Tag Archives: U.S.
NEW YORK/LONDON (Reuters) – Federal prosecutors in New York have been investigating since at least last year whether Chinese tech company Huawei Technologies Co Ltd [HWT.UL] violated U.S. sanctions in relation to Iran, according to sources familiar with situation.
The prosecutors have been investigating alleged shipping of U.S.-origin products to Iran and other countries in violation of U.S. export and sanctions laws, two of the sources said on condition of anonymity.
The probe, first reported by the Wall Street Journal on Wednesday, is being run out of the U.S. Attorney’s office in Brooklyn, the sources said. John Marzulli, a spokesman for the prosecutor’s office, would neither confirm nor deny the existence of the investigation.
The Department of Justice in Washington declined to comment.
Huawei, which makes handsets and telecommunications network equipment, said it complies with “all applicable laws and regulations where it operates, including the applicable export control and sanction laws and regulations of the UN, US and EU.”
News of the Justice Department probe follows a series of U.S. actions aimed at stopping or reducing access by Huawei and Chinese smartphone maker ZTE Corp (000063.SZ) to the U.S. economy amid allegations the companies could be using their technology to spy on Americans.
In February, Senator Richard Burr, the Republican chairman of the U.S. Senate Intelligence Committee, cited concerns about the spread of Chinese technologies in the United States, which he called “counterintelligence and information security risks that come prepackaged with the goods and services of certain overseas vendors.”
Republican Senators Marco Rubio and Tom Cotton have introduced legislation that would block the U.S. government from buying or leasing telecommunications equipment from Huawei or ZTE, citing concern the Chinese companies would use their access to spy on U.S. officials.
U.S. authorities last week banned American companies from selling to ZTE (000063.SZ) for seven years, saying the Chinese company had broken a settlement agreement related to Iran sanctions with repeated false statements – a move that threatens to cut off ZTE’s supply chain.
The ZTE ban was the result of its failure to comply with an agreement with the U.S. Commerce Department reached last year after it pleaded guilty in federal court to conspiring to violate U.S. sanctions by illegally shipping U.S. goods and technology to Iran.
In 2016, the Commerce Department made documents public that showed ZTE’s misconduct and also revealed how a second company, identified only as F7, had successfully evaded U.S. export controls.
In a 2016 letter to the Commerce Department, 10 U.S. lawmakers said they believed F7 to be Huawei, citing media reports.
In April 2017, lawmakers sent another letter to Commerce Secretary Wilbur Ross asking for F7 to be publicly identified and fully investigated.
Reporting by Arjun Panchadar in Bengaluru, Karen Freifeld in New York, Eric Auchard in London; Editing by Frances Kerry and Paul Simao
WASHINGTON (Reuters) – Facebook Inc said Wednesday it has declined an invitation to testify at a U.S. House of Representatives hearing Thursday on filtering practices by social media companies, a company spokesman said.
The company said that even though it will not appear, it looks “forward to a continuing dialogue with members of the committee about Facebook’s strong commitment to being a platform for all voices and ideas.”
Alphabet Inc and Twitter Inc have also been invited to testify at the House Judiciary Committee hearing, but have not said whether they will appear. Some Republicans have criticized social media companies for censoring some conservative viewpoints, a charge the firms have denied.
Reporting by David Shepardson; editing by Jonathan Oatis
BOSTON (Reuters) – Dicerna Pharmaceuticals Inc on Friday said that it will pay $ 15 million plus stock to Alnylam Pharmaceuticals Inc to resolve a lawsuit claiming it stole trade secrets about gene-silencing technology used to develop drug treatments.
The settlement between the two biotech companies resolves a lawsuit that Alnylam filed against Dicerna in 2015. The accord came ahead of a jury trial that was set to begin on Monday in state court in Woburn, Massachusetts.
Under the agreement, Dicerna will pay Alnylam $ 2 million up-front plus 983,208 shares of its common stock, worth around $ 13.7 million based on the stock’s price at midday on Friday. Dicerna’s stock price was up 38.68 percent.
Cambridge, Massachusetts-based Dicerna said it will also pay Alnylam another $ 13 million over the next four years, the timing of which is dependent on revenue Dicerna receives pursuant to future RNAi technology-based partnerships under its GalXC brand.
“With today’s announcement of a settlement with Alnylam, we are now able to focus the entirety of our resources on the advancement of our key clinical and discovery programs,” Dicerna Chief Executive Douglas Fambrough said in a statement.
Alnylam, also Cambridge-based, did not respond to a request for comment.
Alnylam’s lawsuit accused Dicerna of misappropriating confidential information related to RNAi technology Alnylam acquired when in 2014 when it bought a Merck & Co Inc subsidiary in a deal it valued in court papers at $ 325 million.
(Corrects settlement amount in first paragraph to say $ 15 million)
Reporting by Nate Raymond in Boston; Editing by Tom Brown
WASHINGTON (Reuters) – The U.S. Supreme Court on Tuesday will consider whether to let states force out-of-state online retailers to collect sales taxes on purchases in a fight potentially worth billions of dollars pitting South Dakota against e-commerce businesses.
South Dakota is asking the nine justices to overturn a 1992 Supreme Court precedent that states cannot require retailers to collect state sales taxes unless the businesses have a “physical presence” in the state.
The state, appealing a lower court decision that favored Wayfair Inc, Overstock.com Inc and Newegg Inc, is being supported by President Donald Trump’s administration.
A ruling favoring South Dakota could eventually lead to online customers paying more for many purchases.
Such a ruling could help small brick-and-mortar retailers compete with online rivals while delivering up to $ 18 billion into the coffers of the affected states, according to a 2017 federal report. The justices are due to decide the case by the end of June.
South Dakota depends more than most states on sales taxes because it is one of nine that do not have a state income tax. South Dakota projects its revenue losses because of online sales that do not collect state taxes at around $ 50 million annually, while its opponents in the case estimate it as less than half that figure.
The justices will hear the case against a backdrop of Trump’s harsh criticism of Amazon.com Inc, the dominant player in online retail, on the issue of taxes and other matters. Trump has assailed Amazon CEO Jeff Bezos, who owns the Washington Post, a newspaper that the Republican president also has disparaged.
Amazon, which is not involved in the Supreme Court case, collects sales taxes on direct purchases on its site but does not collect taxes for items sold on its platform by third-party venders, amounting to about half of total sales.
South Dakota is supported by industry groups representing major retailers that have brick-and-mortar stores, and therefore already collect state sales taxes. The National Retail Federation, which supports the state, has a membership that includes Walmart Inc and Target Corp, as well as Amazon.
E-commerce companies supporting Wayfair, Overstock and Newegg include two that provide online platforms for individuals to sell online: eBay Inc and Etsy Inc.
The 2016 South Dakota law requires out-of-state online retailers to collect sales tax if they clear $ 100,000 in sales or 200 separate transactions. The state sued a group of online retailers to force them to collect the state sales taxes, with the aim of overturning the 1992 precedent.
Reporting by Lawrence Hurley; Editing by Will Dunham
SAN FRANCISCO/WASHINGTON (Reuters) – Facebook Inc Chief Executive Mark Zuckerberg on Friday endorsed U.S. legislation to regulate political ads across the internet, a concession to lawmakers days before he is scheduled to testify in two U.S. congressional hearings.
Zuckerberg also said Facebook would begin requiring people who want to run ads on the social network addressing political issues to verify their identity and location. That expands an earlier plan to require such verification for ads directly about elections.
“Election interference is a problem that’s bigger than any one platform, and that’s why we support the Honest Ads Act,” Zuckerberg wrote in a Facebook post on Friday.
That legislation was introduced last October to counter concerns about foreign nationals using social media to influence American politics, an issue being looked at as part of an investigation into possible Russian meddling during the 2016 U.S. presidential campaign.
Facebook disclosed in September that Russians under fake names had used the social network to try to influence U.S. voters in the months before and after the 2016 election, writing about inflammatory subjects, setting up events and buying ads.
In February, U.S. Special Counsel Robert Mueller charged 13 Russians and three Russian companies with interfering in the election by sowing discord on social media.
The legislation would expand existing election law covering television and radio outlets to apply to paid internet and digital advertisements on platforms like Facebook, Twitter Inc and Alphabet Inc’s Google.
Facebook had previously stopped short of backing the legislation, saying it wanted to work with lawmakers further and announcing attempts at self-regulation.
Zuckerberg is scheduled to appear on Tuesday before a joint hearing of two U.S. Senate committees, and on Wednesday before a U.S. House committee.
Under the Honest Ads Act, digital platforms with at least 50 million monthly views would need to maintain a public file of all electioneering communications purchased by anyone spending more than $ 500.
Zuckerberg said on Friday that he also wanted to shed more light on “issue ads,” or ads that discuss a political subject but do not directly relate to an election or a candidacy.
Issue ads are frequently run by interest groups, lobbying organizations and wealthy individuals who want to influence legislation or have an indirect impact on an election.
Every advertiser who wants to run an issue ad will need to confirm their identity and location, Zuckerberg wrote.
Reporting by David Ingram in San Francisco and Dustin Volz in Washington; Editing by Bill Rigby
NEW YORK (Reuters) – Soaring crypto-currency prices last year are estimated to result in U.S. tax liabilities of $ 25 billion, adding further selling pressure to these assets in the short term, according to a research note by Fundstrat Global Advisers on Thursday.
This could mean a massive outflow from crypto currencies to the dollar by April 15, the deadline for filing taxes this year, the firm said.
“We believe selling pressures (in crypto) have been amplified by capital gains tax-related selling this year,” said Thomas Lee, Fundstrat’s co-founder and head of research. Lee was formerly J.P. Morgan’s chief equity strategist from 2007 to 2014.
Still, Fundstrat believes the outlook for bitcoin should improve after the April 15 tax deadline. It reiterated its mid-year target of $ 20,000 and year-end forecast of $ 25,000.
Bitcoin in 2018 has lost more than 50 percent of its value, with other crypto currencies such as ether and ripple also hurt by intense regulatory scrutiny around the world.
Bitcoin last traded down nearly 2 percent at $ 6,673.53 on the Bitstamp platform. In December last year, bitcoin hit a record just shy of $ 20,000.
Virtual currencies led by bitcoin grew $ 590 billion in 2017 in terms of market value, compared with an $ 11 billion increase in 2016, Fundstrat said, estimating that 30 percent of crypto holders are in the United States.
The $ 25-billion tax liability accounts for 20 percent of the expected total tax payments for capital gains of around $ 168 billion in 2017, the research firm said. The projected tax liability is based on taxable gains for crypto of $ 92 billion, it added.
Fundstrat also said crypto exchanges posted record profit in November and December and are expected to have huge tax liabilities, which should add to further selling in crypto-currencies. Many of the exchanges have net income exceeding $ 1 billion in 2017 and keep their working capital in bitcoin and ether, the research firm added.
To meet these tax liabilities, exchanges need to sell bitcoin and ether.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Bernadette Baum
The U.S. government’s Supreme Court battle with Microsoft Corp over whether technology companies can be forced to hand over data stored overseas could be nearing its end, after federal prosecutors asked that the case be dismissed.
President Donald Trump on March 22 signed a provision into law making it clear that U.S. judges can issue warrants for such data, while giving companies an avenue to object if the request conflicts with foreign law.
“This case is now moot,” the U.S. Department of Justice said, citing the newly passed legislation, in a 16-page court filing on Friday that requested the dismissal.
The Supreme Court on Feb. 27 heard arguments in the case, which had been one of the most closely watched of the high court’s current term. Some justices urged Congress to pass a law to resolve the matter.
Microsoft and the Justice Department had been locked in a dispute over how U.S. prosecutors seek access to data held on overseas computer servers owned by American companies. The case involved Microsoft’s challenge to a domestic warrant issued by a U.S. judge for emails stored on a Microsoft server in Dublin relating to a drug-trafficking investigation.
The bipartisan new law, known as the Cloud Act, was supported by Microsoft, other major technology companies and the Trump administration. But civil liberties groups opposed it, saying it lacked sufficient privacy protections.
Microsoft, which has 100 data centers in 40 countries, was the first American company to challenge a domestic search warrant seeking data held outside the United States. The Microsoft customer whose emails were sought told the company he was based in Ireland when he signed up for his account.
A representative for Microsoft did not immediately return requests for comment on the Justice Department’s filing.
Reporting by Lawrence Hurley and Alex Dobuzinskis; Additional reporting by Dustin Volz; Editing by Will Dunham and Jonathan Oatis
(Reuters) – U.S. President Donald Trump launched his second attack in a week on Amazon.com Inc on Saturday, accusing the world’s biggest online retailer of getting unfairly cheap rates from the U.S. Postal Service and not paying enough tax.
Trump’s comments on Twitter reiterated criticisms he made on Thursday about the company. He may have been prompted by a report from news website Axios saying he was obsessed with Amazon and considering ways to rein in the company’s power, possibly with federal antitrust or competition laws.
Investor concerns about regulatory action sent Amazon shares down 3.3 percent over Wednesday and Thursday, knocking $ 24 billion off the company’s market value.
“While we are on the subject, it is reported that the U.S. Post Office will lose $ 1.50 on average for each package it delivers for Amazon. That amounts to Billions of Dollars,” Trump tweeted on Saturday.
A Citigroup analysis last year showed that if the U.S. Postal Service (USPS) reallocated costs to account for the growing volume of packages it delivers, it would cost $ 1.46 more to deliver each package. Federal regulators, which review contracts made by USPS, have not raised any issues with the terms of its contract with Amazon.
“If the P.O. ‘increased its parcel rates, Amazon’s shipping costs would rise by $ 2.6 Billion’,” Trump tweeted, although it was not clear what report he was citing. “This Post Office scam must stop. Amazon must pay real costs (and taxes) now!”
A White House spokeswoman said on Thursday the administration has no Amazon-related action at this time.
Trump also accused the Washington Post, owned privately by Amazon Chief Executive and founder Jeff Bezos, of being a “lobbyist” for Amazon.
The newspaper, a frequent target of Trump’s ire, won a Pulitzer Prize last year for its critical investigation of Trump’s donations to charities.
Amazon declined comment. The Washington Post did not immediately reply to a request for comment.
Reporting by Bill Rigby; Editing by Bill Trott
MUNICH (Reuters) – BMW will not change its strategy on autonomous vehicle testing despite the death of a pedestrian struck by a self-driving car during tests by ride-hailing firm Uber [UBER.UL], senior executives said on Wednesday.
The German carmaker added it would double the size of its autonomous vehicle testing fleet to around 80 this year.
“Our estimation about autonomous driving technology remains unchanged even though this appears to be an extremely regrettable accident,” Klaus Froehlich, BMW’s board member responsible for research and development, said of the fatality. [nL1N1R1168]
“The path to autonomous driving is a long one. I have spoken about a mission to Mars,” he said, adding BMW was conducting its own tests under a high level of security.
Froehlich said BMW’s self-driving cars would undergo a test regime equivalent to 250 million driven kilometers (155 million miles).
Of this, 20 million km will be on real roads, while a giant supercomputer will simulate traffic scenarios in a virtual test regime equivalent to 230 million kms, Froehlich explained.
Self-driving cars will appear sooner if cities dedicate special lanes for autonomous cars in ring-fenced areas.
“In a dedicated space for only autonomous vehicles, it is easier to anticipate what other vehicles and traffic will do,” Froehlich said. “This makes it easier to program vehicle reflexes and may even allow a car to have fewer sensors and less processing power than a vehicle which needs to navigate normal traffic with things like bicycle couriers.”
BMW plans to launch an autonomous vehicle in 2021. Introducing a vehicle earlier than this is not plausible, since chipmakers and software designers have not yet developed a computer capable of processing the sheer volume of data generated by a self-driving car, Froehlich said.
BMW is preparing for a new era of on-demand mobility where customers locate and hail vehicles using smartphones. Ride-hailing and car-sharing could be replaced by fleets of autonomous cars, once self-driving cars are roadworthy, Froehlich said.
Reporting by Edward Taylor; Editing by Mark Potter
JERUSALEM (Reuters) – Desilu Studios plans to go public in the United States as a second stage of a proposed acquisition of Israeli technology start-up Vonetize.
The U.S. film studio famous for producing classic shows such as “I Love Lucy”, “Star Trek” and “The Untouchables” said on Friday that it had agreed a deal to take a controlling stake in Vonetize, the share price of which jumped 75 percent on Sunday.
Vonetize, whose technology enables over-the-top (OTT) live channel streaming and on-demand services, operates in 60 countries and has global partnerships with LG, Disney, Warner Brothers, Fox and Sony Universal among others.
Desilu said it had bought a 10 percent stake in cash from controlling shareholders at a company valuation of $ 50 million and received an option to buy a further 44 percent in the next 12 months.
Vonetize said on Sunday that Desilu would list in the United States to finance the deal for the rest of its proposed stake in the Israeli business.
Another route could be that Vonetize would dual-list on Nasdaq this year and then merge Desilu into that listing through a share-swap transaction, said Vonetize CEO Noam Josephides.
Some 40 percent of Vonetize’s shares are in free float.
Josephides said that Vonetize already has approval for a Nasdaq listing this year but a decision had yet to be reached.
Reporting by Steven Scheer; Editing by David Goodman