The week’s news included; Tesco ordered to stop using Clubcard Prices logo, Evergrande hit with $78 billion fraud allegations, Reddit IPO proves successful, Future trainees have offers revoked after failing SQE1.

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: 

  • BBC News – How Temu is shaking up the world of online shopping
  • City A.M. – What the modellers don’t tell you about taxing private school fees
  • BBC News – Is TikTok really a danger to the West?
  • City A.M. – How to invest intelligently in the age of AI

1. TESCO LOSES CLUBCARD LOGO LAWSUIT

Tesco has lost its lawsuit against Lidl over the use of its Clubcard Prices logo. The supermarket must now stop using the logo as the Court of Appeal found there was a risk of confusion between Lidl’s. Lidl had claimed Tesco’s Clubcard logo design, which features a yellow circle on a blue background, deliberately copied their own logo. This, Lidl argued, could trick customers into thinking their prices are comparable. Last year, the High Court ruled in favour of Lidl, and last week, the Court of Appeal agreed. Tesco will now change its Clubcard logo within the next few weeks, although the program itself will not be affected.

2. US TO BOOST DOMESTIC MICROCHIP PRODUCTION

As the race for AI supremacy heats up, the US is taking steps to boost domestic production of semiconductor chips. Semiconductors are electronic microchips that power almost every modern electronic item such as applicances and cars. Joe Biden announced a huge $20 billion in grants and loans for chipmaker Intel. The new funds will create 10,000 US jobs and will help Intel ramp up its semiconductor chip production capacity. Intel is one of the largest chip makers in the world. This award was provided under the 2022 Chips and Science Act to encourage tech firms to invest and produce chips in the US. There is a strong desire to end reliance on technology produced in far-East, particularly in China. 

3. EVERGRANDE HIT WITH $78BN FRAUD ACCUSATIONS

Chinese property conglomerate Evergrande and its founder are facing accusations of a huge $78 billion fraud. Evergrande defaulted on its debts and was ordered to liquidate its assets earlier this year. The company was China’s largest property company with $240 billion in assets but drowned under a $300 billion debt pile. The company was hit hard by a wider slowdown in China’s property market, leaving thousands of new build properties lying vacant. Now, Evergrande has been fined $583.5 million by China’s financial markets regulator. Evergrande is accused of inflating its 2019 and 2020 revenue figures to the tune of $78 billion. Founder of Evergrande, Hui La Yan, is being held responsible and faces a life ban from China’s financial markets and a criminal investigation. Check our previous top 10 for more on Evergrande’s troubles.

4. APPLE FACING US ANTITRUST LAWSUIT

Apple has been hit by a huge antitrust lawsuit in the US. The US Justice department claims that Apple is monopolising the US smartphone sector through anti competitive behaviour. Apple boasts 70% of the US smartphone market. Among many allegations, Apple is accused of making it difficult for users to change operating systems and restricting rival apps and services on the iPhone. These practices are stifling innovation and are unlawful, according to the US Justice department. Apple firmly denies allegations and will fight the case. The tech giant is fighting battles on multiple fronts. The EU had already fined Apple €1.8 billion for its practices in the music streaming business. 

5. REDDIT LAUNCHES IPO 

Social media site Reddit launched its IPO last week, reaching a huge $9 billion valuation. Shares rose 48% on the first day of trading on the New York Stock Exchange and hit $50.44 per share. Reddit offered 22 million shares in its listing, with an undisclosed amount offered directly to Reddit users and moderators. This is one of the largest social media IPOs ever.

Reddit was founded in 2005 and boasts 73 million users. The platform posted a $90 million loss last year and has never made a profit. The advent of AI however, has brought about a new revenue stream. AI companies will pay social media sites like Reddit for data to train their systems. Google reportedly paid $60 million to Reddit for access to its data to train its AI machines. Regulators are reviewing this practice, due to the potential impact on user privacy. Whether Reddit can become profitable with this model remains to be seen. 

6. CMA TO INVESTIGATE VODAFONE-THREE MERGER

The Competition and Markets Authority is launching a stage two investigation into the £15 billion merger between Vodafone and Three UK. The CMA believes the deal could significantly weaken competition and result in higher prices for consumers. Three is the second largest mobile phone operator while Vodafone is the fourth largest. The tie-up would see the big four network operators reduced to three. O2 and EE are the other two largest mobile network operators. The operators provide services to businesses and households so decreasing competition could see prices spike. Vodafone and Three must now respond to the CMA with “meaningful solutions” to their concern. This could involve divestment of assets or segregating certain parts of their businesses. 

7. UBER AGREES AUSTRALIAN LAWSUIT SETTLEMENT FOR £140M

Uber is settling a lawsuit with taxi operators in Australia for A$271.8 million (£140m). The ride hailing giant faced a group action lawsuit involving more than 8000 taxi and hire car owners and drivers. The lawsuit claimed that Uber’s tactics to enter the Australian market unduly damaged their businesses and cost them income. The case has been running since 2019 but now Uber has agreed to settle the case. The Australian court still needs to approve the deal but this marks a significant step forward.

8. UNILEVER CUTS 7500 JOBS

Consumer goods giant Unilever is slashing 7500 jobs worldwide. The company is aiming to make €800 million in savings over the next three years. The cuts represent around 5% of its 128,500 strong workforce. Unilever will also separate its ice cream business into another entity. Unilever’s ice cream brands include; Wall’s, Ben & Jerry’s, Carter d’Or and Magnum. The reason for this is because Unilever feels ice cream was a seasonal product and has less in common with its wider business. This separation will help streamline the businesses and hopefully boost productivity. Unilever hopes to complete this process by the end of 2025.

9. BANK OF ENGLAND KEEPS RATES STEADY

The Bank of England has voted not to change interest rates despite encouraging inflation figures. Interest rates remain at 5.25%, their highest levels since the financial crisis. Governor Andrew Bailey said that it was not yet time to cut interest rates although we are getting there. UK inflation, which measures the average rate of price increases, dropped to 3.4% in February, the lowest since September 2021. The Bank’s target rate is 2% and they anticipate this will be achieved in the summer.

This mirrors the case in the US where the Federal Reserve kept rates between 5.25% and 5.5%. They did however, signal that rates will be cut later this year. As inflation starts to stabilise fall, we should see rates drop and ultimately, pressure on households also fall. 

10. FUTURE TRAINEES LOSE CONTRACTS AFTER SQE FAIL

Future trainees at Magic Circle law firm Clifford Chance saw their training contract offers revoked after failing the Solicitors Qualifying Exam (SQE), according to Legal Cheek. Candidates are expected to pass their SQE1 exam on the first attempt. Clifford Chance takes on a huge 110 new trainees every year and is the largest training contract provider in the UK.  The firm pays for SQE exams and first year trainees receive a £50,000 salary upon joining the firm. Legal Cheek reports that around four trainees saw their offers pulled. Future trainees at law firms CMS and Slaughter and May also saw their offers withdrawn for the same reason. Check the full article out on Legal Cheek.