Archives for October 2016

Apple biggest tax avoider in US stashing $215bn offshore

The common consolidated corporate tax base (CCCTB), which would standardize the way big businesses are taxed in the European Union, was unveiled by Pierre Moscovici, the European Economic Commissioner in Strasbourg on Tuesday.

“We are proposing a system which can simultaneously support business, attract investors, promote growth and stop large-scale tax avoidance,” Moscovici said.

The plan had been debated for more than a decade but never received sufficient support from the member states.

To push the initiative through the EU legislative system, the Commission developed a two phase approach. At first, the regulator plans to introduce a set of universal rules aiming to reduce costs for businesses that operate across borders.

Once the common legal base is approved, the European Commission will bring in the most controversial step of consolidation. Corporate tax revenues would be collected by one tax authority and then redistributed across the EU according to where the companies’ real economic activity takes place. Each country would tax their share of the profits at their own national rate.

The revised draft suggests the shared profits would be based on labor, assets and sales, rather than GDP or size of the country. This corresponds with the EU and OECD’s broader objective of linking taxation to the country where the actual business activity takes place.

READ MORE: Apple tax penalty only the beginning for US firms, warns EU competition watchdog

The new system would be mandatory for corporations with annual revenues of more than €750 million ($814 million). Companies will get an opportunity to work out their taxable profits using a single set of rules, rather than tax regulations of a specific state.

“We are proposing a system which can simultaneously support business, attract investors, promote growth and stop large-scale tax avoidance,” said the commissioner, urging the member states to deliver a fairer, more competitive, more growth-friendly corporate tax system that the EU needs.

Article source: https://www.rt.com/business/364187-new-eu-corporate-tax-system/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Pornhub hubbub: Russians react to XXX site ban

Apart from not moving servers to Russia, LinkedIn collects and sends information about people who are not users of the network without their consent, according to the Russian internet watchdog Roskomnadzor.

“We are seeking a court order to block LinkedIn. We twice sent requests in the summer, but they did not provide answers to our questions,” said Roskomnadzor spokesman Vadim Ampelonskiy in an interview with the TASS news agency.

According to the spokesman, Moscow’s Tagansky District Court has ruled in favor of the watchdog, but LinkedIn has appealed to a higher court.

“If the appellate court upholds the judgment, and it will no longer be appealed, the decision will enter into force within 30 days. We will include the appropriate IP address in the register of violators of the personal data rights, which means blocking,” Ampelonskiy said. The decision will be announced on November 10.

The watchdog will remove the ban, if the social network provides information that it has fulfilled the law and moved servers with data about Russians to the country.

“This is the first company we are suing in court. In future we will use the same mechanism in relation to other companies,” the spokesman said.

Roskomnadzor also told Kommersant daily that another reason for the lawsuit was “numerous publications in the media about repeated leaks of user data from the social network.”

In May, website Haker.ru reported the sale of 167 million stolen LinkedIn accounts, and passwords for 117 million accounts on the dark web. LinkedIn said the leak happened in 2012, and passwords have now been updated.

LinkedIn is the world’s largest business and employment oriented social network. As of 2015, it had 400 million users with 5 million people registered in Russia.

Article source: https://www.rt.com/business/364186-linkedin-russia-possible-ban/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Volkswagen to pay over $15bn in US diesel scandal

Under the settlement, Volkswagen (VW) agrees to spend up to $10 billion on buybacks and owner compensation. An additional $4.7 billion will go to programs to offset excess emissions and clean car projects.

Volkswagen CEO Matthias Mueller told reporters the approval was “an important milestone for us on the way toward clearing up the problem that we caused some time ago.”

The company will start buying back polluting cars in mid-November. Vehicle owners can choose between having their cars bought at pre-scandal “trade in” value or repaired by VW if regulators approve the fixes.

They will also receive an additional compensation of between $5,000 and $10,000.

Judge Charles Breyer turned down objections from owners who thought the compensation should have been higher, saying the agreement was “adequate and fair.”

“Given the risks of prolonged litigation, the immediate settlement of this matter is far preferable,” said Breyer.

As part of the settlement, Volkswagen will fund programs providing a better charging infrastructure for electric cars, the development of zero-emission ride-sharing fleets and general efforts to increase the sale of emission-friendly vehicles.

READ MORE: Volkswagen investors seek $9.2bn compensation over diesel emissions scandal

Over the next three years, the automaker will also pay to fund infrastructure on Native American tribal land to reduce diesel emissions.

The world’s second biggest carmaker Volkswagen agreed to the settlement with the US regulators in June. It is the largest civil settlement ever with an automaker accused of misconduct.

The deal with the regulators followed the company’s admission last year that its supposedly “clean diesel” cars had been deliberately designed to cheat on emissions tests.

Volkswagen is also being sued by Australia’s consumer protection group for misleading consumers in the country over emissions testing.

The German automaker is facing another €8.2 billion in damage claims from investors over their losses following the emissions scandal.

Last year Volkswagen lost $6.6 billion after it admitted cheating with nearly 11 million cars worldwide affected. The company has already put aside $25 billion as part of a global recall program.

Article source: https://www.rt.com/business/364144-volkswagen-fine-approved-diesel/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

The EBA will have to leave for another EU country once Britain quits the bloc.

How Brexit could lead to a united Ireland – and wage cuts for thousands

“Ireland has a significant financial services sector, efficient transport links to other European capitals, and the capacity to absorb the European Banking Authority’s re-location to Ireland,” said Irish Finance Minister Michael Noonan.

Established in 2011 in the wake of the European banking crisis, the regulator provides harmonizing and integrating banking supervision across the EU. The EBA is responsible for regulatory policy, risk assessment, as well as consumer protection and financial innovation.

In the Brexit aftermath, Dublin also set its sights on seducing another EU institution located in London – the European Medicines Agency (EMA).

“A move to Ireland’s English-speaking capital would minimize disruption to EMA work, as well as to staff and families. The Irish medicines regulator is in a strong position to support the EMA; this would ensure continued protection of EU citizens and reassure the industries which it regulates,” said Ireland’s Health Minister Simon Harris.

The Irish government plans to prepare a formal application by early 2017.

The EMA, which began operating in 1995, is in charge of the EU’s scientific evaluation, supervision and safety monitoring of medicines. The regulator is meant to protect public and animal health across the bloc, as well as European Economic Area countries.

“Ireland has a positive track record with hosting international organizations and has proven to be an attractive location for international staff of these international organizations,” according to the Irish finance department.

Article source: https://www.rt.com/business/364142-ireland-bid-host-banking-brexit/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

EU’s biggest gas producer running out of reserves

EU competition rules currently limit Gazprom’s use of the Opal pipeline to half the line’s capacity. The pipeline stretches about 470 kilometers from the German Baltic Sea coast to Brandov on the Czech-German border.

Having access to the full capacity of Opal is necessary for Russia’s Nord Stream-2 pipeline that intends to double the volume of the existing Nord Stream pipeline. The new pipeline will be able to deliver up to 55 billion cubic meters of gas per year to Germany via the Baltic Sea bypassing Ukraine.

The deal may be regarded as Russia and the EU mending their business ties despite sanctions, analysts say.

Russia’s Nord Stream-2 pipeline is a ‘bad deal’ for Europe – Biden

According to the media, under the agreement approved on Tuesday, Gazprom retains its 50 percent exclusive capacity, but will have to give up 10 to 20 percent of the remaining capacity to competitors. The remaining 30 to 40 percent will be available for auction, and Gazprom will be able to participate.

“It is a little bit of a concession to the Russians, but it’s not a Christmas gift,” said the WSJ source.

The decision is likely to arouse discontent among the EU’s eastern members that are opposed to Gazprom’s domination of the European market and Kremlin’s foreign policy.

“By supporting Nord Stream-2, the EU in effect gives succor to a regime whose aggression it seeks to punish through sanctions. This contradiction is unsustainable,” Poland’s Minister for European Affairs Konrad Szymanski wrote in the Financial Times on Monday.

EU Competition Commissioner Margrethe Vestager is meeting Gazprom Deputy Chairman Aleksandr Medvedev on Wednesday to discuss the matter.

Article source: https://www.rt.com/business/364138-nord-stream-opal-russia-eu/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Greece approved to get more bailout funds after completing reforms

The funds were approved this month after Athens completed the required economic reforms.

“Today’s decision to disburse €2.8 billion to Greece is a sign that the Greek people are steadily making progress in reforming their country,” the Board of Directors of the European Stability Mechanism (ESM) said.

“The government has completed key milestones in the area of pension reform, bank governance, the energy sector, and revenue collection,” said ESM Managing Director Klaus Regling.

He added Greek authorities have also taken further steps in making the new privatization and investment fund operational. “If the government continues to implement the reforms agreed in the ESM program, growth of the Greek economy could accelerate next year and the government may be able to start issuing bonds again next year,” Regling said.

READ MORE: Greek pensioners rock police bus at Athens protest, tear-gassed in return (PHOTOS, VIDEOS)

With the latest disbursement Greece has already received €31.7 billion from its bailout package.

Eurogroup ministers agreed to unlock the funds on October 10, praising the Greek government led by Prime Minister Alexis Tsipras for its “tremendous work” in carrying out “difficult reforms for the Greek economy and society.”

Greece may get financial boost from EU refugee crisis

The reforms included tax rises, pension cuts, public asset transfers and the start of a new privatization fund. The unpopular austerity reforms have sparked protests by Greeks who blame the government for “handing over the nation’s wealth and sovereignty.”

They are part of a multibillion euro bailout program agreed by Greece and its creditors last year to avoid the country’s exit from the single currency bloc.

Greek officials now hope creditors – the European Commission, the International Monetary Fund and the European Central Bank – will agree to reduce its debts.

The country is still encumbered by a €300 billion debt burden which is more than 175 percent of its national income.

Article source: https://www.rt.com/business/364051-greece-eu-loan-tranche/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Failure to sign trade deal with Europe may leave Canada stranded

“Let’s be clear, I’m not a herald of anti-globalization, I want a deal,” he said in an interview with the daily.

The head of Belgium’s French-speaking region which is blocking the implementation of the Comprehensive Economic and Trade Agreement (CETA) stressed that the crucial point of the deal is allowing big companies to sue the governments of EU member states.

A secret court system, organized to resolve disputes between investors and governments, can be used by big corporations to dictate public policy, according to the premier.

“I would prefer that this entity disappears pure and simple and that we rely on our courts or at the very least, if we want an arbitration court, it must provide equivalent guarantees to domestic ones,” said Magnette.

The premier referred to a legal mechanism known as the Investor-state dispute settlement (ISDS) that makes it possible for foreign businesses to challenge state interference, such as expropriation.

The lawsuit is commonly brought before a panel of private arbitrators, its members appointed by the investor and state in dispute. The scheme has met strong opposition due to lawsuits brought by companies against tighter rules on public health, environmental and labor standards.

Canada agrees with Wallonia on this matter, according to Magnette. “In truth, it’s a debate that is purely internal to the European Union,” he said.

Wallonia is ready to accept a legally binding amendment to the deal that would interpret provisions on arbitration courts, public services and environmental legislation, though the regional parliament would have favored restarting negotiations on CETA.

Article source: https://www.rt.com/business/364048-wallonia-magnette-canada-trade-deal/?utm_source=rss&utm_medium=rss&utm_campaign=RSS