2.1 Software The net carrying amount of software at December 31, 2023 was €704 million (2022: €692 million). Software is initially recognized at cost, including the cost of acquisition or production and other costs directly attributable to the acquisition or production of the software. 13.2.2 Brands and trademarks At December 31, 2023 the net carrying amount of trademarks was €294 million (2022: €323 million), of which € 9 million related to trademarks with indefinite useful lives. These amounts correspond mainly to the value of brands and trademarks recognized as part of business combinations. 13.2.3 Customer relationships At December 31, 2023, the net carrying amount of customer relationships in the consolidated statement of financial position was €602 million (2022: €612 million). These amounts correspond primarily to the value of customer lists recognized in connection with business combinations (mainly Fenner and Camso). 13.2.4 CO2emission allowances (EU ETS) At December 31, 2023 the net carrying amount of emission allowances was €105 million (2022: €89 million) for 2.1 million tonnes (2022: 2.2 million tonnes). 13.2.5 Development costs No tire development costs were capitalized in 2023 or 2022 as the criteria for recognition as intangible assets were not met. To be recognized as an asset, the development costs incurred for a new product or a significant product renewal project must fulfill six criteria. One of these criteria requires the entity to demonstrate the existence of a market for the output of the intangible asset. The existence of a market is demonstrated only when the Group has obtained OEM approval and when the margin generated by the purchase volumes proposed by the manufacturers is in line with Group objectives. In practice, the corresponding development costs are incurred at a stage of the project which is prior to OEM approval.
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