This week’s news includes; Facebook testimony,  Uber’s mixed week, Google wins right to forgotten case, Spotify acquires music rights company, Santander launches Blockchain based transfers

Below are our top 10 stories that you need to know about. Be sure to check our twitter page and Facebook page for regular posts of important headlines. Get all the important stories and insights straight into your inbox by subscribing to our mailing list here.

Opinion articles of the week:

  • City A.M claims that The UK and Europe are likely to lag behind the likes of the US and China in the race to roll out 5G connectivity.
  • Legal Cheek Millennials may be tech-savvy, but they can definitely learn a thing or two from those with more experience.
  • City A.M looks at arguments that politicians should butt out of Melrose’s GKN takeover.



Mark Zuckerberg testified before the US congress to answer questions about the recent data scandal. The testimony relates to Facebook’s relationship with Cambridge Analytica (CA). CA launched a quiz on Facebook and harvested the data of participants and their friends, without consent. Users were profiled based on this data. Crucially, the data gathered from this was used by Russia to influence the 2016 US elections by pumping propaganda to potential Trump voters. It is estimated that up to 87 million Facebook users may have been affected.

The testimony itself was largely an apology for the breach. Zuckerberg’s biggest regret was failing to detect the Russian influence. Facebook is now hiring thousands of new security staff. He also clarified that the current business model, based on the monetization of user data, was not going to change. The CEO also accepted responsibility for the content on Facebook, another key issue the social media giant faces.

Congress however, faced most of the criticism in the testimony. Many members of congress fail to understand how Facebook (and modern tech companies) operate and this became clear in their questioning. Zuckerberg found himself explaining some rather basic concepts. (see video below) Analysts feel that he did much better than expected. During the speech Zuckerberg’s personal wealth grew by $3 billion as Facebook’s share price rose by 4.5%.


The US imposed sanctions on Russian individuals & related entities but the effects were truly felt last week. 24 Russian oligarchs and their businesses in were added to the sanctions list. US citizens are now prevented from dealing with these individuals and companies in any way. This includes trading their primary debt and even secondary debt.

This was most significant for aluminium producer United Co. Rusal. Rusal is one of the largest aluminium producers in the world and is owned by Russian billionaire Oleg Deripaska. They issue bonds globally but these new sanctions restrict ability to hold and trade them. Rusal’s share price fell by 50% while Deripaska‘s net worth fell by 30% in 6 days. Overall, the impact has been severe. Russian markets crashed 10% and Russia’s wealthiest have oligarchs lost over $16 billion.

US citizens are permitted to divest of their holdings to non-US citizens until 7th May. They also wind down existing contracts with restricted entities until June. Clearstream, one of the largest clearing houses, has halted trading on all securities related to restricted entities. The inability to trade

This is the first time sanctions have directly impacted large international companies in this way. Arguably, this is the most effective imposition of sanctions so far.

The Financial Times looks at the sanctions in more detail.


It’s been an eventful week for Uber. The company has faced two major court rulings and agreed terms for an acquisition.

The European Court of Justice has ruled that France can ban Uber without notifying the EU. France banned Uber’s UberPop service as it allowed unlicensed drivers, creating unfair competition for France’s licensed cab drivers. Uber challenged the new legislation and claimed France were not authorised to ban the service as they failed to notify the EU. The courts in Lille referred the case to the ECJ. The key question was whether the European Commission should have been notified before the ban. Following precedence set in December last year, the EU ruled Uber was not required to notify the commission. Uber is classified as a transport company not an “information society service”. National governments have more freedom to impose laws on transport providers than information society services.  This case could have significant implications for Uber going forward. (The Independent)

A Philadelphia court has ruled that Uber limousine drivers are independent contractors, not employees. This is significant ruling as if it stands then Uber drivers will not be entitled to employment rights and benefits such as minimum wage and . The court held that Uber did not exercise sufficient control over the limo drivers (Reuters). This is contrary to the UK where Uber failed to convince the court that drivers were self-employed contracts. See our article, The Future for Uber for more on this issue.

Uber is set to acquire bike-sharing company “Jump”. Jump provides a platform where users can rent electric powered bikes. They do not have docks so are not required to be returned to particular locations.  The bike sharing industry is growing by 20% per year so this could mark the next big move for the Uber. Customers may soon be able to hire electric bikes through the Uber app.  E-Bikes currently cost $2 for the first 30 minutes and 7c per minute thereon.  BBC News analyses the deal in more detail.


Google has lost a legal battle against a business man who wanted his details removed from its platform. Google had information about the man’s past crimes on its search engines. The man claimed that the information was no longer relevant as his time had been served and he was rehabilitated. A high court judge agreed and issued an “appropriate delisting order”. Google is now required to remove all references but the man will not receive any damages. Another business man simultaneously brought a case forward against Google but lost due to the seriousness of his crimes. (The Independent)

The General Data Protection Regulation (GDPR) comes into force on the 25th May and will set further regulatory requirements for this right. All companies who hold personal data of EU nationals to have the facility for individuals to have their personal data to be erased.  A right to be forgotten already exists in EU law but GDPR will bring more stringent regulation.


Spotify has announced that it will acquire music rights company Loudr. Loudr provides services allowing music digital providers to identify songs and pay royalties to publishers. Loudr will integrate into Spotify and help Spotify with its crisis over royalties. Spotify has faced significant criticism in recent times over its failure to pay artists appropriately. (Bloomberg)

In the US, the Music Modernization Act has just been passed and is revamping the music industry. This bill will see the creation of royalty collecting body and grant a blanket streaming license. This means music streaming services will pay royalties directly to the body and this body will then pay the relevant body. This protects the artists income but also the streaming providers from litigation. Many analysts believe that Spotify’s acquisition as a direct response to the new legislation.

Record labels are also booming, particularly in the UK. Trade income amongst record labels soared 10.6% last year, the fastest growth since the 1990’s. This growth is largely due to increased streaming subscriptions and the rebirth of vinyl. (Sky News)


Santander has teamed up with Ripple to launch a Blockchain-based international money transfer system. The new system is called Santander One Pay FX and uses Ripple’s (a Blockchain development company) platform. The service allows the receiving party to see how much they will receive before the transfer is completed. This feature is not current available on international money transfers. One Pay FX also boasts reduced transactions times and fees.  The service launched on Friday and is only available to Santander debit cards registered on Apple. Santander is the first major bank to use Blockchain technology. (City A.M)

Check out our insight article explaining what Blockchain is and how it works.


The big four auditors are set to face fines of up to £10 million if they fall short of standards. After a review, The Financial Reporting Council (FRC) will be entitled to issue penalties of up to £10m for “seriously poor audit work” to KPMG, EY, Deloitte and PwC.

The FRC used to follow previous fines as guidance for issuing new fines but this move changes this protocol. The highest fine to date was issued to PwC in 2017 as they faced £5.1 for its audit of RSM Tenon.  These levels of fines faced much criticism from within the industry. The director the ICAEW claimed that these fines could “harm the economic functioning of the marketplace”. Whether these fines will harm the sector remains to be seen. (City A.M)


Tesco revealed a 28% rise in operating profits in spite of tough market conditions. Tesco’s pre-tax profits hit £1.64 billion with total sales of £57 billion. Tesco is already benefiting from its £3.7 billion acquisition of Booker. It is testing opening a mini “Booker” wholesale section in its stores Tesco has already began test selling 30 of Booker’s wholesale products on its shelves.

The supermarket has been feeling the pinch from the recent price wars, fuelled by the growth of Aldi and Lidl. Despite these good figures from Tesco, the war is far from over. Lidl has been investing heavily and plans to open 1000 more stores by 2022. (The Guardian)


The retail rout continues as Carpetright announces 92 store closures. The carpet retailer will undergo a restructuring in order to avoid falling into administration. This move was highly expected as Carpetright has already issued a number of profit warnings over the past few months. To fund the plan the company will need to raise £60 million from shareholders and £15m from banks. Carpet will seek rent reductions of up to 50% from landlords on over 100 sites. These store closures will see nearly a quarter of all stores close and up to 300 of their 2700 staff will lose their jobs. (The Guardian)


JP Morgan posted a huge boost in profits, helped by Trump’s tax cuts and higher interest rates. Overall profits were up by 35% to $8.7 billion in the last quarter. The US Federal Reserve raised short-term rates to 1.75% last month and, this boosted JP Morgan’s lending revenue. The banks income tax expense also fell 8.6% to $2.56 billion. Despite this overall boost, this fell short of analyst’s expectation. JP Morgan’s investment banking division revenue fell by 7%.  JP Morgan is the largest bank in the US by assets and posted net revenue of over $28 billion. (Reuters