The week’s news included; TikTok divest or ban bill goes to US Senate, EU approves AI regulation framework, UK bans foreign takeovers of media publishers, Binance execs detained in Nigeria for allegedly crashing Naira.

Below are our top 10 stories that you need to know about. Be sure to check our twitter page, Facebook page and Instagram 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. – AI is supposed to automate paperwork, not create more
  • CNBC – One of world’s top ocean shippers says the outlook has changed for the global economy
  • City A.M. – Old buildings are not as important as people having places to live

1. TIKTOK DIVEST OR BAN  BILL 

The US House of Representatives has approved a bill that would force TikTok to sell its US business or face a ban. Lawmakers overwhelmingly agreed with a Congressional panel that TikTok poses a national security threat under Chinese ownership. TikTok is owned by Chinese tech giant ByteDance. Although TikTok has tried to convince lawmakers that US user data is separated from the Chinese business, this fell on deaf ears. The bill is now with the US Senate for a vote and if approved, will go to Joe Biden to sign off. ByteDance will have 6 months to sell TikTok to a US entity.

In China however, ByteDance would need approval from the government to sell TikTok. The Chinese government has said it will block such a move. Ultimately this would result in TikTok being banned from app stores in the US. There is some concern that this bill could open the floodgates to force the sale of any company. Furthermore, there are 150 million US TikTok users and millions of small businesses that rely on TikTok. Shutting down the app could prove devastating. A forced sale nearly took place under former President Trump but subsequently collapsed. Check out our article exploring the debate.

2. EU APPROVES NEW AI FRAMEWORK

The European Parliament has approved the world’s first comprehensive regulatory framework for artificial intelligence (AI). The AI Act will set binding requirements for AI developers to mitigate the risk of harm to society. A risk based approach will be applied to all AI tools. Typically, those tools which have greater potential to be abused or infringe on civil liberties will be considered high risk. Some AI apps will be banned altogether, such as some AI tools that process biometric data like fingerprints or facial recognition. Systems used in fields like infrastructure, law enforcement or healthcare will be considered high risk and will face tighter restrictions. Developers who make generative systems like ChatGPT may also be required to provide more detail on the data used to train their systems. 

Both China and the US have introduced some rules around AI development but nothing as comprehensive as the EU’s. The UK has no such rules in place or even formally proposed. There are still more steps before the AI Act becomes law but it certainly shows the desire of EU regulators to catch up with the rapidly expanding AI space. 

3. UK BANS FOREIGN BUYOUTS OF UK MEDIA PUBLISHERS

The UK government has banned foreign governments from owning UK media publishers. There is concern about the independence of British media if publishers are bought by foreign governments. This new legislation is driven by the proposed takeover of the Daily Telegraph and Spectator by RedBird IMI, an investment firm backed by the UAE. UAE’s Deputy Prime Minister, Sheik Mansour, who also owns Manchester City Football Club has a 75% stake in RedBird. Although RedBird promised no changes to editorial freedom among other safeguards. This law will only apply to publishers such as newspapers and magazines but not to broadcasters. In light of the legislation and general political opposition to the deal, RedBird’s proposed deal is likely to fail. 

4. LIBOR CONVICTIONS APPEALED

Two former traders have appealed their conviction against their convictions for rigging the Libor rate. The London Interbank Offered Rate (LIBOR) is the rates at which banks lend to each other. Euro Interbank Offered Rate (EURIBOR) covers interbank interest rates in the eurozone. A scandal erupted when it transpired bankers had been rigging the Libor and Euribor rates. 37 traders both in the US and UK have been prosecuted for rigging rates. The “rigging” involved selecting the Libor rates that were most beneficial for the bank’s trades. They argued this was common practice and was not a breach of any rules. The Serious Fraud Office however, considered this to be conspiracy to defraud. Of the two appealing, one trader was sentenced to 11 years in prison but was released in 2021 after serving five and a half years. The second trader received four years in 2019 and was also released in 2021. 

Now, the traders are appealing the ruling to clear their names. If successful, this could pave the way for more overturning of all convictions. There has long been a sentiment amongst market commentators that the affected traders have been scapegoated by banks who needed someone to blame for the scandal. In 2022, traders in the US were exonerated for “rigging” Libor as technically no rules or laws had been broken. BBC News looks closer at the case.

5. REDDIT IPO

Social media site Reddit is launching its IPO this week. It announced it was seeking a $6.4 billion valuation. This figure is notably lower than its $10 billion valuation reached in 2021 during a funding round. It will offer some shares specifically for users and moderators on its website. The company made $810 million in revenue in 2023 but still posted a $90 million loss. Reddit is yet to turn a profit since its inception in 2005.

Reddit is a popular site with 850 million users. Users have expressed concern that going public will affect the quality of the site. This is because shareholders typically demand short term profitability rather than long term improvements. Reddit has strong user communities which may be affected. Reddit was at the forefront of the Gamestop saga in 2021. 

6. HOUSEBUILDER TAKEOVER DEAL FACES CMA PROBE 

The Competition and Markets Authority is investigating the purchase of Redrow by rival housebuilder Barratt. Barratt is the UK’s largest housebuilder and it struck a £2.5 billion to buy its smaller competitor Redrow. The combined companies have a turnover of £7 billion and are worth an estimated £7.2 billion. The CMA believes that this deal could weaken competition in the house building sector . The CMA is beginning its investigation and issuing a “ invitation to comment” to interested parties. Housebuilders had already come under fire for persistent under-delivery of homes (see previous top 10) and the CMA found evidence of anti competitive pricing in the industry. Barratt and Redrow posted £95 million and £84 million in pre-tax profit in H2 of 2023 respectively. The combined company would operate under the name Barratt Redrow.

7. XIAOMI STEPS INTO EV SPACE

Tech giant Xiaomi has stepped into the electric car space and is selling its first vehicle this month. Xiaomi is best known for its smartphones and its fifth largest phone manufacturer in China. The company is investing $10 billion in its vehicle business by 2034. China is the world’s largest car market so Xiaomi will no doubt be looking to cash in. Competitor BYD outsold Tesla globally in the electric car space last quarter, a huge milestone. Tesla has already cut its price in China to remain competitive. In China, a record 8 million plug-electric vehicles were sold in 2023. By comparison, the US only sold 1.4 million last year. 

8. UK ECONOMY GROWS 

The UK economy has returned to growth after falling into recession. In January the economy grew 0.2% breaking the trend of contraction. A recession is defined as two successive quarters of decline. If the UK economy continues to grow in February and March, this could mark the shortest recession in history. Services and construction both saw growth in January which dragged the economy out of decline. Around 80% of the UK economy is service based.

9. BINANCE BOSSES DETAINED IN NIGERIA

Two Binance bosses have been detained in Nigeria, accused of crashing the Naira currency. Nigeria claims the crypto exchange enabled a staggering $26 billion of untraceable transfers out of Nigeria in 2023. These heavy outflows have led to a currency crisis in Nigeria. The Naira has lost a record 230% in value in the last year alone, falling to1524 against the dollar. The government now alleges that Binance’s activities in Nigeria were illegal and is seeking to hit the company with $10 billion in penalties. Two Binance executives were invited to Nigeria, then held a meeting with government officials and were detained without charge. The pair now have a hearing set for March 20. Binance has said that it is working to bring the two executives home. 

10. BOEING WHISTLEBLOWER DIES 

A Boeing whistleblower has been found dead as he was giving evidence against the aircraft manufacturer. John Barnett has worked for aircraft maker Boeing for 30 years before retiring in 2017. He was in the middle of a whistleblower retaliation case against Boeing. He blew the whistle on a number of serious safety issues with Boeing’s 787 dreamliner in 2019. He said the manufacturer deliberately fitted planes with faulty parts and passengers on its 787 Dreamliner could be left without oxygen in the event of a sudden decompression. Barnett claimed he faced harsh retaliation from Boeing as a result.  He then took legal action against Boeing and was giving evidence against the company. Last week, he was found dead and the cause of death has been noted as “self-inflicted wound”. Boeing said ““We are saddened by Mr. Barnett’s passing, and our thoughts are with his family and friends.” 

Boeing has a long list of safety issues spanning the past few years. Earlier this month, a 787 plane dropped abruptly mid-air injuring 50, although the cause is not yet known. In January, a Boeing 737 Max 9 door panel blew off mid flight, leaving a hole in the aircraft.  In 2018 and early 2019, the 737 Max was grounded after two fatal crashes due to defects in the planes software. The 737 Max was grounded for almost two years.