CLOs

The White House and TikTok have drafted a preliminary agreement to resolve national security concerns posed by the Chinese-owned video app but face hurdles over the terms as the platform negotiates to keep operating in the United States without major changes to its ownership structure, reports the New York Times (26 September, Hirsch, McCabe, Benner, Thrush). The two sides have shaped the foundations of a deal in which TikTok would make changes to its data security and governance without requiring its owner, ByteDance, to sell it, said insiders. TikTok has been under a legal cloud in the United States for more than two years because of its Chinese ties. Former US President Donald J. Trump tried to force ByteDance to sell TikTok to a US company in 2020 and threatened to block the app. TikTok has been negotiating with representatives for the Committee on Foreign Investment in the United States to resolve concerns that the app puts national security at risk. The group would need to sign off on an agreement.

From "TikTok Seen Moving Toward US Security Deal, but Hurdles Remain"
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French Finance Minister Bruno Le Maire has pledged additional aid for larger companies hit by high energy prices, reports the Financial Times (26 September, Arnold, White, Strausee). Le Maire vowed his government would help to shield businesses from spiraling gas and electricity prices, saying he would push to double the state aid available for industrial companies and other medium-sized businesses struggling with energy bills to up to €100 million. Meanwhile, Christine Lagarde, president of the European Central Bank, told EU lawmakers on Monday that growth would “slow substantially” in the coming quarters, while the Organization for Economic Co-operation and Development warned on the same day that Europe risked being pushed into a recession next year if a harsh winter exacerbates the region’s energy shortages and natural gas consumption is not reduced at least 10 percent to avoid it being rationed for power-hungry industrial groups.

From "France Aims to Shield Bigger Companies as Recession Fears Deepen in Europe"
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Top US insurance companies and associations say California is risking a crisis in the nation’s largest automobile insurance market by refusing to approve any rate increases since the start of the pandemic, reports the Associated Press (26 September, Thompson). The companies are already cutting back and say they cannot continue operating at a loss while Insurance Commissioner Ricardo Lara delays rate cases filed by companies representing three-quarters of the California market. Allstate, Geico, Kemper, Liberty Mutual, and State Farm all reported paying more in claims than they collected in California premiums in the first half of the year, though they were profitable as recently as last year. It’s part of Lara’s effort to compensate consumers who he says were overcharged during the pandemic’s early months, when traffic all but disappeared after California imposed the nation’s first stay-home order. A state appeals court ruled last year that Lara can’t impose “retroactive rates and refunds.” The state Supreme Court declined review, and while Lara’s office interprets the ruling narrowly, insurers say it’s a blanket ban on his attempts to require further refunds.

From "Insurers Say California’s Inaction Threatens Auto Policies"
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American Airlines Group and JetBlue Airways will defend their partnership in a trial starting this week against government allegations that they are squelching competition in New York and Boston and harming consumers throughout the country, reports the Wall Street Journal (26 September, Sider, Mulvaney). The US Justice Department, along with six states and the District of Columbia, filed an antitrust lawsuit last year to block a 2020 agreement between the two airlines to sell seats on one another’s flights along certain routes, pool airport slots, coordinate schedules, and share revenue from flights within the scope of the partnership in the US Northeast. The department has said the partnership is tantamount to an unlawful merger. The suit filed in Massachusetts federal court alleges the alliance will neutralize JetBlue, which previously was a “scrappy opponent” to the bigger airlines.

From "American, JetBlue to Face Off Against US Justice Department in Antitrust Trial"
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The US Department of Agriculture (USDA) is proposing regulations to prevent meat companies from retaliating against livestock and poultry farmers who speak out on practices such as price-fixing, reports Reuters (26 September, Polansek). The USDA also said it would work with state attorneys general to investigate anticompetitive practices in the agricultural sector that contribute to inflation. The moves aim to increase competition in the meat industry as part of a broader effort by the White House.

From "US Plans Rule to Protect Livestock Farmers from Company Retaliation"
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Apple has begun producing its iPhone 14 model in southern India less than a month after it was launched, reports the Financial Times (26 September, Reed), as the company works to diversify its supply chains out of China and expand production in India. Apple, which makes most of its iPhones in China, has been shifting some of its production outside the country as geopolitical tension rises between Washington and Beijing. China’s harsh pandemic policies with sweeping lockdowns have also disrupted business. The increased production in India is a win for Prime Minister Narendra Modi’s government, which has been working to boost domestic manufacturing and exports through its “Make in India” campaign.

From "Apple Expands iPhone Production in India in Shift Away from China"
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Biogen agreed to pay US$900 million to settle allegations it paid kickbacks to physicians to induce them to prescribe the company’s multiple sclerosis drugs, reports the Wall Street Journal (27 September, Walker). From 2009 to 2014, Biogen allegedly used such remuneration as speaking and consulting fees to persuade doctors to prescribe the company's Avonex and Tecfidera. This resulted in fraudulent payments by Medicare and Medicaid, according to a federal whistleblower lawsuit filed a decade ago by ex-Biogen employee Michael Bawduniak and unsealed in 2015. Under the Civil War-era False Claims Act, private individuals can file civil suits on behalf of the federal government and receive a portion of any recovery related to fraud. Under terms of the Biogen settlement, the company will pay US$843.8 million to the US government, of which Bawduniak will receive 29.6 percent. Biogen must pay an additional US$56.2 million to 15 states.

From "Biogen Agrees to Pay US$900 Million over Alleged Improper Physician Payments"
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TikTok could face a £27 million fine in the United Kingdom for failing to protect children's privacy when they're using the platform, reports BBC News (26 September, McCallum). The UK Information Commissioner's Office (ICO) found the video-sharing platform may have processed the data of under-13s without appropriate consent. The watchdog said the breach happened over more than two years - until July 2020 but that it had not yet drawn final conclusions. The ICO has issued TikTok Inc and TikTok Information Technologies UK Limited with a "notice of intent," a legal document which precedes a potential fine. The notice sets out the ICO's provisional view that TikTok breached UK data protection law between May 2018 and July 2020.

From "TikTok May be Fined £27 Million for Failing to Protect Children"
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A US appeals court on Monday struck down California's ban on privately-run immigrant detention centers, reports Reuters (26 September, Wiessner). The San Francisco-based 9th US Circuit Court of Appeals sided with private prison operator GEO Group and the administration of President Joe Biden in lawsuits challenging the 2019 ban. A federal judge in San Diego had upheld the state law in 2020, saying California could ban private detention centers because federal law does not explicitly allow for them. But the 9th Circuit said the government has come to rely almost exclusively on detention centers operated by GEO Group and other companies. California does not have the authority to second-guess that decision, the court said.

From "GEO Group Wins Legal Challenge to California Private Immigrant Prisons"
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US officials have initiated a criminal investigation into PG&E’s potential role in starting California’s largest wildfire of the year, reports Bloomberg Law (26 September, Wade). The US Forest Service removed one of the utility’s transmission poles from the site in Placer County where the Mosquito fire started, PG&E said Monday in a filing. The investigation marks a significant setback in PG&E’s efforts to move past its troubled history with fires. The company was charged with manslaughter last year in connection with a 2020 blaze that killed four people and was driven into bankruptcy for its role in the 2018 Camp Fire that destroyed the town of Paradise.

From "US Starts Criminal Probe into PG&E’s Role in California Fire"
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The Wall Street Journal (27 September, Eckert, Felton) reports that Ford Motor is petitioning a Georgia court for a new trial after a jury in August delivered a US$1.7 billion verdict against the automaker involving a truck rollover accident that killed two people. In court filings Monday, Ford stated that it was unfairly precluded from providing proof that would have demonstrated the truck involved in the fatal incident was safe and the roof structure was stronger than many of its peers. The 2014 crash killed two members of the plaintiffs’ family. The family sued Ford, alleging that the truck’s roof design was faulty and vulnerable to collapse during a rollover crash. Ford contended Monday that a state judge in 2018 effectively barred it from defending itself against the plaintiffs’ claims.

From "Ford Seeks New Trial After US$1.7 Billion Jury Verdict in Truck Rollover Lawsuit"
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Prime Minister Anthony Albanese said on Monday that Australia plans to toughen privacy rules to force companies to notify banks faster when they experience cyberattacks, reports Reuters (26 September, Jackson, Jose, Kaye), after hackers targeted the country's second-largest telecommunications firm. Optus, owned by Singapore Telecoms, said last week that home addresses and other personal information of up to 10 million customers, or about 40 percent of the population, were compromised. Australian media reported an unidentified party had demanded US$1 million in cryptocurrency for the data in an online forum, but Optus has not commented on its authenticity. Albanese called the incident "a huge wake-up call" for the corporate sector, saying there were some state actors and criminal groups who wanted to access people's data. "We want to make sure ... that we change some of the privacy provisions there so that if people are caught up like this, the banks can be let know, so that they can protect their customers as well," he told a local radio station. Cybersecurity Minister Clare O'Neil said Optus was responsible for the breach and noted such lapses in other jurisdictions would be met with fines in the hundreds of millions of dollars, an apparent reference to European laws that penalize companies four percent of global revenue for privacy breaches. "One significant question is whether the cybersecurity requirements that we place on large telecommunications providers in this country are fit for purpose," O'Neil told parliament.

From "Australia Flags Privacy Overhaul After Huge Cyberattack on Optus"
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France plans to impose a minimum delivery fee of €3 for online book orders of less than €35 euros to level the playing field for independent bookstores competing against e-commerce giants, reports Reuters (23 September, Pineau). A 2014 French law already prohibits free book deliveries, but Amazon and other vendors have circumvented this by charging only 1 euro cent per delivery. Local book stores typically charge up to €7 for shipping a book. Legislation was passed in December 2021 to close the one-cent loophole through a minimum shipping fee, but the law could not take effect until the government had decided on the size of that fee.

From "France Sets Minimum Delivery Fee for Online Book Orders"
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The administration of US President Joe Biden is outlining its goals for a new trade deal with Australia, Japan, South Korea, and nine other nations meant to signal the country’s commitment to working with the Indo-Pacific region, reports the Associated Press (23 September, Wiseman). The Office of the US Trade Representative on Friday released its negotiating objectives for the Indo-Pacific Economic Framework, a deal with the 12 nations launched in May. Among them, the United States wants the Indo-Pacific countries to improve their labor and environmental standards and ensure their markets remain open to competition, while also taking steps to ease supply-chain backlogs at border crossings.

From "US to Seek Stronger Labor, Environmental Standards in Asia"
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Mexican President Andres Manuel Lopez Obrador said on Friday he had reached an agreement with companies to maintain prices of basic food items, reports Reuters (23 September, Hilaire). While not confirming the final number of companies involved, he noted that they included producers and distributors of corn, chicken, eggs, and beef. Lopez Obrador also announced on Friday plans for a "considerable" rise in the minimum wage, in an additional effort to ease inflationary pressures.

From "Mexico President Reaches Agreement with Companies to Maintain Basic Food Prices"
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The upcoming elections in Brazil pose a challenge to investors of Petrobras, reports Bloomberg (23 September, Millard, Andrade). Former President Luiz Inacio Lula da Silva, the front-runner, has vowed to use the company as a vehicle for national development. Incumbent Jair Bolsonaro, meanwhile, is proposing the complete opposite, with plans to privatize the state-run petroleum firm.

From "Lula Has Big Petrobras Plans That Would Undo Privatization Push"
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Sensitive information about millions of Australian telecoms subscribers may have been compromised by a hack of the country’s second-largest provider, Optus, reports Al Jazeera (23 September). Chief Executive Kelly Bayer Rosmarin said a “sophisticated” actor was behind a cyberattack, which gained access to information about up to 9.8 million users. The data accessed included customers’ names, dates of birth, phone numbers and email addresses, as well as some driver’s license and passport numbers.

From "Nearly 10 Million Australians’ Data Possibly Compromised in Hack"
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New Australian stock exchange listings are lagging the broader market in terms of board gender diversity, reports Bloomberg (23 September, Haigh), with just 12.2 percent of directorships at companies that went public in recent years held by women. The issue was particularly acute for the materials industry, which accounted for nearly half of the 401 ASX listings between 2019 and 2022 but had only five percent of board seats held by women, the Australian Institute of Company Directors Gender Diversity Progress Report showed, citing data from OpenDirector. That contrasts with more established companies, with 35.1 percent of board positions at Australia's 200 largest listed companies held by women on 1 September. The mining industry has come under intense scrutiny in recent years for its treatment of women, following an inquiry into cases of abuse of workers at companies including BHP and Rio Tinto.

From "Australian IPOs Lag on Board Gender Balance"
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British Chancellor of the Exchequer Kwasi Kwarteng said on Friday that the government would force transport companies to maintain a minimum level of service during strike action, reports Reuters (23 September, Holton, Milliken). "Other European countries have minimum service levels to stop militant trade unions closing down transport networks during strikes. So we will do the same," he told parliament during a mini-budget announcement. "And we will go further. We will legislate to require unions to put pay offers to a member vote, to ensure strikes can only be called once negotiations have genuinely broken down."

From "UK to Tighten Strike Rules"
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Alan Jope is to retire as chief executive of Unilever at the end of 2023, reports the Financial Times (26 September, Evans, Wembridge). The company said on Monday it would begin its search to replace Jope, who took charge in January 2019. Unilever has faced a period of upheaval, after shareholder discontent over a languishing share price was heightened by an unpopular and unsuccessful attempt to buy the consumer health arm of GSK last year. Jope’s planned departure follows the arrival of activist investor Nelson Peltz, whose Trian Fund Management has a history of shaking up consumer goods makers.

From "Unilever Chief Alan Jope to Retire Next Year"
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