This week’s news includes; US indicts Huawei and slaps PDVSA with sanctions, Barclays moves assets to Dublin, Asda loses equal pay lawsuit and Facebook Research App exposed .
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:
- BBC News – How has business been affected by Brexit so far?
- Legal Cheek – Adapt to Lawtech or be left behind.
- BBC News Will the US and China finally agree a trade deal?
Last week, MP’s held votes on important amendments to the Brexit bill. MP’s voted to block a no-deal Brexit and to push the government to seek alternatives to the Irish backstop.
Spelman’s amendment proposed that Parliament rejects the UK leaving without a withdrawal
agreement and a Framework for the future relationship. MP’s also voted in
favour of Sir Graham Brady’s amendment which require the government to seek “alternative
arrangements to the backstop to avoid a hard border”. This amendment still supports
Theresa May’s deal and the PM even ordered Conservative MP’s to support this
These amendments are not binding but do apply pressure on the government. Theresa May has however, committed to reopen negotiations to find legally-binding alternatives to the backstop.
Five other amendments were rejected, including Jeremy Corbyn’s. He proposed an amendment to allow MP’s to vote on either a Brexit involving a permanent customs union, a second referendum on a proposition with cross party support.
Last week, EU also announced that UK citizens will be granted visa-free travel to the EU after Brexit, even in the event of a no-deal. The proposed regulation would allow visits to the EU for up to 90 days. The UK has already committed to allowing visa free visits for EU citizens after Brexit.
The Independent explains World Trade Organisation rules and what exactly do they mean?
2. HUAWEI INDICTMENTS
The US has hit Huawei and its CFO with 23 criminal indictments. The offences include conspiracy to defraud the US, bank fraud and theft of trade secrets. One of the main aspects was the breach of the US sanctions on Iran. Huawei and its CFO Meng Wanzhou have both been accused of misleading the US and international banks in order to circumvent sanctions and continue business with Iran. The indictment also details how Huawei allegedly stole from T-Mobile by operating a bonus programme that encouraged employees to steal competitor information. Meng Wanzhou was arrested over this issue in Canada in December and is facing extradition to the US. Huawei denies the allegations and China deems the US’ crackdown on Huawei as “unreasonable”.
This news will likely see Western countries further distance themselves from the Chinese tech giant. Huawei is a front-runner in 5G technology and its equipment is used in a number of western telecoms networks. BT recently removed all Huawei equipment over concerns about Chinese spying. Oxford University has also stopped accepting all Huawei donations amid these security concerns.
3. VENEZUELA SANCTIONS
The US has issued sanctions against Venezuelan oil firm PDVSA. US persons can no longer import PDVSA oil or engage with PDVSA while proceeds still go to Maduro’s government. The measure is designed to stop Maduro exploiting the state oil company for his own benefit. Venezuela relies on exports to the US, where it sends 41% of its exports. Maduro is now looking to take legal action to protect PDVSA’s US subsidiary.
The nation is embroiled in a political crisis. Mr Juan Gauido has named himself as interim President and has been recognised as leader by the US and 20 other nations. President Nicolas Maduro still clings to power but faces ever growing pressure to step down. The US hopes this measure will bring about a peaceful transfer of power. PDVSA can avoid sanctions by recognising Gauido as president.
BBC News looks at the crisis in Venezuela in more detail.
4. ITALY FALLS INTO RECESSION
The Italian economy has officially fallen into recession. In the final quarter of 2018 the Italian economy shrunk by 0.2% following a 0.1% decline in the third quarter. The economic decline has largely been triggered by a huge slump in manufacturing.
Italy has been locked in a budget dispute with the EU over the past few months. The budget proposed by the coalition government included numerous costly initiatives. The budget would have introduced a universal basic income, tax cuts and a reduction of the retirement age to 62 (after 38 years in work). The European Union were unwilling to approve this budget over concerns about Italy’s increasing debt levels. Previous governments had committed to maintain a deficit level of 1.8% of GDPR but the new government proposed to increase it to 2.4%. A compromise of 2.04% was reached and concessions amounting to roughly €6 billion were agreed in December. This crisis, however, is fuelling Eurosceptic movements within Italy and we could see greater political instability in coming years.
5. BARCLAYS MOVES ASSETS TO DUBLIN
Barclays has announced that it will be implementing its Brexit contingency plan. Time is running out and the bank said it could wait no longer to receive clarity on the final outcome. The bank will be moving €190 billion of assets of roughly 5000 clients to Dublin. This amounts to roughly 15% of the bank’s assets, covering business that took place in EU. The decision has been made on the assumption that the UK will leave with no deal. Barclays’ Dublin office will double its headcount to 300 as a result of Brexit. The bank was required to seek High Court approval for the transfer. The judge agreed that Barclays could not wait any longer to implement the scheme. The plan will be in place in by 29th March.
6. YAHOO PAY OUT BLOCKED
A US judge has blocked the Yahoo’s attempted settlement over it’s data breaches which affected 3 billion users. Yahoo wanted to allow lawyers to claim up to $37.5 million in costs, the pay-out for victims was not disclosed. The judge deemed this insufficient and held Yahoo provided a lack of clarity on its remedial action.
The class action relates to three data breaches between 2013 and 2016. Breaches in 2013 and 2014 saw unauthorized access to data of 3 billion and 500 million users respectively. The 2014 data was then used to breach user accounts between 2015 and 2016. Yahoo was criticized for failing to quickly notify victims of the breaches. Much of the stolen data was posted for sale on the dark web.
All breaches occurred before Verizon’s acquisition of Yahoo in 2017. Read the full judgement here.
7. ASDA EQUAL PAY DISPUTE
Asda has lost a case in the ongoing equal pay dispute. Retail workers claim that they should have been paid the same rates as those working in warehouses and depots. The case turns on whether retail workers are of equal value as depot workers and therefore, entitled to equal pay. Some of the claims relate to employment at Asda as far back as 2002.
The Court of Appeal held that the workers should be paid equally. The reasoning was because “Asda applied common terms and conditions wherever they work”. The judge deemed that the unequal pay was sex discrimination as the roles were of equal value but the male dominated
An application to appeal to the Supreme Court had been rejected.
Leigh Day is the firm leading equal pay disputes against Asda, Tesco, Sainsbury’s and Morrisons. The firm is representing over 30,000 retail workers. If all claims are successful, the supermarkets could be liable for a pay out of over £8 billion
8. LLOYDS OFFER 100% MORTGAGES
Lloyds has revealed that it will be offering 100% mortgages to first time buyers. Under Lloyd’s “Lend A Hand” deal, buyers can borrow up to £500,000 for a new home. Buyers must, however, must have family that can stand behind the loan. The family member must put a sum equal to 10% of the property value in a Lloyds saving account.
This move forms part of a £30 billion commitment to help first time buyers. Deposits are usually the primary hurdle to home ownership for many first time buyer. In London the average deposit for first time buyers has reached a staggered £110,182 and £33,211 outside London.
9. FACEBOOK RESEARCH APP
Facebook has removed the Facebook Research App, which pays teenagers for their iPhone data. Tech Crunch launched an investigation which uncovered the practice. Users as young as 13 were paid up to $20 per month for access to private messages and emails, browsing and location history. This was a clear breach of Apple’s terms. Facebook removed the app only hours after release of the report. This is Facebook’s second removed data research app. In 2018, Facebook’s Onavo was also banned from Apple’s app store and was almost identical to the Facebook Research App.
Facebook’s latest financials showed quarterly revenues up 30% to $16.9 billion. Facebook currently has 2.32 billion monthly active users a
10. N-POWER JOB CUTS
N-Power has announced that it will slash 900 up to UK jobs. The firm claims that this is due to “worsened market conditions” as it expects significant losses. The price cap came into force on 1st January 2019 to aid customers avoid rip off charges. It limits the cost of electricity and gas on default tariffs at 17p and 4p per kWh respectively. The cap will be reviewed periodically throughout the year. Suppliers felt the market was sufficiently competitive and are concerned that the price cap will eat at profits.
The energy sector is struggling as a number of suppliers such as Extra Energy and Economy Energy have collapsed in recent months. A total of nine At least five of the big six energy firms will posts low profits or losses for 2019, according to Ofgem. It is likely we will see a major shakeup in the energy sector over the next few years.