This week’s news includes; Trump calls national emergency to build wall, Theresa May loses in Parliament again, Patisserie Valerie rescued, Carlton Dance not copyrightable under US law
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:
- CNBC Digital Currency Group CEO says most cryptocurrencies will fail, but bitcoin is still king
- Lex 100 What is intellectual property (IP) law?
- The Telegraph Non-disclosure agreements: Everything you need to know about NDAs.
1. TRUMP CALLS NATIONAL EMERGENCY
President Trump has announced that he will call a state of emergency in order to obtain the funding for his promised border wall. Trump had a reached an impasse in Congress after they refused to provide the $5 billion funding requested for the wall.
Democrats have called Trump’s move to call a state of emergency a “gross abuse of power”. They are preparing to take legal action against President Trump. Congress can block the move if bot houses vote for it and the president does not veto it. Although Republicans control the Senate, many have expressed serious concern about the constitutionality of calling a national emergency. Calling the national emergency will grant Trump access to nearly $8 billion in funding. Trump argues that the flow of illegal immigrants from the Mexican border is a national emergence. The total cost of the wall is expected to be $23 billion.
BBC News explores the reality of Trump’s proposed border wall.
2. THERESA MAY SUFFERS BREXIT DEFEAT IN PARLIAMENT (AGAIN)
MPs have voted down Theresa May’s Brexit approach. The motion put before the house was a parliamentary endorsement of the government’s negotiating strategy. MPs voted down the motion by 303 to 258.
The Brexiteer wing of the Conservative party the European Research Group (ERG) all abstained from the vote. The motion expressed support for a previously backed motion was which would rule out a no-deal Brexit and therefore, they could not support the motion. Additionally, several remainer Conservatives abstained, while five voted with Labour against the government.
The motion is not legally binding, but Jeremy Corbyn says the PM should admit her strategy has failed. The government claim Corbyn is putting party politics before the national interest.
Despite the vote, Theresa May reiterated her commitment to plough on with her plan. She is still seeking alternative arrangements to the controversial Irish backstop. The EU however, shows no sign of budging particularly because there is still no consensus with the UK Parliament. With only 6 weeks until the UK is set to leave the EU, we are still no closer to knowing what Brexit will look like, or if it happens at all.
3. PATISSERIE VALERIE RESCUED
Valerie has been rescued by private equity firm Causeway Capital. The firm
bought the beleaguered cafe chain which will see 96 stores remaining open
saving 2000 jobs. Causeway Capital usually invests in small and medium
An accounting scandal in December 2018 exposed a £20 million blackhole in their books due to “potentially fraudulent, accounting irregularities”. The investigation into its former auditors Grant Thornton is still ongoing. The chain was then unable to meet their debt repayment obligations and were forced to call in the administrators.
Business mogul Mike Ashley pulled out from purchasing Patisserie Valerie after administrators KPMG countered his bid asking for an additional £2 million to his £15 million bid.
4. UK SIGNS TRADE DEAL WITH SWITZERLAND
The UK and Switzerland have signed a continuity trade deal. The deal will allow the two countries to trade based on the EU’s current free trade deal with Switzerland. This marks a positive move for post-Brexit Britain. Switzerland is an important trading partner for the UK, with roughly £32 billion worth of trade between the nations. There is still much work to be done to prevent any disruption. The government is seeking to sign another 40 other free trade deals before March 29th.Mutual recognition agreements have already been signed with Australia and New Zealand.
5. CARLTON DANCE NOT COPYRIGHTABLE
Alfonso Ribeiro has failed his attempt to copyright his “Carlton Dance”. The attempt for registration has been rejected by the US Copyright Office. The Copyright Office claimed that the iconic dance was “a simple routine and not registrable as a choreographic work”. This was supposed to be the first step towards successfully suing the makers of Fortnite, Take-Two Interactive. Fortnite introduced a dance within the game called “fresh” Which follows the same choreography. The rejection by the copyright Office is likely to see the lawsuit thrown out all together.
6. JP MORGAN CRYPTO
US investment bank JP Morgan has launched its own cryptocurrency, JPM Coin. CEO Jamie Dimon has been one of the most vocal critics of Bitcoin, the largest cryptocurrency. He says however, that he has always believed in the potential of the underlying technology.
JPM coin is only available for internal transfers between institutional accounts. Clients will still have to be approved by regulators and must go through anti-money laundering checks. Deposited cash is then converted to equivalent JPM coins and clients are then able to move coins over the blockchain network. The coins can then be converted to USD once the transaction is complete. The bank will not see the transactions that take place due to the privacy of the blockchain.
Cryptocurrencies run on blockchain and provide an ultra secure means of peer to peer transfers. The potential speed of cryptocurrency transactions is one of its most appealing attributes, which has evidently lured in JP Morgan. Another core attribute of cryptocurrency however, is its general decentralized nature. Not JPM Coin. JPM Coin is controlled solely by the bank. The move has been met by scepticism within the crypto community although JP Morgan is not the first to centralise its blockchain.
Check out our insight article to learn more about Blockchain.
7. RBS PROFITS
RBS looks to have made a full recovery from the recession. RBS doubled profits to £1.62 billion for 2018. The bank has undergone a major shakeup to achieve this turnaround. It has sold off large parts of its business and has not set aside extra money to deal with PPI claims as the 29 August 2019 claim deadline draws nearer. The bank is still 62% owned by the government after the £45 billion bailout in 2008. The government hopes to sell off all RBS shares by 2024 although heavy losses are expected. RBS shares are currently trading at around half of the 502p per share the government paid. Consistently positive results could see a surge in its share price, but the outlook is shaky. As with all companies, RBS expressed concern about geopolitical uncertainty and believe that a significant economic slowdown in imminent. RBS’ CEO warns that Brexit could have a more significant impact on the economy than predicted. The bank had lent £1.9 billion to companies to help with Brexit contingency plans. There is a fear that we could see an increase in defaults depending on the outcome of Brexit. (BBC News)
8. AMAZON CANCELS HQ2
Amazon has cancelled plans to open its New York HQ. The plans were announced in November and would cost $5 billion to construct, with roughly 25,000 jobs expected to be created. Amazon scrapped the project because of strong political opposition to the move. Amazon was set to receive a $3 billion taxpayer subsidies. This opposition came from both activists, local and state politicians. Business Insider has the full statement.
Amazon has also received fierce determination criticism for paying $0 in federal income tax despite boasting a $11.7 billion profit in 2018. Amazon managed this through unspecified ‘tax credits’ as well as a tax break for executive stock options.
9. FLY BMI COLLAPSE
Budget airline Flybmi has fallen into administration. The company was beleaguered by rising costs and increased competition making business unsustainable. The company also cited Brexit as a reason for increased costs. The EU has recently removed UK airlines from the Emission Trading Scheme which has led to increased carbon costs. As of Saturday, all flights were cancelled and Flybmi filed for administration. The sudden collapse left several passengers stranded and looking for alternative routes home. The airline employs 367 people. (The Telegraph)
10. DEBENHAMS SECURES LIFELINE
Debenhams has secured a £40 million credit facility allowing the high street retailer to plough on. The company hopes to this cash will allow it to carry out its restructuring and recapitalization. This process will however, result in thousands of jobs cuts as the firm tries to stay afloat in a challenging retail environment. Debenhams issued a number of profit warning and had all already cut over 4000 jobs last year The retailer posted a loss of £10m in 2017. The news of the loan facility led to a 28% rise in Debenhams share price.