Law

Money-laundering fight starts with transparency

21 Sep 2020

Bank shares fell after leaks suggested lenders moved allegedly dodgy funds despite red flags. They will keep doing so if they can plead ignorance about where cash ultimately comes from and ends up. Better visibility on company ownership, and cross-border data sharing, will help.

Trump judicial picks are lasting gift to business

18 Sep 2020

The death of Justice Ruth Bader Ginsburg hands Donald Trump his third U.S. Supreme Court pick. He’s already appointed 25% of active federal judges. The resulting anti-regulation bias could last a generation. That may be good for companies – less so their employees and customers.

Corona Capital: Davos delay, Political TV ratings

26 Aug 2020

Concise views on the pandemic’s corporate and financial fallout: The World Economic Forum’s annual winter meeting becomes a summer gathering; and in the U.S., the Democrats’ online spectacle leads TV ratings over the Republicans’ more traditional convention.

Uber may be in the driver’s seat in labor dispute

21 Aug 2020

A California court gave the ride-hailing firm some breathing room to comply with a new law that turns gig workers into employees. Voters will decide in November if that should hold. The protracted mess gives Uber, DoorDash and others a reason to compromise on labor policies.

Stock markets in China grow governance teeth

5 Aug 2020

The Supreme Court will allow class-action lawsuits similar to those that won big settlements for Enron and WorldCom shareholders. Liberalisations have unleashed massive rallies on domestic bourses, and restraint on executive abuse is overdue. China Inc had better lawyer up.

Goldman Sachs’ 1MDB scar is already fading

24 Jul 2020

It’s paying $2.5 bln to Malaysia over its role in the scandal, four times its fees. Next comes closure with U.S. regulators. The cost in cash and reputation no doubt stings, a bit. But it's too small to amount to more than one extra line on Wall Street’s mile-long rap sheet.

UK insolvency shakeup stops at Chapter 10.5

23 Jul 2020

A fast-tracked new bankruptcy code gives Covid-hit firms, like Virgin Atlantic, precious breathing space. As with the U.S. Chapter 11, directors can get protection from creditors as they try to restructure. It’s better than the systems used by EU peers, but can still be improved.

Wirecard’s red flags offer lessons for investors

20 Jul 2020

Shareholders couldn’t have known that $2 bln of the payments group’s cash was missing. But its seemingly unnecessary reliance on debt finance raised questions. A weak board and short-term executive pay packages were further warning signs. All three serve as a teachable moment.

Apple tax win flags EU problem of enemies within

15 Jul 2020

The tech giant won a legal case over $15 bln of back taxes. Ireland was fighting at its side against Europe’s antitrust czar Margrethe Vestager. The alliance shows the stiff resistance she faces, from governments as much as companies, to corporate tax reform or a digital levy.

Sweden chips away at fintech star’s foundations

13 Jul 2020

A new law by the Nordic state requires Klarna to reduce the prominence of so-called “buy now, pay later” options on e-commerce platforms. It could check a key growth area for the domestic financial group. That might be a problem if other governments decide to clip its wings too.

Trump case gives mogul presidential wannabes pause

9 Jul 2020

The U.S. Supreme Court ruled a prosecutor can obtain Donald Trump’s financial records. Congress had less luck in another case, but the decision clarifies what information White House candidates can keep under wraps. That sets a new bar for other business leaders who want the job.

China’s firewall casts shadow over Hong Kong

7 Jul 2020

Twitter, Google and Facebook suspended cooperation with local courts as new rules allow police to seize assets and force sites to delete seditious content. Others such as Netflix stand to be affected, and blockages seem likely. That can only accelerate the exodus of talent.

China smothers Hong Kong in heavy security blanket

1 Jul 2020

A harsh new law will quash protests that have vexed the business community. The definition of subversion is ominously vague, while allowing for extradition and secret trials. It also applies to non-residents, further complicating risk management. The price of order is high.

Wirecard is argument for a Big Four pay clawback

30 Jun 2020

Audit giant EY is embroiled in the German scandal after signing off accounts when $2 bln was missing. Remedies like splitting bookkeeping from consulting or using two auditors may focus minds on finding frauds. But until pay is linked to clean accounts, scandals will continue.

Bayer pays dearly for blind faith in science

24 Jun 2020

The German group will spend up to $10.9 bln to settle U.S. claims its weedkiller causes cancer. Though Roundup remains legal, Bayer misread the danger of taking its chances with American juries. Shareholders will bear the toxic legacy of its ill-judged $66 bln Monsanto takeover.

Corona Capital: Carnival, Cheap funds, Salmon

18 Jun 2020

Concise views on the pandemic’s corporate and financial fallout: What lies on the horizon for the cruise operator; locking in cheap financing; and a fishy tale of coronavirus-related swings in demand.

LGBTQ ruling adds to the great American workaround

15 Jun 2020

Outlawing workplace discrimination was a job for Congress, not the Supreme Court. But with government so dysfunctional, change had to come from elsewhere. Big companies know the feeling: they are already working around the political void on everything from climate to Covid-19.

UK’s pandemic insurance test will be first of many

15 Jun 2020

A British court will decide in July whether 1,200 firms can claim for lost sales caused by Covid-19. Insurers can easily absorb worst-case losses of around $380 mln. But with other countries planning similar rulings, business interruption policies could yet prove a big headache.

IBM makes a virtue of facial-recognition necessity

9 Jun 2020

New CEO Arvind Krishna is ending the $117 bln firm’s attempts to develop the technology and questioning whether police should use it. Companies rarely abandon potential profit for PR wins, but it’s easier when operations are small, rivals pull ahead, and regulation threatens.

U.S. response to Hong Kong calls for precision

5 Jun 2020

Politicians want to swat China for ramming through draconian security laws in the restless city. The likely targets are Chinese banks. Starving them of dollars is a harsh option but risks collateral damage to foreign firms. Naming and shaming individuals is smarter and cheaper.