0001104659-21-054100 | 20-F | XBRL Viewer

Years Ended December 31,

Balance at January 1

Addition for tax positions

Balance at December 31

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Cover Page	12 Months Ended
Cover Page	Dec. 31, 2020 shares
Document Information [Line Items]
Entity Registrant Name	Huazhu Group Limited
Entity Central Index Key	0001483994
Document Type	20-F
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Trading Symbol	HTHT
Document Period End Date	Dec. 31, 2020
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding	321,267,680
Entity Interactive Data Current	Yes
Entity File Number	001-34656
Entity Incorporation, State or Country Code	E9
Document Annual Report	true
Document Transition Report	false
Document Shell Company Report	false
Document Registration Statement	false
Document Accounting Standard	U.S. GAAP
Entity Address, Address Line One	No. 699 Wuzhong Road
Entity Address, Country	CN
Entity Address, City or Town	Shanghai
Entity Address, Postal Zip Code	201103
Title of 12(b) Security	American Depositary Shares
Security Exchange Name	NASDAQ
ICFR Auditor Attestation Flag	false
Business Contact [Member]
Document Information [Line Items]
Contact Personnel Name	Teo Nee Chuan
Entity Address, Address Line One	No. 699 Wuzhong Road
Local Phone Number	21-6195-2011
City Area Code	86
Entity Address, Country	CN
Entity Address, City or Town	Shanghai
Contact Personnel Email Address	TeoNeeChuan@huazhu.com
Entity Address, Postal Zip Code	201103

CONSOLIDATED BALANCE SHEETS ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
Current assets:
Cash and cash equivalents	¥ 7,026	$ 1,077	¥ 3,234
Restricted cash	64	10	10,765
Short-term investments measured at fair value	3,903	598	2,908
Accounts receivable, net of allowance of RMB17 and RMB41 as of December 31, 2019 and 2020, respectively	404	62	218
Loan receivables - current, net	304	47	193
Amounts due from related parties, net	178	27	182
Inventories	89	14	57
Other current assets, net	914	140	699
Total current assets	12,882	1,975	18,256
Property and equipment, net	6,682	1,024	5,854
Intangible assets, net	5,945	911	1,662
Operating lease right-of-use assets	28,980	4,441	20,875
Finance lease right-of-use assets	2,041	313
Land use rights, net	213	33	215
Long-term investments	1,923	295	1,929
Goodwill	4,988	764	2,657
Loan receivables, net	135	21	280
Other assets, net	743	114	707
Deferred tax assets	623	94	548
Total assets	65,155	9,985	52,983
Current liabilities:
Short-term debt	1,142	175	8,499
Accounts payable	1,241	190	1,176
Amounts due to related parties	132	20	95
Salary and welfare payables	526	81	491
Deferred revenue	1,272	195	1,179
Operating lease liabilities, current	3,406	522	3,082
Finance lease liabilities, current	31	5
Accrued expenses and other current liabilities	2,440	374	1,856
Dividends payable			678
Income tax payable	339	52	231
Total current liabilities	10,529	1,614	17,287
Long-term debt	10,856	1,664	8,084
Operating lease liabilities, non-current	27,048	4,145	18,496
Finance lease liabilities, non-current	2,497	383
Deferred revenue	662	101	559
Other long-term liabilities	771	118	566
Retirement benefit obligations	179	27
Deferred tax liabilities	1,181	181	491
Total liabilities	53,723	8,233	45,483
Commitments and contingencies (Note 21)
Equity:
Ordinary shares (US$0.0001 par value per share; 8,023,485,450 shares authorized; 299,424,485 and 324,364,444 shares issued as of December 31, 2019 and 2020, and 285,902,609 and 310,842,568 shares outstanding as of December 31, 2019 and 2020, respectively)	0	0	0
Treasury shares (3,096,764 and 3,096,764 shares as of December 31, 2019 and 2020, respectively)	(107)	(16)	(107)
Additional paid-in capital	9,808	1,503	3,834
Retained earnings	1,502	230	3,701
Accumulated other comprehensive (loss) income	127	19	(49)
Total Huazhu Group Limited shareholders' equity	11,330	1,736	7,379
Noncontrolling interest	102	16	121
Total equity	11,432	1,752	7,500
Total liabilities and equity	¥ 65,155	$ 9,985	¥ 52,983

CONSOLIDATED BALANCE SHEETS (Parenthetical) ¥ in Millions	Dec. 31, 2020 CNY (¥) shares	Dec. 31, 2019 CNY (¥) shares
CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance \| ¥	¥ 41	¥ 17
Ordinary shares, shares authorized	8,023,485,450	8,023,485,450
Ordinary shares, shares issued	324,364,444	299,424,485
Ordinary shares, shares outstanding	310,842,568	285,902,609
Treasury shares, shares	3,096,764	3,096,764

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) ¥ / shares shares	Dec. 31, 2020 USD ($) $ / shares shares	Dec. 31, 2019 CNY (¥) ¥ / shares shares	Dec. 31, 2018 CNY (¥) ¥ / shares shares
Revenues:
Total revenues	¥ 10,196	$ 1,563	¥ 11,212	¥ 10,063
Operating costs and expenses:
Hotel operating costs	9,729	1,491	7,190	6,476
Other operating costs	52	8	57	15
Selling and marketing expenses	597	91	426	348
General and administrative expenses	1,259	193	1,061	851
Pre-opening expenses	288	44	502	255
Total operating costs and expenses	11,925	1,827	9,236	7,945
Goodwill impairment loss	437	67	0	0
Other operating income, net	480	74	132	226
Income (loss) from operations	(1,686)	(257)	2,108	2,344
Interest income	119	18	160	148
Interest expense	533	82	315	244
Other (expenses) income, net	(89)	(14)	331	203
Unrealized (losses) gains from fair value changes of equity securities	(265)	(42)	316	(914)
Foreign exchange (loss) gain	175	27	(35)	(144)
Income (loss) before income taxes	(2,279)	(350)	2,565	1,393
Income tax expense (benefit)	(215)	(33)	640	569
(Loss) income from equity method investments	(140)	(21)	(164)	(97)
Net income (loss)	(2,204)	(338)	1,761	727
Less: net income (loss) attributable to noncontrolling interest	(12)	(2)	(8)	11
Net income (loss) attributable to Huazhu Group Limited	(2,192)	(336)	1,769	716
Other comprehensive income (loss)
Loss arising from defined benefit plan, net of tax of nil, nil, and RMB13 for 2018, 2019 and 2020, respectively	(27)	(4)
Foreign currency translation adjustments, net of tax of nil for 2018, 2019 and 2020, respectively	203	31	(7)	(169)
Comprehensive income (loss)	(2,028)	(311)	1,754	558
Less: comprehensive (loss) income attributable to the noncontrolling interest	(12)	(2)	(8)	11
Comprehensive income (loss) attributable to Huazhu Group Limited	¥ (2,016)	$ (309)	¥ 1,762	¥ 547
Earnings (losses) per share:
Basic \| (per share)	¥ (7.49)	$ (1.15)	¥ 6.22	¥ 2.54
Diluted \| (per share)	¥ (7.49)	$ (1.15)	¥ 5.94	¥ 2.49
Weighted average number of shares used in computation:
Basic (in shares)	292,739,841	292,739,841	284,305,138	281,717,485
Diluted (in shares)	292,739,841	292,739,841	304,309,890	303,605,809
Leased and owned hotels
Revenues:
Total revenues	¥ 6,908	$ 1,059	¥ 7,718	¥ 7,470
Manachised and franchised hotels agreements
Revenues:
Total revenues	3,136	481	3,342	2,527
Others
Revenues:
Total revenues	¥ 152	$ 23	¥ 152	¥ 66

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Gain arising from defined benefit plan, tax	¥ 13	¥ 0	¥ 0
Foreign currency translation adjustments, tax	¥ 0	¥ 0	¥ 0

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ¥ in Millions	Ordinary Shares Adjusted balance as of January 1, 2020 CNY (¥) shares	Ordinary Shares CNY (¥) shares	Ordinary Shares USD ($) shares	Treasury Shares Adjusted balance as of January 1, 2020 CNY (¥) shares	Treasury Shares CNY (¥) shares	Additional Paid-in Capital Adjusted balance as of January 1, 2020 CNY (¥)	Additional Paid-in Capital CNY (¥)	Retained Earnings Cumulative Effect, Period of Adoption, Adjustment CNY (¥)	Retained Earnings Adjusted balance as of January 1, 2020 CNY (¥)	Retained Earnings CNY (¥)	Accumulated Other Comprehensive (Loss) Income Cumulative Effect, Period of Adoption, Adjustment CNY (¥)	Accumulated Other Comprehensive (Loss) Income Adjusted balance as of January 1, 2020 CNY (¥)	Accumulated Other Comprehensive (Loss) Income CNY (¥)	Noncontrolling Interest Adjusted balance as of January 1, 2020 CNY (¥)	Noncontrolling Interest CNY (¥)	Cumulative Effect, Period of Adoption, Adjustment CNY (¥)	Adjusted balance as of January 1, 2020 CNY (¥)	CNY (¥) shares	USD ($) shares
Balance at Dec. 31, 2017		¥ 0			¥ (107)		¥ 3,624			¥ 2,513			¥ 168		¥ 36			¥ 6,234
Balance issued (in shares) at Dec. 31, 2017 \| shares		294,040,234	294,040,234
Balance outstanding (in shares) at Dec. 31, 2017 \| shares		280,518,358	280,518,358
Treasury shares, balance (in shares) at Dec. 31, 2017 \| shares					3,096,764
Increase (Decrease) in Stockholders' Equity
Issuance of ordinary shares upon exercise of options and vesting of restricted stocks		¥ 0					14											14
Issuance of ordinary shares upon exercise of options and vesting of restricted stocks (in shares) \| shares		2,557,654	2,557,654
Share-based compensation							83											83
Noncontrolling interest recognized in connection with acquisitions															150			150
Net income										716					11			727
Cash dividends declared/paid/approved										(660)								(660)
Dividends paid to noncontrolling interest holders															(5)			(5)
Capital contribution from noncontrolling interest holders															29			29
Acquisition of noncontrolling interest							(8)								(76)			(84)
Foreign currency translation adjustments													(169)					(169)
Balance (ASU 2016-01) at Dec. 31, 2018								¥ 41			¥ (41)
Balance at Dec. 31, 2018		¥ 0			¥ (107)		3,713			2,610			(42)		145			6,319
Balance issued (in shares) at Dec. 31, 2018 \| shares		296,597,888	296,597,888
Balance outstanding (in shares) at Dec. 31, 2018 \| shares		283,076,012	283,076,012
Treasury shares, balance (in shares) at Dec. 31, 2018 \| shares					3,096,764
Increase (Decrease) in Stockholders' Equity
Issuance of ordinary shares upon exercise of options and vesting of restricted stocks		¥ 0					14											14
Issuance of ordinary shares upon exercise of options and vesting of restricted stocks (in shares) \| shares		2,826,597	2,826,597
Share-based compensation							110											110
Net income										1,769					(8)			1,761
Cash dividends declared/paid/approved										(678)								(678)
Dividends paid to noncontrolling interest holders															(5)			(5)
Capital contribution from noncontrolling interest holders															22			22
Disposal of noncontrolling interest for deconsolidation															3			3
Acquisition of noncontrolling interest							(3)								(36)			(39)
Foreign currency translation adjustments													(7)					(7)
Balance (ASU 2016-13) at Dec. 31, 2019	¥ 0			¥ (107)		¥ 3,834		¥ (7)	¥ 3,694			¥ (49)		¥ 121		¥ (7)	¥ 7,493
Balance at Dec. 31, 2019		¥ 0			¥ (107)		3,834			3,701			(49)		121			¥ 7,500
Balance issued (in shares) (ASU 2016-13) at Dec. 31, 2019 \| shares	299,424,485
Balance issued (in shares) at Dec. 31, 2019 \| shares		299,424,485	299,424,485															299,424,485	299,424,485
Balance outstanding (in shares) (ASU 2016-13) at Dec. 31, 2019 \| shares	285,902,609
Balance outstanding (in shares) at Dec. 31, 2019 \| shares		285,902,609	285,902,609															285,902,609	285,902,609
Treasury shares, balance (in shares) (ASU 2016-13) at Dec. 31, 2019 \| shares				3,096,764
Treasury shares, balance (in shares) at Dec. 31, 2019 \| shares					3,096,764													3,096,764	3,096,764
Increase (Decrease) in Stockholders' Equity
Issuance of ordinary shares upon exercise of options and vesting of restricted stocks		¥ 0					2											¥ 2
Issuance of ordinary shares upon exercise of options and vesting of restricted stocks (in shares) \| shares		1,454,307	1,454,307
Share-based compensation							122											122
Issuance of ordinary shares in Hong Kong public offering		¥ 0					5,968											5,968
Issuance of ordinary shares in Hong Kong public offering (in shares) \| shares		23,485,450	23,485,450
Conversion of Convertible Senior Notes due 2022		¥ 0	$ 202				0											0
Conversion of Convertible Senior Notes due 2022 (In shares) \| shares		202	202
Noncontrolling interest recognized from partial disposal															2			2
Noncontrolling interest recognized in connection with acquisitions															3			3
Net income										(2,192)					(12)			(2,204)	$ (338,000,000)
Dividends paid to noncontrolling interest holders															(4)			(4)
Capital contribution from noncontrolling interest holders															10			10
Disposal of noncontrolling interest for deconsolidation															0			0
Loss arising from defined benefit plan, net of tax													(27)					(27)	(4,000,000)
Acquisition of noncontrolling interest							(118)								(18)			(136)
Foreign currency translation adjustments													203					203	31,000,000
Balance at Dec. 31, 2020		¥ 0			¥ (107)		¥ 9,808			¥ 1,502			¥ 127		¥ 102			¥ 11,432	$ 1,752,000,000
Balance issued (in shares) at Dec. 31, 2020 \| shares		324,364,444	324,364,444															324,364,444	324,364,444
Balance outstanding (in shares) at Dec. 31, 2020 \| shares		310,842,568	310,842,568															310,842,568	310,842,568
Treasury shares, balance (in shares) at Dec. 31, 2020 \| shares					3,096,764													3,096,764	3,096,764

CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Operating activities:
Net income (loss)	¥ (2,204)	$ (338)	¥ 1,761	¥ 727
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Share-based compensation	122	19	110	83
Depreciation and amortization	1,362	208	991	891
Amortization of issuance cost of convertible senior notes and upfront fee of bank borrowings	83	13	28	28
Deferred taxes	(553)	(84)	(38)	(91)
Credit loss	65	10	21	10
Deferred rent				140
Loss (gain) from disposal of property and equipment	1	0	(10)	0
Impairment loss	709	109	13	35
Loss from equity method investments, net of dividends	145	22	213	157
Investment loss (income)	108	17	(477)	1,009
Interest accretion for finance lease	27	4
Noncash lease expense	2,063	316	2,235
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable	35	5	(34)	(36)
Prepaid rent				(283)
Inventories	0	0	(17)	(14)
Amounts due from related parties	(14)	(2)	32	(32)
Other current assets	(147)	(23)	(80)	(56)
Other assets	(86)	(13)	(175)	(32)
Accounts payable	31	5	(1)	11
Amounts due to related parties	20	3	17	38
Salary and welfare payables	(46)	(7)	(28)	91
Deferred revenue	(52)	(8)	279	114
Accrued expenses and other current liabilities	445	68	408	140
Operating lease liabilities	(1,640)	(251)	(2,036)
Income tax payable	94	14	(35)	48
Other long-term liabilities	41	6	116	71
Net cash provided by operating activities	609	93	3,293	3,049
Investing activities:
Purchases of property and equipment	(1,745)	(267)	(1,527)	(1,115)
Purchases of intangibles	(28)	(4)	(5)	(4)
Purchases of land use rights	(3)	(1)	(3)	(76)
Amount received as a result of government zoning			13	7
Acquisitions, net of cash received	(5,060)	(775)	(244)	(496)
Proceeds from disposal of subsidiary and branch, net of cash disposed	4	1	2	8
Purchases of short term and long term investments	(1,702)	(261)	(328)	(4,959)
Proceeds from maturity/sale and return of long-term investments	396	61	2,002	177
Payment for shareholder loan to equity investees	(15)	(2)	(87)	(7)
Collection of shareholder loan from equity investees	15	2	88
Payment for the origination of loan receivables	(130)	(20)	(454)	(313)
Proceeds from collection of loan receivables	167	26	258	433
Net cash (used in) investing activities	(8,101)	(1,240)	(285)	(6,345)
Financing activities:
Proceeds from issuance of ordinary shares in Hong Kong public offering	6,018	922
Ordinary share issuance costs	(32)	(5)
Net proceeds from issuance of ordinary shares upon exercise of options	1	0	14	14
Proceeds from short-term bank borrowings	1,658	254	2,214	928
Repayment of short-term bank borrowings	(1,993)	(306)	(1,902)	(128)
Proceeds from long-term bank borrowings	1,652	253	13,176	4,275
Repayment of long-term bank borrowings	(9,163)	(1,405)	(6,760)	(799)
Funds advanced from noncontrolling interest holders	14	2	2	36
Repayment of funds advanced from noncontrolling interest holders	(9)	(1)	(19)	(8)
Acquisitions of noncontrolling interest	(98)	(16)	(39)	(84)
Proceeds from amounts due to related parties				103
Repayment of amounts due to related parties				(113)
Contribution from noncontrolling interest holders	10	2	22	29
Proceeds from long-term finance liabilities (failed sale and leaseback "failed SLB")	83	13
Repayment of long-term finance liabilities (failed SLB)	(42)	(6)
Dividends paid to noncontrolling interest holders	(4)	(1)	(5)	(5)
Dividends paid	(678)	(104)	(658)
Proceeds from issuance of convertible senior notes	3,499	536
Direct financing costs paid	(10)	(1)
Principal payments of finance lease	(23)	(3)
Net cash provided by financing activities	883	134	6,045	4,248
Effect of exchange rate changes on cash and cash equivalents, and restricted cash	(300)	(45)	62	(24)
Net increase in cash, cash equivalents and restricted cash	(6,909)	(1,058)	9,115	928
Cash, cash equivalents and restricted cash at the beginning of the year	13,999	2,145	4,884	3,956
Cash, cash equivalents and restricted cash at the end of the year	7,090	1,087	13,999	4,884
Supplemental disclosure of cash flow information:
Interest paid, net of amounts capitalized	476	73	414	239
Income taxes paid	238	36	712	613
Cash paid for amounts included in the measurement of operating lease liabilities	3,309	507	2,905
Cash paid for amounts included in the measurement of finance lease liabilities	63	10
Non-cash right-of-use assets obtained in exchange for operating lease liabilities	1,422	218	4,176
Non-cash right-of-use assets obtained in exchange for finance lease liabilities	270	41
Non-cash right-of-use assets obtained in acquisition for operating lease	8,645	1,325	22
Non-cash right-of-use assets obtained in acquisition for finance lease	1,794	275
Non-cash lease liabilities obtained in acquisition for operating lease	8,849	1,356
Non-cash lease liabilities obtained in acquisition for finance lease	2,187	335
Supplemental schedule of non-cash investing and financing activities:
Purchases of property and equipment included in payables	736	113	963	688
Consideration payable for business acquisition			16	40
Purchase of intangible assets included in payables	5	1	3	5
Reimbursement of government zoning included in receivables	¥ 2	$ 0
Cash dividends declared in payables			¥ 678	¥ 658

ORGANIZATION AND PRINCIPAL ACTIVITIES

12 Months Ended

Dec. 31, 2020

ORGANIZATION AND PRINCIPAL ACTIVITIES

ORGANIZATION AND PRINCIPAL ACTIVITIES

1.ORGANIZATION AND PRINCIPAL ACTIVITIES

Huazhu Group Limited (the “Company”) was incorporated in the Cayman Islands under the laws of the Cayman Islands on January 4, 2007. The principal business activities of the Company and its subsidiaries and consolidated variable interest entities (the “Group”) are to develop leased and owned, manachised and franchised hotels mainly in the People’s Republic of China(“PRC”).

On January 2, 2020, the Group completed the acquisition of 100% equity interest of Steigenberger Hotels Aktiengesellschaft Germany ("Deutsche Hospitality" or "DH"). Deutsche Hospitality was engaged in the business of leasing, franchising, operating and managing hotels under five brands in the midscale and upscale market in Europe, the Middle East and Africa. After the acquisition, “legacy DH” refers to Deutsche Hospitality and its subsidiaries and “legacy Huazhu” refers to the Group excluding Deutsche Hospitality.

The Group completed public offering in Hong Kong in September 2020 with proceeds of RMB6,018 and the trading of ordinary shares on the Hong Kong Stock Exchange commenced on September 22, 2020 under the stock code “1179”.

Leased and owned hotels

The Group leases hotel properties from property owners or purchases properties directly and is responsible for all aspects of hotel operations and management, including hiring, training and supervising the managers and employees required to operate the hotels. In addition, the Group is responsible for hotel development and customization to conform to the standards of the Group brands at the beginning of the lease or the construction, as well as repairs and maintenance, operating expenses and management of properties over the term of the lease or the land and building certificate.

As of December 31, 2019 and 2020, the Group had 688 and 753 leased and owned hotels in operation, respectively.

Manachised and franchised hotels

Typically the Group enters into certain franchise and management arrangements with franchisees for which the Group is responsible for providing branding, quality assurance, training, reservation, hiring and appointing of the hotel general manager and various other support services relating to the hotel renovation and operation. Those hotels are classified as manachised hotels. Under typical franchise and management agreements, the franchisee is required to pay an initial franchise fee and ongoing franchise and management service fees, the majority of which are equal to a certain percentage of the revenues of the hotel. The franchisee is responsible for the costs of hotel development, renovation and the costs of its operations. The term of the franchise and management agreements are typically eight to ten years for legacy Huazhu and 15 to 20 years for manachised hotels and 10 to 15 years for franchised hotels under legacy DH and are renewable upon mutual agreement between the Group and the franchisee. The Group also has some franchised hotels in which cases the Group does not provide a hotel general manager. As of December 31, 2019 and 2020, the Group had 4,519 and 5,746 manachised hotels in operation and 411 and 290 franchised hotels in operation, respectively.

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2020

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES

2.SUMMARY OF PRINCIPAL ACCOUNTING POLICIES

Basis of presentation

The consolidated financial statements of the Group have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Basis of consolidation

The consolidated financial statements include the financial statements of the Company, its majority-owned subsidiaries and consolidated variable interest entities (the “VIEs”). All intercompany transactions and balances are eliminated on consolidation.

Variable Interest Entities

The Group evaluates the need to consolidate certain variable interest entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support.

The Company is deemed as the primary beneficiary of and consolidates variable interest entities when the Company has the power to direct the activities that most significantly impact the economic success of the entities and effectively assumes the obligation to absorb losses and has the rights to receive benefits that are potentially significant to the entities.

As of December 31, 2019 and 2020, the Group consolidated eight and eight entities under VIE model, and the assets and liabilities of the consolidated VIEs are immaterial to the Group’s consolidated financial statements.

The Group evaluates its business activities and arrangements with the entities that operate the manachised and franchised hotels and the funds that it serves as general partner or fund manager to identify potential variable interest entities. Generally, these entities that operate the manachised and franchised hotels qualify for the business scope exception, therefore consolidation is not appropriate under the variable interest entity consolidation guidance. For the disclosure of significant non-consolidated variable interest entities, see Note 7 Investments.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Group bases its estimates on historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Significant accounting estimates reflected in the Group’s consolidated financial statements include the useful lives and impairment of property and equipment, right-of-use assets and intangible assets with definite lives, valuation allowance of deferred tax assets, purchase price allocation, impairment of goodwill and intangible assets without definite lives, fair value measurement and impairment of investments, share-based compensation, obligations related to the pension plans, estimates involved in the accounting for its customer loyalty program, contingent liabilities and incremental borrowing rate used to measure lease liabilities.

Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and demand deposits, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less when purchased.

Restricted cash

Restricted cash mainly represents deposits used as security against borrowings, deposits restricted due to contract disputes or lawsuit and cash restricted for special purposes.

Investments

Investments represent equity-method investments, equity investments with readily determinable fair values, equity investments without readily determinable fair values and available-for-sale debt securities.

The Group accounts for equity investment in entities with significant influence under equity-method accounting. Under this method, the Group’s pro rata share of income (loss) from investment is recognized in the consolidated statements of comprehensive income. Dividends received reduce the carrying amount of the investment. When the Group’s share of loss in an equity-method investee equals or exceeds its carrying value of the investment in that entity, the Group continues to report its share of equity method losses in the statements of comprehensive income to the extent and as an adjustment to the carrying amount of its other investments in the investee. Equity-method investment is reviewed for impairment by assessing if the decline in market value of the investment below the carrying value is other-than-temporary. In making this determination, factors are evaluated in determining whether a loss in value should be recognized. These include consideration of the intent and ability of the Group to hold investment and the ability of the investee to sustain an earnings capacity, justifying the carrying amount of the investment. Impairment losses are recognized in other expense when a decline in value is deemed to be other-than- temporary.

Investments in equity securities that have readily determinable fair values (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) are measured at fair value, with unrealized gains and losses from fair value changes recognized in net income in the consolidated statements of comprehensive income.

Investments in equity securities without readily determinable fair values are measured at cost minus impairment adjusted by observable price changes in orderly transactions for the identical or a similar investment of the same issuer. These investments are measured at fair value on a nonrecurring basis when there are events or changes in circumstances that may have a significant adverse effect. An impairment loss is recognized in the consolidated statements of comprehensive income equal to the amount by which the carrying value exceeds the fair value of the investment.

Debt securities that the company has no intent to hold till maturity or may sell the security in response to the changes in economic conditions are classified as available-for-sale debt securities. Available-for-sale debt securities are reported at fair value, with unrealized gains and losses (other than impairment losses) recognized in accumulated other comprehensive income or loss. Realized gains and losses on debt securities are recognized in the net income in the consolidated statements of comprehensive income. Before the adoption of Accounting Standards Update (“ASU”) 2016-13 the amount of the total impairment related to the credit loss was recognized in the income statement and the amount related to all other factors is recognized in other comprehensive income, net of applicable taxes, and the impairment losses recognized in the income statement cannot be reversed for any future recoveries. After the adoption of ASC 326 on January 1, 2020, credit-related impairment is measured as the difference between the debt security’s amortized cost basis and the present value of expected cash flows and is recognized as an allowance on the balance sheet with a corresponding adjustment to earnings. The allowance should not exceed the amount by which the amortized cost basis exceeds fair value.

As a result of the impairment analysis, the Group recorded an impairment of nil, RMB10 and RMB92 in 2018, 2019 and 2020, respectively.

Accounts receivable, loan receivables and other financial assets

Accounts receivable, net

Accounts receivable mainly consist of franchise fee receivables, amounts due from corporate customers, travel agents, hotel guests and credit card receivables, which are recognized and carried at the original invoice or accrued amount less an allowance for credit losses. Before the year 2020, the Group established an allowance for doubtful accounts primarily based on the aging of the receivables and factors surrounding the credit risk of specific customers. After the adoption of ASU 2016-13 Financial instruments- credit losses on January 1, 2020, the accounts receivable balance reflects invoiced and accrued revenue and is presented net of an allowance for credit losses. The Group establishes current expected credit losses (“CECL”) for pools of assets with similar risk characteristics by evaluating historical levels of credit losses, current economic conditions that may affect a customer’s ability to pay, and creditworthiness of significant customers. When specific customers are identified as no longer sharing the same risk profile as their current pool, they are removed from the pool and evaluated separately. The Group major focus on historical collection experience and considering on aging or specific customer circumstance.

Loan receivables, net

The Group entered into entrusted loan agreements with certain franchisees with the typical terms to be two to three years and annual interest rates ranging from 8.0% to 8.5%, and with other un-related third-parties with the annual interest rates ranging from 4.8% to 15.0%. Loan receivables are measured at amortized cost with interest accrued based on the contract rate. The Group classified loan receivables as long-term or short-term investments according to their contractual maturity or expected holding time. Before the year of 2020, the Group evaluates the credit risk associated with the loans, and estimates the cash flow expected to be collected over the life of loans on an individual basis based on the Group’s past experiences, the borrowers’ financial position, their financial performance and their ability to continue to generate sufficient cash flows. A credit allowance will be established for the loans unable to collect. The Group adopted ASU 2016-13 on January 1, 2020 utilizing the modified retrospective approach. After the adoption of ASU 2016-13, the Group estimates the CECL based on the expectation of future economic conditions, historical collection experience and a loss-rate approach whereby the allowance is calculated using the probability of default and recovery rates and multiplying it by the asset's amortized cost at the balance sheet date.

Additionally, the Group records an allowance on other forms of financial assets, including other current assets, other assets and amounts due from related parties with the similar approach of accounts receivable.

Inventories

Inventories mainly consist of small appliances, bedding and daily consumables, operating supplies, food and beverage inventory items. Small appliances and bedding for new hotels opened are stated at cost, less accumulated amortization, and are amortized over their estimated useful lives, generally one year, from the time they are put into use. Daily consumables and beddings replacement are expensed when used.

Property and equipment, net

Property and equipment, net are stated at cost less accumulated depreciation. The renovations, betterments and interest cost incurred during construction are capitalized. Depreciation of property and equipment is provided using the straight line method over their expected useful lives. The expected useful lives are as follows:


Leasehold improvements		Shorter of the lease term or their estimated useful lives
Buildings		20-40 years
Furniture, fixtures and equipment		1-20 years
Motor vehicles		5 years

Construction in progress represents leasehold improvements and property under construction or being installed and is stated at cost. Cost comprises original cost of property and equipment, installation, construction and other direct costs. Construction in progress is transferred to leasehold improvements and depreciation commences when the asset is ready for its intended use.

Expenditures for repairs and maintenance are expensed as incurred. Gain or loss on disposal of property and equipment, if any, is recognized in the consolidated statements of comprehensive income as the difference between the net sales proceeds and the carrying amount of the underlying asset.

Intangible assets, net and unfavorable lease

Intangible assets consist primarily of brand name, master brand agreement, non-compete agreements, franchise or manachise agreements and favorable leases acquired in business combinations before the adoption of Topic 842, Leases ("ASC 842") and purchased software. Intangible assets acquired through business combinations are recognized as assets separate from goodwill if they satisfy either the “contractual-legal” or “separability” criterion. Intangible assets, including brand name, master brand agreement, non-compete agreements, franchise or manachise agreements, favorable lease agreements and other intangible assets acquired from business combination are recognized and measured at fair value upon acquisition.

The favorable lease agreements and unfavorable lease agreements in which the Group acts as a lessee were reclassified to operating lease right-of-use assets on January 1, 2019, upon adoption of ASC 842, Leases, which are amortized combining with right-of-use assets over remaining operating lease terms. The favorable lease agreements in which the Group acts as a lessor were accounted as intangible assets as before, which are amortized over remaining operating lease terms.

Non-compete agreements and franchise or manachise agreements are amortized over the expected useful life and remaining franchise contract terms, respectively. Purchased software is stated at cost less accumulated amortization.

Intangible assets with finite useful lives are amortized using the straight-line method over their respective estimated useful lives over which the assets are expected to contribute directly or indirectly to the future cash flows of the Group. These estimated useful lives are generally as follows:

Franchise or manachise agreements		Remaining contract terms from 10 to 20 years
Non-compete agreements		2 - 10 years based on specified non-compete period
Favorable lease agreements acquired before the adoption of ASC 842		Remaining lease terms from 1 to 20 years
Purchased software		3 - 10 years based on the estimated usage period
Unfavorable lease agreements		Remaining lease terms from 3 to 13 years
Other intangible assets including trademark, licenses and other rights		2 - 15 years based on the contractual term, the length of license agreements and the effective terms of other legal rights

Almost all the brand names acquired by the Group are considered to have indefinite useful lives since there are no legal, regulatory, contractual, competitive, economic or other factors that limit the useful lives of these brands and these brands can be renewed at nominal cost. Master brand agreement, acquired in Accor acquisition, granted the Group certain franchise rights with initial term of 70 years, and can be renewed without substantial obstacles. As a result, the useful life is determined to be indefinite. The Group evaluates the brand name and master brand agreement each reporting period to determine whether events and circumstances continue to support an indefinite useful life. Impairment is tested annually or more frequently if events or changes in circumstances indicate that it might be impaired. The Group measures the impairment by comparing the fair value of brand name and master brand agreement with its carrying amount. If the carrying amount of brand name and master brand agreement exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess. The Group measures the fair value of the brand name under the relief-from-royalty method, the master brand agreement under the multi-period excess earnings method. The determination of the fair value requires management to make significant estimates and assumptions related to forecasts of future revenues, operating margin, royalty saving rate and discount rates to estimate the net present value of future cash flows.

Management performs its annual brand names and master brand agreement impairment test on November 30 and when triggering events occurred. Due to the COVID-19 outbreak worldwide, the Group suffered an operating loss for the first quarter of 2020. As the situation was not totally under control and impacts of the COVID-19 pandemic worldwide were highly uncertain, the Group performed impairment testing regarding all its indefinite-lives intangible assets as of March 31, 2020. There was no impairment loss recognized for any indefinite-lives intangible assets as a result of the impairment test. Due to COVID-19 outbreak relapsed in Europe in the second and third quarter of 2020, the Group performed impairment testing for the indefinite-lives intangible assets of legacy DH as of June 30, 2020 and September 30, 2020. As a result, the estimated fair value of all the indefinite-lives intangible assets of legacy DH substantially exceeded its carrying value, and no impairment was identified. The Group also performed annual impairment test for all its indefinite-lives intangible assets on November 30, 2020 and did not recognize any intangible assets impairment for year ended December 31, 2020.

As of December 31, 2020, the estimated fair value of three brand names acquired in DH acquisition exceeded its carrying value by approximately RMB190, RMB61 and RMB184, which accounted for 7%, 9% and 42% of its carrying value, respectively. A 5% increase in the discount rate or decrease in royalty saving rate could reduce the fair value of these three brand names by RMB178, RMB45 and RMB38, or RMB151, RMB38 and RMB31, respectively, and the fair value could cover its carrying value, thus, no impairment was recognized.

Land use rights

The land use rights represent the operating lease prepayments for the rights to use the land in the PRC under ASC 842, which are amortized on a straight-line basis over the remaining term of the land certificates, between 30 to 50 years. Amortization expense of land use rights for the years ended December 31, 2018, 2019 and 2020 amounted to RMB5, RMB8 and RMB7, respectively.

Impairment of long-lived assets

The Group evaluates its long-lived assets and finite lived intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When these events occur, the Group measures impairment by comparing the carrying amount of the assets to future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Group recognizes an impairment loss equal to the difference between the carrying amount and fair value of these assets.

The Group performed a recoverability test of its long-lived assets associated with certain hotels due to the continued underperformance relative to the projected operating results, of which the carrying amount of the long-lived assets exceed the future undiscounted net cash flows, and recognized an impairment loss of RMB35, RMB3 and RMB180 during the years ended December 31, 2018, 2019 and 2020, respectively.

Fair value of the long-lived assets was determined by the Group based on the income approach using the discounted cash flow associated with the underlying assets, which incorporated certain assumptions including projected hotels’ revenue, growth rates and projected operating costs based on current economic condition, expectation of management and projected trends of current operating results.

Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable assets less liabilities acquired.

Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that it might be impaired. Before the adoption of ASU No. 2017-04, Intangibles-Goodwill and Other, the Group performed a two-step goodwill impairment test. The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. A reporting unit is identified as an operating segment or one level below an operating segment (also known as a component) for which discrete financial information is available and is regularly reviewed by segment manager. Before the acquisition of Deutsche Hospitality, all the acquired business has been migrated to the Group’s business, and the Group's management regularly reviews operation data including industrial metrics of revenue per available room, occupancy rate, and number of hotels by scale/brand, rather than discrete financial information for the purpose of performance evaluation and resource allocation at brand level. The Group concluded that it had only one reporting unit, and therefore the goodwill impairment testing was performed on consolidation level. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities.

The Group adopted ASU No. 2017-04, Intangibles-Goodwill and Other on January 1, 2020, which requires a one-step impairment test in which an entity compares the fair value of a reporting unit with its carrying amount and recognizes an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, if any. Upon the acquisition of Deutsche Hospitality, the Group concludes there are two reporting units, which are legacy Huazhu and legacy DH since the segment manager regularly reviews discrete financial information for legacy Huazhu and legacy DH separately. The goodwill impairment testing was performed at each reporting unit level. If the carrying amount of a reporting unit exceeds its fair value, an impairment amounts to that excess should be recognized in the statement of comprehensive income.

Fair value of the equity value was determined by the Group based on the income approach using the discounted cash flow associated with the underlying assets, which incorporated certain assumptions including projected hotels' revenue, growth rates and projected operating costs based on current economic condition, expectation of management and projected trends of current operating results.

Management performs its annual goodwill impairment test on November 30 and when triggering events occurred. The Group recorded an impairment of nil, nil and RMB437 for the years ended December 31, 2018, 2019 and 2020. Given the impact of the COVID-19 pandemic on hospitality industry in China, the Group concluded that indicators of impairment for legacy Huazhu existed and performed the goodwill impairment as of March 31, 2020 with no impairment recognized. No further deterioration occurred due to COVID-19 pandemic in China, the Group updated previous assumptions based on the current economic environment in its annual impairment assessment on November 30, 2020, including the inherent risk and uncertainty due to the stay-in-place measures enacted, consumer confidence levels, and the ongoing impact of the COVID-19 pandemic on the hospitality industry. Based on the analysis, the Group concluded that the goodwill of legacy Huazhu was not impaired for the year ended December 31, 2020. For the goodwill of legacy DH, indicators of impairment existed as of March 31, June 30 and September 30, 2020 due to COVID-19 outbreak and the relapse in Europe. The Group performed impairment test quarterly and recorded an impairment of RMB437 during the third quarter of 2020. No further impairment of goodwill was recorded in the last quarter of 2020 considering no further deterioration occurred in Europe when the Group performed its annual assessment.

As of December 31, 2020, the estimated fair value of goodwill of legacy DH exceeded its carrying value by approximately RMB244, which accounted for 6% of its carrying value. A 5% decline in the underlying projected cash flow or increase in the discount rate could have resulted in goodwill impairment charges of approximately RMB42 and RMB175, respectively.

Revenue recognition

Revenue are primarily derived from products and services in leased and owned hotels, contracts of manachised and franchised hotels with third-party franchisees as well as activities other than the operation of hotel businesses.

Leased and owned hotel revenues

Leased and owned hotel revenues are primarily derived from the rental of rooms, food and beverage sales and other ancillary goods and services, including but not limited to souvenir, laundry, parking and conference reservation. Each of these products and services represents an individual performance obligation and, in exchange for these services, the Group receives fixed amounts based on published rates or negotiated contracts. Payment is due in full at the time when the services are rendered or the goods are provided. Room rental revenue is recognized on a daily basis when rooms are occupied. Food and beverage revenue and other goods and services revenue are recognized when they have been delivered or rendered to the guests as the respective performance obligations are satisfied.

Manachised and franchised hotel revenues

The manachise and franchise agreement contains the following promised services:

●Intellectual Property ("IP") license grant the right to access the Group’s hotel system IP, including brand names.

●Pre-opening services include providing services (e.g., install IT information system and provide access to purchase platform, help to obtain operational qualification, and help to recruit and train employees) to the franchisees to assist in preparing for the hotel opening.

●System maintenance services include providing standardization hotel property management system (“PMS”), central reservation system (“CRS”) and other internet related services.

●Hotel management services include providing day-to-day management services of the hotels for the franchisees.

The promises to provide pre-opening services and system maintenance services are not distinct performance obligation because they are attendant to the license of IP. Therefore, the promises to provide pre-opening services and system maintenance services are combined with the license of IP to form a single performance obligation. Hotel management services forms a single distinct performance obligation.

Manachised and franchised hotel revenues are derived from franchise or manachise agreements where the franchisees are primarily required to pay (i) an initial one-time franchise fee, and (ii) continuing franchise fees, which mainly consist of (a) on-going management and franchise service fees, (b) central reservation system usage fees, system maintenance and support fees and (c) reimbursements for hotel manager fees.

Initial one-time franchise fee, is typically fixed and collected upfront and recognized as revenue over the term of the franchise contract. The Group does not consider this advance consideration to include a significant financing component, since it is used to protect the Group from the franchisees failing to adequately complete some or all of its obligations under the contract.

On-going management and franchise service fees are generally calculated as a certain percentage of the room revenues of the franchised hotel. Generally, management and franchise service fees are due and payable on a monthly basis as services are provided and revenue is recognized over time as services are rendered.

Central reservation system usage fees, other system maintenance and support fees are typically billed and collected monthly along with base management and franchise fees, and revenue is generally recognized as services are provided.

Reimbursements for hotel manager fees, which cover the manachised hotel managers’ payroll, social welfare benefits and certain other out-of-pocket expenses that the Group incurs on behalf of the manachised hotels. The reimbursements are recognized over time within revenues for the reimbursement of costs incurred on behalf of manachised hotels.

Above policies are only applicable to legacy Huazhu. For manachised hotels under Deutsche Hospitality, the franchisees have historically been required to pay Deutsche Hospitality an on-going management fees consisting of a base fee as a percentage of the hotel’s gross revenues and an incentive fee as a percentage of the hotel’s gross adjusted profit. For franchised hotels under Deutsche Hospitality, the franchisees have historically been required to pay Deutsche Hospitality a license fee, a franchise fee and a central service fee. The manachised and franchised hotel revenues of Deutsche Hospitality are recognized over time as services are rendered. The Group is gradually conforming the terms of Deutsche Hospitality’s franchise and management agreements to those of hotels under legacy Huazhu.

Since the COVID-19 outbreak in January 2020, the Group has offered one-time reduction on continuing franchise fees of approximately RMB132 for 2020 to help franchisees meet their short-term working capital needs. There is no change to the scope of services or other terms of the agreements. Previously recognized revenue on the original contract was not adjusted.

Other Revenues

Other revenues are derived from activities other than the operation of hotel businesses, which mainly include revenues from Hua Zhu mall and the provision of IT products and services to hotels. Revenues from Hua Zhu mall are commissions charged from suppliers for goods sold through the platform and are recognized upon delivery of goods to end customers when its suppliers’ obligation is fulfilled. Revenues from IT products are recognized when goods are delivered and revenues from IT services are recognized when services are rendered.

Loyalty Program

Under the loyalty program the Group administers, members earn loyalty points that can be redeemed for future products and services. Points earned by loyalty program members represent a material right to free or discounted goods or services in the future. The loyalty program has one performance obligation that consists of marketing and managing the program and arranging for award redemptions by members. The Group is responsible for arranging for the redemption of points, but the Group does not directly fulfill the redemption obligation except at leased and owned hotels. Therefore, the Group is the agent with respect to this performance obligation for manachised and franchised hotels, and is the principal with respect to leased and owned hotels.

For leased and owned hotels, a portion of the leased and owned revenues is deferred until a member redeems points. The amount of revenue the Group recognize upon point redemption is impacted by the estimate of the “breakage” for points that members will never redeem in the Group’s owned and leased hotels.

For manachised and franchised hotels, the portion of revenue deferred by manachised and franchised hotels are collected by the Group which will be refunded upon redemption of points at manachised and franchised hotels. The estimated breakage for points earned in manachised and franchised hotels are recognized as manachised and franchised revenue for each period. The Group estimates breakage based on the Group’s historical experience and expectations of future member behavior and will true up the estimated breakage at end of each period.

Above policies are only applicable to legacy Huazhu. The loyalty program initiated by Deutsche Hospitality has substantially the same rights, nature and redeemable approaches as that of legacy Huazhu, therefore the accounting treatment is the same. As of December 31, 2020, the contract liabilities related to Deutsche Hospitality were immaterial and the loyalty program of Deutsche Hospitality was in the progress of being migrated to that of legacy Huazhu.

Membership fees from the Group’s customer loyalty program are all from legacy Huazhu, which are earned and recognized on a straight-line basis over the expected membership duration of the different membership levels and also applicable to legacy Huazhu only. Such duration is estimated based on the Group’s and management’s experience and is adjusted on a periodic basis to reflect changes in membership retention. The membership duration is estimated to be two to five years which reflects the expected membership retention. Revenues recognized from membership fees were RMB192, RMB224 and RMB223 for the years ended December 31, 2018, 2019 and 2020, respectively, which amount were included in revenues from leased and owned hotel or revenues from manachised and franchised hotels depending on the type of hotels the membership was sold at.

Contract Balances

The Group’s payments from customers are based on the billing terms established in contracts. Customer billings are classified as accounts receivable when the Group’s right to consideration is unconditional. If the right to consideration is conditional on future performance under the contract, the balance is classified as a contract asset. Payments received in advance of performance under the contract are classified as current or non-current contract liabilities on the Group’s consolidated balance sheets and are recognized as revenue as the Group performs under the contract.

Value-Added Taxes and surcharges

The accommodation services of the Group in PRC and Germany are subject to 6% and 19% of Value-Added Taxes, respectively.

The Group is subject to education surtax and urban maintenance and construction tax, on the services provided in the PRC.

Advertising and promotional expenses

Advertising related expenses, including promotion expenses and production costs of marketing materials, are charged to the consolidated statements of comprehensive income as incurred, and amounted to RMB103, RMB99 and RMB150 for the years ended December 31, 2018, 2019 and 2020, respectively.

Government grants

Government grants represent cash received by the Group in the PRC from local governments as incentives for investing in certain local districts, and are typically granted based on the amount of investments the Group made as well as income generated by the Group in such districts under legacy Huazhu. Such subsidies allow the Group full discretion to utilize the funds and are used by the Group for general corporate purposes. The local governments have final discretion as to whether the Group has met all criteria to be entitled to the subsidies. Normally, the Group does not receive written confirmation from local governments indicating the approval of the cash subsidy before cash is received, and therefore cash subsidies are recognized when received and when all the conditions for their receipts have been satisfied. Government grants recognized by legacy Huazhu were RMB106, RMB148 and RMB154 for the years ended December 31, 2018, 2019 and 2020, respectively, which were recorded as other operating income.

Government grants represent cash received by the Group as compensation for COVID-19 impacts in various countries under legacy DH. The grants consist of short term work compensation, fixed costs compensation and revenue based compensation. Short term work compensation recognized by legacy DH was RMB244 for the year ended December 31, 2020, which was netted with operating costs and expenses. Other grants recognized by legacy DH were RMB17 for the year ended December 31, 2020, which were recorded as other operating income.

Leases

As a lessee

Before January 1, 2019, the Group adopted the ASC Topic 840, Leases, each lease is classified at the inception date as either a capital lease or an operating lease. All of the Group's leases were classified under ASC Topic 840 as operating leases while there are both capital lease and operating lease under legacy DH. The Group’s reporting for periods prior to January 1, 2019 continued to be reported in accordance with Leases (Topic 840). The Group elected the practical expedients under ASU 2016-02 which includes the use of hindsight in determining the lease term and the practical expedient package to not reassess whether any expired or existing contracts are or contain leases, to not reassess the classification of any expired or existing leases, and to not reassess initial direct costs for any existing leases.

In evaluating whether an agreement constitute a lease upon adoption of the new lease accounting standard ASC 842, the Group reviews the contractual terms to determine which party obtains both the economic benefits and control of the assets at the inception of the contract. The Group categorizes leases with contractual terms longer than twelve months as either operating or finance lease at the commencement date of a lease.

The Group recognizes a lease liability for future fixed lease payments and variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date and a right-of-use ("ROU") asset representing the right to use the underlying asset for the lease term. Lease liabilities are recognized at commencement date based on the present value of fixed lease payments and variable lease payments that depend on an index or a rate (initially measured using the index or rate as at the commencement date) over the lease term using the rate implicit in the lease, if available, or the Group's incremental borrowing rate. As its leases do not provide an implicit borrowing rate, the Group uses an incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at the commencement date. Upon adoption of ASU 2016-02, the Group elected to use the remaining lease term as of January 1, 2019 in the estimation of the applicable discount rate for leases that were in place at adoption. For the initial measurement of the lease liability for leases commencing after January 1, 2019, the Group uses the discount rate as of the commencement date of the lease, incorporating the entire lease term. Current maturities of operating lease liabilities and finance lease liabilities are classified as operating lease liabilities, current and finance lease liability, current, respectively, in the Group's consolidated balance sheets. Long-term portions of operating lease liabilities and finance lease liabilities are classified as operating lease liabilities, non-current and finance lease liability, non-current, respectively, in the Group's consolidated balance sheets. Most leases have initial terms ranging from 10 to 20 years for legacy Huazhu, and from 20 to 25 years for legacy DH. The lease term includes lessee options to extend the lease and periods occurring after a lessee early termination option, only to the extent it is reasonably certain that the Group will exercise such extension options and not exercise such early termination options, respectively. The Group’s lease agreements may include nonlease components, mainly common area maintenance, which are combined with the lease components as the Group elects to account for these components as a single lease component, as permitted. The Group elected the practical expedient of not to separate land components outside PRC from leases of specified property and equipment at the ASC842 transition date. Besides, the Group’s lease payments are generally fixed and certain agreements contain variable lease payments based on the operating performance of the leased property and the changes in the index of consumer pricing index ("CPI"). All the lease agreements with variable lease payments based on the changes in CPI are held by legacy DH. For operating leases, the Group recognizes lease expense on a straight-line basis over the lease term and variable lease payments that depend on an index or a rate are initially measured using the index or rate at the commencement date, otherwise variable lease payments are recognized in the period in which the obligation for those payments is incurred. The operating lease expense is recognized as hotel operating costs, general and administrative expenses and pre-opening expenses in the consolidated statements of comprehensive income. For finance lease, lease expense is generally front-loaded as the finance lease ROU asset is depreciated on a straight-line basis over the shorter of the lease term or useful life of the underlying asset within hotel operating costs in the consolidated statements of comprehensive income, but interest expense on the lease liability is recognized in interest expense in the consolidated statements of comprehensive income using the effective interest method which results in more expense during the early years of the lease. Additionally, the Group elected not to recognize leases with lease terms of 12 months or less at the commencement date. Lease payments on short-term leases are recognized as an expense on a straight-line basis over the lease term, not included in lease liabilities. The Group's lease agreements do not contain any significant residual value guarantees or restricted covenants.

The ROU assets are measured at the amount of the lease liabilities with adjustments, if applicable, for lease prepayments made prior to or at lease commencement, initial direct costs incurred by the Group, deferred rent and lease incentives, and any off-market terms (that is, favorable or unfavorable terms) present in the lease when the Group acquired leases in a business combination in which the acquiree acts as a lessee. The Group evaluates the carrying value of ROU assets if there are indicators of impairment and reviews the recoverability of the related asset group. The Group excludes the lease obligation from the carrying value of the asset group. Accordingly, the lease payments (both principal and interest) don't reduce the undiscounted expected future cash flows used to test the asset group for recoverability. If the carrying value of the asset group determined to not be recoverable and is in excess of the estimated fair value, the Group records an impairment loss in the consolidated statements of comprehensive income. Noncash lease expense are used as the noncash add-back for the amortization of the operating ROU assets to the operating section of the consolidated statements of cash flow.

The Group reassesses of a contract is or contains a leasing arrangement and re-measures ROU assets and liabilities upon modification of the contract. The Group will derecognize ROU assets and liabilities, with difference recognized in the consolidated statements of comprehensive income on the contract termination.

Sublease

The Group subleases property which are not suitable to operate hotels to third parties under operating leases. In accordance with the provisions of ASC 842, since the Group has not been relieved as the primary obligor of the head lease, the Group cannot net the sublease income against its lease payment to calculate the lease liability and ROU asset. The Group's practice has been, and will continue to, straight-line the sub-lease income over the term of the sublease, which is consistent with the accounting treatment under ASC840.

Income taxes

Current income taxes are provided for in accordance with the relevant statutory tax laws and regulations.

Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. Net operating losses are carried forward and credited by applying enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of the Group, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. For a particular tax-paying component of an entity and within a particular tax jurisdiction, all deferred tax liabilities and assets, as well as any related valuation allowance, shall be offset and presented as a single noncurrent amount. However, an entity shall not offset deferred tax liabilities and assets attributable to different tax-paying components of the entity or to different tax jurisdictions.

Foreign currency translation

The reporting currency of the Group is the Renminbi (“RMB”). The functional currency of the Company is the United States dollar (“US$”). Monetary assets and liabilities denominated in currencies other than the functional currency are remeasured in functional currency at the rates of exchange ruling at the balance sheet date. Transactions in currencies other than the functional currency during the year are converted into the functional currency at the applicable rates of exchange prevailing on the day transactions occurred. Transaction gains and losses are recognized in the statements of comprehensive income.

Assets and liabilities are translated into RMB at the exchange rates at the balance sheet date, equity accounts are translated at historical exchange rates and revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of comprehensive income.

The financial records of the Group’s subsidiaries are maintained in local currencies, which are the functional currencies.

Comprehensive income

Comprehensive income includes all changes in equity except for those resulting from investments by owners and distributions to owners and is comprised of net income, foreign-currency translation adjustments and gain (loss) arising from defined benefit plan.

Concentration of credit risk

Financial instruments that potentially expose the Group to concentration of credit risk consist primarily of cash and cash equivalents, restricted cash, short-term and long-term investments, loan receivables, amount due from related parties, other current assets, other assets and accounts receivable. All of the Group’s cash and cash equivalents and restricted cash are held with financial institutions that Group's management believes to be high credit quality. In addition, the Group’s investment policy limits its exposure to concentrations of credit risk and the Group’s short-term and long-term investments consist of equity investments in listing and private companies. The Group’s loan receivables are lent to entities with high credit quality. The Group conducts credit evaluations on its group and agency customers and generally does not require collateral or other security from such customers. The Group periodically evaluates the

creditworthiness of the existing customers in determining credit losses for accounts receivable, loan receivable and financial assets, including other current assets, other assets and amounts due from related parties based on the expectation of future economic conditions, historical collection experience and a loss-rate approach.

Fair value

The Group defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.

The established fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs may be used to measure fair value include:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

When available, the Group uses quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, the Group measures fair value using valuation techniques that use, when possible, current market-based or independently sourced market parameters, such as interest rates. The Group’s financial instruments include cash and cash equivalent, restricted cash, loan receivables current and non-current portion, receivables, payables, short-term debts, long-term debts. The carrying amounts of these short-term financial instruments approximates their fair value due to their short-term nature. The long-term debts and long-term loan receivables approximate their fair values, because the bearing interest rate approximates market interest rate, and market interest rates have not fluctuated significantly since the commencement of loan contracts signed. The carrying amounts of convertible senior notes were RMB3,209, RMB3,290 and RMB6,318 and the corresponding fair value estimated based on quoted market price were RMB3,185, RMB3,711 and RMB7,747, as of December 31, 2018, 2019 and 2020, respectively. The fair value of pension plan assets is discussed in Note 18.

As of December 31, 2019 and 2020, information about inputs into the fair value measurements of the Group’s assets and liabilities that are measured at fair value on a recurring basis in periods subsequent to their initial recognition is as follows:


			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active		Significant
			Markets for Identical	Significant Other	Unobservable
As of			Assets	Observable Inputs	Inputs
December 31,	Description	Fair Value	(Level 1)	(Level 2)	(Level 3)
2019	Equity securities with readily determinable fair value	2,908	2,908	—	—
2019	Available-for-sale debt securities	220	—	220	—
2020	Equity securities with readily determinable fair value	3,903	3,903	—	—
2020	Available-for-sale debt securities	220	—	220	—
2020	Employee benefit plan assets	6	6	—	—

The following table presents the Group’s assets measured at fair value on a non-recurring basis for the years ended December 31, 2018, 2019 and 2020:


			Fair Value Measurements at Reporting Date Using
			Quoted Prices
			in Active	Significant
			Markets for	Other	Significant
		Fair Value for	Identical	Observable	Unobservable	Total
Years Ended		Years Ended	Assets	Inputs	Inputs	Loss for
December 31,	Description	December 31	(Level 1)	(Level 2)	(Level 3)	the Year
2018	Property and equipment	10	—	—	10	35
2019	Property and equipment	—	—	—	—	3
2019	Long-term investment	—	—	—	—	10
2020	Property and equipment	2	—	—	2	41
2020	Operating lease right-of-use assets	71	—	—	71	139
2020	Long-term investment	—	—	—	—	92
2020	Goodwill	2,328	—	—	2,328	437

As a result of reduced expectations of future cash flows from certain leased hotels, the Group determined that the hotels property and equipment with a carrying amount of RMB45, RMB3 and RMB43 was not fully recoverable and consequently recorded an impairment charge of RMB35, RMB3 and RMB41 for the years ended December 31, 2018, 2019 and 2020, respectively.

Fair value of the property and equipment impairment testing was determined by the Group based on the income approach using the discounted cash flow associated with the underlying assets, which incorporated certain assumptions including projected hotels’ revenue, growth rates and projected operating costs based on current economic condition, expectation of management and projected trends of current operating results. As a result, the Group has determined that the majority of the inputs used to value its long-lived assets held and used and its reporting units are unobservable inputs that fall within Level 3 of the fair value hierarchy. The revenue growth rate and the discount rate were the significant unobservable input used in the fair value measurement, which are ranged between negative 15% and 4%, 8.64% and 20%, respectively, for the years ended December 31, 2018, 2019 and 2020, respectively.

As a result of the impairment assessment, the Group determined that the operating lease right-of-use assets amount with a carrying amount of nil, nil and RMB210 was impaired and recorded an impairment charge of nil, nil and RMB139 for the years ended December 31, 2018, 2019 and 2020, respectively.

As a result of the impairment assessment, the Group determined that the long-term investment amount with a carrying amount of nil, RMB10 and RMB92 was impaired as a result of the impairment assessment for the years ended December 31, 2018, 2019 and 2020, respectively.

As a result of the impairment assessment, the Group determined that the goodwill amount with a carrying amount of nil, nil and RMB2,768 was impaired and recorded an impairment charge of nil, nil and RMB437 for the years ended December 31, 2018, 2019 and 2020, respectively.

Share-based compensation

The Group recognizes share-based compensation in the consolidated statements of comprehensive income based on the fair value of equity awards on the date of the grant, with compensation expenses recognized over the period in which the grantee is required to provide service to the Group in exchange for the equity award. Vesting of certain equity awards are based on the performance conditions for a period of time following the grant date. Share-based compensation expense is recognized according to the Group’s judgement of likely future performance and will be adjusted in future periods based on the actual performance. The share-based compensation expenses have been categorized as either hotel operating costs, general and administrative expenses or selling and marketing expenses, depending on the job functions of the grantees. For the years ended December 31, 2018, 2019 and 2020, the Group recognized share-based compensation expenses of RMB83, RMB110 and RMB122, respectively, which were classified as follows:


	Years Ended December 31,
	2018	2019	2020
Hotel operating costs	27	35	42
Selling and marketing expenses	3	3	4
General and administrative expenses	53	72	76
Total	83	110	122

Earnings (losses) per share

Basic earnings (losses) per share is computed by dividing income attributable to holders of ordinary shares by the weighted average number of ordinary shares outstanding during the year. Diluted earnings (losses) per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares, which consist of the ordinary shares issuable upon the conversion of the convertible senior notes (using the if-converted method) and ordinary shares issuable upon the exercise of stock options and vest of nonvested restricted stocks (using the treasury stock method).

The loaned shares under the ADS lending agreement are excluded from both the basic and diluted earnings (losses) per share calculation unless default of the ADS lending arrangement occurs which the Group considered the possibility is remote.

Segment and geography information

The Group identifies a business as an operating segment if: i) it engages in business activities from which it may earn revenues and incur expenses; ii) its operating results are regularly reviewed by the Chief Operating Decision Maker ("CODM") to make decisions about resources to be allocated to the segment and assess its performance; and iii) it has available discrete financial information. The Group’s chief operating decision maker has been identified as the chief executive officer. Before the acquisition of DH completed on January 2, 2020, CODM regularly reviews the operation data, such as industrial metrics of revenue per available room, occupancy rate, and number of hotels by scale/brand, to assess the performance and allocate the resources at brand level. All the acquired business including Accor, Crystal Orange and Blossom Hotel Management has been migrated to the Group’s business, and the Group operates and manages its business as a single segment. After the acquisition of DH, CODM regularly reviews the operating data and EBITDA, which is defined as earnings before interest income, interest expense, income tax expense (benefit) and depreciation and amortization, a non-GAAP financial measure for legacy Huazhu and legacy DH separately to evaluate their performance. Therefore, in January 2020, the Group modified its operating segment structure to be two operating segments which are legacy Huazhu and legacy DH as a result of a change in the way management intends to evaluate results and allocate resources within the Group. In identifying its reportable segments, the Group assesses nature of operating segments and evaluates the operating results of each reporting segments. Both operation segments meet the quantitative thresholds and should be considered as two reportable segments.

The following table provides a summary of the Group’s operating segment results for the year ended December 31, 2020. The Group presents segment information after elimination of intercompany transactions.


	Legacy Huazhu	Legacy DH	Total

Total revenues	8,664	1,532	10,196
Operating costs and expenses	8,978	2,947	11,925
Goodwill impairment loss	—	437	437
Other operating income, net	214	266	480
Interest income	118	1	119
Interest expense	427	106	533
Other (expenses) income, net	(92)	3	(89)
Unrealized (losses) gains from fair value changes of equity securities	(266)	1	(265)
Foreign exchange gain (loss)	176	(1)	175
Loss before income tax	(591)	(1,688)	(2,279)
Income tax expense (benefit)	151	(366)	(215)
(Loss) income from equity method investments	(117)	(23)	(140)
Net loss attributable to noncontrolling interest	(12)	—	(12)
Net loss attributable to Huazhu Group Limited	(847)	(1,345)	(2,192)
Income tax expense (benefit)	151	(366)	(215)
Interest income	118	1	119
Interest expense	427	106	533
Depreciation and amortization	1,123	239	1,362
EBITDA (Non-GAAP)	736	(1,367)	(631)

The following table presents total assets for operating segments, reconciled to consolidated amounts:


	Legacy Huazhu	Legacy DH	Total
Total assets	46,243	18,912	65,155

The following tables represent revenues and property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill by geographical region.

Revenues:


China		8,647
Germany		1,212
All others		337
Total		10,196

Property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill:


China		30,635
Germany		15,670
All others		2,544
Total		48,849

Other than China and Germany, there were no countries that individually represented more than 10% of the total revenue and certain long lived assets for the year ended and as of December 31, 2020.

Treasury shares

Treasury shares represent shares repurchased by the Company that are no longer outstanding and are held by the Company. Treasury shares are accounted for under the cost method. As of December 31, 2020, under the repurchase plan, the Company had repurchased an aggregate of 3,096,764 ordinary shares on the open market for total cash consideration of RMB107. The repurchased shares were presented as “treasury shares” in shareholders’ equity on the Group’s consolidated balance sheets.

Recently Issued Accounting Pronouncements

Adopted Accounting Standards

In June 2016, the FASB released ASU No.2016-13 ("ASU 2016-13"), Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU, along with subsequent ASUs issued to clarify certain provisions of ASU 2016-13, provide more useful information about expected credit losses to financial statement users and changes how entities will measure credit losses on financial instruments and timing of when such losses should be recognized. The standards are to be applied using a modified retrospective approach and are effective for interim periods and fiscal years beginning after December 15, 2019, with early adoption permitted. The Group adopted the guidance on January 1, 2020, as required, using the modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date to align the Group’s current processes for establishing an allowance for credit losses with the new guidance. Upon adoption, the Group recorded an adjustment of RMB7 to opening retained earnings related to the credit allowance for accounts receivable, other receivables and loan receivables. ASU 2016-03 did not materially affect Group's consolidated financial statements.

In January 2017, the FASB issued ASU No.2017-04, Intangibles-Goodwill and Other, which removes the requirement to compare the implied fair value of goodwill with its carrying amount as part of step 2 of the goodwill impairment test. As a result, under the ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, the ASU clarifies the requirements for excluding and allocating foreign currency translation adjustments to reporting units in connection with an entity’s testing of reporting units for goodwill impairment. The ASU also clarifies that an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. For public business entities, the ASU is effective prospectively for fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Group adopted this ASU on January 1, 2020 and the adoption does not have a significant impact on the Group’s consolidated financial statements.

In August 2018, the FASB released ASU No. 2018-13 ("ASU 2018-13"), Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 modifies the disclosure requirements on fair value measurements. The provisions of ASU 2018-13 are to be applied using a prospective or retrospective approach, depending on the amendment, and are effective for interim periods and fiscal years beginning after December 15, 2019, with early adoption permitted. The Group adopted this ASU on January 1, 2020 and the adoption of this ASU does not have a significant impact on the Group’s consolidated financial statements.

In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities. The new standard changes how entities evaluate decision-making fees under the variable interest entity guidance. The new standard is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted in any interim period after issuance. The standard should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings at the beginning of the period of adoption. The Group adopted this ASU on January 1, 2020 and the adoption of this ASU does not have a significant impact on the Group’s consolidated financial statements.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ASU 2020-04 provides optional expedients and exceptions that the Company can elect to adopt, subject to meeting certain criteria, regarding contract modifications, hedging relationships, and other transactions that reference the London interbank offered rate for deposits of US dollars ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform. The relief provided in ASU 2020-04 is applicable to all entities, but is only available through December 31, 2022. The Group adopted this ASU on April 1, 2020 and the adoption of this ASU does not have a significant impact on the Group’s consolidated financial statements.

In April 2020, the FASB released a Q&A which allows lessees and lessors to make an election to either apply the lease modification guidance or the variable rents guidance under ASC 840 and ASC 842 for lease concessions related to COVID-19 as long as the total cash flows as a result of the concession are substantially the same or less than those in the contract before the concession. A preparer can make this election without the need to determine whether a force majeure clause exists in the lease. The Group has elected to account for the lease concessions as variable lease expenses.

Accounting Standards Not Yet Adopted

In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Topic 715-20). The amendment modifies the disclosure requirements for employers that sponsor defined benefit pension or other post-retirement plans. The revised guidance is effective for financial statements issued for fiscal years beginning after December 15, 2020, with early adoption permitted. The revised guidance will not have a material impact on the consolidated financial statements.

In December 2019, the FASB has issued ASU No. 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes. The guidance issued in this update simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in ASC740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition for deferred tax liabilities for outside basis differences. This ASU also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted, and is not expected to have a material impact on the Group’s consolidated financial statements.

Translation into United States Dollars

The financial statements of the Group are stated in RMB. Translations of amounts from RMB into United States dollars are solely for the convenience of the reader and were calculated at the rate of US$1 = RMB6.5250, on December 31, 2020, as set forth in H.10 statistical release of the Federal Reserve Board. The translation is not intended to imply that the RMB amounts could have been, or could be, converted, realized or settled into United States dollars at that rate on December 31, 2020, or at any other rate.

ACQUISITIONS

12 Months Ended

Dec. 31, 2020

ACQUISITIONS

ACQUISITIONS

3.ACQUISITIONS

(i) In August, 2018, the Group completed the acquisition of 83% equity interest of Blossom Hotel Investment Management (Kunshan) Co., Ltd. (the "Blossom Hotel Management"). Blossom Hotel Management was engaged in the business of owning, leasing, franchising, operating and managing hotels under Blossom Hotel Management brand in the upscale market in the PRC. The aggregated consideration RMB536 consisted of RMB463 cash consideration transferred and RMB73 implied fair value of the 11% equity interest originally owned by the Group. The previously held 11% equity interest that was accounted for using cost method was remeasured to fair value on the acquisition date, resulting in a gain of RMB13 recognized in investment income.

In August 2018, the Group purchased additional 11% noncontrolling interest from several minority shareholders for total cash consideration of RMB73. In 2019, the Group additional purchased 5% noncontrolling interest for total consideration of RMB34. The purchase of the noncontrolling interest is treated as an equity transaction. As of December 31, 2020, the Group owns 99% equity interest of Blossom Hotel Management in total.

(ii) During the years ended December 31, 2018, 2019 and 2020, the Group acquired two individual hotels, three individual companies and three individual companies for total cash consideration of RMB7, RMB54 and RMB26, respectively. The business acquisitions were accounted for under purchase accounting. The assets and liabilities of these hotels and companies acquired in 2018, 2019 and 2020 were immaterial to the consolidated financial statements.

(iii) On January 2, 2020, the Group completed the acquisition of 100% equity interest of Deutsche Hospitality. Deutsche Hospitality was engaged in the business of leasing, franchising, operating and managing hotels under five brands in the midscale and upscale market in Europe, the Middle East and Africa. The aggregated consideration was EUR720 million (equivalent to RMB5,624) which has been fully paid in cash as of January 2, 2020.

The total revenue and net loss of the acquiree included in the consolidated statements of comprehensive income for the year ended December 31, 2020 were RMB1,532 and RMB1,345, respectively.

The following table summarizes unaudited pro forma results of operation for the years ended December 31, 2019 and 2020 assuming that the acquisition occurred as of January 1, 2019. The pro forma results have been prepared for comparative purpose only based on management’s best estimate and do not purport to be indicative of the results of operations which actually would have resulted had the acquisition occurred as of January 1, 2019.


	Period Ended December 31,
	2019	2020
Pro forma total revenue	14,995	10,196

Pro forma net income (loss)

1,780

(2,204)

The Group incurred transaction cost of RMB70 for the acquisition, which was expensed in 2019. These expenses are non-recurring in nature, and were eliminated from the calculation of pro forma net income above.

The allocation of the purchase price as of the date of acquisition is summarized as follows:


		Amortization Period
Current assets	785
Property and equipment, net	586	2-25 years
Operating lease right-of-use assets	8,616	The lease terms
Financing lease right-of-use assets	1,794	Shorter of estimated useful lives of the assets and the lease terms
Franchise or manachise agreements	270	Remaining contract terms
Brand names	3,873	Indefinite-lives
Non-compete agreement	10	2 years
Goodwill	2,694
Deferred tax assets	170
Other non-current assets	280
Operating lease liability, current	(296)
Finance lease liability, current	(21)
Other current liabilities	(784)
Operating lease liability, non-current	(8,553)
Finance lease liability, non-current	(2,166)
Other noncurrent liabilities	(330)
Deferred tax liabilities	(1,304)
Total	5,624

Goodwill was recognized as a result of expected synergies from combining operations of the Group and acquired business and other intangible assets that don’t qualify for separate recognition. The goodwill generated from the DH acquisition is allocated to the reporting unit of legacy DH. None of the Goodwill is expected to be deductible for tax purposes.

REVENUE FROM CONTRACTS WITH CUSTOMERS

12 Months Ended

Dec. 31, 2020

REVENUE FROM CONTRACTS WITH CUSTOMERS

REVENUE FROM CONTRACTS WITH CUSTOMERS

4.REVENUE FROM CONTRACTS WITH CUSTOMERS

Disaggregated Revenues

The following tables present the Group’s revenues disaggregated by the nature of the product or service:


	Years Ended December 31,
	2018	2019	2020
Room revenues	6,894	7,057	5,735
Food and beverage revenues	304	351	608
Others	272	310	565
Leased and owned hotels revenue	7,470	7,718	6,908
Initial one-time franchise fee	79	93	110
On-going management and service fees	983	1,228	1,057
Central reservation system usage fees, other system maintenance and support fees	630	908	908
Reimbursements for hotel manager fees	455	581	657
Other fees	380	532	404
Manachised and franchised hotels revenue	2,527	3,342	3,136
Other revenues	66	152	152
Total revenues	10,063	11,212	10,196

Contract Balances

The Group’s contract assets are insignificant at December 31, 2019 and 2020.


	As of December 31,
	2019	2020
Current contract liabilities	1,179	1,272
Long-term contract liabilities	559	662
Total contract liabilities	1,738	1,934

The contract liabilities balances above which are classified as deferred revenue on the consolidated balance sheet, as of December 31, 2019 and 2020 were comprised of the following:


	As of December 31,
	2019	2020
Initial fees received from franchisees owners	869	924
Cash received for membership fees and not recognized as revenue	400	430
Advances received from customers	412	529
Deferred revenue related to the loyalty program	57	51
Total	1,738	1,934

The Group classifies initial fees received from franchisees into current liabilities when the hotel has not yet opened. Initial fees received from franchisees for pre-opening hotels are RMB448 and RMB429 as of December 31, 2019 and 2020, respectively. Once the hotel opens, initial one-time franchise fee will be recognized as revenue over the term of the franchise contract and the initial fees received from franchisees that has not been recognized as revenue will be reclassified into current contract liabilities and long-term contract liabilities, respectively.

The Group recognized revenues that were previously deferred as contract liabilities of RMB491 and RMB748 during the years ended December 31, 2019 and 2020, respectively.

Revenue Allocated to Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods.

As of December 31, 2020, the Group had RMB51 of deferred revenues related to unsatisfied performance obligations under H Rewards that will be recognized as revenues when the points are redeemed, which the Group estimate will occur over the next two years. The Group had RMB924 of deferred revenues related to initial fees received from franchisees owners are expected to be recognized as revenues over the remaining contract periods over generally one to ten years. Additionally, the Group had RMB430 of deferred revenues related to membership fees that are expected to be recognized as revenues over the remaining membership life, which is estimated to be one to five years. The Group also had RMB529 of deferred revenues related to advances received from customers, which are expected to be recognized as revenues in future periods over the terms of the related contracts.

The Group did not estimate revenues expected to be recognized related to the Group’s unsatisfied performance for the following:

●

Revenues related to on-going management and franchise service fees, as they are considered sales-based royalty fees.

●

Revenues related to central reservation system usage fees, other system maintenance and support fees, and reimbursement for hotel manager fee, as the related revenues from the satisfaction of these performance obligations is recognized when the Group is entitled to invoice the amount.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

PROPERTY AND EQUIPMENT, NET

12 Months Ended

Dec. 31, 2020

PROPERTY AND EQUIPMENT, NET

PROPERTY AND EQUIPMENT, NET

5.PROPERTY AND EQUIPMENT, NET

Property and equipment, net consist of the following:


	As of December 31,
	2019	2020
Cost:
Buildings	247	247
Leasehold improvements	8,414	9,542
Furniture, fixtures and equipment	1,270	2,008
Motor vehicles	1	1
	9,932	11,798
Less: Accumulated depreciation	(4,918)	(5,764)
	5,014	6,034
Construction in progress	840	648
Property and equipment, net	5,854	6,682

Depreciation expense was RMB847, RMB967 and RMB1,219 for the years ended December 31, 2018, 2019 and 2020, respectively.

The Group occasionally demolishes certain leased hotels due to local government zoning requirements, which typically results in receiving compensation from the government.

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE

12 Months Ended

Dec. 31, 2020

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE

6.INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE

Intangible assets, net consist of the following:


	As of December 31,
	2019	2020
Intangible assets with indefinite lives:
Brand names (Note 3)	1,340	5,319
Master brand agreement	192	192
Intangible assets with definite lives:
Franchise or manachise agreements	95	356
Favorable lease agreements from sublease	13	12
Purchased software	72	108
Other intangible assets	20	70
Total	1,732	6,057
Less: Accumulated amortization	(70)	(112)
Total	1,662	5,945

The values of favorable lease agreements were determined based on the estimated present value of the amount the Group has avoided paying as a result of entering into the lease agreements. Unfavorable lease agreements were determined based on the estimated present value of the acquired lease that exceeded market prices and are recognized as other long-term liabilities. As of December 31, 2020, the unfavorable lease agreements were immaterial. The value of favorable and unfavorable lease agreements is amortized using the straight-line method over the remaining lease term before January 1, 2019. Favorable lease agreements and unfavorable lease agreements in which the Group acts as a lessee were reclassified to operating lease right-of-use assets on January 1, 2019, upon adoption of ASC 842. For the favorable lease agreements in which the Group acts as a lessor were accounted as intangible assets as before.

Amortization expense of intangible assets for the years ended December 31, 2018, 2019 and 2020 amounted to RMB39, RMB16 and RMB62, respectively.

The annual estimated amortization expense for the above intangible assets excluding brand name and master brand agreement for the following years is as follows:


		Amortization for Intangible Assets
2021		43
2022		36
2023		34
2024		31
2025		30
Thereafter		260
Total		434

INVESTMENTS

12 Months Ended

Dec. 31, 2020

INVESTMENTS.

INVESTMENTS

7.INVESTMENTS

The investments as of December 31, 2019 and 2020 were as follows:


	As of December 31,
	2019	2020
Equity securities with readily determinable fair values:
Accor	2,770	3,849
Other marketable securities	138	54
Equity securities without readily determinable fair values:
Cjia/Cjia Group	232	183
OYO	66	66
Other equity securities without readily determinable fair values	100	72
Equity-method investments:
AAPC LUB	469	490
Hotel related funds	507	476
China Hospitality JV	115	103
Zleep	—	88
Other investments	220	225
Available-for-sale debt securities:
Cjia/Cjia Group	220	220
Total	4,837	5,826

Equity securities with readily determinable fair values:

In 2017, 2018, 2019 and 2020, the Group purchased 2,309,981 and 10,782,131 and 282,787 and 8,737,987 ordinary shares of Accor, respectively,a hotel group listed in Paris stock exchange, from open market. In 2019 and 2020, the Group sold out 4,904,222 and 1,003,654 of these shares with gains of RMB52 and losses of RMB21 realized, respectively. As of December 31, 2020, the Group accumulatively hold 16,205,010 shares of Accor, which accounts for less than 7% of Accor total outstanding shares where the Group does not have the ability to significantly influence the operations of this entity. In 2019 and 2020, the Group recognized unrealized gains from fair value changes of Accor of RMB351 and unrealized losses from fair value changes of Accor of RMB253, respectively.

At December 31, 2019 and 2020, the Group had RMB138 and RMB54, respectively, of other marketable securities, which represent investments in entities in hospitality or related industries where the Group does not have the ability to significantly influence the operations of these entities. In 2018, 2019 and 2020, the Group recognized unrealized losses from fair value changes of other marketable securities of RMB120, RMB35 and RMB12, respectively.

Equity securities without readily determinable fair values:

In 2016, the Group sold its subsidiary, Chengjia Hotel Management Co., Ltd. to Chengjia (Shanghai) Apartment Management Co., Limited (“Cjia”), the Group’s equity investee. As of December 31, 2016, the Group had approximately 23% equity interest of Cjia and a sixty-month convertible note with original value of RMB52. In 2017, the Group invested in Cjia for convertible notes totaled RMB200. With the injection from an unrelated investor to Cjia, the Group recognized gain on deemed disposal of RMB40 in other income in 2017. In 2018, Cjia completed its restructuring, and accordingly the Group’s equity interest of 17% in Cjia was transformed to be the Group’s equity interest of 17% in China Cjia Group Limited (“Cjia Group”). In addition, the Group made further investment in preferred shares of Cjia Group of US$45 million in 2018. Meanwhile, the convertible notes of Cjia could be replaced by convertible notes of Cjia Group in the next four years. In 2019, Cjia Group repurchased from the Group part of its ordinary shares and preferred shares and issued new shares to an unrelated investor. As a result, the Group recognized a gain of RMB9 in other income in 2019. As of December 31, 2020, the Group had approximately 15% ordinary shares of Cjia Group. The Group accounted for the ordinary shares in Cjia Group under equity-method as the Group has the ability to exert significant influence. The convertible notes are recorded as available-for-sale debt securities. The preferred shares are accounted for as equity securities without readily determined fair value as they are not in substance ordinary shares. The Group recognized investment loss of RMB38, RMB45 and RMB49 in income (loss) from equity method investments in 2018, 2019 and 2020, respectively. Loss from equity method investments reduced the cost of equity-method investment to zero and further adjusted the carrying amount of preferred shares and convertible notes.

In September 2017, the Group purchased approximately 1% equity interest of Oravel Stays Private limited ("OYO"), an India leading hospitality company. The Group accounted the investment as equity securities without readily determinable fair values since the Group does not have the ability to exert significant influence over OYO.

Other equity securities without readily determinable fair values included several insignificant investments in certain privately-held companies. As a result of the COVID-19 pandemic, the Group recognized an impairment of RMB45 for these equity securities for the year ended December 31, 2020.

Equity-method investments:

In January 2016, the Group acquired approximately 28% equity interest in AAPC LUB. The Group accounted for the investment in AAPC LUB under equity-method as the Group has the ability to exert significant influence. The Group recognized investment income of RMB43, RMB47 and RMB21 in income (loss) from equity method investments in 2018, 2019 and 2020, respectively. In 2018, 2019 and 2020, the Group received cash dividend from AAPC LUB of RMB60, RMB39 and nil which was recognized as return on investment.

As of December 31, 2019 and 2020, the Group had RMB507 and RMB476, respectively, of investments in hotel related funds. Those funds were VIEs and were managed by or power shared with un-related third-parties. However, the Group determined that they were not the primary beneficiary of those VIEs since the Group did not have the power to direct the activities of these VIEs that most significantly impacted their economic performance. The Group accounted for the investment under equity-method as the Group has the ability to exert significant influence. The Group recognized investment loss of RMB28, investment income of RMB11, and investment loss of RMB16 in income (loss) from equity method investments in 2018, 2019 and 2020, respectively. The maximum potential financial statement loss the Group could incur if the investment funds were to default on all of their obligations is the loss of value of the interests in such investments of RMB476 that the Group holds as of December 31, 2020.

In 2018, the Group partnered with an unrelated third party investor to form China Hospitality JV, Ltd. (“China Hospitality JV”), of which the Group holds 20% equity interest. The business of China Hospitality JV was to acquire and operate two hotel properties, one of which has been converted into office buildings in 2020. The Group accounted for the investment in China Hospitality JV under equity-method as the Group has the ability to exert significant influence. The Group recognized investment loss of RMB11, RMB2, and RMB12 in income (loss) from equity method investments in 2018, 2019 and 2020, respectively.

In February 2019, Deutsche Hospitality acquired 51% of the shares in Zleep Hotels A/S ("Zleep"), a hotel brand in Scandinavia. The Group's interest in Zleep is accounted for using the equity method in the consolidated financial statements because the Group has joint control only in the business and finance decisions due to voting right restrictions. The Group recognized investment loss of RMB23 in income (loss) from equity method investments in 2020.

Other investments included several insignificant equity investments in certain privately-held companies. As a result of the COVID-19 pandemic, the Group recognized an impairment of RMB47 for these equity investments for the year ended December 31, 2020.

GOODWILL

12 Months Ended

Dec. 31, 2020

GOODWILL.

GOODWILL

8.GOODWILL

The changes in the carrying amount of goodwill for the years ended December 31, 2019 and 2020 were as follows:


	Gross	Accumulated	Net
	Amount	Impairment Loss	Amount
Balance at January 1, 2019	2,634	(4)	2,630
Increase in goodwill related to acquisitions	27	—	27
Balance at December 31, 2019	2,661	(4)	2,657
Increase in goodwill related to acquisitions	2,697	—	2,697
Impairment losses recognized	—	(437)	(437)
Net foreign exchange	74	(3)	71
Balance at December 31, 2020	5,432	(444)	4,988

After the acquisition of DH, the goodwill by reporting units as of December 31, 2020 was as follows:


	Legacy	Legacy
	Huazhu⁽¹⁾	DH⁽²⁾	Total
Goodwill as of December 31, 2019	2,657	—	2,657
Goodwill as of December 31, 2020	2,660	2,328	4,988

(1)Amounts for the legacy Huazhu reporting unit include gross carrying values of RMB2,661 and RMB2,664 as of December 31, 2019 and 2020, respectively, and accumulated impairment losses of RMB4 and RMB4 as of December 31, 2019 and 2020.

(2)Before the acquisition of DH, all the goodwill is allocated to one reporting unit legacy Huazhu. There were accumulated impairment losses of RMB440 for the legacy DH reporting unit as of December 31, 2020.

DEBT

12 Months Ended

Dec. 31, 2020

DEBT

DEBT

9.DEBT

The short-term and long-term debt as of December 31, 2019 and 2020 were as follows:


	As of December 31,
	2019	2020
Short-term debt:
Long-term bank borrowings, current portion	3,953	251
Short-term bank borrowings	1,256	851
Convertible senior notes, current portion	3,290	—
FF&E liability, current portion	—	40
Total	8,499	1,142

Long-term debt:
Long-term bank borrowings, non-current portion	8,084	4,384
Convertible senior notes, non-current portion	—	6,318
FF&E liability, non-current portion	—	135
Others	—	19
Total	8,084	10,856

Bank borrowings

In October 2019, the Group entered into a one-year term facility agreement under which the Group can borrow up to US$180 million within two months secured by deposit at least equal to loan facility amount with accrued interest and any cost. The interest rate was fixed at 2.52%. The Group had drawn down US$180 million under this agreement with US$185 million deposit in 2019 and repaid nil in 2019. The Group had repaid all the bank borrowings in 2020.

In December 2019, the Group entered into a EUR440 million term facility and US$500 million revolving credit facility agreement with several banks. The US$500 million revolving credit facility is available for 35 months after the date of the agreement. The interest rate on the loan for each interest period is the aggregate of the applicable Margin and LIBOR or EURIBOR in relation to any loan in EUR. The Margin for each loan depends on the applicable leverage range, generally means 2.0% per annum. There are some financial covenants including interest coverage ratio, leverage and book equity related to this facility and the Group was in compliance as of December 31, 2019. On April 17, 2020, the Group obtained an exemption approval for the EUR440 million and US$500 million long-term credit facility, providing that with satisfaction of amended covenants, the original financial covenants will not be applicable until the six-month period ending June 30, 2021. The amended covenants include book equity, borrowings, EBITDA and minimum cash related to this facility. On December 11, 2020, the Group obtained a further waiver, which released certain covenants included in the amended covenants signed on April 17, 2020. The Group is and expects to be able to remain fully in compliance with the further amended covenants. The Group had drawn down EUR440 million and US$500 million as of December 31, 2019 under the facility agreement and repaid nil in 2019. The Group had drawn down US$200 million as of December 31, 2020 under the facility agreement and repaid EUR1 million and US$700 million in 2020. The US$500 million revolving credit had been fully paid off as of December 31, 2020, and the available credit facility under this agreement is US$500 million, which is due in December 2022. The weighted average interest rate of borrowings drawn under this agreement was 2.86% and 2.89% for the years ended December 31, 2019 and 2020 respectively.

In March 2019, the Group entered into a five-year RMB1,190 bank loan contract expiring in March 2024. The interest rate resets every six months, and is based on the People's Bank of China five-year benchmark interest rate on the pricing date. The loan contains certain financial covenants including interest coverage ratio and net tangible assets and the Group was in compliance as of December 31, 2019. In 2020, the Group obtained an exemption approval for the RMB1,190 long-term credit facility, providing that with satisfaction of amended covenants, the original financial covenants of interest coverage ratio will not be applicable until the six-month period ending June 30, 2021. The amended covenants include borrowings, EBITDA and cash dividend distribution limitation related to this facility. The Group is and expects to be able to remain fully in compliance with the amended covenants; The Group had repaid RMB89 and RMB179 in 2019 and 2020 in accordance with the agreed repayment schedule. As of December 31, 2020, the outstanding loan amount is RMB922. The weighted average interest rate of borrowings drawn under this agreement was 4.75% for the years ended December 31, 2019 and 2020.

Convertible Senior Notes due 2022

On November 3, 2017, the Company issued US$475 million of Convertible Senior Notes (the "2022 Notes”). The 2022 Notes mature on November 1, 2022 and bear interest at a rate of 0.375% per annum, payable in arrears semi-annually on May 1 and November 1, beginning May 1, 2018. In 2017, proceeds to the Company were RMB3,093 (equivalently US$467 million), net of issuance costs of RMB54 (equivalently US$8 million).

Holders of the 2022 Notes have the option to convert their Notes at any time prior to the close of business on the second business day immediately preceding the maturity date. The 2022 Notes can be converted into the Company’s ADSs at an initial conversion rate of 5.4869 , before the ADSs split, of the Company’s ADSs per US$1,000 principal amount of the 2022 Notes (equivalent to an initial conversion price of US$182.25 per ADS before the ADSs split effected in May 2018). The conversion rate is subject to adjustment in some events but is not adjusted for any accrued and unpaid interest. In addition, following a make-whole fundamental change (as defined in the Indenture) that occur prior to the maturity date or following the Company's delivery of a notice of a tax redemption, the Company will increase the conversion rate for a holder who elects to convert its notes in connection with such a corporate event or such tax redemption. RMB0.06 of the 2022 Notes had been converted into 202 ADSs upon the holders’ request as of December 31, 2020.

The holders were able to require the Company to repurchase all or portion of the 2022 Notes for cash on November 2, 2020, or upon a fundamental change, at a repurchase price equal to 100% of the principal amount, plus accrued and unpaid interest. RMB0.04 of the 2022 Notes had been repurchased in cash upon the holders’ request as of December 31, 2020.

The conversion option meets the definition of a derivative. However, since the conversion option is considered indexed to the Company's own stock and classified in stockholders' equity, the scope exception is met, accordingly the bifurcation of conversion option from the 2022 Notes is not required. There is no beneficial conversion feature ("BCF") attribute to the 2022 Notes as the set conversion prices for the 2022 Notes are greater than the respective fair values of the ordinary share price at date of issuance.

The feature of mandatory redemption upon maturity is clearly and closely related to the debt host and this feature is no need to be bifurcated. Furthermore, the Company concluded that the feature of contingent put options upon tax events or fundamental changes does not need to be considered as an embedded derivative to be bifurcated.

Therefore, the Company accounted for the 2022 Notes in accordance with ASC 470, as a single instrument. Issuance costs related to the 2022 Notes was recorded in consolidated balance sheet as a direct deduction from the principal amount of the 2022 Notes, and was amortized over the period from November 3, 2017, the date of issuance, to November 1, 2020, the first put date of the 2022 Notes, using the effective interest method. On December 31, 2019, the Group reclassified the 2022 Notes as short-term debt as the 2022 Notes holders have a put option which can be exercised within one year. After November 2, 2020, the Group reclassified the 2022 Notes as long-term debt as the put option was expired and the 2022 Notes will mature on November 1, 2022.

ADS Lending Arrangement

Concurrent with the offering of the 2022 Notes, the Company entered into ADS lending agreements with the affiliates of the initial purchasers of the 2022 Notes ("ADS Borrowers"), pursuant to which the Company lent to the ADS Borrowers 2,606,278 ADSs (the "Loaned ADSs") at a price equal to par, or $0.0004 per ADS before the ADSs split ("ADS lending arrangement"). The purpose of the ADS lending arrangements is to facilitate privately negotiated transactions in which the ultimate holders of the 2022 Notes may elect to hedge their investment in the related notes. In May 2018, the Company changed the ADS to ordinary share ratio from one ADS representing four ordinary shares to one ADS representing one ordinary share. Therefore, as of December 31, 2018, 2019 and 2020, the outstanding number of Loaned ADSs was 10,425,112.

The Loaned ADSs must be returned to the Company by the earliest of (a) the maturity date of the 2022 Notes, November 1, 2022, (b) upon the Company’s election to terminate the ADS lending agreement at any time after the later of (x) the date on which the entire principal amount of the 2022 Notes ceases to be outstanding, and (y) the date on which the entire principal amount of any additional convertible securities that the Company has in writing consented to permit the ADS Borrower to hedge under the ADS lending agreement ceases to be outstanding, in each case, whether as a result of conversion, redemption, repurchase, cancellation or otherwise; and (c) the termination of the ADS lending agreement. The Company is not required to make any payment to the initial purchasers or ADS Borrower upon the return of the Loaned ADSs. The ADS Borrowers do not have the choice or option to pay cash in exchange for the return of the Loaned ADSs.

No collateral is required to be posted for the Loaned ADSs. The initial purchasers are required to remit to the Company any dividends paid to the holders of the Loaned ADSs. An ADS Borrower has the ability to vote without restriction. However, the ADS Borrowers have agreed not to vote on the Loaned ADSs.

In accordance with FASB ASC Sub-topic 470-20, the Company has accounted for the ADS lending agreement initially at fair value and recognized it as an issuance cost associated with the convertible debt offering. As a result, additional debt issuance costs of RMB26 (equivalently US$4 million) were recorded on the issuance date with a corresponding increase to additional paid-in-capital. This debt issuance costs have also been amortized from the date of issuance to the put date of Notes, using the effective interest method.

In accordance with ASC Topic 470-20, although legally issued, the Loaned ADSs are not considered outstanding, and then excluded from basic and diluted earnings per share unless default of the ADS lending arrangement occurs, at which time the Loaned ADSs would be included in the basic and diluted earnings per share calculation. As of December 31, 2020, it is not probable that the ADS Borrower or the counterparty to the ADS lending arrangement will default.

Capped Call Options

In connection with the issuance of the 2022 Notes, the Group has entered into capped call option transactions with some of the initial purchasers or their affiliates (the "Option Counterparties") to reduce the potential dilution to existing shareholders of the Group upon conversion of the 2022 Notes. The cap price of the capped call transactions will initially be US$221.31 per ADS before the ADSs split, subject to adjustment under the terms of the capped call transactions. The total premium paid by the Group for the capped call transactions was RMB177 (equivalently US$27 million) on the purchased date. The capped call option is classified in stockholders’ equity, recorded at the cost with no subsequent changes in fair value be recorded.

Convertible Senior Notes due 2026

On May 12, 2020, the Company issued US$450 million Convertible Senior Notes (the "2026 Notes"). On May 26, 2020, the Company issued an additional US$50 million in aggregate principal amount of the 2026 Notes pursuant to the exercise in full by the initial purchasers of an option to purchase additional notes. The 2026 Notes will mature on May 1, 2026 and bear interest at a rate of 3.00% per annum, payable in arrears semi-annually on May 1 and November 1 of each year, beginning on November 1, 2020. In 2020, proceeds to the Company were RMB3,499 (equivalently US$493 million), net of issuance costs of RMB49 (equivalently US$7 million).

Holders of the 2026 Notes have the option to convert their Notes at any time prior to the close of business on the second business day immediately preceding the maturity date. The 2026 Notes can be converted into the Company's ADSs at an initial conversion rate of 23.971 of the Company's ADSs per US$1,000 principal amount of the 2026 Notes (equivalent to an initial conversion price of US$41.72 per ADS). The conversion rate is subject to adjustment in some events but is not adjusted for any accrued and unpaid interest. In addition, following a make-whole fundamental change (as defined in the Indenture) that occur prior to the maturity date or following the Company’s delivery of a notice of a tax redemption, the Company will increase the conversion rate for a holder who elects to convert its notes in connection with such a corporate event or such tax redemption.

The holders may require the Company to repurchase all or portion of the 2026 Notes for cash on May 1, 2024, or in the event of certain fundamental changes, at a repurchase price equal to 100% of the principal amount, plus accrued and unpaid interest.

The conversion option meets the definition of a derivative. However, since the conversion option is considered indexed to the Company’s own stock and classified in stockholders’ equity, the scope exception is met, accordingly the bifurcation of conversion option from the 2026 Notes is not required. There is no beneficial conversion feature (“BCF”) attribute to the 2026 Notes as the set conversion prices for the 2026 Notes are greater than the respective fair values of the ordinary share price at date of issuance.

Therefore, the Company accounted for the 2026 Notes in accordance with ASC 470, as a single instrument. Issuance costs related to the 2026 Notes is recorded in consolidated balance sheet as a direct deduction from the principal amount of the 2026 Notes, and is amortized over the period from May 12, 2020, the date of issuance, to May 1, 2024, the first put date of the 2026 Notes, using the effective interest method.

FF&E Liability

The group entered into several contracts with lessors to install furniture, fixtures and equipment ("FF&E") in various leased hotels prior to the respective commencement date. Those transactions are classified as "failed" sale and leaseback transactions, as the control of the furniture, fixtures and equipment does not transfer to the lessor. Consequently, the received consideration from the lessor is accounted for as a liability. The current portion and non-current portion of FF&E liability are recorded in short-term debt and long-term debt, respectively.

Debt Maturities

The contractual maturities of the Group’s debt as of December 31, 2020 were as follows:


Year Ending December 31,		Principle Amounts
2021		1,142
2022		6,985
2023		396
2024		3,505
2025		51
Thereafter		54
Total		12,133

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

12 Months Ended

Dec. 31, 2020

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

10.ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES


	As of December 31,
	2019	2020
Payable to franchisees	1,028	1,349
Other payables	410	535
Accrued rental, utilities and other accrued expenses	133	245
Liabilities related to customer loyalty program	110	111
Value-added tax, other tax and surcharge payables	90	124
Payable to noncontrolling interest holders	85	76
Total	1,856	2,440

Payable to franchisees mainly represents room charges received on behalf of franchisees and are payable within one year. From time to time, the Group receives cash advances from noncontrolling interest holders of entities that are not wholly owned by the Group. Such advances are non-interest bearing and are payable within one year.

HOTEL OPERATING COSTS

12 Months Ended

Dec. 31, 2020

HOTEL OPERATING COSTS.

HOTEL OPERATING COSTS

11.HOTEL OPERATING COSTS

Hotel operating costs include all direct costs incurred in the operation of the leased and owned hotels, manachised and franchised hotels and consist of the following:


	Years Ended December 31,
	2018	2019	2020
Rents	2,406	2,624	3,485
Utilities	399	404	478
Personnel costs	1,663	1,854	2,501
Depreciation and amortization	869	960	1,316
Consumable, food and beverage	673	793	885
Others	466	555	1,064
Total	6,476	7,190	9,729

PRE-OPENING EXPENSES

12 Months Ended

Dec. 31, 2020

PRE-OPENING EXPENSES

PRE-OPENING EXPENSES

12.PRE-OPENING EXPENSES

The Group expenses all costs incurred in connection with start-up activities, including pre-operating costs associated with new hotel facilities and costs incurred with the formation of the subsidiaries, such as organization costs. Pre-opening expenses primarily include rental expenses and employee costs incurred during the hotel pre-opening period.


	Years Ended December 31,
	2018	2019	2020
Rents	221	460	251
Personnel costs	18	14	15
Others	16	28	22
Total	255	502	288

SHARE-BASED COMPENSATION

12 Months Ended

Dec. 31, 2020

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

13.SHARE-BASED COMPENSATION

In February 2007, the Group adopted the 2007 Global Share Plan which allows the Group to offer incentive awards to employees, officers, directors and consultants or advisors (the “Participants”). Under the 2007 Global Share Plan, the Group may issue incentive awards to the Participants to purchase not more than 10,000,000 ordinary shares. In June 2007, the Group adopted the 2008 Global Share Plan which allows the Group to offer incentive awards to Participants to purchase up to 3,000,000 ordinary shares. In October 2008, the Group increased the maximum number of incentive awards available under the 2008 Global Share Plan to 7,000,000. In September 2009, the Group adopted the 2009 Share Incentive Plan which allows the Group to offer incentive awards to Participants. Under the 2009 Share Incentive Plan, the Group may issue incentive awards to purchase up to 3,000,000 ordinary shares. In August 2010, the Group increased the maximum number of incentive awards available under the 2009 Share Incentive Plan to 15,000,000. In March 2015, the Group increased the maximum number of incentive awards available under the 2009 Share Incentive Plan to 43,000,000. The 2007 and 2008 Global Share Plans and 2009 Share Incentive Plan (collectively, the “Incentive Award Plans”) contain the same terms and conditions. The incentive awards granted under the Incentive Award Plans typically have a maximum life of ten years and vest in typical ways as listed below:

a.)Vest 50% on the second anniversary of the stated vesting commencement date with the remaining 50% vesting ratably over the following two years;

b.)

Vest over a period of ten years in equal yearly installments;

As of December 31, 2020, the Group had granted 24,577,669 options and 24,338,385 nonvested restricted stocks, which were subject to adjustment on performance condition.

Share options

No share options were granted during the years 2018, 2019 and 2020.

The following table summarized the Group’s share option activity under the option plans:


			Weighted Average
	Number of	Weighted Average	Remaining	Aggregate Intrinsic
	Options	Exercise Price	Contractual Life	Value
		US$	Years	US$'million
Share options outstanding at January 1, 2020	47,632	4.95
Forfeited	(1,000)	1.53
Exercised	(46,632)	5.03
Share options outstanding at December 31, 2020	—		—	—
Share options vested or expected to vest at December 31, 2020	—		—	—
Share options exercisable at December 31, 2020	—		—	—

As of December 31, 2020, total unrecognized compensation expense related to the option arrangements was nil.

During the years ended December 31, 2018, 2019 and 2020, 876,715, 1,088,358 and 46,632 options were exercised with an aggregate intrinsic value of RMB194, RMB255 and RMB11, respectively.

Nonvested restricted stocks

The fair value of nonvested restricted stock with service conditions or performance conditions is based on the fair market value of the underlying ordinary shares on the date of grant.

In 2018, 2019 and 2020, the Group granted 661,973, 221,712 and nil nonvested restricted stocks, respectively to senior officers and managers, each was in ten tranches with performance conditions. Each tranche is accounted for as a separate award with the same grant date, its own service inception date and requisite service period. The share-based compensation cost is recognized for each vesting tranche during the respective service period based on the estimated performance conditions at the service inception date. The Group reassesses the performance condition at each reporting period for true up. For each tranche, 50% vests on the second anniversary of the vesting commencement date with the remaining 50% vesting ratably over the following two years.

The following table summarized the Group’s nonvested restricted stock activities in 2020.



		Weighted Average Grant
	Number of Restricted	Date
	Stocks	Fair Value
		US$
Nonvested restricted stocks outstanding at January 1, 2020	10,245,390	9.87
Granted	493,407	32.74
Forfeited	(1,671,111)	8.45
Vested	(1,407,675)	11.41
Adjusted for performance conditions	(564,603)	5.93
Nonvested restricted stocks outstanding at December 31, 2020	7,095,408	11.80

As of December 31, 2020, there was RMB455 in unrecognized compensation costs, net of estimated forfeitures, related to unvested restricted stocks, which is expected to be recognized over a weighted-average period of 3.41 years.

The total fair value of nonvested restricted stocks vested in 2018, 2019 and 2020 was RMB183, RMB443 and RMB368, respectively.

EARNINGS (LOSSES) PER SHARE

12 Months Ended

Dec. 31, 2020

EARNINGS (LOSSES) PER SHARE

EARNINGS (LOSSES) PER SHARE

14.EARNINGS (LOSSES) PER SHARE

The following table sets forth the computation of basic and diluted earnings (losses) per share for the years indicated:


	Years Ended December 31,
	2018	2019	2020
Net income (loss) attributable to ordinary shareholders — basic	716	1,769	(2,192)
Eliminate the dilutive effect of interest expense of convertible senior notes	40	40	—
Net income attributable to ordinary shareholders — diluted	756	1,809	(2,192)
Weighted average ordinary shares outstanding — basic	281,717,485	284,305,138	292,739,841
Incremental weighted-average ordinary shares from assumed exercise of share options and nonvested restricted stocks using the treasury stock method	11,463,212	9,397,527	—
Dilutive effect of convertible senior notes	10,425,112	10,607,225	—
Weighted average ordinary shares outstanding — diluted	303,605,809	304,309,890	292,739,841
Basic earnings (losses) per share	2.54	6.22	(7.49)
Diluted earnings (losses) per share	2.49	5.94	(7.49)

For the years ended December 31, 2018, 2019 and 2020, the Group had securities which could potentially dilute basic earnings per share in the future, but which were excluded from the computation of diluted earnings per share as their effects would have been anti-dilutive. Such outstanding securities consist of the following:


	Years Ended December 31,
	2018	2019	2020
Outstanding employee options and nonvested restricted stocks	530,009	—	7,095,408
Shares of convertible senior notes	—	—	18,327,489
Total	530,009	—	25,422,897

Cash Dividend

12 Months Ended

Dec. 31, 2020

Cash Dividend

Cash Dividend

15.Cash Dividend

On December 13, 2018, the Group approved and declared a cash dividend of US$0.34 per ordinary share on its outstanding shares as of the close of trading on January 2, 2019. Such dividend of RMB658 was recorded as dividends payable as of December 31, 2018, and fully paid in January 2019.

In November 2019, the Group approved a cash dividend in the total amount of approximately US$100 million on its outstanding shares as of the close of trading on January 10, 2020. Such dividend of RMB678 was recorded as dividends payable as of December 31, 2019, and fully paid in February 2020.

The Group did not distribute cash dividend to its shareholders in 2020.

LEASES

12 Months Ended

Dec. 31, 2020

LEASES

LEASES

16.LEASES

The Group’s leases mainly related to building and the rights to use the land. The total expense related to short-term leases were insignificant for period of 2018, 2019 and 2020, and sublease income of the Group which is recognized in revenues in the consolidated statements of comprehensive income were RMB123, RMB121 and RMB112 for the years ended December 31, 2018, 2019 and 2020, respectively. The Group recognizes a negative lease expense of RMB250 for 2020 under the relief as the Group elects using the variable lease expense approach.

A summary of supplemental information related to operating leases in 2019 and 2020 is as follows:


	Years Ended December 31,
	2019		2020
Lease cost:
Operating fixed lease cost	3,094		3,964
Finance lease cost	—		—
— Amortization of ROU assets	—		74
— Interest on lease liabilities	—		90
Short term lease cost	0		0
Variable lease cost	10		(171)
Total lease cost	3,104		3,957

Other information:
Weighted average remaining lease term
Operating leases	11 years		14 years
Finance leases	—		29 years
Weighted average discount rate
Operating leases	7.34	%	6.23	%
Finance leases	—		3.96	%

Lease expense for all the Group’s leases (including fixed lease cost, variable lease cost and short-term lease cost) for the year ended December 31, 2018 were RMB2,641.

As of December 31, 2020, the maturities of lease liabilities in accordance with ASC 842 in each of the next five years and thereafter are as follows:


Year Ending December 31,	Total Operating Leases	Total Finance Leases
2021	3,858	129
2022	3,826	144
2023	3,733	146
2024	3,660	147
2025	3,466	147
Thereafter	25,730	3,575

Total minimum lease payments	44,273	4,288

Less: amount representing interest	(13,819)	(1,760)

Present value of minimum lease payments	30,454	2,528

As of December 31, 2020, the Group has entered 31 lease contracts that the Group expects to account for as operating or finance leases, the future undiscounted lease payments for these non-cancellable lease contracts are RMB8,511, which is not reflected in the consolidated balance sheets.

As of December 31, 2019, the maturities of lease liabilities in accordance with ASC 842 in each of the next five years and thereafter were as follows:


Year Ending December 31,
2020		3,236
2021		3,231
2022		3,157
2023		3,031
2024		2,921
Thereafter		18,077

Total minimum lease payments		33,653

Less: amount representing interest		(11,598)

Present value of minimum lease payments		22,055

As of December 31, 2019, the Group has entered six lease contracts that the Group expects to account for as operating leases which is not reflected in the consolidated balance sheets but reflected in the table above as the leases have not commenced.

INCOME TAXES

12 Months Ended

Dec. 31, 2020

INCOME TAXES

INCOME TAXES

17.INCOME TAXES

The Group is subject to different income tax rates in various countries and jurisdictions under laws and relevant interpretations depending on the place of formation. Under the current laws of Germany, companies are subject to income tax at a standard rate of 15% (15.825% including solidarity surcharge), plus municipal trade tax of 7%-17%. The income tax rates in other countries and jurisdictions are of little effect on the financial statements.

Under the Law of the People’s Republic of China on Enterprise Income Tax (“EIT Law”), which was effective from January 1, 2008, domestically-owned enterprises and foreign-invested enterprises are subject to a uniform tax rate of 25%, and the industries and projects that are encouraged and supported by the State may enjoy tax preferential treatment. Jizhu Information and Technology (Shanghai) Co., Ltd. (“Jizhu Shanghai”), which once called Mengguang Information and Technology (Shanghai) Co., Ltd, is a recognized software development entity located in Shanghai of PRC. Jizhu Shanghai is entitled to a two-year exemption and three-year 50% reduction tax holiday starting from the first profit making year after absorbing all prior years’ tax losses, and has entered into the first tax profitable year in 2014. Therefore, it applied tax exemption from 2014 to 2015, and tax rate of 12.5% from 2016 to 2018. In November 2018, Jizhu Shanghai was qualified as high and new tech enterprise, resulting Jizhu Shanghai subject to a reduced tax rate of 15% in 2019 and 2020. H-World Information and Technology Co., Ltd. is qualified as high and new tech enterprise, resulting H-World Information and Technology Co., Ltd. subject to a reduced tax rate of 15% in 2019, 2020 and 2021.

Income (loss) before income taxes consists of:


	Years Ended December 31,
	2018	2019	2020
PRC including Hong Kong and Taiwan	1,583	2,334	(392)
Germany	—	—	(1,606)
Other	(190)	231	(281)
Total	1,393	2,565	(2,279)

Tax expense (benefit) is comprised of the following:


	Years Ended December 31,
	2018	2019	2020
Current Tax	660	678	338
Deferred Tax	(91)	(38)	(553)
Total	569	640	(215)

A reconciliation between the effective income tax rate and the PRC statutory income tax rate is as follows:


	Years Ended December 31,
	2018		2019		2020
PRC statutory tax rate	25	%	25	%	25	%
Tax effect of non-deductible expenses and non-taxable income in determining taxable profit	15	%	(3)	%	(6)	%
Effect of different tax rate of group entities operating in other jurisdictions	4	%	1	%	(2)	%
Effect of change in valuation allowance	(1)	%	2	%	(10)	%
Effect of tax holiday	(3)	%	(2)	%	1	%
Effect of cash dividends	5	%	4	%	0	%
Effect of disposal of subsidiary	1	%	—		—
Effect of excess tax benefit of rewards	(5)	%	(2)	%	1	%
Effective tax rate	41	%	25	%	9	%

The aggregate amount and per share effect of the tax holidays are as follows:


	Years Ended December 31,
	2018	2019	2020
Aggregate amount	31	45	31
Per share effect—basic	0.11	0.16	0.11
Per share effect—diluted	0.10	0.15	0.11

The principal components of the Group’s deferred income tax assets and liabilities as of December 31, 2019 and 2020 are as follows:


	As of December 31,
	2019	2020
Deferred tax assets:
Net loss carryforward	243	888
Deferred revenue	260	283
Long-term assets	125	388
Bad debt provision	7	18
Accrued payroll	23	69
Other accrued expenses	19	3
Share-based compensation	23	31
Others	0	12
Valuation allowance	(152)	(369)
Total deferred tax assets, net of valuation allowance	548	1,323
Deferred tax liabilities:
Fair value adjustment for Building, land use rights and identified intangible assets due to acquisition	449	1,782
Others	42	99
Total deferred tax liabilities	491	1,881
Net deferred tax assets (liabilities)	57	(558)
Analysis as:
Deferred tax assets	548	623
Deferred tax liabilities	491	1,181
Net deferred tax assets (liabilities)	57	(558)

The Group considers positive and negative evidence to determine whether some portion or all of the deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward periods, the Group’s experience with tax attributes expiring unused and tax planning alternatives. Valuation allowances have been established for deferred tax assets based on a more likely than not threshold. The Group’s ability to realize deferred tax assets depends on its ability to generate sufficient taxable income within the carryforward periods provided for in the tax law. Movement of the valuation allowance is as follows:


	Years Ended December 31,
	2018	2019	2020
Balance at the beginning of the year	(123)	(107)	(152)
Provided	(36)	(79)	(249)
Reversed	43	24	32
Written off	9	10	—
Balance at the end of the year	(107)	(152)	(369)

As of December 31, 2020, the Group's PRC subsidiaries had tax loss carryforwards of RMB888, which will expire between 2021 and 2024 if not used, and RMB1,492, which will expire between 2021 and 2028 if not used. The Germany Companies had tax loss carry forwards of RMB1,778, which can be offset in the future without anytime restriction.

The Group determines whether or not a tax position is “more-likely-than-not” of being sustained upon audit based solely on the technical merits of the position. At December 31, 2019 and 2020, the Group had recorded liabilities for uncertain tax benefit of approximately RMB18 and RMB50 mainly associated with the interests on intercompany loans and other permanent differences related to Corporate Income and Trade Taxes, respectively. No interest or penalty expense was recorded for the years ended December 31, 2018, 2019 and 2020. The Group does not anticipate any significant changes to its liability for unrecognized tax benefits within the next 12 months.

In accordance with the EIT Law, dividends, which arise from profits of foreign invested enterprises (“FIEs”) earned after January 1, 2008, are subject to a 10% withholding income tax. If there is a favorable tax treaty between mainland China and the jurisdiction of the foreign holding company, the income tax rate may be reduced. For example, holding companies in Hong Kong that are also tax residents in Hong Kong are eligible for a 5% withholding tax on dividends under the Tax Memorandum between China and the Hong Kong Special Administrative Region if the holding company is the beneficial owner of the dividends. Under applicable accounting principles, a deferred tax liability should be recorded for taxable temporary differences attributable to the excess of financial reporting basis over tax basis in a domestic subsidiary. In 2018, the Group revised its dividend policy to maintain a moderate dividend distribution every year with the range of 0.5% to 2.0% of its market capitalization from current year net income starting from 2018. The Group’s board of directors has complete discretion in deciding whether to distribute dividends and the dividend amounts within the approved range. The Group was restricted from distributing cash dividends until June 30, 2021 pursuant to the waiver from certain financial covenants that the Group obtained on April 17, 2020 for the syndicated bank loans and therefore did not accrue PRC dividend withholding tax in 2020. In 2019 and 2020, PRC dividend withholding tax of RMB73 and nil was accrued. Other than these dividends distributions, the Group intends to indefinitely reinvest the remaining undistributed earnings of the Group’s PRC subsidiaries, and therefore, no additional provision for PRC dividend withholding tax was accrued.

According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of income taxes is due to computational errors made by the taxpayer. The statute of limitations will be extended to five years under special circumstances, which are not clearly defined, but an underpayment of income tax liability exceeding RMB0.1 is specifically listed as a special circumstance. In the case of a transfer pricing related adjustment, the statute of limitations is ten years. There is no statute of limitations in the case of tax evasion. The Group’s PRC subsidiaries are therefore subject to examination by the PRC tax authorities from 2016 through 2020 on non-transfer pricing matters, and from 2011 through 2020 on transfer pricing matters. Generally, the statute of limitations for the assessment and collection of taxes is four years. The four-year period usually starts at the end of the year in which the tax return is filed. If no tax return is filed, the statute of limitations starts with the end of the third year following the year in which the tax arose. Extended limitations of 5 and 10 years will apply in the event of tax evasion or tax fraud. The statute of limitations may be suspended for a variety of reasons, for example, appeal of assessment by taxpayers, announcement or start of a tax audit, obvious mistake in tax assessment, etc.

According to the German General Fiscal Code, the statute of limitations for the assessment and collection of taxes is four years. The four-year period usually starts at the end of the year in which the tax return is filed. If no tax return is filed, the statute of limitations starts with the end of the third year following the year in which the tax arose. Extended limitations of 5 and 10 years will apply in the event of tax evasion or tax fraud. The statute of limitations may be suspended for a variety of reasons, for example, appeal of assessment by taxpayers, announcement or start of a tax audit, obvious mistake in tax assessment, etc.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2020

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS

18.EMPLOYEE BENEFIT PLANS

a. Defined Benefit Plans

Retirement benefit obligation result all from the German pension plan after the completion of the acquisition of DH as this pension plan is the most significant defined benefit plan in the Group.

The Group is required to recognize the funded status of the pension plan, which is the difference between the fair value of plan assets and projected benefit obligations, in the consolidated balance sheets and make corresponding adjustments for changes in the value through accumulated other comprehensive income(loss), net of taxes.

The following table presents the projected benefit obligation, fair value of plan assets, funded status and accumulated benefit obligation for the plans during the year ended December 31, 2020:


Change in Projected Benefit Obligation:		Year Ended December 31, 2020
Begin of the year		147
Current service cost		5
Interest cost		1
Contributions by plan participants		1
Actuarial loss (gain)		38
Foreign currency translation		3
Benefits paid		(7)
Settlements		(1)
Administrative Expenses, Taxes and Premiums Paid		0
Curtailments		(1)
Effect of other economic events		7
End of the year		193


		Year Ended December 31, 2020
Change in Plan Assets:
Begin of the year		32
Actual return (loss) on plan assets		(2)
Foreign currency translation		1
Employer contributions		9
Employee contributions		1
Benefits paid		(8)
Other economic events		(27)
End of the year		6
Excess of defined benefit obligation over the fair value of plan assets		187
Accumulated benefit obligation		193

Amounts recognized in the consolidated balance sheets consisted of the following:


		As of December 31, 2020
Salary and welfare payables		8
Retirement benefit obligation		179
Liability in the balance sheet		187

The net amount recognized in accumulated other comprehensive loss was RMB27 for the year ended December 31, 2020.

The net periodic pension cost (credit) and the estimated unrecognized prior service cost and net loss that will be amortized into net periodic pension cost (credit) during the year ended December 31, 2020 is immaterial.

The principal actuarial assumptions used were as follows:


	As of December 31, 2020
Discount rate- Germany	0.33	%
Discount rate- other	0.12	%
Inflation rate	1.00	%
Future salary increases	1.50	%
Future pension increases	1.80	%

The investment objectives for the various plans are preservation of capital, current income and long-term growth of capital. All plan assets are managed by outside investment managers. Asset allocations are reviewed periodically by the investment managers.

Expected long-term returns on plan assets are determined using historical performance for debt and equity securities held by the Group’s plans, actual performance of plan assets and current and expected market conditions. Expected returns are formulated based on the target asset allocation. The target asset allocation for the plan, as a percentage of total plan assets, as of December 31, 2020 was 25 percent in funds that invest in equity securities and 30 percent in funds that invest in debt securities.

The following tables present the fair value hierarchy of total plan assets measured at fair value by asset category as of December 31, 2020:


		As of December 31, 2020
Level 1
Equity funds		1
Bond funds		2
Property		2
Other		1
Total		6

The Group expect to contribute approximately RMB1 to the plan in 2021.

As of December 31, 2020, the benefits expected to be paid in the year ended December 31, 2021 are RMB8.

b. Defined Contribution Plans

Full time employees of the Group in the PRC participate in a government-mandated defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. PRC labor regulations require the Group to accrue for these benefits based on a certain percentage of the employees’ salaries. The total contribution for such employee benefits were RMB321, RMB413 and RMB283 for the years ended December 31, 2018, 2019 and 2020, respectively. The Group has no ongoing obligation to its employees subsequent to its contributions to the PRC plan. In an attempt to mitigate the adverse financial effects of the COVID-19 pandemic on employers, the Chinese Government had announced temporary reductions in, and exemptions from, the payment of contributions in 2020.

Furthermore, the Group pays contribution to governmental and private pension insurance organizations based on legal regulations in some countries out of China. The contributions are recognized as expense and amount RMB129 for the year ended December 31, 2020.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
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-Section 55
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Section S99
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

RESTRICTED NET ASSETS

12 Months Ended

Dec. 31, 2020

RESTRICTED NET ASSETS

RESTRICTED NET ASSETS

19.RESTRICTED NET ASSETS

Pursuant to laws applicable to entities incorporated in the PRC, the subsidiaries of the Group in the PRC must make appropriations from after-tax profit to non-distributable reserve funds. These reserve funds include one or more of the following: (i) a general reserve, (ii) an enterprise expansion fund and (iii) a staff bonus and welfare fund. Subject to certain cumulative limits, the general reserve fund requires annual appropriation of 10% of after tax profit (as determined under accounting principles generally accepted in the PRC at each year-end) until the accumulative amount of such reserve fund reaches 50% of their registered capital; the other fund appropriations are at the subsidiaries’ discretion. These reserve funds can only be used for specific purposes of offsetting future losses, enterprise expansion and staff bonus and welfare and are not distributable as cash dividends and amounted to RMB502, RMB604 and RMB771 as of December 31, 2018, 2019 and 2020, respectively. In addition, due to restrictions on the distribution of share capital from the Group’s PRC subsidiaries, the PRC subsidiaries share capital of RMB3,075 at December 31, 2020 is considered restricted. As a result of these PRC laws and regulations, as of December 31, 2020, approximately RMB3,846 is not available for distribution to the Group by its PRC subsidiaries in the form of dividends, loans or advances.

Pursuant to laws applicable to entities incorporated in the Europe, certain subsidiaries of the Group must make appropriations from after-tax profit to non-distributable reserve funds. These reserve funds include general reserve which is not distributable as cash dividends or other cash disbursements and amounted to RMB12 as of December 31, 2020. In addition, due to restrictions on the distribution of share capital from the Deutsche Hospitality and its subsidiaries, the share capital of RMB5 at December 31, 2020 is considered restricted.

RELATED PARTY TRANSACTIONS AND BALANCES

12 Months Ended

Dec. 31, 2020

RELATED PARTY TRANSACTIONS AND BALANCES

20.RELATED PARTY TRANSACTIONS AND BALANCES

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities.

The following entities are considered to be related parties to the Group. The related parties mainly act as service providers and service recipients to the Group. The Group is not obligated to provide any type of financial support to these related parties.


Related Party	Nature of the Party	Relationship with the Group
Trip.com Group Limited (“Trip.com”)	Online travel services provider	Mr. Qi Ji is a director
Sheen Star Group Limited (“Sheen Star”)	Investment holding company	Equity method investee of the Group, controlled by Mr. Qi Ji
Accor Hotels (“Accor”)	Hotel Group	Shareholder of the Group
China Cjia Group Limited (“Cjia Group”)	Apartment Management Group	Equity method investee of the Group
Shanghai CREATER Industrial Co., Ltd. (“CREATER”)	Staged office space company	Equity method investee of the Group
Shanghai Zhuchuang Enterprise Management Co., Ltd. (“Zhuchuang”)	Staged office space company	Equity method investee of the Group
China Hospitality JV, Ltd. (“China Hospitality JV”)	Property management company	Equity method investee of the Group
Smart Lodging Group (Cayman) Limited(“Smart Lodging”)	Hotel chain	Equity method investee of the Group
Shanghai Lianquan Hotel Management Co., Ltd. (“Lianquan”)	Hotel management company	Equity method investee of the Group
Suzhou Huali Jinshi Construction Decoration Co., Ltd. ("Huali Jinshi")	Building decoration company	Equity method investee of the Group

Shanghai CREATER Industrial Co., Ltd. ceased to be related parties of the Group from August 2019.

(a) Related party balances

Amounts due from related parties were mainly comprised of shareholder loans to Sheen Star, CREATER, Cjia Group, Zhuchuang and Lianquan, which are short-term in nature and mainly payable on demand, and receivable for service fee from Accor, service fee and room charges withheld by Trip.com. As the Group adopted ASU 2016-13 on January 1, 2020 utilizing the modified retrospective approach, the Group recorded credit losses of RMB18 for the year ended December 31, 2020.


	As of December 31,
	2019	2020
Sheen Star	52	52
Zhuchuang	27	27
Trip.com	16	22
Cjia Group	16	22
Accor	1	1
Lianquan	50	58
Others	20	14
Allowance for expected credit losses	—	(18)
Total	182	178

Amounts due to related parties were mainly comprised of payables for brand use fee, reservation fee and other service fee to Trip.com, and Accor, consultation fee to and cash received on behalf of Cjia Group and China Hospitality JV and payables for construction service fee to Huali Jinshi, which are short-term in nature and payable on demand.


	As of December 31,
	2019	2020
Trip.com	33	48
China Hospitality JV	25	—
Accor	11	8
Cjia Group	17	42
Huali Jinshi	9	29
Others	0	5
Total	95	132

(b) Related party transactions

During the years ended December 31, 2018, 2019 and 2020, significant related party transactions were as follows:


	Years Ended December 31,
	2018	2019	2020
Commission expenses to Trip.com	61	72	78
Lease expenses to Trip.com	18	18	18
Brand use fee, reservation fee and other related service fee to Accor	18	28	17
Marketing and training fee from Trip.com	12	41	66
Service fee from Accor	14	9	3
Service fee from China Hospitality JV	10	6	1
Service fee from Sheen Star	2	4	4
Goods sold and service provided to Cjia Group	30	21	18
Sublease income from Cjia Group	—	14	9
Service fee to Cjia Group	—	6	17
Early termination compensation of sublease to Cjia Group	—	—	8
Early termination compensation of franchise agreement from China Hospitality JV	—	—	26
Purchase of property and equipment from Cjia Group	—	—	11
Service fee to Huali Jinshi	1	99	41
Sublease income from Lianquan	—	7	12
Interest income from Sheen Star	—	8	1
Interest income from CREATER	10	6	—
Loan from Cjia Group	103	—	—
Loan payment to Smart Lodging	—	30	—
Loan payment to Lianquan	—	32	—

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2020

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES

21.	COMMITMENTS AND CONTINGENCIES

(a) Commitments

As of December 31, 2020, the Group’s commitments related to leasehold improvements and installation of equipment for hotel operations was RMB360, which is expected to be incurred within one year.

By subscription agreement of September 6 and November 29, 2018, D.H. Deutsche Hospitality GmbH, Frankfurt am Main (Germany), entered into a commitment to purchase ordinary shares in a fund for European hotel real estate of Commerz Real to a maximum amount of EUR12 million. The first payment was done in January 2021 amounting to EUR3 million, whereas the investment plan is still not final.

(b) Contingencies

The Group is subject to periodic legal or administrative proceedings in the ordinary course of the Group's business, including lease contract terminations and disputes, and management agreement disputes. The Group does not believe that any currently pending legal or administrative proceeding to which the Group is a party will have a material adverse effect on the financial statements. As of December 31, 2020, the accrued contingent liability was RMB60.

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY

12 Months Ended

Dec. 31, 2020

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY

ADDITIONAL FINANCIAL INFORMATION — FINANCIAL STATEMENTS SCHEDULE I

HUAZHU GROUP LIMITED

FINANCIAL INFORMATION FOR PARENT COMPANY

BALANCE SHEETS

(Renminbi in millions , except share and per share data , unless otherwise stated)


	As of December 31,
	2019	2020	2020
			US$'million
			(Note 2)
Assets
Current assets:
Cash and cash equivalents	361	1,892	290
Short-term investments	64	51	8
Other current assets	24	16	2
Total current assets	449	1,959	300
Other assets	155	—	—
Investment in subsidiaries	16,472	16,103	2,467
Total assets	17,076	18,062	2,767
Liabilities and equity
Current liabilities:
Short-term debt	8,312	—	—
Dividends payable	678	—	—
Amount due to related parties	594	273	42
Accrued expenses and other current liabilities	113	141	21
Total current liabilities	9,697	414	63
Long-term debt	—	6,318	968
Total liabilities	9,697	6,732	1,031
Equity:
Ordinary shares (US$0.0001 par value per share; 8,023,485,450 shares authorized; 299,424,485 and 324,364,444 shares issued as of December 31, 2019 and 2020, and 285,902,609 and 310,842,568 shares outstanding as of December 31, 2019 and 2020, respectively)	0	0	0
Treasury shares (3,096,764 and 3,096,764 shares as of December 31, 2019 and 2020, respectively)	(107)	(107)	(16)
Additional paid-in capital	3,834	9,808	1,503
Retained earnings	3,701	1,502	230
Accumulated other comprehensive (loss) income	(49)	127	19
Total equity	7,379	11,330	1,736
Total liabilities and equity	17,076	18,062	2,767

ADDITIONAL FINANCIAL INFORMATION — FINANCIAL STATEMENTS SCHEDULE I

HUAZHU GROUP LIMITED

FINANCIAL INFORMATION FOR PARENT COMPANY

STATEMENTS OF COMPREHENSIVE INCOME

(Renminbi in millions, unless otherwise stated)


	Years Ended December 31,
	2018	2019	2020	2020
				US$'million
				(Note 2)
Operating costs and expenses:
General and administrative expenses	89	115	155	24
Total operating costs and expenses	89	115	155	24
Loss from operations	(89)	(115)	(155)	(24)
Interest income	1	10	2	0
Interest expense	198	201	154	24
Foreign exchange gain (loss)	17	5	(8)	(1)
Other income, net	50	30	32	5
Unrealized loss from fair value changes of equity securities	(45)	(27)	(10)	(1)
Income (loss) in investment in subsidiaries	980	2,067	(1,899)	(291)
Net income (loss) attributable to Huazhu Group Limited	716	1,769	(2,192)	(336)

Other comprehensive (loss) income, net of tax	(169)	(7)	176	27
Comprehensive income (loss)	547	1,762	(2,016)	(309)

ADDITIONAL FINANCIAL INFORMATION — FINANCIAL STATEMENTS SCHEDULE I

HUAZHU GROUP LIMITED

FINANCIAL INFORMATION FOR PARENT COMPANY

CONDENSED STATEMENTS OF CASH FLOWS

(Renminbi in millions, unless otherwise stated)


	Years Ended December 31,
	2018	2019	2020		2020
					US$'million
					(Note 2)
Net cash (used in) provided by operating activities	(60)	(212)	49		8
Investing activities:
Investment in subsidiaries	—	(1,039)	(6,267)		(960)
Receipt of investment in subsidiaries	2,121	9	—		—
Purchase of long-term investments	(3,782)	—	—		—
Net cash used in investing activities	(1,661)	(1,030)	(6,267)		(960)
Financing activities:
Proceeds from issuance of ordinary shares in Hong Kong public offering	—	—	6,018		922
Ordinary share issuance costs	—	—	(10)		(2)
Net proceeds from issuance of ordinary shares upon exercise of option	14	14	1		0
Proceeds of advances from subsidiaries	149	109	—		—
Proceeds from short-term bank borrowings	—	1,265	—		—
Repayment of short-term bank borrowings	(128)	—	(282)	A	(43)
Proceeds from long-term bank borrowings	2,409	5,206	—		—
Repayment of long-term bank borrowings	(786)	(5,169)	—		—
Proceeds from issuance of convertible senior notes	—	—	3,499		536
Repayment of convertible senior notes	—	—	0		0
Debt financing costs paid	—	—	(9)		(1)
Dividends paid	—	(658)	(678)		(104)
Net cash provided by financing activities	1,658	767	8,539		1,308
Effect of exchange rate changes on cash and cash equivalents	201	141	(791)		(121)
Net increase (decrease) in cash and cash equivalents	138	(334)	1,530		235
Cash, cash equivalents at the beginning of the year	557	695	361		55
Cash, cash equivalents at the end of the year	695	361	1,891		290

A— Except for repayment of short-term bank borrowings by cash, short-term bank borrowings of RMB4,628 was settled by investment in subsidiaries.

The accompanying notes are an integral part of these consolidated financial statements

ADDITIONAL FINANCIAL INFORMATION — FINANCIAL STATEMENTS SCHEDULE I

HUAZHU GROUP LIMITED

FINANCIAL INFORMATION FOR PARENT COMPANY

Note to Schedule I

Schedule I has been provided pursuant to the requirements of Rule 12-04(a) and 5-04-(c) of Regulation S-X, which require condensed financial information as to the financial position, change in financial position and results of operations of a parent company as of the same dates and for the same periods for which audited consolidated financial statements have been presented when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year.

The condensed financial information has been prepared using the same accounting policies as set out in the accompanying consolidated financial statements except that the equity method has been used to account for investments in its subsidiaries. Such investments in subsidiaries are presented on the balance sheets as investment in subsidiaries and the profit of the subsidiaries is presented as income in investment in subsidiaries.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. The footnote disclosures contain supplemental information relating to the operations of the Company and, as such, these statements should be read in conjunction with the notes to the accompanying consolidated financial statements.

As of December 31, 2020, there are no material contingencies, mandatory dividend, and significant provision of long-term obligation or guarantee of the Company, except for those which have separately disclosed in the consolidated financial statements.

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

12 Months Ended

Dec. 31, 2020

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

ADDITION INFORMATION — FINANCIAL STATEMENTS SCHEDULE II

HUAZHU GROUP LIMITED

This financial information has been prepared in conformity with accounting principles generally accepted in the United States.

VALUATION AND QUALIFYING ACCOUNTS


	Balance at	Charge to
	Beginning of	Costs and	Charge to Other		Addition Due to	Charge Taken		Balance at
	Year	Expenses	Accounts		Acquisition	Against Allowance	Write off	End of Year
	(Renminbi in millions)
Allowance for accounts receivable, loan receivables and other financial assets:
2018	11	10	—		4	—	(8)	17
2019	17	21	—		—	—	(16)	22
2020	22	65	7	A	—	—	(7)	87
Valuation allowance for deferred tax assets

2018	123	36	—		—	(43)	(9)	107
2019	107	79	—		—	(24)	(10)	152
2020	152	249	—		—	(32)	—	369

A-This amount represents the credit loss for accounts receivable, loan receivables and other financial assets recorded upon the adoption of ASU 2016-13 (Note 2).

******

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2020

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES

Basis of presentation

The consolidated financial statements of the Group have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Basis of consolidation

Variable Interest Entities

Use of estimates

Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and demand deposits, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less when purchased.

Restricted cash

Restricted cash mainly represents deposits used as security against borrowings, deposits restricted due to contract disputes or lawsuit and cash restricted for special purposes.

Investments

As a result of the impairment analysis, the Group recorded an impairment of nil, RMB10 and RMB92 in 2018, 2019 and 2020, respectively.

Accounts receivable, net

Accounts receivable, net

Loan receivables, net

Loan receivables, net

Inventories

Property and equipment, net


Leasehold improvements		Shorter of the lease term or their estimated useful lives
Buildings		20-40 years
Furniture, fixtures and equipment		1-20 years
Motor vehicles		5 years

Intangible assets, net and unfavorable lease

Franchise or manachise agreements		Remaining contract terms from 10 to 20 years
Non-compete agreements		2 - 10 years based on specified non-compete period
Favorable lease agreements acquired before the adoption of ASC 842		Remaining lease terms from 1 to 20 years
Purchased software		3 - 10 years based on the estimated usage period
Unfavorable lease agreements		Remaining lease terms from 3 to 13 years
Other intangible assets including trademark, licenses and other rights		2 - 15 years based on the contractual term, the length of license agreements and the effective terms of other legal rights

Land use rights

Impairment of long-lived assets

Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable assets less liabilities acquired.

Revenue recognition

Leased and owned hotel revenues

Manachised and franchised hotel revenues

The manachise and franchise agreement contains the following promised services:

●Intellectual Property ("IP") license grant the right to access the Group’s hotel system IP, including brand names.

●System maintenance services include providing standardization hotel property management system (“PMS”), central reservation system (“CRS”) and other internet related services.

●Hotel management services include providing day-to-day management services of the hotels for the franchisees.

Other Revenues

Loyalty Program

Contract Balances

Value-Added Taxes and surcharges

The accommodation services of the Group in PRC and Germany are subject to 6% and 19% of Value-Added Taxes, respectively.

The Group is subject to education surtax and urban maintenance and construction tax, on the services provided in the PRC.

Advertising and promotional expenses

Government grants

Leases

As a lessee

Sublease

Income taxes

Current income taxes are provided for in accordance with the relevant statutory tax laws and regulations.

Foreign currency translation

The financial records of the Group’s subsidiaries are maintained in local currencies, which are the functional currencies.

Comprehensive income

Concentration of credit risk

Fair value

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.


			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active		Significant
			Markets for Identical	Significant Other	Unobservable
As of			Assets	Observable Inputs	Inputs
December 31,	Description	Fair Value	(Level 1)	(Level 2)	(Level 3)
2019	Equity securities with readily determinable fair value	2,908	2,908	—	—
2019	Available-for-sale debt securities	220	—	220	—
2020	Equity securities with readily determinable fair value	3,903	3,903	—	—
2020	Available-for-sale debt securities	220	—	220	—
2020	Employee benefit plan assets	6	6	—	—

The following table presents the Group’s assets measured at fair value on a non-recurring basis for the years ended December 31, 2018, 2019 and 2020:


			Fair Value Measurements at Reporting Date Using
			Quoted Prices
			in Active	Significant
			Markets for	Other	Significant
		Fair Value for	Identical	Observable	Unobservable	Total
Years Ended		Years Ended	Assets	Inputs	Inputs	Loss for
December 31,	Description	December 31	(Level 1)	(Level 2)	(Level 3)	the Year
2018	Property and equipment	10	—	—	10	35
2019	Property and equipment	—	—	—	—	3
2019	Long-term investment	—	—	—	—	10
2020	Property and equipment	2	—	—	2	41
2020	Operating lease right-of-use assets	71	—	—	71	139
2020	Long-term investment	—	—	—	—	92
2020	Goodwill	2,328	—	—	2,328	437

Share-based compensation


	Years Ended December 31,
	2018	2019	2020
Hotel operating costs	27	35	42
Selling and marketing expenses	3	3	4
General and administrative expenses	53	72	76
Total	83	110	122

Earnings (losses) per share

Segment and geography information


	Legacy Huazhu	Legacy DH	Total

Total revenues	8,664	1,532	10,196
Operating costs and expenses	8,978	2,947	11,925
Goodwill impairment loss	—	437	437
Other operating income, net	214	266	480
Interest income	118	1	119
Interest expense	427	106	533
Other (expenses) income, net	(92)	3	(89)
Unrealized (losses) gains from fair value changes of equity securities	(266)	1	(265)
Foreign exchange gain (loss)	176	(1)	175
Loss before income tax	(591)	(1,688)	(2,279)
Income tax expense (benefit)	151	(366)	(215)
(Loss) income from equity method investments	(117)	(23)	(140)
Net loss attributable to noncontrolling interest	(12)	—	(12)
Net loss attributable to Huazhu Group Limited	(847)	(1,345)	(2,192)
Income tax expense (benefit)	151	(366)	(215)
Interest income	118	1	119
Interest expense	427	106	533
Depreciation and amortization	1,123	239	1,362
EBITDA (Non-GAAP)	736	(1,367)	(631)

The following table presents total assets for operating segments, reconciled to consolidated amounts:


	Legacy Huazhu	Legacy DH	Total
Total assets	46,243	18,912	65,155

The following tables represent revenues and property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill by geographical region.

Revenues:


China		8,647
Germany		1,212
All others		337
Total		10,196

Property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill:


China		30,635
Germany		15,670
All others		2,544
Total		48,849

Other than China and Germany, there were no countries that individually represented more than 10% of the total revenue and certain long lived assets for the year ended and as of December 31, 2020.

Treasury shares

Recently Issued Accounting Pronouncements

Adopted Accounting Standards

Accounting Standards Not Yet Adopted

Translation into United States Dollars

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2020

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES

Schedule of expected useful lives of property and equipment


Leasehold improvements		Shorter of the lease term or their estimated useful lives
Buildings		20-40 years
Furniture, fixtures and equipment		1-20 years
Motor vehicles		5 years

Schedule of estimated useful lives of intangible assets

Franchise or manachise agreements		Remaining contract terms from 10 to 20 years
Non-compete agreements		2 - 10 years based on specified non-compete period
Favorable lease agreements acquired before the adoption of ASC 842		Remaining lease terms from 1 to 20 years
Purchased software		3 - 10 years based on the estimated usage period
Unfavorable lease agreements		Remaining lease terms from 3 to 13 years
Other intangible assets including trademark, licenses and other rights		2 - 15 years based on the contractual term, the length of license agreements and the effective terms of other legal rights

Schedule of information about inputs into the fair value measurements of the assets and liabilities that are measured at fair value on a recurring basis in periods subsequent to their initial recognition


			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active		Significant
			Markets for Identical	Significant Other	Unobservable
As of			Assets	Observable Inputs	Inputs
December 31,	Description	Fair Value	(Level 1)	(Level 2)	(Level 3)
2019	Equity securities with readily determinable fair value	2,908	2,908	—	—
2019	Available-for-sale debt securities	220	—	220	—
2020	Equity securities with readily determinable fair value	3,903	3,903	—	—
2020	Available-for-sale debt securities	220	—	220	—
2020	Employee benefit plan assets	6	6	—	—

Schedule of assets measured at fair value on a non-recurring basis


			Fair Value Measurements at Reporting Date Using
			Quoted Prices
			in Active	Significant
			Markets for	Other	Significant
		Fair Value for	Identical	Observable	Unobservable	Total
Years Ended		Years Ended	Assets	Inputs	Inputs	Loss for
December 31,	Description	December 31	(Level 1)	(Level 2)	(Level 3)	the Year
2018	Property and equipment	10	—	—	10	35
2019	Property and equipment	—	—	—	—	3
2019	Long-term investment	—	—	—	—	10
2020	Property and equipment	2	—	—	2	41
2020	Operating lease right-of-use assets	71	—	—	71	139
2020	Long-term investment	—	—	—	—	92
2020	Goodwill	2,328	—	—	2,328	437

Schedule of share-based compensation expense recognized


	Years Ended December 31,
	2018	2019	2020
Hotel operating costs	27	35	42
Selling and marketing expenses	3	3	4
General and administrative expenses	53	72	76
Total	83	110	122

Reconciliation of Revenue from Segments to Consolidated [Table Text Block]


	Legacy Huazhu	Legacy DH	Total

Total revenues	8,664	1,532	10,196
Operating costs and expenses	8,978	2,947	11,925
Goodwill impairment loss	—	437	437
Other operating income, net	214	266	480
Interest income	118	1	119
Interest expense	427	106	533
Other (expenses) income, net	(92)	3	(89)
Unrealized (losses) gains from fair value changes of equity securities	(266)	1	(265)
Foreign exchange gain (loss)	176	(1)	175
Loss before income tax	(591)	(1,688)	(2,279)
Income tax expense (benefit)	151	(366)	(215)
(Loss) income from equity method investments	(117)	(23)	(140)
Net loss attributable to noncontrolling interest	(12)	—	(12)
Net loss attributable to Huazhu Group Limited	(847)	(1,345)	(2,192)
Income tax expense (benefit)	151	(366)	(215)
Interest income	118	1	119
Interest expense	427	106	533
Depreciation and amortization	1,123	239	1,362
EBITDA (Non-GAAP)	736	(1,367)	(631)

Summary of total assets for operating segments, reconciled to consolidated amounts


	Legacy Huazhu	Legacy DH	Total
Total assets	46,243	18,912	65,155

Summary of revenues and property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill by geographical region

The following tables represent revenues and property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill by geographical region.

Revenues:


China		8,647
Germany		1,212
All others		337
Total		10,196

Property and equipment, net, intangible assets, net, right-of-use assets, land use rights, net and goodwill:


China		30,635
Germany		15,670
All others		2,544
Total		48,849

ACQUISITIONS (Tables) - Deutsche Hospitality

12 Months Ended

Dec. 31, 2020

Business Acquisition [Line Items]

Summary of unaudited pro forma results of operation


	Period Ended December 31,
	2019	2020
Pro forma total revenue	14,995	10,196

Pro forma net income (loss)

1,780

(2,204)

Schedule of allocation of the purchase price as of the date of acquisition

The allocation of the purchase price as of the date of acquisition is summarized as follows:


		Amortization Period
Current assets	785
Property and equipment, net	586	2-25 years
Operating lease right-of-use assets	8,616	The lease terms
Financing lease right-of-use assets	1,794	Shorter of estimated useful lives of the assets and the lease terms
Franchise or manachise agreements	270	Remaining contract terms
Brand names	3,873	Indefinite-lives
Non-compete agreement	10	2 years
Goodwill	2,694
Deferred tax assets	170
Other non-current assets	280
Operating lease liability, current	(296)
Finance lease liability, current	(21)
Other current liabilities	(784)
Operating lease liability, non-current	(8,553)
Finance lease liability, non-current	(2,166)
Other noncurrent liabilities	(330)
Deferred tax liabilities	(1,304)
Total	5,624

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)

12 Months Ended

Dec. 31, 2020

REVENUE FROM CONTRACTS WITH CUSTOMERS

Schedule of disaggregated revenues

The following tables present the Group’s revenues disaggregated by the nature of the product or service:


	Years Ended December 31,
	2018	2019	2020
Room revenues	6,894	7,057	5,735
Food and beverage revenues	304	351	608
Others	272	310	565
Leased and owned hotels revenue	7,470	7,718	6,908
Initial one-time franchise fee	79	93	110
On-going management and service fees	983	1,228	1,057
Central reservation system usage fees, other system maintenance and support fees	630	908	908
Reimbursements for hotel manager fees	455	581	657
Other fees	380	532	404
Manachised and franchised hotels revenue	2,527	3,342	3,136
Other revenues	66	152	152
Total revenues	10,063	11,212	10,196

Schedule of contract balances

The Group’s contract assets are insignificant at December 31, 2019 and 2020.


	As of December 31,
	2019	2020
Current contract liabilities	1,179	1,272
Long-term contract liabilities	559	662
Total contract liabilities	1,738	1,934

The contract liabilities balances above which are classified as deferred revenue on the consolidated balance sheet, as of December 31, 2019 and 2020 were comprised of the following:


	As of December 31,
	2019	2020
Initial fees received from franchisees owners	869	924
Cash received for membership fees and not recognized as revenue	400	430
Advances received from customers	412	529
Deferred revenue related to the loyalty program	57	51
Total	1,738	1,934

PROPERTY AND EQUIPMENT, NET (Tables)

12 Months Ended

Dec. 31, 2020

PROPERTY AND EQUIPMENT, NET

Schedule of property and equipment, net

Property and equipment, net consist of the following:


	As of December 31,
	2019	2020
Cost:
Buildings	247	247
Leasehold improvements	8,414	9,542
Furniture, fixtures and equipment	1,270	2,008
Motor vehicles	1	1
	9,932	11,798
Less: Accumulated depreciation	(4,918)	(5,764)
	5,014	6,034
Construction in progress	840	648
Property and equipment, net	5,854	6,682

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE (Tables)

12 Months Ended

Dec. 31, 2020

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE

Schedule of intangible assets with indefinite life

Intangible assets, net consist of the following:


	As of December 31,
	2019	2020
Intangible assets with indefinite lives:
Brand names (Note 3)	1,340	5,319
Master brand agreement	192	192
Intangible assets with definite lives:
Franchise or manachise agreements	95	356
Favorable lease agreements from sublease	13	12
Purchased software	72	108
Other intangible assets	20	70
Total	1,732	6,057
Less: Accumulated amortization	(70)	(112)
Total	1,662	5,945

Schedule of annual estimated amortization expense for intangible assets and unfavorable lease excluding brand name and master brand agreement

The annual estimated amortization expense for the above intangible assets excluding brand name and master brand agreement for the following years is as follows:


		Amortization for Intangible Assets
2021		43
2022		36
2023		34
2024		31
2025		30
Thereafter		260
Total		434

INVESTMENTS (Tables)

12 Months Ended

Dec. 31, 2020

INVESTMENTS.

Schedule of investments


	As of December 31,
	2019	2020
Equity securities with readily determinable fair values:
Accor	2,770	3,849
Other marketable securities	138	54
Equity securities without readily determinable fair values:
Cjia/Cjia Group	232	183
OYO	66	66
Other equity securities without readily determinable fair values	100	72
Equity-method investments:
AAPC LUB	469	490
Hotel related funds	507	476
China Hospitality JV	115	103
Zleep	—	88
Other investments	220	225
Available-for-sale debt securities:
Cjia/Cjia Group	220	220
Total	4,837	5,826

GOODWILL (Tables)

12 Months Ended

Dec. 31, 2020

GOODWILL.

Schedule of changes in the carrying amount of goodwill


	Gross	Accumulated	Net
	Amount	Impairment Loss	Amount
Balance at January 1, 2019	2,634	(4)	2,630
Increase in goodwill related to acquisitions	27	—	27
Balance at December 31, 2019	2,661	(4)	2,657
Increase in goodwill related to acquisitions	2,697	—	2,697
Impairment losses recognized	—	(437)	(437)
Net foreign exchange	74	(3)	71
Balance at December 31, 2020	5,432	(444)	4,988


	Legacy	Legacy
	Huazhu⁽¹⁾	DH⁽²⁾	Total
Goodwill as of December 31, 2019	2,657	—	2,657
Goodwill as of December 31, 2020	2,660	2,328	4,988

DEBT (Tables)

12 Months Ended

Dec. 31, 2020

DEBT

Schedule of short-term and long-term debt

The short-term and long-term debt as of December 31, 2019 and 2020 were as follows:


	As of December 31,
	2019	2020
Short-term debt:
Long-term bank borrowings, current portion	3,953	251
Short-term bank borrowings	1,256	851
Convertible senior notes, current portion	3,290	—
FF&E liability, current portion	—	40
Total	8,499	1,142

Long-term debt:
Long-term bank borrowings, non-current portion	8,084	4,384
Convertible senior notes, non-current portion	—	6,318
FF&E liability, non-current portion	—	135
Others	—	19
Total	8,084	10,856

Schedule of contractual maturities of the group's long-term debt

The contractual maturities of the Group’s debt as of December 31, 2020 were as follows:


Year Ending December 31,		Principle Amounts
2021		1,142
2022		6,985
2023		396
2024		3,505
2025		51
Thereafter		54
Total		12,133

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2020

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Schedule of accrued expenses and other current liabilities


	As of December 31,
	2019	2020
Payable to franchisees	1,028	1,349
Other payables	410	535
Accrued rental, utilities and other accrued expenses	133	245
Liabilities related to customer loyalty program	110	111
Value-added tax, other tax and surcharge payables	90	124
Payable to noncontrolling interest holders	85	76
Total	1,856	2,440

HOTEL OPERATING COSTS (Tables)

12 Months Ended

Dec. 31, 2020

HOTEL OPERATING COSTS.

Schedule of hotel operating costs


	Years Ended December 31,
	2018	2019	2020
Rents	2,406	2,624	3,485
Utilities	399	404	478
Personnel costs	1,663	1,854	2,501
Depreciation and amortization	869	960	1,316
Consumable, food and beverage	673	793	885
Others	466	555	1,064
Total	6,476	7,190	9,729

PRE-OPENING EXPENSES (Tables)

12 Months Ended

Dec. 31, 2020

PRE-OPENING EXPENSES

Schedule of pre-opening expenses incurred during the hotel pre-opening period


	Years Ended December 31,
	2018	2019	2020
Rents	221	460	251
Personnel costs	18	14	15
Others	16	28	22
Total	255	502	288

SHARE-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2020

SHARE-BASED COMPENSATION

Summary of the Group's share option activity under the option plans


			Weighted Average
	Number of	Weighted Average	Remaining	Aggregate Intrinsic
	Options	Exercise Price	Contractual Life	Value
		US$	Years	US$'million
Share options outstanding at January 1, 2020	47,632	4.95
Forfeited	(1,000)	1.53
Exercised	(46,632)	5.03
Share options outstanding at December 31, 2020	—		—	—
Share options vested or expected to vest at December 31, 2020	—		—	—
Share options exercisable at December 31, 2020	—		—	—

Summary of the Group's nonvested restricted stock activity



		Weighted Average Grant
	Number of Restricted	Date
	Stocks	Fair Value
		US$
Nonvested restricted stocks outstanding at January 1, 2020	10,245,390	9.87
Granted	493,407	32.74
Forfeited	(1,671,111)	8.45
Vested	(1,407,675)	11.41
Adjusted for performance conditions	(564,603)	5.93
Nonvested restricted stocks outstanding at December 31, 2020	7,095,408	11.80

EARNINGS (LOSSES) PER SHARE (Tables)

12 Months Ended

Dec. 31, 2020

EARNINGS (LOSSES) PER SHARE

Schedule of computation of basic and diluted earnings per share


	Years Ended December 31,
	2018	2019	2020
Net income (loss) attributable to ordinary shareholders — basic	716	1,769	(2,192)
Eliminate the dilutive effect of interest expense of convertible senior notes	40	40	—
Net income attributable to ordinary shareholders — diluted	756	1,809	(2,192)
Weighted average ordinary shares outstanding — basic	281,717,485	284,305,138	292,739,841
Incremental weighted-average ordinary shares from assumed exercise of share options and nonvested restricted stocks using the treasury stock method	11,463,212	9,397,527	—
Dilutive effect of convertible senior notes	10,425,112	10,607,225	—
Weighted average ordinary shares outstanding — diluted	303,605,809	304,309,890	292,739,841
Basic earnings (losses) per share	2.54	6.22	(7.49)
Diluted earnings (losses) per share	2.49	5.94	(7.49)

Schedule of outstanding securities excluded from the computation of diluted earnings per share


	Years Ended December 31,
	2018	2019	2020
Outstanding employee options and nonvested restricted stocks	530,009	—	7,095,408
Shares of convertible senior notes	—	—	18,327,489
Total	530,009	—	25,422,897

LEASES (Tables)

12 Months Ended

Dec. 31, 2020

LEASES

Summary of supplemental information related to operating leases


	Years Ended December 31,
	2019		2020
Lease cost:
Operating fixed lease cost	3,094		3,964
Finance lease cost	—		—
— Amortization of ROU assets	—		74
— Interest on lease liabilities	—		90
Short term lease cost	0		0
Variable lease cost	10		(171)
Total lease cost	3,104		3,957

Other information:
Weighted average remaining lease term
Operating leases	11 years		14 years
Finance leases	—		29 years
Weighted average discount rate
Operating leases	7.34	%	6.23	%
Finance leases	—		3.96	%

Schedule of maturities of lease liabilities

As of December 31, 2020, the maturities of lease liabilities in accordance with ASC 842 in each of the next five years and thereafter are as follows:


Year Ending December 31,	Total Operating Leases	Total Finance Leases
2021	3,858	129
2022	3,826	144
2023	3,733	146
2024	3,660	147
2025	3,466	147
Thereafter	25,730	3,575

Total minimum lease payments	44,273	4,288

Less: amount representing interest	(13,819)	(1,760)

Present value of minimum lease payments	30,454	2,528

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

INCOME TAXES

Summary of income (loss) before income taxes


	Years Ended December 31,
	2018	2019	2020
PRC including Hong Kong and Taiwan	1,583	2,334	(392)
Germany	—	—	(1,606)
Other	(190)	231	(281)
Total	1,393	2,565	(2,279)

Schedule of tax expense (benefit)


	Years Ended December 31,
	2018	2019	2020
Current Tax	660	678	338
Deferred Tax	(91)	(38)	(553)
Total	569	640	(215)

Schedule of a reconciliation between the effective income tax rate and PRC statutory income tax rate


	Years Ended December 31,
	2018		2019		2020
PRC statutory tax rate	25	%	25	%	25	%
Tax effect of non-deductible expenses and non-taxable income in determining taxable profit	15	%	(3)	%	(6)	%
Effect of different tax rate of group entities operating in other jurisdictions	4	%	1	%	(2)	%
Effect of change in valuation allowance	(1)	%	2	%	(10)	%
Effect of tax holiday	(3)	%	(2)	%	1	%
Effect of cash dividends	5	%	4	%	0	%
Effect of disposal of subsidiary	1	%	—		—
Effect of excess tax benefit of rewards	(5)	%	(2)	%	1	%
Effective tax rate	41	%	25	%	9	%

Schedule of the aggregate amount and per share effect of the tax holidays


	Years Ended December 31,
	2018	2019	2020
Aggregate amount	31	45	31
Per share effect—basic	0.11	0.16	0.11
Per share effect—diluted	0.10	0.15	0.11

Schedule of the principal components of the Group's deferred income tax assets and liabilities


	As of December 31,
	2019	2020
Deferred tax assets:
Net loss carryforward	243	888
Deferred revenue	260	283
Long-term assets	125	388
Bad debt provision	7	18
Accrued payroll	23	69
Other accrued expenses	19	3
Share-based compensation	23	31
Others	0	12
Valuation allowance	(152)	(369)
Total deferred tax assets, net of valuation allowance	548	1,323
Deferred tax liabilities:
Fair value adjustment for Building, land use rights and identified intangible assets due to acquisition	449	1,782
Others	42	99
Total deferred tax liabilities	491	1,881
Net deferred tax assets (liabilities)	57	(558)
Analysis as:
Deferred tax assets	548	623
Deferred tax liabilities	491	1,181
Net deferred tax assets (liabilities)	57	(558)

Summary of movement of the valuation allowance


	Years Ended December 31,
	2018	2019	2020
Balance at the beginning of the year	(123)	(107)	(152)
Provided	(36)	(79)	(249)
Reversed	43	24	32
Written off	9	10	—
Balance at the end of the year	(107)	(152)	(369)

Schedule of unrecognized tax benefits

EMPLOYEE BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2020

EMPLOYEE BENEFIT PLANS

Schedule of projected benefit obligation, fair value of plan assets, funded status and accumulated benefit obligation for the plans


Change in Projected Benefit Obligation:		Year Ended December 31, 2020
Begin of the year		147
Current service cost		5
Interest cost		1
Contributions by plan participants		1
Actuarial loss (gain)		38
Foreign currency translation		3
Benefits paid		(7)
Settlements		(1)
Administrative Expenses, Taxes and Premiums Paid		0
Curtailments		(1)
Effect of other economic events		7
End of the year		193


		Year Ended December 31, 2020
Change in Plan Assets:
Begin of the year		32
Actual return (loss) on plan assets		(2)
Foreign currency translation		1
Employer contributions		9
Employee contributions		1
Benefits paid		(8)
Other economic events		(27)
End of the year		6
Excess of defined benefit obligation over the fair value of plan assets		187
Accumulated benefit obligation		193

Schedule of amounts recognized in the consolidated balance sheets


		As of December 31, 2020
Salary and welfare payables		8
Retirement benefit obligation		179
Liability in the balance sheet		187

Schedule of principal actuarial assumptions


	As of December 31, 2020
Discount rate- Germany	0.33	%
Discount rate- other	0.12	%
Inflation rate	1.00	%
Future salary increases	1.50	%
Future pension increases	1.80	%

Schedule of fair value hierarchy of total plan assets measured at fair value by asset category


		As of December 31, 2020
Level 1
Equity funds		1
Bond funds		2
Property		2
Other		1
Total		6

RELATED PARTY TRANSACTIONS AND BALANCES (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of related parties


Related Party	Nature of the Party	Relationship with the Group
Trip.com Group Limited (“Trip.com”)	Online travel services provider	Mr. Qi Ji is a director
Sheen Star Group Limited (“Sheen Star”)	Investment holding company	Equity method investee of the Group, controlled by Mr. Qi Ji
Accor Hotels (“Accor”)	Hotel Group	Shareholder of the Group
China Cjia Group Limited (“Cjia Group”)	Apartment Management Group	Equity method investee of the Group
Shanghai CREATER Industrial Co., Ltd. (“CREATER”)	Staged office space company	Equity method investee of the Group
Shanghai Zhuchuang Enterprise Management Co., Ltd. (“Zhuchuang”)	Staged office space company	Equity method investee of the Group
China Hospitality JV, Ltd. (“China Hospitality JV”)	Property management company	Equity method investee of the Group
Smart Lodging Group (Cayman) Limited(“Smart Lodging”)	Hotel chain	Equity method investee of the Group
Shanghai Lianquan Hotel Management Co., Ltd. (“Lianquan”)	Hotel management company	Equity method investee of the Group
Suzhou Huali Jinshi Construction Decoration Co., Ltd. ("Huali Jinshi")	Building decoration company	Equity method investee of the Group

Schedule of amounts due from related parties


	As of December 31,
	2019	2020
Sheen Star	52	52
Zhuchuang	27	27
Trip.com	16	22
Cjia Group	16	22
Accor	1	1
Lianquan	50	58
Others	20	14
Allowance for expected credit losses	—	(18)
Total	182	178

Schedule of amounts due to related party


	As of December 31,
	2019	2020
Trip.com	33	48
China Hospitality JV	25	—
Accor	11	8
Cjia Group	17	42
Huali Jinshi	9	29
Others	0	5
Total	95	132

Schedule of significant related party transactions


	Years Ended December 31,
	2018	2019	2020
Commission expenses to Trip.com	61	72	78
Lease expenses to Trip.com	18	18	18
Brand use fee, reservation fee and other related service fee to Accor	18	28	17
Marketing and training fee from Trip.com	12	41	66
Service fee from Accor	14	9	3
Service fee from China Hospitality JV	10	6	1
Service fee from Sheen Star	2	4	4
Goods sold and service provided to Cjia Group	30	21	18
Sublease income from Cjia Group	—	14	9
Service fee to Cjia Group	—	6	17
Early termination compensation of sublease to Cjia Group	—	—	8
Early termination compensation of franchise agreement from China Hospitality JV	—	—	26
Purchase of property and equipment from Cjia Group	—	—	11
Service fee to Huali Jinshi	1	99	41
Sublease income from Lianquan	—	7	12
Interest income from Sheen Star	—	8	1
Interest income from CREATER	10	6	—
Loan from Cjia Group	103	—	—
Loan payment to Smart Lodging	—	30	—
Loan payment to Lianquan	—	32	—

ORGANIZATION AND PRINCIPAL ACTIVITIES (Details) ¥ in Millions, $ in Millions	1 Months Ended	12 Months Ended
	Sep. 30, 2020 CNY (¥)	Dec. 31, 2020 CNY (¥) item	Dec. 31, 2020 USD ($) item	Jan. 02, 2020	Dec. 31, 2019 item
Organization and presentation activities
Proceeds from issuance of ordinary shares in Hong Kong public offering	¥ 6,018	¥ 6,018	$ 922
legacy Huazhu \| Minimum
Organization and presentation activities
Term of franchise and management agreement		8 years	8 years
legacy Huazhu \| Maximum
Organization and presentation activities
Term of franchise and management agreement		10 years	10 years
Leased and owned hotels
Organization and presentation activities
Number of hotels		753	753		688
Manachised hotels
Organization and presentation activities
Number of hotels		5,746	5,746		4,519
Manachised hotels \| legacy DH \| Minimum
Organization and presentation activities
Term of franchise and management agreement		15 years	15 years
Manachised hotels \| legacy DH \| Maximum
Organization and presentation activities
Term of franchise and management agreement		20 years	20 years
Franchised hotels
Organization and presentation activities
Number of hotels		290	290		411
Franchised hotels \| legacy DH \| Minimum
Organization and presentation activities
Term of franchise and management agreement		10 years	10 years
Franchised hotels \| legacy DH \| Maximum
Organization and presentation activities
Term of franchise and management agreement		15 years	15 years
Deutsche Hospitality
Organization and presentation activities
Percent of ownership acquired (as percent)				100.00%

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Variable Interest Entities (Details) - item	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
VIEs
Variable Interest Entities
Number of entities consolidated	8	8

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Investments, Loan receivables and Inventories (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Investments
Impairment loss	¥ 92	¥ 10	¥ 0
Inventories
Estimated useful life of small appliances and bedding	1 year
Minimum \| Certain franchisees
Loan receivables
Term of loan agreement	2 years
Interest rate (as a percent)	8.00%
Minimum \| Un-related third-parties
Loan receivables
Interest rate (as a percent)	4.80%
Maximum \| Certain franchisees
Loan receivables
Term of loan agreement	3 years
Interest rate (as a percent)	8.50%
Maximum \| Un-related third-parties
Loan receivables
Interest rate (as a percent)	15.00%

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Property and equipment, net (Details)	12 Months Ended
	Dec. 31, 2020
Leasehold improvements
Property and equipment, net
Property and equipment, estimated useful life	Shorter of the lease term or their estimated useful lives
Buildings \| Minimum
Property and equipment, net
Property and equipment, estimated useful life	20 years
Buildings \| Maximum
Property and equipment, net
Property and equipment, estimated useful life	40 years
Furniture, fixtures and equipment \| Minimum
Property and equipment, net
Property and equipment, estimated useful life	1 year
Furniture, fixtures and equipment \| Maximum
Property and equipment, net
Property and equipment, estimated useful life	20 years
Motor vehicles
Property and equipment, net
Property and equipment, estimated useful life	5 years

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Intangible assets (Details) ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) item	Dec. 31, 2020 USD ($) item	Nov. 30, 2020 CNY (¥)
Finite-Lived Intangible Assets [Line Items]
Franchise fee reduction offered to franchisee to since the COVID-19 outbreak	¥ 132
legacy DH
Finite-Lived Intangible Assets [Line Items]
Fair value exceeded carrying value	¥ 244
Percentage of fair value exceeded the carrying value	6.00%
Hypothetical decline in projected cash flow (as a percent)	5.00%
Short term work compensation	¥ 244
Other Operating Income \| legacy DH
Finite-Lived Intangible Assets [Line Items]
Other grants recognized	¥ 17
Master brand agreement
Finite-Lived Intangible Assets [Line Items]
Initial term	70 years	70 years
Deutsche Hospitality
Finite-Lived Intangible Assets [Line Items]
Hypothetical increase in discount rate	5.00%
Hypothetical decrease in royalty saving rate	5.00%
Impairment loss recognized \| $		$ 0
Deutsche Hospitality \| legacy DH
Finite-Lived Intangible Assets [Line Items]
Hypothetical goodwill impairment in 5% decline in projected cash flow			¥ 42
Hypothetical goodwill impairment in 5% increase in discount rate	¥ 175
Deutsche Hospitality \| Brand names
Finite-Lived Intangible Assets [Line Items]
Number of brand names acquired \| item	3	3
Deutsche Hospitality \| Brand name, one
Finite-Lived Intangible Assets [Line Items]
Fair value exceeded carrying value	¥ 190
Percentage of fair value exceeded the carrying value	7.00%
Hypothetical indefinite life intangible asset impairment in 5% increase in discount rate	¥ 178
Hypothetical indefinite life intangible asset impairment in 5% decrease in royalty saving rate	151
Deutsche Hospitality \| Brand name, two
Finite-Lived Intangible Assets [Line Items]
Fair value exceeded carrying value	¥ 61
Percentage of fair value exceeded the carrying value	9.00%
Hypothetical indefinite life intangible asset impairment in 5% increase in discount rate	¥ 45
Hypothetical indefinite life intangible asset impairment in 5% decrease in royalty saving rate	38
Deutsche Hospitality \| Brand name, three
Finite-Lived Intangible Assets [Line Items]
Fair value exceeded carrying value	¥ 184
Percentage of fair value exceeded the carrying value	42.00%
Hypothetical indefinite life intangible asset impairment in 5% increase in discount rate	¥ 38
Hypothetical indefinite life intangible asset impairment in 5% decrease in royalty saving rate	¥ 31
Minimum \| Manachised and franchised hotels agreements
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	10 years	10 years
Minimum \| Non-compete agreement
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	2 years	2 years
Minimum \| Favorable lease agreements
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	1 year	1 year
Minimum \| Purchased software
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	3 years	3 years
Minimum \| Unfavorable lease agreements
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	3 years	3 years
Minimum \| Other intangible assets
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	2 years	2 years
Maximum \| Manachised and franchised hotels agreements
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	20 years	20 years
Maximum \| Non-compete agreement
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	10 years	10 years
Maximum \| Favorable lease agreements
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	20 years	20 years
Maximum \| Purchased software
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	10 years	10 years
Maximum \| Unfavorable lease agreements
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	13 years	13 years
Maximum \| Other intangible assets
Finite-Lived Intangible Assets [Line Items]
Remaining contract terms	15 years	15 years

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Land use rights (Details) € in Millions, ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) item	Dec. 31, 2019 CNY (¥) item	Dec. 31, 2018 CNY (¥)	Apr. 17, 2020 EUR (€)	Dec. 31, 2019 EUR (€)	Dec. 31, 2019 CNY (¥)
Accounting policies
Amortization expense	¥ 62	¥ 16	¥ 39
Long-lived asset impairment loss	¥ 180	¥ 3	35
Number of reporting units \| item	2	1
Contract liabilities	¥ 1,934					¥ 1,738
Net revenues	10,196	¥ 11,212	10,063
Advertising related expenses	150	99	103
Other Operating Income \| legacy Huazhu
Accounting policies
Unrestricted government subsidies from local governmental agencies	154	148	106
Hotel related funds
Accounting policies
Investments in funds	476					¥ 507
Term Facility Expiring December 2022
Accounting policies
Line of Credit Facility, Maximum Borrowing Capacity \| €				€ 440	€ 440
Loyalty program
Accounting policies
Net revenues	223	224	192
Land use rights
Accounting policies
Amortization expense	¥ 7	¥ 8	¥ 5
Minimum
Accounting policies
Estimated membership duration	2 years
VAT (as a percent)	6.00%
Minimum \| legacy Huazhu
Accounting policies
Initial lease term	10 years
Minimum \| legacy DH
Accounting policies
Initial lease term	20 years
Minimum \| Land use rights
Accounting policies
Remaining contractual term	30 years
Maximum
Accounting policies
Estimated membership duration	5 years
VAT (as a percent)	19.00%
Maximum \| legacy Huazhu
Accounting policies
Initial lease term	20 years
Maximum \| legacy DH
Accounting policies
Initial lease term	25 years
Maximum \| Land use rights
Accounting policies
Remaining contractual term	50 years

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Fair value (Details) ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥) USD ($)	Dec. 31, 2018 CNY (¥) USD ($)	Dec. 31, 2020 USD ($)
Fair value
Equity securities with readily determinable fair value	¥ 3,903		¥ 2,908		$ 598,000,000
Retirement benefit obligation	179				27,000,000
Property and equipment - Total Loss for the Year	180		3	¥ 35
Operating lease right-of-use assets	28,980		20,875		4,441,000,000
Goodwill	4,988		2,657	2,630	$ 764,000,000
Goodwill, Impairment Loss	437	$ 67,000,000	0	0
Property and equipment, impairment loss	41		3	35
Impairment loss of investment	92		10	0
Operating lease right-of-use assets	139
Long-lived asset impairment loss	180		3	35
Operating Lease, Impairment Loss	139		0	0
Leased hotels
Fair value
Property and equipment - Total Loss for the Year			3	35
Property and equipment, impairment loss	41
Long-lived asset impairment loss			3	35
Convertible senior notes
Fair value
Long-term bank borrowings, current portion			3,290
Carrying amounts of convertible senior notes	6,318		3,290	3,209
Fair value of convertible senior notes	7,747		3,711	3,185
Recurring basis \| Level 1
Fair value
Equity securities with readily determinable fair value	3,903		2,908
Retirement benefit obligation	6
Recurring basis \| Significant Other Observable Inputs (Level 2)
Fair value
Available-for-sale debt securities	220		¥ 220
Non-recurring basis
Fair value
Property and equipment	2			10
Operating lease right-of-use assets	71
Goodwill	2,328
Non-recurring basis \| Significant Unobservable Inputs (Level 3)
Fair value
Property and equipment	2			¥ 10
Operating lease right-of-use assets	71
Goodwill	¥ 2,328
Revenue growth rate \| Minimum
Fair value
Measurement input \| $			(15)	(15)	(15)
Revenue growth rate \| Maximum
Fair value
Measurement input	4		4	4	4
Discount rate \| Minimum
Fair value
Measurement input	8.64		8.64	8.64	8.64
Discount rate \| Maximum
Fair value
Measurement input	20				20
Fair value \| Recurring basis
Fair value
Equity securities with readily determinable fair value	¥ 3,903		¥ 2,908
Available-for-sale debt securities	220		220
Retirement benefit obligation	6
Carrying value \| Non-recurring basis
Fair value
Long-term investments	92		10	¥ 0
Operating lease right-of-use assets	210		0	0
Goodwill	2,768		0	0
Carrying value \| Non-recurring basis \| Leased hotels
Fair value
Property and equipment	¥ 43		¥ 3	¥ 45

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Share-based compensation and Treasury shares (Details) ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) segment shares	Dec. 31, 2019 CNY (¥) shares	Dec. 31, 2018 CNY (¥)
Share-based compensation
Recognized share-based compensation expenses	¥ 122	¥ 110	¥ 83
Number of operating segments \| segment	2
Treasury shares
Repurchase of ordinary shares (in shares) \| shares	3,096,764	3,096,764
Cash consideration paid for ordinary shares repurchased	¥ 107
Hotel operating costs
Share-based compensation
Recognized share-based compensation expenses	42	¥ 35	27
Selling and marketing expenses
Share-based compensation
Recognized share-based compensation expenses	4	3	3
General and administrative expenses
Share-based compensation
Recognized share-based compensation expenses	¥ 76	¥ 72	¥ 53

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Segment and geography information (Details) ¥ in Millions, $ in Millions	3 Months Ended	12 Months Ended
	Sep. 30, 2020 CNY (¥)	Dec. 31, 2020 CNY (¥) segment	Dec. 31, 2020 USD ($) segment	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Segment Reporting, Revenue Reconciling Item [Line Items]
Number of operating segments \| segment		2	2
Number of reportable segments \| segment		2	2
Total revenues		¥ 10,196	$ 1,563	¥ 11,212	¥ 10,063
Operating costs and expenses		11,925	1,827	9,236	7,945
Goodwill impairment loss		437	67	0	0
Other operating income, net		480	74	132	226
Interest income		119	18	160	148
Interest expense		533	82	315	244
Other (expenses) income, net		(89)	(14)	331	203
Unrealized (loss) gain from fair value changes of equity securities		(265)	(42)	316	(914)
Foreign exchange gain (loss)		175	27	(35)	(144)
Income (loss) before income taxes		(2,279)	(350)	2,565	1,393
Income tax expense (benefit)		(215)	(33)	640	569
(Loss) income from equity method investments		(140)	(21)	(164)	(97)
Net loss attributable to noncontrolling interest		(12)	(2)	(8)	11
Net income (loss) attributable to Huazhu Group Limited		(2,192)	(336)	1,769	716
Income tax expense (benefit)		(215)	(33)	640	569
Interest expense		533	82	315	244
Depreciation and amortization		1,362	$ 208	¥ 991	¥ 891
EBITDA (Non-GAAP)		(631)
legacy Huazhu
Segment Reporting, Revenue Reconciling Item [Line Items]
Total revenues		8,664
Operating costs and expenses		8,978
Other operating income, net		214
Interest income		118
Interest expense		427
Other (expenses) income, net		(92)
Unrealized (loss) gain from fair value changes of equity securities		(266)
Foreign exchange gain (loss)		176
Income (loss) before income taxes		(591)
Income tax expense (benefit)		151
(Loss) income from equity method investments		(117)
Net loss attributable to noncontrolling interest		(12)
Net income (loss) attributable to Huazhu Group Limited		(847)
Income tax expense (benefit)		151
Interest expense		427
Depreciation and amortization		1,123
EBITDA (Non-GAAP)		736
legacy DH
Segment Reporting, Revenue Reconciling Item [Line Items]
Total revenues		1,532
Operating costs and expenses		2,947
Goodwill impairment loss	¥ 437	437
Other operating income, net		266
Interest income		1
Interest expense		106
Other (expenses) income, net		3
Unrealized (loss) gain from fair value changes of equity securities		1
Foreign exchange gain (loss)		(1)
Income (loss) before income taxes		(1,688)
Income tax expense (benefit)		(366)
(Loss) income from equity method investments		(23)
Net income (loss) attributable to Huazhu Group Limited		(1,345)
Income tax expense (benefit)		(366)
Interest expense		106
Depreciation and amortization		239
EBITDA (Non-GAAP)		¥ (1,367)

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Segment and geography information -2 (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
Segment Reporting Information [Line Items]
Total assets	¥ 65,155	$ 9,985	¥ 52,983
Total liabilities	53,723	$ 8,233	¥ 45,483
legacy Huazhu
Segment Reporting Information [Line Items]
Total assets	46,243
legacy DH
Segment Reporting Information [Line Items]
Total assets	¥ 18,912

- Definition

Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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+ Details

- Definition

Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Segment and geography information -3 (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	¥ 10,196	$ 1,563	¥ 11,212	¥ 10,063
Long-Lived Assets	48,849
China
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	8,647
Long-Lived Assets	30,635
GERMANY
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	1,212
Long-Lived Assets	15,670
Others
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	337
Long-Lived Assets	¥ 2,544

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

SUMMARY OF PRINCIPAL ACCOUNTING POLICIES - Recently Issued Accounting Pronouncements (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥) ¥ / $	Dec. 31, 2020 USD ($) ¥ / $	Jan. 01, 2020 CNY (¥)	Dec. 31, 2019 CNY (¥)
Recently issued accounting pronouncements
Adjustment to retained earnings	¥ 1,502	$ 230		¥ 3,701
Right-to-use assets	28,980	$ 4,441		20,875
Lease liabilities	¥ 30,454			¥ 22,055
Translation into United States Dollars
Foreign exchange rate used to translate amounts denominated in RMB to US dollar \| ¥ / $	6.5250	6.5250
ASU 2016-13 \| Restatement
Recently issued accounting pronouncements
Adjustment to retained earnings			¥ 7

ACQUISITIONS - Crystal Orange & Blossom Hotel management (Details) ¥ in Millions, $ in Millions	1 Months Ended		12 Months Ended
	Sep. 30, 2019 CNY (¥)	Aug. 31, 2018 CNY (¥)	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Business acquisition, pro forma information
Cash consideration to noncontrolling interests			¥ 98	$ 16	¥ 39	¥ 84
Blossom Hotel Management
Acquisitions
Percentage of ownership interest acquired		83.00%
Aggregated consideration		¥ 536
Cash consideration		463
Implied fair value of equity interests		¥ 73
Percentage of equity interests transferred		11.00%
Gain on remeasurement		¥ 13
Business acquisition, pro forma information
Percentage of noncontrolling interest acquired	5.00%	11.00%
Cash consideration to noncontrolling interests	¥ 34	¥ 73
Percent of equity interest owned in total			99.00%	99.00%

ACQUISITIONS - Hotels and Companies (Details) - Series of Individually Immaterial Business Acquisitions [Member] ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) item	Dec. 31, 2019 CNY (¥) item	Dec. 31, 2018 CNY (¥) item
Acquisitions
Cash consideration \| ¥	¥ 26	¥ 54	¥ 7
Number of hotels acquired			2
Number of companies acquired	3	3

ACQUISITIONS - Deutsche Hospitality (Details) - Deutsche Hospitality € in Millions			12 Months Ended
	Jan. 02, 2020 EUR (€)	Jan. 02, 2020 CNY (¥)	Dec. 31, 2020 CNY (¥)
Business Acquisition [Line Items]
Percentage of ownership interest acquired	100.00%	100.00%
Number of brands in which entity is operating		5
Aggregated consideration	€ 720	¥ 5,624,000
Net revenue of the acquiree included in the consolidated statements of comprehensive income			¥ 1,532,000,000
Net loss of the acquiree included in the consolidated statements of comprehensive income			¥ 1,345,000,000

ACQUISITIONS - Deutsche Hospitality, Unaudited proforma results of operations (Details) - Deutsche Hospitality - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Pro forma results of operation
Pro forma total revenue	¥ 10,196	¥ 14,995
Pro forma net income (loss)	¥ (2,204)	1,780
Transaction cost		¥ 70

ACQUISITIONS - Deutsche Hospitality, allocation of purchase price (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Goodwill	¥ 4,988	$ 764	¥ 2,657	¥ 2,630
Manachised and franchised hotels agreements \| Minimum
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Estimated useful life of intangible assets	10 years
Manachised and franchised hotels agreements \| Maximum
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Estimated useful life of intangible assets	20 years
Non-compete agreement \| Minimum
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Estimated useful life of intangible assets	2 years
Non-compete agreement \| Maximum
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Estimated useful life of intangible assets	10 years
Deutsche Hospitality
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Current assets	¥ 785
Property and equipment, net	586
Operating lease right-of-use assets	8,616
Financing lease right-of-use assets	1,794
Goodwill	2,694
Deferred tax assets	170
Other non-current assets	280
Operating lease liability, current	(296)
Finance lease liability, current	(21)
Other current liabilities	(784)
Operating lease liability, non-current	(8,553)
Finance lease liability, non-current	(2,166)
Other noncurrent liabilities	(330)
Deferred tax liabilities	(1,304)
Total	¥ 5,624
Deutsche Hospitality \| Minimum
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Estimated useful life of property, plant and equipment	2 years
Deutsche Hospitality \| Maximum
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Estimated useful life of property, plant and equipment	25 years
Deutsche Hospitality \| Manachised Agreement
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Intangible assets, finite life	¥ 270
Deutsche Hospitality \| Non-compete agreement
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Intangible assets, finite life	¥ 10
Estimated useful life of intangible assets	2 years
Deutsche Hospitality \| Brand names
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Intangible assets, Indefinite life	¥ 3,873

REVENUE FROM CONTRACT WITH CUSTOMERS - Disaggregated Revenues (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Disaggregated Revenues
Total revenues	¥ 10,196	¥ 11,212	¥ 10,063
Leased and owned hotels
Disaggregated Revenues
Total revenues	6,908	7,718	7,470
Room Revenues
Disaggregated Revenues
Total revenues	5,735	7,057	6,894
Food and Beverage Revenues
Disaggregated Revenues
Total revenues	608	351	304
Others
Disaggregated Revenues
Total revenues	565	310	272
Manachised and franchised hotels agreements
Disaggregated Revenues
Total revenues	3,136	3,342	2,527
Initial one-time franchise fee
Disaggregated Revenues
Total revenues	110	93	79
On-going management and service fees
Disaggregated Revenues
Total revenues	1,057	1,228	983
Central reservation system usage fees, other system maintenance and support fees
Disaggregated Revenues
Total revenues	908	908	630
Reimbursements for hotel manager fees
Disaggregated Revenues
Total revenues	657	581	455
Other fees
Disaggregated Revenues
Total revenues	404	532	380
Others
Disaggregated Revenues
Total revenues	¥ 152	¥ 152	¥ 66

REVENUE FROM CONTRACT WITH CUSTOMERS - Contract Balances (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
Contract with Customer, Liability [Abstract]
Current contract liabilities	¥ 1,272	$ 195	¥ 1,179
Long-term contract liabilities	662	$ 101	559
Total contract liabilities	¥ 1,934		¥ 1,738

REVENUE FROM CONTRACT WITH CUSTOMERS - Contract Balances - Contract liabilities (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Contract with Customer, Liability
Initial fees received from franchisees owners	¥ 924	¥ 869
Cash received for membership fees and not recognized as revenue	430	400
Advances received from customers	529	412
Deferred revenue related to the loyalty program	51	57
Total contract liabilities	1,934	1,738
Initial fee on pre opening hotels received as current liabilities	429	448
Revenue recognized	¥ 748	¥ 491

REVENUE FROM CONTRACT WITH CUSTOMERS - Contract Balances - Unsatisfied performance obligations (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenues related to unsatisfied performance obligations of loyalty program	¥ 51	¥ 57
Deferred revenue related to initial fees	924	869
Deferred revenue related to membership fees	430	400
Deferred revenues related to advances received from customers, expected to recognize revenue in future periods	¥ 529	¥ 412
Minimum
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining contract period	1 year
Remaining membership life	1 year
Maximum
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining contract period	10 years
Remaining membership life	5 years
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenues related to unsatisfied performance obligations of loyalty program	¥ 51
Deferred revenue, recognized as revenue, estimated period	2 years

PROPERTY AND EQUIPMENT, NET - Schedule (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
Cost:
Property and equipment, gross	¥ 11,798		¥ 9,932
Less: Accumulated depreciation	(5,764)		(4,918)
Property and equipment net excluding construction in process	6,034		5,014
Construction in progress	648		840
Property and equipment, net	6,682	$ 1,024	5,854
Buildings
Cost:
Property and equipment, gross	247		247
Leasehold improvements
Cost:
Property and equipment, gross	9,542		8,414
Furniture, fixtures and equipment
Cost:
Property and equipment, gross	2,008		1,270
Motor vehicles
Cost:
Property and equipment, gross	¥ 1		¥ 1

PROPERTY AND EQUIPMENT, NET - Narrative (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
PROPERTY AND EQUIPMENT, NET
Depreciation expense	¥ 1,219	¥ 967	¥ 847

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE - Schedule (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)	Dec. 31, 2020 USD ($)
Intangible assets, net
Intangible assets, gross	¥ 6,057	¥ 1,732
Less: Accumulated amortization	(112)	(70)
Total	5,945	1,662		$ 911
Unfavorable lease
Amortization expense of intangible assets	62	16	¥ 39
Manachised and franchised hotels agreements
Intangible assets, net
Intangible assets, gross	356	95
Favorable lease agreements
Intangible assets, net
Intangible assets, gross	12	13
Purchased software
Intangible assets, net
Intangible assets, gross	108	72
Other intangible assets
Intangible assets, net
Intangible assets, gross	70	20
Brand names
Intangible assets, net
Intangible assets, gross	5,319	1,340
Master brand agreement
Intangible assets, net
Intangible assets, gross	¥ 192	¥ 192

INTANGIBLE ASSETS, NET AND UNFAVORABLE LEASE - Amortization (Details) ¥ in Millions	Dec. 31, 2020 CNY (¥)
Amortization for Intangible Assets
2021	¥ 43
2022	36
2023	34
2024	31
2025	30
Thereafter	260
Total	¥ 434

INVESTMENTS - Schedule (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
Equity securities with readily determinable fair values:	¥ 3,903	$ 598	¥ 2,908
Investments	5,826		4,837
Accor
Equity securities with readily determinable fair values:	3,849		2,770
Other marketable securities
Equity securities with readily determinable fair values:	54		138
OYO
Equity securities without readily determinable fair values:	66		66
Other equity securities
Equity securities without readily determinable fair values:	72		100
Cjia Group
Equity securities without readily determinable fair values:	183		232
Equity-method investments:	0
Available-for-sale debt securities:	220		220
AAPC LUB
Equity-method investments:	490		469
Hotel related funds
Equity-method investments:	476		507
China Hospitality JV
Equity-method investments:	103		115
Zleep
Equity-method investments:	88
Other investments
Equity-method investments:	¥ 225		¥ 220

INVESTMENTS - Equity securities with readily determinable fair values (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) shares	Dec. 31, 2019 CNY (¥) shares	Dec. 31, 2018 CNY (¥) shares	Dec. 31, 2017 shares	Dec. 31, 2020 USD ($) shares
Equity securities with readily determinable fair values
Equity securities with readily determinable fair value	¥ 3,903	¥ 2,908			$ 598
Accor
Equity securities with readily determinable fair values
Number of ordinary shares acquired \| shares	8,737,987	282,787	10,782,131	2,309,981
Number of ordinary shares sold \| shares	1,003,654	4,904,222
Gain (loss) realized	¥ (21)	¥ 52
Number of shares held in investment \| shares	16,205,010				16,205,010
Unrealized gain from fair value		351
Unrealized losses from fair value	¥ 253
Equity securities with readily determinable fair value	¥ 3,849	2,770
Accor \| Maximum
Equity securities with readily determinable fair values
Investment in equity securities (in percentage)	7.00%				7.00%
Other marketable securities
Equity securities with readily determinable fair values
Unrealized losses from fair value	¥ 12	35	¥ 120
Equity securities with readily determinable fair value	¥ 54	¥ 138

INVESTMENTS - Equity securities without readily determinable fair values (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 CNY (¥)	Dec. 31, 2016 CNY (¥)	Sep. 30, 2017
Investment income (loss)	¥ (140)	$ (21)	¥ (164)	¥ (97)
Covid 19
Impairment of equity securities with out readily determinable fair value	¥ 45
Cjia Group
Equity interest owned (as a percent)	15.00%			17.00%	17.00%		23.00%
Convertible notes term							60 months
Original value of convertible notes invested							¥ 52
Amount invested in convertible note						¥ 200
Gain recognized on deemed disposal			9			¥ 40
Consideration for purchase of investments \| $					$ 45
Investment income (loss)	¥ (49)		¥ (45)	¥ (38)
Equity Method Investments	¥ 0
OYO
Equity interest owned (as a percent)								1.00%

INVESTMENTS - Equity-method investments (Details) ¥ in Millions, $ in Millions	1 Months Ended	12 Months Ended
	Feb. 28, 2019	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)	Dec. 31, 2016
Equity-method investments
Investment income (loss)		¥ (140)	$ (21)	¥ (164)	¥ (97)
Other than Temporary Impairment Losses, Investments		92		10	0
Covid 19 \| Equity-method investments
Equity-method investments
Other than Temporary Impairment Losses, Investments		47
AAPC LUB
Equity-method investments
Investment income (loss)		21		47	43
Proceeds from Dividends Received		0		39	60
Equity Method Investments		490		469
Percentage of equity interest acquired						28.00%
Hotel related funds
Equity-method investments
Investment income (loss)		(16)		11	(28)
Equity Method Investments		476		507
Maximum potential loss, in loss of value of interests in investments		476
China Hospitality JV
Equity-method investments
Investment income (loss)		(12)		(2)	¥ (11)
Equity Method Investments		103		¥ 115
Percentage of equity interest acquired					20.00%
Zleep
Equity-method investments
Investment income (loss)		(23)
Equity Method Investments		¥ 88
Percentage of equity interest acquired	51.00%

GOODWILL (Details) ¥ in Millions, $ in Millions	12 Months Ended
GOODWILL (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Changes in carrying amount of goodwill
Balance at the beginning of the period, Gross Amount	¥ 2,661		¥ 2,634
Balance at the beginning of the period, Accumulated Impairment Loss	(4)		(4)
Balance at the beginning of the period, Net Amount	2,657		2,630
Increase in goodwill related to acquisitions	2,697		27
Impairment losses recognized	437	$ 67	0	¥ 0
Foreign currency translation adjustment, Gross amount	74
Foreign currency translation adjustment, Accumulated Impairment Loss	(3)
Next foreign exchange	71
Balance at the end of the period, Gross Amount	5,432		2,661	2,634
Balance at the end of the period, Accumulated Impairment Loss	(444)		(4)	(4)
Balance at the end of the period, Net Amount	¥ 4,988	$ 764	¥ 2,657	¥ 2,630

GOODWILL - After acquisition of DH (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) item	Dec. 31, 2019 CNY (¥) segment item	Dec. 31, 2020 USD ($)	Dec. 31, 2018 CNY (¥)
Goodwill [Line Items]
Goodwill	¥ 4,988	¥ 2,657	$ 764	¥ 2,630
Gross carrying values	5,432	2,661		2,634
Accumulated impairment losses	¥ 444	¥ 4		¥ 4
Number of reporting units \| item	2	1
legacy Huazhu
Goodwill [Line Items]
Goodwill	¥ 2,660	¥ 2,657
Gross carrying values	2,664	2,661
Accumulated impairment losses	4	¥ 4
Number of reporting units \| segment		1
legacy DH
Goodwill [Line Items]
Goodwill	2,328
Accumulated impairment losses	¥ 440

DEBT - Components (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
DEBT
Short-term Debt	¥ 1,142	$ 175	¥ 8,499
Total	1,142		8,499
Long-term debt, non-current portion	10,856	$ 1,664	8,084
Long-term debt	10,856		8,084
Bank borrowings
DEBT
Long-term debt, current portion	251		3,953
Long-term debt, non-current portion	4,384		8,084
Convertible senior notes
DEBT
Long-term debt, current portion			3,290
Long-term debt, non-current portion	6,318
FF&E liability
DEBT
Long-term debt, current portion	40
Long-term debt, non-current portion	135
Others
DEBT
Long-term debt	19
Bank borrowings
DEBT
Short-term Debt	¥ 851		¥ 1,256

DEBT - Bank borrowings (Details) € in Millions, ¥ in Millions	1 Months Ended		12 Months Ended
	Oct. 31, 2019 USD ($)	Mar. 31, 2019 CNY (¥)	Dec. 31, 2020 EUR (€)	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2019 USD ($)	Dec. 31, 2020 USD ($)	Apr. 17, 2020 EUR (€)	Apr. 17, 2020 USD ($)	Dec. 31, 2019 EUR (€)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2019 USD ($)
Debt
Repayment of line of credit facility							$ 0
Long-term debt \| ¥				¥ 10,856								¥ 8,084
Term facility and revolving credit facility
Debt
Percentage points added to the reference rate						2.00%	2.00%
Weighted average interest rate (as a percent)			2.89%	2.89%	2.89%	2.86%	2.86%
One Year Term Facility
Debt
Term of debt instrument	1 year
Maximum borrowing amount	$ 180,000,000
Fixed interest rate (as a percent)	2.52%
Deposit paid							$ 185,000,000
Credit facility drawn down amount	$ 180,000,000
Repayment of line of credit facility							$ 0
Term Facility Expiring December 2022
Debt
Maximum borrowing amount \| €									€ 440		€ 440
Credit facility drawn down amount			€ 1			¥ 440
Revolving Credit Facility Expiring December 2022
Debt
Term of debt instrument						35 months	35 months
Maximum borrowing amount										$ 500,000,000			$ 500,000,000
Credit facility drawn down amount				¥ 200	$ 700,000,000		$ 500,000,000
Repayment of line of credit facility					$ 500,000,000
Available credit facility								$ 500,000,000
Five Year Term Facility
Debt
Term of debt instrument		5 years
Maximum borrowing amount \| ¥		¥ 1,190		1,190
Repayment of line of credit facility \| ¥				179		¥ 89
Long-term debt \| ¥				¥ 922
Weighted average interest rate (as a percent)			4.75%	4.75%	4.75%	4.75%	4.75%

DEBT - Convertible Senior Notes (Details) $ / shares in Units, ¥ in Thousands					12 Months Ended
	May 12, 2020 CNY (¥)	May 12, 2020 USD ($)	Nov. 03, 2017 CNY (¥)	Nov. 03, 2017 USD ($)	Dec. 31, 2020 CNY (¥) shares	May 12, 2020 USD ($) $ / shares	Nov. 03, 2017 USD ($) $ / shares
Debt Instrument [Line Items]
Amount converted \| ¥					¥ 0
Convertible senior notes \| 2022 Notes
Debt Instrument [Line Items]
Aggregate principal amount \| $							$ 475,000,000
Fixed interest rate (as a percent)			0.375%				0.375%
Initial conversion rate per ADS			5.4869	5.4869
Increment used for debt conversion \| $				$ 1,000
Initial conversion price \| $ / shares							$ 182.25
Repurchase price as a percentage of principal amount			100.00%	100.00%
Proceeds from issuance of debt			¥ 3,093,000	$ 467,000,000
Debt issuance costs			54,000				$ 8,000,000
Amount converted \| ¥					¥ 60
Number of shares converted \| shares					202
Note repurchased \| ¥			¥ 40
Beneficial conversion feature \| ¥					¥ 0
Convertible senior notes \| 2026 Notes
Debt Instrument [Line Items]
Aggregate principal amount \| $						$ 450,000,000
Additional aggregate maximum amount of notes to purchase \| $						$ 50,000,000
Fixed interest rate (as a percent)	3.00%					3.00%
Initial conversion rate per ADS	41.72	41.72
Increment used for debt conversion \| $		$ 1,000
Initial conversion price \| $ / shares						$ 23.971
Repurchase price as a percentage of principal amount	100.00%	100.00%
Proceeds from issuance of debt	¥ 3,499,000	$ 493,000,000
Debt issuance costs	49,000					$ 7,000,000
Beneficial conversion feature \| ¥	¥ 0

DEBT - ADS Lending Arrangement (Details) - ADS Lending Arrangement $ / shares in Units, ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2017 CNY (¥) shares	Dec. 31, 2020 shares	Dec. 31, 2019 shares	Dec. 31, 2018 shares	Dec. 31, 2017 USD ($) $ / shares
Debt Instrument [Line Items]
Number of Loaned ADS lent	2,606,278
ADS par value per share \| $ / shares					$ 0.0004
ADS outstanding		10,425,112	10,425,112	10,425,112
Debt issuance costs	¥ 26				$ 4

DEBT - Capped Call Options (Details) - Call Option ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2019 CNY (¥) $ / item	Dec. 31, 2019 USD ($) $ / item
Debt Instrument [Line Items]
Cap price of the capped call transactions per ADS	221.31	221.31
Premium paid for capped call transactions	¥ 177	$ 27

DEBT - Schedule of contractual maturities of the group's long-term debt (Details) ¥ in Millions	Dec. 31, 2020 CNY (¥)
Contractual maturities
2021	¥ 1,142
2022	6,985
2023	396
2024	3,505
2025	51
Thereafter	54
Total	¥ 12,133

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Payable to franchisees	¥ 1,349		¥ 1,028
Other payables	535		410
Accrued rental, utilities and other accrued expenses	245		133
Liabilities related to customer loyalty program	111		110
Value-added tax, other tax and surcharge payables	124		90
Payable to noncontrolling interest holders	76		85
Total	¥ 2,440	$ 374	¥ 1,856
Additional disclosures
Payable to franchisees, term (in years)	1 year
Payable to noncontrolling interest holders, term (in years)	1 year

HOTEL OPERATING COSTS (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
HOTEL OPERATING COSTS.
Rents	¥ 3,485		¥ 2,624	¥ 2,406
Utilities	478		404	399
Personnel costs	2,501		1,854	1,663
Depreciation and amortization	1,316		960	869
Consumable, food and beverage	885		793	673
Others	1,064		555	466
Total	¥ 9,729	$ 1,491	¥ 7,190	¥ 6,476

PRE-OPENING EXPENSES (Details) ¥ in Millions, $ in Millions	12 Months Ended
PRE-OPENING EXPENSES (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
PRE-OPENING EXPENSES
Rents	¥ 251		¥ 460	¥ 221
Personnel costs	15		14	18
Others	22		28	16
Total	¥ 288	$ 44	¥ 502	¥ 255

SHARE-BASED COMPENSATION - Plan (Details) - shares	12 Months Ended
SHARE-BASED COMPENSATION - Plan (Details) - shares	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Mar. 31, 2015	Aug. 31, 2010	Sep. 30, 2009	Oct. 31, 2008	Jun. 30, 2007	Feb. 28, 2007
Share options
Share based compensation
Granted (in shares)	0	0	0
Incentive Award Plans
Share based compensation
Vesting period	10 years
Incentive Award Plans \| Maximum
Share based compensation
Share-based payment award, contractual term	10 years
Incentive Award Plans \| Share options
Share based compensation
Share-based payment award, option granted (in shares)	24,577,669
Incentive Award Plans \| Restricted stocks
Share based compensation
Share-based payment award, nonvested restricted stocks (in shares)	24,338,385
Incentive Award Plans \| Second anniversary of the stated vesting commencement date
Share based compensation
Share-based payment award, vesting percentage	50.00%
Incentive Award Plans \| Vesting ratably over the following two years
Share based compensation
Share-based payment award, vesting percentage	50.00%
Vesting period	2 years
2007 Global Share Plan
Share based compensation
Share-based payment award, maximum number of incentive award available (in shares)									10,000,000
2008 Global Share Plan
Share based compensation
Share-based payment award, maximum number of incentive award available (in shares)							7,000,000	3,000,000
2009 Global Share Plan
Share based compensation
Share-based payment award, maximum number of incentive award available (in shares)				43,000,000	15,000,000	3,000,000

SHARE-BASED COMPENSATION - Option assumptions and Activity (Details) - Share options ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) shares	Dec. 31, 2020 $ / shares	Dec. 31, 2019 CNY (¥) shares	Dec. 31, 2018 CNY (¥) shares
Number of Options
Share options outstanding at the beginning of the period (in shares) \| shares	47,632
Forfeited (in shares) \| shares	(1,000)
Exercised (in shares) \| shares	(46,632)		(1,088,358)	(876,715)
Share options outstanding at the end of the period (in shares) \| shares			47,632
Weighted Average Exercise Price
Share options outstanding at the beginning of the period (in dollars per shares) \| $ / shares		$ 4.95
Forfeited (in dollars per shares) \| $ / shares		1.53
Exercised (in dollars per shares) \| $ / shares		$ 5.03
Share options outstanding at the end of the period (in dollars per shares) \| $ / shares
Aggregate intrinsic value of options exercised \| ¥	¥ 11		¥ 255	¥ 194

SHARE-BASED COMPENSATION - Nonvested restricted stocks (Details) ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) tranche shares	Dec. 31, 2020 CNY (¥) $ / shares	Dec. 31, 2019 CNY (¥) tranche shares	Dec. 31, 2018 CNY (¥) tranche shares
Restricted stocks
Number of Restricted Stocks
Nonvested restricted stocks outstanding at the beginning of the period (in shares)	10,245,390
Granted (in shares)	493,407
Forfeited (in shares)	(1,671,111)
Vested (in shares)	(1,407,675)
Adjusted for performance conditions (in shares)	(564,603)
Nonvested restricted stocks outstanding at the end of the period (in shares)	7,095,408		10,245,390
Weighted Average Grant Date Fair Value
Nonvested restricted stocks outstanding at the beginning of the period (in dollars per shares) \| $ / shares		$ 9.87
Granted (in dollars per shares) \| $ / shares		32.74
Forfeited (in dollars per shares) \| $ / shares		8.45
Vested (in dollars per shares) \| $ / shares		11.41
Adjusted for performance conditions (in dollars per share) \| $ / shares		5.93
Nonvested restricted stocks outstanding at the end of the period (in dollars per shares) \| $ / shares		$ 11.80
Total unrecognized compensation expense \| ¥	¥ 455	$ 455
Weighted-average period for recognition of unrecognized compensation costs	3 years 4 months 28 days
Total fair value of nonvested restricted stocks, vested \| ¥	¥ 368		¥ 443	¥ 183
Restricted stocks \| Performance Condition
Share based compensation
Number of tranche \| tranche	10		10	10
Number of Restricted Stocks
Granted (in shares)	0		221,712	661,973
Restricted stocks \| Performance Condition \| Second anniversary of the stated vesting commencement date
Share based compensation
Share-based payment award, vesting percentage	50.00%
Restricted stocks \| Performance Condition \| Vesting ratably over the following two years
Share based compensation
Share-based payment award, vesting percentage	50.00%
Period for remaining percentage vested	2 years
Share options
Weighted Average Grant Date Fair Value
Total unrecognized compensation expense \| ¥	¥ 0	$ 0

EARNINGS (LOSSES) PER SHARE (Details) ¥ / shares in Units, ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) ¥ / shares shares	Dec. 31, 2020 $ / shares	Dec. 31, 2019 CNY (¥) ¥ / shares shares	Dec. 31, 2018 CNY (¥) ¥ / shares shares
EARNINGS (LOSSES) PER SHARE
Net income (loss) attributable to ordinary shareholders - basic \| ¥	¥ (2,192)		¥ 1,769	¥ 716
Eliminate the dilutive effect of interest expense of convertible senior notes \| ¥			40	40
Net income attributable to ordinary shareholders - diluted \| ¥	¥ (2,192)		¥ 1,809	¥ 756
Weighted average ordinary shares outstanding - basic	292,739,841		284,305,138	281,717,485
Incremental weighted-average ordinary shares from assumed exercise of share options and nonvested restricted stocks using the treasury stock method			9,397,527	11,463,212
Dilutive effect of convertible senior notes			10,607,225	10,425,112
Weighted average ordinary shares outstanding - diluted	292,739,841		304,309,890	303,605,809
Basic earnings (losses) per share \| (per share)	¥ (7.49)	$ (1.15)	¥ 6.22	¥ 2.54
Diluted earnings (losses) per share \| (per share)	¥ (7.49)	$ (1.15)	¥ 5.94	¥ 2.49

EARNINGS (LOSSES) PER SHARE - Computation of diluted earnings (Details) - shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2018
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities which could potentially dilute basic earnings per share which were excluded from the computation of diluted earnings per share	25,422,897	530,009
Outstanding employee options and nonvested restricted stocks
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities which could potentially dilute basic earnings per share which were excluded from the computation of diluted earnings per share	7,095,408	530,009
Shares of convertible senior notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities which could potentially dilute basic earnings per share which were excluded from the computation of diluted earnings per share	18,327,489

Cash Dividend (Details) $ / shares in Units, ¥ in Millions, $ in Millions	Dec. 13, 2018 $ / shares	Dec. 31, 2019 CNY (¥)	Nov. 30, 2019 USD ($)	Dec. 31, 2018 CNY (¥)
Cash Dividend
Cash dividends declared (Per share)	$ 0.34
Dividends payable		¥ 678	$ 100	¥ 658

LEASES - Supplemental Information Related to Operating Leases (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Lease cost:
Operating fixed lease cost	¥ 3,964	¥ 3,094
- Amortization of ROU assets	74
- Interest on lease liabilities	90
Short term lease cost	0	0
Variable lease cost		10
Variable lease cost	171
Total lease cost	¥ 3,957	¥ 3,104
Other information:
Weighted average remaining lease term, Operating leases	14 years	11 years
Weighted average remaining lease term, Finance leases	29 years
Weighted average discount rate, Operating leases	6.23%	7.34%
Weighted average discount rate, Finance leases	3.96%

LEASES - Schedule Of Maturities Of Lease Liabilities (Details) - CNY (¥) ¥ in Millions	Dec. 31, 2020	Dec. 31, 2019
Total Operating Leases
2021	¥ 3,858	¥ 3,236
2022	3,826	3,231
2023	3,733	3,157
2024	3,660	3,031
2025	3,466	2,921
Thereafter	25,730	18,077
Total minimum lease payments	44,273	33,653
Less: amount representing interest	(13,819)	(11,598)
Present value of minimum lease payments	30,454	¥ 22,055
Total Finance Leases
2021	129
2022	144
2023	146
2024	147
2025	147
Thereafter	3,575
Total minimum lease payments	4,288
Less: amount representing interest	(1,760)
Present value of minimum lease payments	¥ 2,528

LEASES - Schedule Of Future Minimum Payments (Details) - CNY (¥) ¥ in Millions	Dec. 31, 2020	Dec. 31, 2019
Total Operating Leases
2020	¥ 3,858	¥ 3,236
2021	3,826	3,231
2022	3,733	3,157
2023	3,660	3,031
2024	3,466	2,921
Thereafter	25,730	18,077
Total minimum lease payments	44,273	33,653
Less: amount representing interest	13,819	11,598
Present value of minimum lease payments	¥ 30,454	¥ 22,055

LEASES - Narrative (Details) ¥ in Millions	12 Months Ended
LEASES - Narrative (Details) ¥ in Millions	Dec. 31, 2020 CNY (¥) contract	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
LEASES
Sublease Income	¥ 112	¥ 121	¥ 123
Negative lease expense recognized under the relief using variable lease expense approach	¥ 250
Lease expense			¥ 2,641
Number of lease contracts \| contract	31
Non-cancellable lease contracts not reflected in consolidate balance sheets	¥ 8,511

INCOME TAXES (Details) - CNY (¥) ¥ in Millions	12 Months Ended
INCOME TAXES (Details) - CNY (¥) ¥ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Income tax
Effective tax rate (as a percent)		25.00%	25.00%	25.00%
Cash dividends paid			¥ 678	¥ 660
Income (loss) before income taxes
Total		¥ (2,279)	¥ 2,565	¥ 1,393
Minimum
Income tax
Extended limitation tax evasion period		5 years
Maximum
Income tax
Extended limitation tax evasion period		10 years
China
Income tax
Effective tax rate (as a percent)		25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%
Income (loss) before income taxes
PRC including Hong Kong and Taiwan		¥ (392)	¥ 2,334	¥ 1,583
GERMANY
Income tax
Effective tax rate (as a percent)		15.00%
Effective income tax rate including solidarity surcharge		15.825%
Income (loss) before income taxes
Income taxes foreign		¥ (1,606)
GERMANY \| Minimum
Income tax
Municipal Trade Tax		7.00%
GERMANY \| Maximum
Income tax
Municipal Trade Tax		17.00%
Others
Income (loss) before income taxes
Income taxes foreign		¥ (281)	¥ 231	¥ (190)
Jizhu Shanghai \| China
Income tax
Effective tax rate (as a percent)		15.00%	15.00%	12.50%	12.50%	12.50%
Income tax exemption period		2 years
Period of income tax rate reduction		3 years
Percentage of tax reduction		50.00%
Jiangsu Mengguang \| China
Income tax
Effective tax rate (as a percent)	15.00%	15.00%	15.00%

INCOME TAXES - Reconciliation (Details) ¥ / shares in Units, ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥) ¥ / shares	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥) ¥ / shares	Dec. 31, 2018 CNY (¥) ¥ / shares
Tax expense (benefit)
Current Tax \| ¥	¥ 338		¥ 678	¥ 660
Deferred Tax	(553)	$ (84)	(38)	(91)
Total	¥ (215)	$ (33)	¥ 640	¥ 569
Reconciliation between the effective income tax rate and the PRC statutory income tax rate
PRC statutory tax rate	25.00%	25.00%	25.00%	25.00%
Tax effect of non-deductible expenses and non-taxable income in determining taxable profit	(6.00%)	(6.00%)	(3.00%)	15.00%
Effect of different tax rate of group entities operating in other jurisdictions	(2.00%)	(2.00%)	1.00%	4.00%
Effect of change in valuation allowance	(10.00%)	(10.00%)	2.00%	(1.00%)
Effect of tax holiday	1.00%	1.00%	(2.00%)	(3.00%)
Effect of cash dividends	0.00%	0.00%	4.00%	5.00%
Effect of disposal of subsidiary				1.00%
Effect of excess tax benefit of rewards	1.00%	1.00%	(2.00%)	(5.00%)
Effective tax rate	9.00%	9.00%	25.00%	41.00%
Aggregate amount and per share effect of the tax holidays
Aggregate amount \| ¥	¥ 31		¥ 45	¥ 31
Per share effect-basic \| ¥ / shares	¥ 0.11		¥ 0.16	¥ 0.11
Per share effect-diluted \| ¥ / shares	¥ 0.11		¥ 0.15	¥ 0.10

INCOME TAXES - Deferred income tax assets and liabilities (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2020	Dec. 31, 2019
Deferred tax assets:
Net loss carryforward				¥ 888	¥ 243
Deferred revenue				283	260
Long-term assets				388	125
Bad debt provision				18	7
Accrued payroll				69	23
Other accrued expenses				3	19
Share-based compensation				31	23
Others				12	0
Valuation allowance	¥ (369)	¥ (107)	¥ (107)	(369)	(152)
Total deferred tax assets				1,323	548
Deferred tax liabilities:
Favorable lease, building and land use rights-fair value adjustment				1,782	449
Others				99	42
Total deferred tax liabilities				1,881	491
Net deferred tax assets (liabilities)				(558)
Net deferred tax assets (liabilities)					57
Analysis as:
Deferred tax assets				623	548
Deferred tax liabilities				1,181	491
Net deferred tax assets (liabilities)				¥ (558)
Net deferred tax assets (liabilities)					¥ 57
Movement of the valuation allowance
Balance at the beginning of the year	(152)	(107)	(123)
Provided	(249)	(79)	(36)
Reversed	32	24	43
Written off		10	9
Balance at the end of the year	¥ (369)	¥ (152)	¥ (107)

INCOME TAXES - Valuation allowance (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Uncertain tax benefits
Interest or penalty expense	¥ 0.0	¥ 0.0	¥ 0.0
Roll-forward of the unrecognized tax benefits
Beginning balance	18.0	14.0	26.0
Addition for tax positions	32.0	4.0	(12.0)
Ending balance	¥ 50.0	18.0	14.0
Withholding income tax rate (as a percentage)	10.00%
Withholding income tax rate with Hong Kong as holding company (as a percentage)	5.00%
PRC dividend withholding tax accrued	¥ 0.0	73.0
Additional provision for PRC dividend withholding tax accrued	¥ 0.0
Period of statute of limitations	3 years
Period of statute of limitations, if the underpayment is more than the specified amount	5 years
Minimum amount of underpayment of taxes for statute of limitations to be extended to five years	¥ 0.1
Period of statute of limitations for transfer pricing issues	10 years
GERMANY
Valuation allowance
Tax loss carryforwards	¥ 1,778.0
China
Valuation allowance
Tax loss carryforwards, expire between 2021 and 2024	888.0
Tax loss carryforwards, expire between 2021 and 2028	¥ 1,492.0
Maximum
Uncertain tax benefits
Market capitalization percent	2.00%
Minimum
Uncertain tax benefits
Market capitalization percent	0.50%
Valuation allowance for deferred tax assets
Valuation allowance
Charge to costs and expenses	¥ 249.0	79.0	36.0
Charge taken against allowance	¥ 32.0	24.0	43.0
Write off		¥ 10.0	¥ 9.0

EMPLOYEE BENEFIT PLANS _ Change in Projected Benefit Obligations and Change in Plan Assets (Details) ¥ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)
Change in Projected Benefit Obligation
Begin of the year	¥ 147
Current service cost	5
Interest cost	1
Contributions by plan participants	1
Actuarial loss (gain)	38
Foreign currency translation	3
Benefits paid	(7)
Settlements	(1)
Administrative Expenses, Taxes and Premiums Paid	0
Curtailments	(1)
Effect of other economic events	7
End of the year	193
Change in Plan Assets
Begin of the year	32
Actual return on plan assets	(2)
Foreign currency translation	1
Employer contributions	9
Employee contributions	1
Benefits paid	(8)
Other economic events	(27)
End of the year	6
Excess of defined benefit obligation over the fair value of plan assets	187
Accumulated benefit obligation	¥ 193

EMPLOYEE BENEFIT PLANS - Amounts recognized in the consolidated balance sheets (Details) - 12 months ended Dec. 31, 2020 ¥ in Millions, $ in Millions	CNY (¥)	USD ($)	USD ($)
Defined Benefit Plan, Amounts for Asset (Liability) Recognized in Statement of Financial Position [Abstract]
Salary and welfare payables	¥ 8
Retirement benefit obligation	179		$ 27
Liability in the balance sheet	187
Net amount recognized in accumulated other comprehensive loss	¥ 27	$ 4

EMPLOYEE BENEFIT PLANS - Principal actuarial assumptions (Details) - CNY (¥) ¥ in Millions	Dec. 31, 2020	Dec. 31, 2019
Principal actuarial assumptions
Inflation rate	1.00%
Future salary increases	1.50%
Future pension increases	1.80%
Fair value hierarchy of total plan assets measured at fair value by asset	¥ 6	¥ 32
Expect to contribute	1
Benefits expected to be paid in 2021	¥ 8
Germany
Principal actuarial assumptions
Discount rate	0.33%
Other
Principal actuarial assumptions
Discount rate	0.12%
Equity securities
Principal actuarial assumptions
Target asset allocation for the plan, as a percentage of total plan assets	25.00%
Debt securities
Principal actuarial assumptions
Target asset allocation for the plan, as a percentage of total plan assets	30.00%
Level 1
Principal actuarial assumptions
Fair value hierarchy of total plan assets measured at fair value by asset	¥ 6
Level 1 \| Equity funds
Principal actuarial assumptions
Fair value hierarchy of total plan assets measured at fair value by asset	1
Level 1 \| Bond funds
Principal actuarial assumptions
Fair value hierarchy of total plan assets measured at fair value by asset	2
Level 1 \| Property
Principal actuarial assumptions
Fair value hierarchy of total plan assets measured at fair value by asset	2
Level 1 \| Other
Principal actuarial assumptions
Fair value hierarchy of total plan assets measured at fair value by asset	¥ 1

EMPLOYEE BENEFIT PLANS - Defined Contribution Plans (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
EMPLOYEE BENEFIT PLANS
Total contribution for employee benefits	¥ 283	¥ 413	¥ 321
Contributions recognized as expense	¥ 129

RESTRICTED NET ASSETS (Details) - CNY (¥) ¥ in Millions	12 Months Ended
RESTRICTED NET ASSETS (Details) - CNY (¥) ¥ in Millions	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Minimum required percentage of after tax profit appropriated to general reserve fund	10.00%
Threshold percentage of general reserve fund to registered capital	50.00%
Reserve funds not distributed as cash dividends	¥ 771	¥ 604	¥ 502
Restricted share capital	3,075
Restricted net assets not available for distribution to the Company in the form of dividends, loans or advances	3,846
General reserve not distributable as cash dividends or other cash disbursements	12
Deutsche Hospitality
Restricted share capital	¥ 5

RELATED PARTY TRANSACTIONS AND BALANCES (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)	Dec. 31, 2020 USD ($)
Related party transaction
Amount due from related parties	¥ 178		¥ 182		$ 27
Due to related party	132		95
Loan payment	15	$ 2	87	¥ 7
Loan from related party				103
Sheen Star
Related party transaction
Amount due from related parties	52		52
Sheen Star \| Service fee
Related party transaction
Revenue from related parties	4		4	2
Sheen Star \| Interest income
Related party transaction
Interest income from related party	1		8
CREATER \| Interest income
Related party transaction
Interest income from related party			6	10
Zhuchuang
Related party transaction
Amount due from related parties	27		27
Trip.com
Related party transaction
Amount due from related parties	22		16
Due to related party	48		33
Trip.com \| Marketing and training fee
Related party transaction
Revenue from related parties	66		41	12
Trip.com \| Commission expenses
Related party transaction
Expenses with related parties	78		72	61
Trip.com \| Lease expenses
Related party transaction
Expenses with related parties	18		18	18
China Hospitality JV
Related party transaction
Due to related party			25
China Hospitality JV \| Service fee
Related party transaction
Revenue from related parties	1		6	10
China Hospitality JV \| Early termination compensation
Related party transaction
Expenses with related parties	26
Cjia Group
Related party transaction
Amount due from related parties	22		16
Due to related party	42		17
Loan from related party				103
Cjia Group \| Service fee
Related party transaction
Expenses with related parties	17		6
Cjia Group \| Goods sold and service provided
Related party transaction
Revenue from related parties	18		21	30
Cjia Group \| Sublease Income
Related party transaction
Revenue from related parties	9		14
Cjia Group \| Early termination compensation
Related party transaction
Expenses with related parties	8
Cjia Group \| Purchase of property, plant and equipment
Related party transaction
Expenses with related parties	11
Huali Jinshi
Related party transaction
Due to related party	29		9
Huali Jinshi \| Service fee
Related party transaction
Expenses with related parties	41		99	1
Accor
Related party transaction
Amount due from related parties	1		1
Due to related party	8		11
Accor \| Service fee
Related party transaction
Revenue from related parties	3		9	14
Accor \| Brand use fee, reservation fee and other related service fee
Related party transaction
Expenses with related parties	17		28	¥ 18
Lianquan
Related party transaction
Amount due from related parties	58		50
Loan payment			32
Lianquan \| Sublease Income
Related party transaction
Revenue from related parties	12		7
Others
Related party transaction
Amount due from related parties	14		20
Due to related party	5		0
Allowance for expected credit losses
Related party transaction
Amount due from related parties	18
Smart Lodging
Related party transaction
Loan payment			¥ 30
ASU 2016-13
Related party transaction
Credit allowance	¥ 18

COMMITMENTS AND CONTINGENCIES (Details) € in Millions, ¥ in Millions	1 Months Ended
	Jan. 31, 2021 EUR (€)	Dec. 31, 2020 CNY (¥)	Dec. 31, 2018 EUR (€)
Loss Contingencies [Line Items]
Purchase commitments expected to be incurred within one year related to leasehold improvements and installation of equipment for hotel operations \| ¥		¥ 360
Accrued contingencies \| ¥		¥ 60
First payment made \| €	€ 3
Maximum
Loss Contingencies [Line Items]
Commitment to purchase ordinary shares \| €			€ 12

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY - BALANCE SHEETS (Details) ¥ in Millions, $ in Millions	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Nov. 30, 2019 USD ($)	Dec. 31, 2018 CNY (¥)
Current assets:
Cash and cash equivalents	¥ 7,026	$ 1,077	¥ 3,234
Other current assets, net	914	140	699
Total current assets	12,882	1,975	18,256
Other assets, net	743	114	707
Total assets	65,155	9,985	52,983
Current liabilities:
Short-term debt	1,142	175	8,499
Dividends payable			678	$ 100	¥ 658
Amount due to related parties	132	20	95
Accrued expenses and other current liabilities	2,440	374	1,856
Total current liabilities	10,529	1,614	17,287
Long-term debt	10,856	1,664	8,084
Total liabilities	53,723	8,233	45,483
Equity:
Ordinary shares (US$0.0001 par value per share; 8,023,485,450 shares authorized; 299,424,485 and 324,364,444 shares issued as of December 31, 2019 and 2020, and 285,902,609 and 310,842,568 shares outstanding as of December 31, 2019 and 2020, respectively)	0	0	0
Treasury shares (3,096,764 and 3,096,764 shares as of December 31, 2018 and 2019, respectively)	(107)	(16)	(107)
Additional paid-in capital	9,808	1,503	3,834
Retained earnings	1,502	230	3,701
Accumulated other comprehensive (loss) income	127	19	(49)
Total equity	11,330	1,736	7,379
Total liabilities and equity	65,155	9,985	52,983
Parent Company
Current assets:
Cash and cash equivalents	1,892	290	361
Short-term investments	51	8	64
Other current assets, net	16	2	24
Total current assets	1,959	300	449
Other assets, net			155
Investment in subsidiaries	16,103	2,467	16,472
Total assets	18,062	2,767	17,076
Current liabilities:
Short-term debt			8,312
Dividends payable			678
Amount due to related parties	273	42	594
Accrued expenses and other current liabilities	141	21	113
Total current liabilities	414	63	9,697
Long-term debt	6,318	968
Total liabilities	6,732	1,031	9,697
Equity:
Ordinary shares (US$0.0001 par value per share; 8,023,485,450 shares authorized; 299,424,485 and 324,364,444 shares issued as of December 31, 2019 and 2020, and 285,902,609 and 310,842,568 shares outstanding as of December 31, 2019 and 2020, respectively)	0	0	0
Treasury shares (3,096,764 and 3,096,764 shares as of December 31, 2018 and 2019, respectively)	(107)	(16)	(107)
Additional paid-in capital	9,808	1,503	3,834
Retained earnings	1,502	230	3,701
Accumulated other comprehensive (loss) income	127	19	(49)
Total equity	11,330	1,736	7,379
Total liabilities and equity	¥ 18,062	$ 2,767	¥ 17,076

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY - BALANCE SHEETS (Parenthetical) (Details) - $ / shares	Dec. 31, 2020	Dec. 31, 2019
BALANCE SHEETS
Ordinary shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	8,023,485,450	8,023,485,450
Ordinary shares, shares issued	324,364,444	299,424,485
Ordinary shares, shares outstanding	310,842,568	285,902,609
Treasury shares, shares	3,096,764	3,096,764
Parent Company
BALANCE SHEETS
Ordinary shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	8,023,485,450	8,023,485,450
Ordinary shares, shares issued	324,364,444	299,424,485
Ordinary shares, shares outstanding	310,842,568	285,902,609
Treasury shares, shares	3,096,764	3,096,764

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY - STATEMENTS OF COMPREHENSIVE INCOME (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Operating costs and expenses:
General and administrative expenses	¥ 1,259	$ 193	¥ 1,061	¥ 851
Total operating costs and expenses	11,925	1,827	9,236	7,945
Loss from operations	(1,686)	(257)	2,108	2,344
Interest income	119	18	160	148
Interest expense	(533)	(82)	(315)	(244)
Foreign exchange gain (loss)	175	27	(35)	(144)
Other income, net	(89)	(14)	331	203
Unrealized (loss) gain from fair value changes of equity securities	(265)	(42)	316	(914)
Net income (loss) attributable to Huazhu Group Limited	(2,192)	(336)	1,769	716
Other comprehensive income
Loss / Gain arising from defined benefit plan, net of tax	27	4
Foreign currency translation adjustments, net of tax of nil for 2018, 2019 and 2020, respectively	203	31	(7)	(169)
Comprehensive income (loss) attributable to Huazhu Group Limited	(2,016)	(309)	1,762	547
Parent Company
Operating costs and expenses:
General and administrative expenses	155	24	115	89
Total operating costs and expenses	155	24	115	89
Loss from operations	(155)	(24)	(115)	(89)
Interest income	2	0	10	1
Interest expense	154	24	201	198
Foreign exchange gain (loss)	(8)	(1)	5	17
Other income, net	32	5	30	50
Unrealized (loss) gain from fair value changes of equity securities	(10)	(1)	(27)	(45)
Income in investment in subsidiaries	(1,899)	(291)	2,067	980
Net income (loss) attributable to Huazhu Group Limited	(2,192)	(336)	1,769	716
Other comprehensive income
Foreign currency translation adjustments, net of tax of nil for 2018, 2019 and 2020, respectively	176	27	(7)	(169)
Comprehensive income (loss) attributable to Huazhu Group Limited	¥ (2,016)	$ (309)	¥ 1,762	¥ 547

SCHEDULE I FINANCIAL INFORMATION FOR PARENT COMPANY - CONDENSED STATEMENTS OF CASH FLOWS (Details) ¥ in Millions, $ in Millions	1 Months Ended	12 Months Ended
	Sep. 30, 2020 CNY (¥)	Dec. 31, 2020 CNY (¥)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CNY (¥)	Dec. 31, 2018 CNY (¥)
Adjustments to reconcile net income to net cash used in operating activities:
Net cash provided by operating activities		¥ 609	$ 93	¥ 3,293	¥ 3,049
Investing activities:
Net cash (used in) investing activities		(8,101)	(1,240)	(285)	(6,345)
Financing activities:
Proceeds from issuance of ordinary shares in Hong Kong public offering	¥ 6,018	6,018	922
Ordinary share issuance costs		(32)	(5)
Net proceeds from issuance of ordinary shares upon exercise of option		1	0	14	14
Proceeds from short-term bank borrowings		1,658	254	2,214	928
Repayment of short-term bank borrowings		(1,993)	(306)	(1,902)	(128)
Proceeds from long-term bank borrowings		1,652	253	13,176	4,275
Repayment of long-term bank borrowings		(9,163)	(1,405)	(6,760)	(799)
Proceeds from issuance of convertible senior notes		3,499	536
Direct financing costs paid		(10)	(1)
Dividends paid		(678)	(104)	(658)
Net cash provided by financing activities		883	134	6,045	4,248
Effect of exchange rate changes on cash and cash equivalents		(300)	(45)	62	(24)
Net increase in cash, cash equivalents and restricted cash		(6,909)	(1,058)	9,115	928
Cash, cash equivalents and restricted cash at the beginning of the year		13,999	2,145	4,884	3,956
Cash, cash equivalents and restricted cash at the end of the year		7,090	1,087	13,999	4,884
Short-term bank borrowings settled by investment in subsidiaries		4,628
Parent Company
Adjustments to reconcile net income to net cash used in operating activities:
Net cash provided by operating activities		49	8	(212)	(60)
Investing activities:
Investment in subsidiaries		(6,267)	(960)	(1,039)
Receipt of investment in subsidiaries				9	2,121
Purchase of long-term investments					(3,782)
Net cash (used in) investing activities		(6,267)	(960)	(1,030)	(1,661)
Financing activities:
Proceeds from issuance of ordinary shares in Hong Kong public offering		6,018	922
Ordinary share issuance costs		(10)	(2)
Net proceeds from issuance of ordinary shares upon exercise of option		1	0	14	14
Proceeds of advances from subsidiaries				109	149
Proceeds from short-term bank borrowings				1,265
Repayment of short-term bank borrowings		(282)	(43)		(128)
Proceeds from long-term bank borrowings				5,206	2,409
Repayment of long-term bank borrowings				(5,169)	(786)
Proceeds from issuance of convertible senior notes		3,499	536
Repayment of convertible senior notes		0	0
Direct financing costs paid		(9)	(1)
Dividends paid		(678)	(104)	(658)
Net cash provided by financing activities		8,539	1,308	767	1,658
Effect of exchange rate changes on cash and cash equivalents		(791)	(121)	141	201
Net increase in cash, cash equivalents and restricted cash		1,530	235	(334)	138
Cash, cash equivalents and restricted cash at the beginning of the year		361	55	695	557
Cash, cash equivalents and restricted cash at the end of the year		¥ 1,891	$ 290	¥ 361	¥ 695

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Allowance for doubtful accounts of accounts receivables and other receivables:
Valuation And Qualifying Accounts
Balance at Beginning of Year	¥ 22	¥ 17	¥ 11
Charge to Costs and Expenses	65	21	10
Charge to Other Accounts	7
Addition Due to Acquisition			4
Write off	(7)	(16)	(8)
Balance at End of Year	87	22	17
Valuation allowance for deferred tax assets
Valuation And Qualifying Accounts
Balance at Beginning of Year	152	107	123
Charge to Costs and Expenses	249	79	36
Charge Taken Against Allowance	(32)	(24)	(43)
Write off		(10)	(9)
Balance at End of Year	¥ 369	¥ 152	¥ 107