:00:00. > :00:09.This is Business Live from BBC News with Ben Thompson and Sally Bundock.
:00:10. > :00:16.Privacy Shield, a new deal between the US and Europe promises
:00:17. > :00:19.to keep Europeans data safe from US intelligence but will it get
:00:20. > :00:21.the green light from politicians in Brussels?
:00:22. > :00:43.Live from London, that's our top story on Wednesday, 3rd February.
:00:44. > :00:46.After the old data-sharing framework, Safe Harbour,
:00:47. > :00:49.was deemed unfit for purpose - it left business in legal limbo.
:00:50. > :00:51.We'll assess what it could mean for firms on both sides
:00:52. > :01:06.ChemChina, a Chinese state-owned company is closing
:01:07. > :01:10.in on a $43 billion dollar deal to buy Swiss firm Syngenta.
:01:11. > :01:12.Markets remain pretty fickle and volatile
:01:13. > :01:17.We'll get the inside track on the gadget that's helping small
:01:18. > :01:43.And as a Chem-China snaps up Sygenta for a massive $43 billion
:01:44. > :01:46.we want to know do you worry about what goes into your food?
:01:47. > :01:55.The European Commission and the United States have agreed
:01:56. > :01:58.on a new set of rules for how our personal data can be
:01:59. > :02:01.It's called the EU-US Privacy Shield.
:02:02. > :02:04.It comes after the previous deal, known as Safe Harbour,
:02:05. > :02:06.was declared unfit for purpose in October.
:02:07. > :02:08.The new rules are designed to protect the rights of Europeans,
:02:09. > :02:10.regardless of where their data is actually stored.
:02:11. > :02:23.If you live in the EU and use sites like Google, Facebook or iTunes,
:02:24. > :02:26.your personal data will have been removed from your country and
:02:27. > :02:32.shipped off to the US for processing. It happened as part of a
:02:33. > :02:36.deal called Safe Harbour which came into force in 2000, but last year, a
:02:37. > :02:42.Facebook user challenged the deal. He said it allowed US intelligence
:02:43. > :02:47.agencies to look at his data while it was being stored in the States.
:02:48. > :02:51.He won and the data sharing agreement was ruled invalid. Now, a
:02:52. > :02:58.new deal has been agreed. This mechanism will be known as EU-US
:02:59. > :03:03.privacy shield. Under the terms of the new deal, there will be an
:03:04. > :03:09.annual joint review on the new data sharing pact. Complaints from Europe
:03:10. > :03:14.will be dealt with on an individual basis but a new US Government
:03:15. > :03:20.employee. The new pack still needs political approval, but it will come
:03:21. > :03:35.as a relief from both sides of the Atlantic.
:03:36. > :03:50.Dee-Ann Huward-Mills, Head of data protection at Baker
:03:51. > :03:56.This will be an interesting day. We are expecting to hear announcements
:03:57. > :03:59.from the EU watchdogs, data protection authorities and that's
:04:00. > :04:04.going to be a very, very interesting development. After the old deal was
:04:05. > :04:09.thrown out, firms really were in legal limbo, not knowing whose laws
:04:10. > :04:13.they should be complying with. This should be a sigh of relief? It
:04:14. > :04:18.presents a good opportunity for business certainty. Much needed
:04:19. > :04:24.business certainty and the firms and the businesses that take data
:04:25. > :04:26.protection and privacy seriously will come out on top and have an
:04:27. > :04:30.opportunity to build the consumer trust. It is critical. Is the burden
:04:31. > :04:33.greater on them in terms of what they have to do to make sure they
:04:34. > :04:37.are following the letter of the law? I think this is going to be an area
:04:38. > :04:41.where firms are going to have to take data protection and privacy
:04:42. > :04:44.seriously. They will have to look at the systems they have in place and
:04:45. > :04:47.perhaps audit and see where they are. We all interface with the
:04:48. > :04:52.internet, we have smartphones and whether you are a retailer or a
:04:53. > :04:56.pharmaceutical business or financial organisations, they are going to
:04:57. > :05:02.have to take to area very seriously indeed. Clarify what data we are
:05:03. > :05:06.talking about here. This is data we have willingly provided and put
:05:07. > :05:09.online or given to firms? It is information about you and myself.
:05:10. > :05:14.When we go to a store, we purchase goods. The organisations are able to
:05:15. > :05:18.track what we're doing, where we surf, what we download and so it is
:05:19. > :05:22.information about you and myself. Really, briefly, is this safer,
:05:23. > :05:26.privacy shield? Does it mean we're safer? The point of this is to raise
:05:27. > :05:30.the bar, raise the standards, raise the safeguards. You're going to have
:05:31. > :05:34.greater oversight, greater transparency, that's good for
:05:35. > :05:36.business and good cord consumers. Thank you very much indeed for
:05:37. > :05:39.coming N When we hear from the various
:05:40. > :05:41.hurdles they have to overcome in terms of getting there through, we
:05:42. > :05:44.will update you. A US judge has cleared the way
:05:45. > :05:47.for investors to sue the Brazilian oil firm Petrobras over billions
:05:48. > :05:50.of dollars of losses which allegedly stem from a bribery
:05:51. > :05:52.and corruption scandal. A judge in New York says two
:05:53. > :05:55.different sets of investors can pursue the case as a
:05:56. > :06:14.class action lawsuit. Mexican Grill says sales slumped in
:06:15. > :06:22.the US. It is the first sales drop since the company went public a
:06:23. > :06:26.decade ago. Artificial intelligence firm Swift
:06:27. > :06:36.Key is to be bought by Microsoft. The Financial Times says the deal is
:06:37. > :06:41.worth $250 million. Swiptkey is known for its predictive keyboard.
:06:42. > :06:46.It was another grim session for financial markets in Asia. We will
:06:47. > :06:52.talk about that in a minute. China said its economic growth projection
:06:53. > :06:55.range between 6.5% and 7%. That's coming from an official at the top
:06:56. > :06:59.economic planner. That was an announcement that came through
:07:00. > :07:03.today. Of course, any reminder of some of the challenges facing China
:07:04. > :07:13.in terms of economic growth puts a shiver down the spine of investors
:07:14. > :07:15.around the world. It is a story we've talked a lot about and one we
:07:16. > :07:48.will discuss at length more. Leisa, bring us up-to-date with the
:07:49. > :07:57.details. It is massive, Ben. We are not talking about the zeros in 43
:07:58. > :08:02.billion. It worked out at $470. This is the biggest purchase of an
:08:03. > :08:08.overseas company by the Chinese. It is the second biggest take-over in
:08:09. > :08:14.the chemical industry. There is consolidation going on in the
:08:15. > :08:18.sector. But this isn't a done deal. It has to be signed off by
:08:19. > :08:26.regulators in Europe and the US and they will be looking at this closely
:08:27. > :08:33.because Chem China will become the biggest supplier of chemicals. A lot
:08:34. > :08:40.of people are going who is Chem China. Well, it is Government owned.
:08:41. > :08:45.In March they bought Pirelli, the tyre maker. The bottom line is that
:08:46. > :08:48.China is betting big on seed and crop technology because after all,
:08:49. > :08:53.China has to feed the world's biggest population. Thank you very
:08:54. > :08:56.much. I'm sure it is a firm we will hear more from over the course of
:08:57. > :09:06.the coming year. One we'll watch closely. Thank you.
:09:07. > :09:13.The Nikkei is down over 3%. Oil back up on the course of the day, but it
:09:14. > :09:17.is just shy of $33. Hammering energy firms again and sending stocks
:09:18. > :09:21.lower. It shows how fickle the equity markets are right now.
:09:22. > :09:24.Underlying that is the concern over the economic outlook particularly in
:09:25. > :09:29.China as we have discussed. In Europe, we will get the latest
:09:30. > :09:33.service sector numbers from Germany today. All expected to remain
:09:34. > :09:38.robust. In the UK, despite the talk of how unbalanced economic growth
:09:39. > :09:42.has been, of course, largely based on consumer spending again, today's
:09:43. > :09:46.service sector figures are expected to show some weakness from December,
:09:47. > :09:48.but there was a lot of flooding in many parts of the UK and that
:09:49. > :09:54.stopped people going out to spend. It could be a temporary blip. So
:09:55. > :09:55.what will move at Wall Street later? Michelle has the details in New
:09:56. > :09:58.York. Ahead of the big jobs report
:09:59. > :10:00.on Friday, look out for data on hiring by private employers,
:10:01. > :10:03.analysts are forecasting a slowdown in January with an estimated
:10:04. > :10:05.195,000 jobs, compared Meanwhile the flood
:10:06. > :10:09.of earnings continues. General Motors is expected
:10:10. > :10:12.to report strong burnings. Executives have already predicted
:10:13. > :10:14.a strong road ahead. The largest US cable operator
:10:15. > :10:23.Comcast is expected to impress investors despite facing more
:10:24. > :10:29.competition from streaming services How well is the owner of Pizza Hut
:10:30. > :10:38.and Tyco bell doing? When it reports fourth-quarter
:10:39. > :10:40.results, investors will be interested to see how it's doing
:10:41. > :10:43.in its home market but also looking for updates on the upcoming spin off
:10:44. > :10:57.of the Chinese business. Another busy day on Wall Street. Tom
:10:58. > :11:02.Stephenson is with us. Nice to see you, Tom. Good morning.
:11:03. > :11:06.So where oil goes, share markets follow, it would seem? Yeah. Equity
:11:07. > :11:09.markets are obsessed by the oil price at the moment and unusually,
:11:10. > :11:13.they are moving in the same direction as the oil market because
:11:14. > :11:17.one argument is that a falling oil price is good news for equities
:11:18. > :11:22.because it is good for consumers and good for companies. Because their
:11:23. > :11:25.costs fall. The market is not seeing it that way at the moment. The
:11:26. > :11:33.market is looking at the oil price and saying it is a reflection of
:11:34. > :11:36.slowing growth. Sorry, I was interrupting there without
:11:37. > :11:39.realising. One of the issues that we were talking about earlier is the
:11:40. > :11:42.fact that people are not spending that money that they have perhaps
:11:43. > :11:47.got in their pocket because they are not having to pay so much for their
:11:48. > :11:51.petrol and their gas in their car or their energy bills, they are saving
:11:52. > :11:56.it, we're all a bit worried? The expectation was as the oil price
:11:57. > :11:59.fell consumption would rise, we haven't seen that. We may find there
:12:00. > :12:02.is a delayed reaction of the reason people save the money was because
:12:03. > :12:06.they were highly indebted after the financial crisis. What we may find
:12:07. > :12:09.is as household balance sheets come back into order, as people pay down
:12:10. > :12:13.their debts, they will start to spend more and we're seeing that
:12:14. > :12:17.with higher car sales for example in the US and in the UK. So it maybe
:12:18. > :12:21.beginning to come through. Let's touch on the service sector
:12:22. > :12:25.figures. Just giving us an idea really of the rebalancing that we
:12:26. > :12:30.talk a lot about, particularly in the UK, but it is true across Europe
:12:31. > :12:34.in terms of the how the economy will rebalance, away from consumer
:12:35. > :12:38.spending and away interest the service sector? We need the economy
:12:39. > :12:42.to rebalance, but in the short-term we people to spend more. It is a
:12:43. > :12:46.tricky balance and you talk about China earlier on, we saw that. China
:12:47. > :12:49.is going through this big rebalancing away from investment and
:12:50. > :12:53.towards consumption and that, actually is a good thing for the
:12:54. > :12:56.Chinese market. Tom, we will see you soon. Returning in five minutes to
:12:57. > :13:01.look at other stories at business in the press.
:13:02. > :13:06.Swiping with your smartphone, we will speak to the the head of one of
:13:07. > :13:10.the firms providing card readers for smartphones and tablets. That's
:13:11. > :13:12.designed to help small business take card payments. You're with Business
:13:13. > :13:25.Live from BBC News. When you use apps, you leave a trail
:13:26. > :13:29.of data and at the moment there is limits on how the data is used, but
:13:30. > :13:32.the Institute of Chartered accountants is warning this could
:13:33. > :13:35.change. They are worried if you don't exercise enough, you could
:13:36. > :13:40.find yourself with a massive increase in your life insurance
:13:41. > :13:43.policy. Well, Philippa Kelly is from the Institute of Chartered
:13:44. > :13:47.accountants and joins us now. Good morning. You might expect that this
:13:48. > :13:50.is actually a good thing. It is about using technology to make sure
:13:51. > :13:54.that people who take the right decisions in life are rewarded for
:13:55. > :13:58.it. Is that not the case? Good morning. Yes, it will be a good
:13:59. > :14:03.thing for some people as you say, if you make healthy choices and make a
:14:04. > :14:06.decisions, you are a safe driver, etcetera, you will probably be
:14:07. > :14:10.rewarded with lower insurance premiums through use of this
:14:11. > :14:14.additional data we're all generating in our every day lives, but where
:14:15. > :14:17.someone benefits, there will be someone who is disadvantaged as
:14:18. > :14:21.well, because insurance has always been about sharing risk and when we
:14:22. > :14:26.move away from that, there will be people who win and people who lose
:14:27. > :14:29.and that's what we're considering in the report is where do we need to
:14:30. > :14:33.intervene to make sure that coverage can be fairly provided if someone is
:14:34. > :14:37.losing out because of a factor that they can't control?
:14:38. > :14:42.Explain then what is changing that means that this data at the moment
:14:43. > :14:47.can't get into the hands of insurance companies could soon get
:14:48. > :14:51.into their hands? So we are all generating loads of data as you said
:14:52. > :14:55.throughout our every day lives with Clubcard and with mobile phones and
:14:56. > :15:01.at the moment, we're happily sharing that da with other organisations. So
:15:02. > :15:06.your supermarket, your smartphone provider, so if they wanted to, they
:15:07. > :15:09.could probably be quite well placed to design an insurance product for
:15:10. > :15:13.you on that basis. So there is the potential for other companies to
:15:14. > :15:17.enter the insurance market and sell us insurance products using the data
:15:18. > :15:22.we have given them, but also insurance companies themselves are
:15:23. > :15:26.looking at more ways that they can start gathering this ta so if you
:15:27. > :15:29.are part of a company health insurance scheme and your employer
:15:30. > :15:33.offers you a fit bit, it could be if they get a certain percentage of
:15:34. > :15:36.employees to wear them, they get a lower premium.
:15:37. > :15:45.We are out of time. It is fascinating.
:15:46. > :15:53.Buy to let landlords will be selling 500,000 homes thanks to changes in
:15:54. > :16:00.legislation. You are watching Business Live. European data should
:16:01. > :16:06.now be safe. Ridge in the United States after a new sharing agreement
:16:07. > :16:09.comes into force. It still needs the approval of politicians in Brussels.
:16:10. > :16:15.It is dull paving the way for a new deal after the old system was deemed
:16:16. > :16:17.unfit for purpose. -- it is still paving the way.
:16:18. > :16:19.Now, firms like Paypal might have revolutionised the way we pay
:16:20. > :16:22.for goods online, but when it comes to face-to-face transactions,
:16:23. > :16:25.many smaller companies are still using cold hard cash.
:16:26. > :16:29.But one firm that wants to change that is iZettle.
:16:30. > :16:33.The Finnish tech firm has come up with a gadget that lets
:16:34. > :16:35.small businesses take card payments - via apps and card
:16:36. > :16:38.The company has also recently branched into financing,
:16:39. > :16:43.offering small loans to their clients.
:16:44. > :16:45.They now operate in 12 countries, including the Nordics,
:16:46. > :16:47.UK, Brazil and, most recently, Italy.
:16:48. > :16:49.It's founder and Chief Executive says the company
:16:50. > :16:51.is "democratising payments" - letting small firms compete
:16:52. > :16:54.with their bigger rivals - but is he right?
:16:55. > :16:59.Well, Chief Executive of iZettle Jacob de Geer is with us.
:17:00. > :17:09.Thank you for joining us. I have to say, I'm not familiar with your
:17:10. > :17:14.company or the gadget. I've not seen it but I read about it today and I
:17:15. > :17:18.thought, gosh, this is great because there are so many small shops I go
:17:19. > :17:22.into and if I haven't got cash I have to spend ?5 or more in order
:17:23. > :17:28.for them to do a transaction without them paying fees. If I just need a
:17:29. > :17:34.pint of milk and I have got no money on me it is quite a problem. It is
:17:35. > :17:39.and that is just the first problem really. Prior to companies like
:17:40. > :17:45.iZettle, the chance for these businesses to get access to taking
:17:46. > :17:50.card payments was pretty slim or complicated at least. With the
:17:51. > :17:55.business model and the tools that we provide they can get access to
:17:56. > :18:01.payments but also loans. In a simple way. This is also about offering
:18:02. > :18:05.payments for people who would not traditionally have a bricks and
:18:06. > :18:08.mortar store like market traders, craftspeople or a tradesman who
:18:09. > :18:14.comes to your house, rather than carrying the kit around they can
:18:15. > :18:16.take a payment with their phone. Yes, for all of those previously
:18:17. > :18:24.underserved by banks like sole traders. Those businesses typically
:18:25. > :18:33.account for 20-30% of GDP in a given market. Correct me if I'm wrong, but
:18:34. > :18:36.iZettle gives readers to homeless magazine sellers. Someone who would
:18:37. > :18:45.normally have to take cash but you gave it to homeless people to sell
:18:46. > :18:50.magazines. I assume that is true. It means that greater access to the
:18:51. > :18:55.system has got to be a good thing? Absolutely. If you look around the
:18:56. > :19:00.world, cash is on a pretty rapid decline. If you look at any store,
:19:01. > :19:07.25% of the customers that come in, if they can't pay with a card they
:19:08. > :19:12.will leave and the same thing goes with street newspaper vendors or.
:19:13. > :19:16.Access to the card network system and that whole infrastructure is
:19:17. > :19:23.vital for any type of business. If you are giving them away, which you
:19:24. > :19:27.are to a great degree to sellers of the Big Issue, how do you make
:19:28. > :19:35.profits? Banks take a setup fee, monthly these, we have taken that
:19:36. > :19:40.away, and the only fee is a transaction fee, pay-as-you-go
:19:41. > :19:45.service, basically. Based on your transaction volume, you pay a
:19:46. > :19:49.percentage and that goes down the more you sell. Is it competitive
:19:50. > :19:56.compared to others with a similar service? Absolutely, because these
:19:57. > :19:59.people typically can't get access to the infrastructure. You touched on a
:20:00. > :20:06.fact there are others doing the same thing. How difficult is it to stand
:20:07. > :20:10.out in this market? We like and you to PayPal. One company that changes
:20:11. > :20:14.the way we do things. It is also a market where the winner takes all
:20:15. > :20:18.and you want to be dominant and change behaviour and the one that
:20:19. > :20:23.people turn to. You have competitors and how do you make sure that people
:20:24. > :20:27.use your service and not others? Well, it's a combination of many
:20:28. > :20:31.factors from how you sign up and how fast you get access to the card
:20:32. > :20:36.terminal. We are the first company in the world giving out the
:20:37. > :20:39.terminals for free. Chip and pin. Typically people charge a lot for
:20:40. > :20:46.that infrastructure. It's a combination of factors. It could be
:20:47. > :20:51.anything from data analytics and how customers actually spend money, how
:20:52. > :20:57.should we mix and match products to maximise your margins? It's a
:20:58. > :21:02.combination of those things. I will let you in. I want to ask about the
:21:03. > :21:06.death of cash. How long does cash have left? I imagine you would like
:21:07. > :21:11.to see cash falling by the wayside eventually? Is a matter of fact I
:21:12. > :21:16.should not say I don't like cash. And that I want to see the end of
:21:17. > :21:20.cash, but the fact of the matter is, coming back to privacy and things
:21:21. > :21:24.you have discussed previously, I think cash is a vital part of our
:21:25. > :21:29.privacy and I hope that cash will continue on its decline, but I is
:21:30. > :21:33.dull hope there will be cash in the world so I can buy things that I
:21:34. > :21:42.don't want anyone else to know about. Like Sally with their pint of
:21:43. > :21:45.milk. The piggy bank. Is that just my house? Thanks for coming in. Very
:21:46. > :21:47.interesting. IZettle. Let's take a quick look at the news
:21:48. > :21:52.that's making headlines The FT leads on the news that Yahoo
:21:53. > :21:58.will lay off 15% of its workforce as it pursues an "aggressive
:21:59. > :22:10.strategic plan" to return It is the latest attempt to turn
:22:11. > :22:12.around the troubled Internet company.
:22:13. > :22:15.The Huffington Post reports that the CEO of BlackRock wants
:22:16. > :22:16.companies to stop quarterly earnings estimates.
:22:17. > :22:21.He says the force investors - and in turn, CEOs -
:22:22. > :22:34.to focus too much on the short-term gain.
:22:35. > :22:43.Many of us were able to get through a depressing January by looking at
:22:44. > :22:47.swimming pools and bowling alleys on property websites. We can't afford
:22:48. > :22:53.to buy. I thought I saw your house on there. That is the one with the
:22:54. > :22:59.swimming pool and bowling alley! Tom Lees back to talk about these
:23:00. > :23:02.stories. -- he is back. We started the programme with a question about
:23:03. > :23:08.whether you care about what is in food. That breeze says that organic
:23:09. > :23:17.food is winning, you are what you eat. This is about the Chinese deal.
:23:18. > :23:23.I knew what you eat? It's terribly important and I buy organic if I
:23:24. > :23:34.can. Let's talk about Yahoo. This story broke yesterday. Marissa Mayer
:23:35. > :23:39.is struggling to turn around the fortunes of the company. 15% of the
:23:40. > :23:44.workforce is going and it's not really working. If you look at
:23:45. > :23:50.Yahoo, the value is essentially its stake in Alibaba. That is something
:23:51. > :23:54.they can't really access because of the tax implications. What's
:23:55. > :23:58.interesting for me about Yahoo's situation for an investor is that it
:23:59. > :24:03.is a symptom of how business cycles are shortening. It makes investment
:24:04. > :24:08.very challenging because it's only a few years ago that the Internet
:24:09. > :24:13.portal was the way forward and that's where Yahoo was so
:24:14. > :24:17.successful. As people became more familiar with the Internet they
:24:18. > :24:21.started using it in a different way and Yahoo has struggled to keep up
:24:22. > :24:26.with those changes. The boss has been there for four years now, she
:24:27. > :24:32.came from Google and was a star at Google. Just 37, six months pregnant
:24:33. > :24:38.when she announced she would become the new boss. And Yahoo went through
:24:39. > :24:43.three bosses in a year. Loads of pressure on her to make this work.
:24:44. > :24:49.As you have just explained it's a company that really many have moved
:24:50. > :24:52.on from? It is just up against an unstoppable change in the direction
:24:53. > :24:57.of how we access information on the Internet. I think you talked about
:24:58. > :24:59.the churn at the top, and that's often the case when you get
:25:00. > :25:06.companies which are fundamentally struggling to compete. It's very
:25:07. > :25:09.difficult for any Chief Executive to come in and make the necessary
:25:10. > :25:16.changes and she is clearly struggling. Let's talk about
:25:17. > :25:21.Blackrock next. I like this story. I'm not having much luck with my
:25:22. > :25:24.technology this morning. This is the Chief Executive who wants companies
:25:25. > :25:29.to stop quarterly earnings estimates, purely because we are too
:25:30. > :25:34.focused on the short term and not the long-term. Yes, and it's not
:25:35. > :25:41.what you expect from the Chief Executive of an investment company,
:25:42. > :25:44.less information, to be pushing for. There is a self-serving element
:25:45. > :25:49.because if there is less publicly available information then an
:25:50. > :25:52.organisation like Blackrock has a competitive advantage but
:25:53. > :25:56.fundamentally his point is right, companies are obsessed by the
:25:57. > :26:02.short-term, three cycles of reports and it means they don't make good
:26:03. > :26:05.long-term gains. Thank you. See you soon. Goodbye.