Published: 26 May 2021
Boris Johnson’s former right-hand man Dominic Cummings is expected to turn his fire on the PM and Health Secretary Matt Hancock today, as well as government advisers and Whitehall departments, when he appears before the health and science select committee. Cummings has said previously that the government’s initial strategy to combat covid was "disastrously misconceived."
Companies could be blocked from listing on the London Stock Exchange on national security grounds, under new rules being considered by the Treasury. A statement issued by the Treasury yesterday said: "The UK's reputation for clean, transparent markets makes it an attractive global financial centre…We're planning to bolster this by taking a targeted new power to block listings that pose a national security risk and will launch a consultation to inform its design in the coming months." The Financial Times says a listing is likely to be stopped if it gave a foreign state access to state or commercial secrets and will focus on strategic areas of importance such as technology, defence and national infrastructure. However the BBC reports that under the Treasury's national security proposals, companies owned by people whose activities may harm UK interests could also be blocked from selling shares on the London market.
China has overtaken Germany to become the UK's biggest single import market for the first time since records began. Goods imported from China rose 66% from the start of 2018 to £16.9bn in the first quarter of this year, the Office for National Statistics said. Imports from Germany fell by a quarter to £12.5bn in the same period. The change came as trade with the European Union was disrupted by Brexit and the pandemic boosted demand for Chinese goods.
The Competition and Markets Authority (CMA) is investigating AstraZeneca's proposed $39bn acquisition of US firm Alexion Pharmaceuticals, approved by shareholders earlier this month. The US has cleared the deal, as have other countries including Canada, Brazil and Russia.
Ofgem has announced plans to invest £300m in more than 200 low-carbon projects to aid the nation's push towards net-zero emissions. The energy market regulator said the new infrastructure investments will include 1,800 new ultra-rapid charging points at motorway service areas, tripling the current network. Another 1,750 charge points will be built in towns and cities. "The payment will support the rapid take up of electric vehicles, which will be vital if Britain is to hit its climate change targets," said Jonathan Brearley, chief executive of Ofgem.
Violence and abuse against shop workers is on the rise according to the British Retail Consortium (BRC), which says there were on average 455 incidents a day in 2019, up 7% on the previous year. The BRC said things have worsened during the pandemic and called for greater legal protections for retail workers, as only 6% of incidents resulted in prosecution. The cost of retail crime has also risen, the retail body said, with some £1.3bn of losses recorded mostly due to customer theft.
Discount supermarket Lidl has been ordered to stop selling its Hampstead gin in a redesigned bottle in Scotland, because it looks too similar to upmarket rival Hendricks. The edict was made at the Court of Session in Edinburgh by Judge Lord Clark who said Lidl had breached the 1994 Trade Marks Act. Hendricks is made by William Grant and Sons Irish Brands Ltd in the Ayrshire town of Girvan. The decision comes just months after M&S took action against Aldi over its Colin the Caterpillar cake lookalike.
Marks & Spencer has reported a pre-tax loss of £201.2m in 2020/21 financial year, down from a £67.2m profit in the previous year. The high street chain blames the effect of lockdowns and social distancing measures, and the forced closure of large parts of its non-food store estate. Consequently, the firm cut 7,000 jobs in the last 12 months. However, M&S’s recent link-up with online grocer Ocado helped deliver "strong underlying like-for-like growth" in food sales of 6.9%, after adjusting for the closure of hospitality and the adverse impact on franchise sales.
Sandwich maker Greencore has told Sky News it is hiring thousands of workers in sites including Worksop, Northampton and Liverpool as it has secured new business worth £175m a year in the last 12 months and has seen "encouraging" momentum return to sales in recent weeks, with revenues now running only about 5% below pre-covid levels. Greencore’s customers include all the major UK supermarkets as well as convenience and travel retailers and coffee shops. The firm slipped to a £1.8m loss for the six months to 26 March, compared with a £27.3m profit a year earlier.
Losses have widened at Cellular Goods, the cannabis business backed by David Beckham. Yesterday the firm reported losses of £2.1m in the six months to the end of February 2021, during which period It floated on the London Stock Exchange, raising £13m. The business lost just £140,000 in the same period a year earlier. The company blamed set-up costs and one-off share-based incentive payments for key members of staff. Cellular Goods plans to make skincare and mood enhancing products from cannabinoids — natural compounds produced by the cannabis plant. The products will not contain tetrahydrocannabinol (THC), the psychoactive compound found in cannabis that makes people high. Beckham owns a 5% stake through his holding company DB Ventures.
Kanabo, the first cannabis business to list on the London Stock Exchange, has signed a deal with Hellenic Dynamics, which has a 200,000 square meter growing facility in Northern Greece. In return for a £750,000 investment in Hellenic shares, Kanabo will purchase up to 1,000 kg per year of cannabis flowers, subject to regulatory approvals, for extraction of medical standard oils. Hellenic said it wants to grow genetically unique tetrahydrocannabinol (THC) strain of dried medical cannabis flowers and flower extracts for export into the medical cannabis market in Europe. The European market was worth €4.1bn (£3.5bn) in 2019 and is expected to reach €43.3bn (£37.5bn) by 2027. Hellenic has announced its own plans to list on the London Stock Exchange.
Online furniture store Made.com has announced plans to float on the London Stock Exchange, with the aim of raising £100m. It is expected to be valued at around £1bn. The store was co-founded by high-profile tech entrepreneur Brent Hoberman, who also co-founded Lastminute.com. Publishing financial data for the first time, Made said gross sales for the year ended 31 December 2020 were £315m, while net revenue was £247m.
The owner of British Gas has called on the Government to throw £35 million at a plan to rip out gas boilers and replace them with hybrid systems, which use both gas and electricity to heat the UK’s homes, PA Media reports. Centrica said that a “retrofit fund” could transition around 5,000 homes from gas to hybrid heating by 2024, something which would reduce, though not eliminate, carbon emissions from heating these homes. More than eight in 10 of the UK’s homes are heated with gas boilers which are responsible for about 14% of the country’s carbon emissions.
TheCityUK, the lobbying group for Britain's financial services sector, has published a white paper calling the government to put in place tailored regulation for the cryptocurrency sector. The paper said Britain could influence global policy by setting the standard for regulating crypto and take advantage of the booming sector by luring businesses with the certainty of rules. "There is a fierce global race underway to see which applications of DLT [distributed ledger technology] and cryptoassets will win out, and who will grab the biggest slice of the value they promise," said Miles Celic, chief executive of TheCityUK. "The ultimate winner is for markets to decide, but government and regulators have an important part to play. "They must set safe and robust rules for this burgeoning sector – while ensuring they don’t inadvertently squash good ideas before they can mature and flourish." The cryptocurrency market has quadrupled in value to $1.5tn since last October as institutional investors Tesla, Square and Blackrock among others have ploughed money into bitcoin alongside amateur investors. Goldman Sachs said this week that cryptocurrencies should be treated as a new type of asset class, and Mastercard is to launch a cryptocurrency credit card.
A Dutch court is due to rule today on a landmark case brought by climate activists against Royal Dutch Shell. The plaintiffs include Greenpeace and Friends of the Earth Netherlands, who want the court to force the energy firm to change strategy and speed its cuts to greenhouse gas emissions. They claim Shell's climate strategy is not in line with the UN-backed 2015 Paris climate agreement to limit global warming to 1.5 degrees Celsius above pre-industrial levels and that Shell is putting Dutch citizens in danger because of its continuing investment in the production of fossil fuels. They are demanding Shell cut carbon emissions by 45% by 2030. The company plans to make a cut of 20% over the next decade and achieve net zero carbon emissions by 2050.
Germany's antitrust regulator has launched a probe into Google under the country’s Competition Act, which prohibits companies from engaging in anti-competitive practices. A second probe will assess how Google handles customer data. The regulator has already opened similar probes into Facebook and Amazon. A spokesperson for Google, which is co-operating with the investigation, told Reuters that people used its services because they were helpful, and not because they were forced to. He added: "We give people easy control over how their information is used and we limit the use of personal information."
Amazon is being sued by Washington DC over allegations it abuses its position as a retail giant. The lawsuit, filed yesterday, claims that Amazon's control of up to 70% of US online sales results in higher prices for consumers. "Amazon's online retail sales platform benefits from, and is protected by, Amazon's anticompetitive business practices," it said. Amazon said that the lawsuit "has it exactly backwards" because sellers set their own prices for the products they offer in our store.
US President Joe Biden’s plans for a global corporate tax rate have been scuppered by Ireland: Finance Minister Paschal Donohoe told Sky News yesterday that the country has no plans to change its 12.5% tax rate - one of the lowest in the developed world. Donohoe said he had "significant reservations" over the US president’s plan, suggested in order to prevent companies shifting billions of dollars of profits to countries with lower tax rates. The Biden administration is planning to raise the US corporate tax rate from 21% to 28% and increase the rates for American companies working overseas.
US business groups have teamed up to form a coalition opposing Biden’s proposed tax increases, including those earmarked to fund major infrastructure projects. Twenty-eight industry groups have created an alliance called "America's Job Creators for a Strong Recovery". Organiser Eric Hoplin, who is president and chief executive of the National Association of Wholesaler-Distributors warned: "The record tax hikes that Democrats are seeking to ram through could not come at a worse time for America's job creators who are just beginning to recover from a crippling pandemic.” Other business groups signed up to the coalition include the American Hotel and Lodging Association, American Rental Association, Auto Care Association, National Grocers Association and the Wine and Spirits Wholesalers of America. Chris Smith, executive director of Main Street Employers Coalition, added: "The pandemic has taxed individually and family-owned businesses enough - taxing them again while they are still struggling to recover just goes too far."
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