:00:07. > :00:10.Hello everybody, this is Business Live.
:00:11. > :00:12.Taxing times for Google as it faces the backlash of politicians
:00:13. > :00:18.in the UK over its tax agreement with George Osborne.
:00:19. > :00:35.Live from London, that's our top story on Thursday 11th of February.
:00:36. > :00:39.Google's tax settlement with the UK under scrutiny today -
:00:40. > :00:43.we look at how companies shift their profits around the world
:00:44. > :00:48.Also in the programme, Twitter shares slump,
:00:49. > :00:52.despite the fact the little blue bird raked in more money in the past
:00:53. > :00:56.three months - so why aren't investors happy?
:00:57. > :00:58.Well, here's the problem - it just continues failing
:00:59. > :01:12.And we will bring you the markets. It is the same old story. A lot of
:01:13. > :01:13.jitters over the global economy and the central bank has no ammunition
:01:14. > :01:16.left. And the Brits are coming -
:01:17. > :01:19.in the world of wine, that is. We'll be getting the inside track
:01:20. > :01:22.on why more vineyards And today we want to know,
:01:23. > :01:26.do you care about where your The public and political backlash
:01:27. > :01:45.against corporate tax avoidance This morning, US search giant Google
:01:46. > :01:53.and UK tax officials will be grilled by British MPs about a $189
:01:54. > :01:59.million tax settlement. France's Finance Minister said
:02:00. > :02:12.it was tantamount to state aid. Meanwhile, the European Commission
:02:13. > :02:15.is preparing draft laws to force multinationals to publish a country
:02:16. > :02:19.by country breakdown It follows anti-tax avoidance plans
:02:20. > :02:28.announced last month by the EU's tax policy commissioner
:02:29. > :02:36.Pierre Moscovici. Those plans incorporate tougher
:02:37. > :02:39.international rules on what's called In plain English, that's shifting
:02:40. > :02:46.profits to low tax locations! So if you sell internet ads
:02:47. > :02:49.or cafe latte in Britain, you can't book the sale in Dublin,
:02:50. > :02:52.Amsterdam or the British Virgin It certainly goes along
:02:53. > :03:00.with the public mood. UK Finance Minister George Osborne
:03:01. > :03:09.was hugely criticised for agreeing a $189 million tax settlement
:03:10. > :03:12.with internet giant Google - In France and Italy,
:03:13. > :03:19.ministers have been suggesting they're going to go after some much
:03:20. > :03:33.bigger sums in back taxes. Dr Stuart Thomson is
:03:34. > :03:50.Public Affairs Consultant Let's talk about today's grilling.
:03:51. > :03:55.Google bosses, HMRC having to answer to UK politicians. Will anything
:03:56. > :03:59.come out of this? Highly doubtful. Most of the deals are done behind
:04:00. > :04:02.closed doors. The amount they can say in public will be fairly
:04:03. > :04:10.minimal. It will not stop the politicians having an absolute pop
:04:11. > :04:14.at the HMRC and Google. It is a lot of bad reputation, these sessions.
:04:15. > :04:22.Depending on how HMRC react and Google. My guess is they will say
:04:23. > :04:27.they have done a good deal. Where do we go from here? The pressure is
:04:28. > :04:32.mounting. Hubbard opinion, politicians not just in the UK but
:04:33. > :04:37.internationally, in fact. It is an issue in the United States and
:04:38. > :04:41.across Europe. How will this finally play out? It is interesting that
:04:42. > :04:48.George Osborne has completely miss read this. His claim this was a good
:04:49. > :04:52.deal initially fell flat with his own party and particularly the
:04:53. > :04:56.public. We are now looking to Europe to step in and sort out the mess.
:04:57. > :05:03.The British public are looking to the European Commission to try to
:05:04. > :05:08.force the British government to try to get more money out of Google. We
:05:09. > :05:14.are largely relying on Europe. Can that be done then? The British
:05:15. > :05:19.public are looking across the water to the likes of France and Italy.
:05:20. > :05:26.France and Italy get more money out of Google than say the British did.
:05:27. > :05:31.They are going to be fuming! If the commission actually looks at this
:05:32. > :05:40.issue, as it has done with other tax issues in the Netherlands and
:05:41. > :05:43.Ireland, it will of course apply pressure on the commission. If they
:05:44. > :05:47.see other countries are doing better deals and they are looking at the
:05:48. > :05:54.British Steel, it is bound to have an impact. So yes, British
:05:55. > :05:59.politicians will not like to admit it but Europe is the way forward.
:06:00. > :06:03.Some are arguing that from the point of view of the companies themselves,
:06:04. > :06:08.they are doing their job in the sense that they are making the most
:06:09. > :06:12.profits they can. They are pleasing their board of directors whereas the
:06:13. > :06:16.tax authorities should have been more proactive in going after the
:06:17. > :06:21.big guys as opposed to concentrating on small businesses. Even
:06:22. > :06:26.individuals, self-employed individuals and going after them.
:06:27. > :06:30.Absolutely, if you have to spend 30 minutes on the phone with HMRC
:06:31. > :06:35.waiting for an answer, you are going to be particularly livid when you
:06:36. > :06:37.see deals like this being done. Senior Google executives allegedly
:06:38. > :06:43.being paid more than the tax deal was worth. What we need is the
:06:44. > :06:49.government to be robust and stand-up. That needs the Treasury
:06:50. > :06:52.and HMRC to be able to do that. It needs a shift in a position as far
:06:53. > :07:00.as they are concerned. We have to see if they can do that. Thank you
:07:01. > :07:03.very much indeed. It is a complicated area.
:07:04. > :07:06.In other news, luxury electric car maker Tesla says it lost
:07:07. > :07:12.$320 million in the three months to December.
:07:13. > :07:15.Its shares have lost almost a third of their value since the beginning
:07:16. > :07:22.of the year, on investor concerns about continuing losses.
:07:23. > :07:25.However, they jumped in after hours trading after boss Elon Musk
:07:26. > :07:28.promised investors it would stop losing money this year
:07:29. > :07:34.while forecasting a 70% growth in vehicle sales.
:07:35. > :07:38.Oil giant BP says global demand for energy will increase by 34% over
:07:39. > :07:41.the next two decades, driven by growth in the world
:07:42. > :07:46.Oil's market share though will decline in favour of natural
:07:47. > :07:51.BP forecasts renewable energy sources like bio-fuels and wind
:07:52. > :07:59.power will provide around 15% of global power generation by 2035.
:08:00. > :08:03.Food and drink giant Nestle has ended its sponsorship of the IAAF,
:08:04. > :08:09.as it fears the doping scandal engulfing the world athletics
:08:10. > :08:15.governing body could damage its reputation.
:08:16. > :08:17.The Swiss company said it had taken the decision
:08:18. > :08:23.However, IAAF president Lord Coe said he was angered by the decision
:08:24. > :08:35.I don't know what he's going to do, but he will not accept it.
:08:36. > :08:37.Last month, sportswear giant Adidas ended its sponsorship deal
:08:38. > :08:49.Lord Coe putting his foot down. But what is he going to do about it? We
:08:50. > :08:56.shall wait and see and we will tell you all about it when it does
:08:57. > :09:00.happen. Let's look at Thomas Cook. Losses at Thomas Cook narrowed in
:09:01. > :09:04.the 3 months to the end of December. Customers opting to go elsewhere.
:09:05. > :09:09.Spain, the Caribbean more in fashion. North Africa is not, for
:09:10. > :09:15.obvious reasons. Security concerns, threat of terrorism. And a very
:09:16. > :09:25.similar stories are what we talked about last week earlier this week.
:09:26. > :09:33.Total, the French oil giant, saying it needs $45 a barrel of oil to
:09:34. > :09:43.break even. A barrel of oil at the moment is $30.44. They are a long
:09:44. > :09:46.way off. You are looking at me blankly at! I get it.
:09:47. > :09:51.Full year profits at the British-Australian miner
:09:52. > :09:53.Rio Tinto have fallen by 51%, partly because of slowing demand
:09:54. > :10:06.How is Rio getting on? The numbers are not pretty. Profit pretty much
:10:07. > :10:13.have to do $4.5 million last year. -- billion. To putted really simply,
:10:14. > :10:18.we can blame it on China. Slowing growth and demand from the mainland
:10:19. > :10:24.has resulted in steep falls in commodity prices. Iron ore, copper,
:10:25. > :10:29.we are seeing prices at their lowest in years. These are hurting miners
:10:30. > :10:32.across the board. Rio Tinto are scrapping their dividend policy of
:10:33. > :10:37.maintaining a raising their payouts each year. Now there are rivals have
:10:38. > :10:40.done similar. That is because these miners are under pressure to
:10:41. > :10:49.conserve cash as well as to cut costs. Salaries are to be frozen
:10:50. > :10:56.because of the bleak outlook. Thank you.
:10:57. > :11:01.Let's stay with the markets. Not great news. Some fresh cracks
:11:02. > :11:05.appearing in the global markets. Investors are turning their backs on
:11:06. > :11:10.the shares. They are dumping their money into the so-called safe
:11:11. > :11:16.havens, like the Japanese yen, which is not great news for corporate
:11:17. > :11:26.Japan. As the yen goes up, their profits go down. Even with Japan's
:11:27. > :11:31.market closed, this is the last close... Today it is closed in Japan
:11:32. > :11:37.for a public holiday. Despite that, the dollar hit a 15 month low
:11:38. > :11:44.against the yen. Gold prices hitting their highest since May. Investors
:11:45. > :11:48.are betting the US Fed could be done raising interest rates. Same old
:11:49. > :11:52.vibe in Europe. The global slowdown. Everybody is worried about that and
:11:53. > :11:56.the fact that the central bankers have got no more tools lab, no more
:11:57. > :12:04.ammunition to fight another slow down. On that cheery note, let's
:12:05. > :12:06.find out what is being talked about on Wall Street. At the moment 1 big
:12:07. > :12:16.topic is that little bluebird. Investors have been getting used to
:12:17. > :12:23.earning reports from Twitter that contains bad news about how many
:12:24. > :12:27.users they are investing. The number of people has actually fallen. That
:12:28. > :12:32.more than anything explains the initial dive into it share prices
:12:33. > :12:37.after the report came out. Bear in mind the price of the has fallen by
:12:38. > :12:48.more than 2/3 in the past year as investors apparently lose faith that
:12:49. > :12:51.tweeters can be converted into a sustainable business. Can Twitter's
:12:52. > :12:56.latest efforts to improve their service allowed to turn the corner?
:12:57. > :13:02.Start attracting new users and find a way to make more money from then?
:13:03. > :13:05.In his video presentation to analysts and investors, the Twitter
:13:06. > :13:11.boss tried to sound upbeat. We believe we can build the largest
:13:12. > :13:19.daily connected audience, 1 that watches together and can talk with 1
:13:20. > :13:22.another in real-time. It is what Twitter has provided for close to 10
:13:23. > :13:27.years and what we will continue to drive in the future. The other
:13:28. > :13:31.question prompted by Twitter's problems, and its collapse in share
:13:32. > :13:33.price, is does the company now become an irresistible takeover
:13:34. > :13:41.target for other players in the technology sector?
:13:42. > :13:42.Check your Twitter feed for updates. Michelle is on Twitter.
:13:43. > :13:44.Joining us is Mike Amey, managing director and portfolio
:13:45. > :13:48.manager at global investment firm, PIMCO.
:13:49. > :14:00.Are you on Twitter? We are, I am not. I am all Facebook. -- I am on
:14:01. > :14:06.Facebook. Only recently. Twitter have not made it that far yet.
:14:07. > :14:16.Facebook goes 1 way, Twitter the other. We are looking at that board.
:14:17. > :14:21.That is a horrid opening? The US has a bad run into the close. Markets
:14:22. > :14:25.have taken a little bit of a leg down overnight. The classic ones you
:14:26. > :14:30.look at overnight at the yen. That has been doing very well. Some of
:14:31. > :14:36.this is a response to that. People are looking for a circuit breaker.
:14:37. > :14:43.Janet Yellen did little to calm nerves? She was in no man rush to
:14:44. > :14:49.raise interest rates. But the US economy is still doing fine. If the
:14:50. > :14:52.US economy is doing fine, why not raise interest rates? Because she
:14:53. > :14:56.can see what is going on in the rest of the world. She tried to say as
:14:57. > :15:00.little as he possibly could and tried not to rock the boat. She
:15:01. > :15:04.looked like she got away with it until that laid close, where people
:15:05. > :15:10.just said, that's out of the way, let's go back to... I was reading in
:15:11. > :15:14.1 market report that actually everybody was looking ahead to her
:15:15. > :15:19.speech and that was keeping markets a little bit buoyant. When she had
:15:20. > :15:25.finished, they then concentrated back on China, oil, global
:15:26. > :15:30.pressures. It went pear shaped again Chumak Rio that is right. She pulled
:15:31. > :15:35.a magic rabbit out of the bag on 1 hand. There was a little bit of
:15:36. > :15:42.hope. The markets put themselves into this self reinforcing Ron
:15:43. > :15:52.where... What are you telling your clients? I am really worried. You
:15:53. > :15:57.have got the oil price, the commodities, you have got the big
:15:58. > :16:04.boss of Mirsky, which is all around the world. He says it is in the
:16:05. > :16:10.worst -- a worse state than 2008. The central bank has no ammunition
:16:11. > :16:17.left. It is pretty dire. Yes, there are a couple of things we should
:16:18. > :16:22.remember. To some degree is these levels are already reflecting some
:16:23. > :16:30.risks. Do not forget that income growth is still doing okay. Wages
:16:31. > :16:34.are going up. It is not a given that everybody will stop spending. House
:16:35. > :16:38.prices still going up. For most people things do not look too bad.
:16:39. > :16:50.That should be okay as long as it the case.
:16:51. > :16:56.Still to come, how do you fancy a collapse of English is, I know that
:16:57. > :17:05.he does, we will be telling you more about that a bit later. Live on BBC
:17:06. > :17:09.News. All prices are tumbling, we have talked about that already, who
:17:10. > :17:16.would want to predict the future of the energy market right now? We have
:17:17. > :17:20.just seen them publish their latest output, we have been speaking to the
:17:21. > :17:26.BP chief economist, formerly of the Bank of England. What has he been
:17:27. > :17:30.saying? I guess what he has been saying at the moment, I played a
:17:31. > :17:33.game recently, with all of the chief executives and got them to try and
:17:34. > :17:39.predict your prize in six months' time, I got everything from $6 the
:17:40. > :17:44.formally be Prime Minister. Their one has got a clue. BB are looking
:17:45. > :17:49.at the next 20 years, what is the global demand for energy and supply.
:17:50. > :17:56.The former economist from the Bank of England, this is what he had to
:17:57. > :18:02.say. The key driver of energy demand is the world economy, as the world
:18:03. > :18:04.economy continues to grow. It needs more energy to drive those high
:18:05. > :18:08.levels of activity and living standards and that is what drives
:18:09. > :18:14.this increase in energy demand of around about a third in the next 20
:18:15. > :18:17.years. In the short time we have got massive oversupply, right now the
:18:18. > :18:21.pile of unused oil this to a growing every day, it is not getting
:18:22. > :18:27.smaller, it is growing, that is why you are seeing prices in the gutter,
:18:28. > :18:31.$27. You think the second half of this year you may see at the cup.
:18:32. > :18:35.The other interesting thing, is that if they are right about global
:18:36. > :18:39.demand and what the mix of energy that we are going to use for the
:18:40. > :18:42.future, then we are not there to hit the global targets hit in the Paris
:18:43. > :18:47.summit at the end of last year. On their projections, the Paris climate
:18:48. > :18:51.summit objectives will be missed. At the moment who would want to bet
:18:52. > :19:01.where the oil price will be in one day and even one year's time? I love
:19:02. > :19:06.this one. It is on the website. It is on the BBC website, go and check
:19:07. > :19:11.them out. Shoppers failed to spot the cheapest deals. This is a survey
:19:12. > :19:16.done by the money advice service. They asked 2000 customers to choose
:19:17. > :19:21.the best value deals, only 2% came out with the best deal. The I can
:19:22. > :19:28.smell a deal, my wife is hopeless though. It is all of this confusing
:19:29. > :19:31.thing, 342, you don't bear which one is the good deals and which one is
:19:32. > :19:41.not ripping you off but spending more money. Buy one get one free.
:19:42. > :19:47.You are watching businesslike, searching questions for Google over
:19:48. > :19:52.its tax bill, 189 million in taxes, is that enough for this
:19:53. > :19:55.multinational giants to pay? Google and HMRC will be before UK
:19:56. > :20:00.politicians today getting a grinning. Do tune in for that. Let
:20:01. > :20:05.us get on to a subject that you may love or hate, what is all favourite
:20:06. > :20:11.wine? French Burgundy or Spanish Rioja. What about English fears,
:20:12. > :20:16.which is what Aaron is now producing on the table. The Chinese president
:20:17. > :20:21.was treated to UK home-grown wine during his recent visit last year,
:20:22. > :20:26.whether or not he will be ordering a case, it seems that British winds
:20:27. > :20:32.may be on the up. Applications to develop British Vineyards rose. They
:20:33. > :20:36.rose by more than 40% last year, the UK winemaker is much smaller. And
:20:37. > :20:40.the sparkling wine production is tiny compared to the major champagne
:20:41. > :20:51.houses, around about 35,000 bottles each year. It was recently bought by
:20:52. > :20:55.an investment firm and made a loss in the first half of the year, the
:20:56. > :21:01.chief executive, we dragged him in a studio and he has brought a couple
:21:02. > :21:05.of props. Welcome to the programme, Sally and I were talking about this
:21:06. > :21:12.earlier this morning, saying, this whole UK British sparkling wine, has
:21:13. > :21:18.been a real phenomena. It has been a real buzz over the last few years.
:21:19. > :21:22.Why now? Have things changed? Why all of a sudden over the last few
:21:23. > :21:29.years has the British wine industry shot through the roof? I think it
:21:30. > :21:33.has got much more public awareness, because of the international
:21:34. > :21:37.competition and awards. And the spate of good news basically. Not
:21:38. > :21:45.only that, but the arrival of the first champagne house in England,
:21:46. > :21:49.Tass and Joe, the French are coming. They have clearly seen
:21:50. > :21:57.that we are onto a good thing and demand far outstrips supply at the
:21:58. > :22:03.moment. It is a combination of factors including climate. It hasn't
:22:04. > :22:06.happened overnight, the first pioneers of image sparkling wine
:22:07. > :22:11.were at it 20 years ago at least. It has been a story about climate
:22:12. > :22:16.change, if we look back 25 years, the weather that they had in the
:22:17. > :22:20.capital of champagne is what we have now. So we are able to produce
:22:21. > :22:26.wines, at a level of sophistication to rival the best champagne. Is this
:22:27. > :22:33.one of your problems, the industry is growing, you are growing, English
:22:34. > :22:42.wine growers, only account for 0.14% of the UK market. It is about 25
:22:43. > :22:48.million drinkers. Is it a problem? What is this going to cost me a a
:22:49. > :22:51.bottle of this? Danish mine, the markets developing, people like us
:22:52. > :22:56.who are going for the luxury end of the market, very good about what we
:22:57. > :23:00.do. The age the wines for four years and we only use the grapes, and we
:23:01. > :23:03.are completely uncompromising in the approach to make the best wines.
:23:04. > :23:08.There are other people who are maybe ageing wines from not as long, a lot
:23:09. > :23:15.of the entry point champagne that you buy in the supermarket, might be
:23:16. > :23:20.brought in using maiden fruit, it might only have been aged for a
:23:21. > :23:25.year. So there is a range from 15 to ?17 as an entry point to 30 or 40,
:23:26. > :23:27.there will be special and luxury additions coming out over the next
:23:28. > :23:34.few years which will be heading towards ?100. We have been told that
:23:35. > :23:38.we are out of time. Which is a real shame and we appreciate you coming
:23:39. > :23:43.in, very interesting to hear how that has developed over time. In a
:23:44. > :23:47.moment we will have a look at the business pages, here is a quick look
:23:48. > :23:50.at how you can stay in touch. You can stay ahead with all of the day
:23:51. > :23:54.is breaking business news, keep you up-to-date with all of the latest
:23:55. > :23:58.details with insight and analysis from BBC's team of editors around
:23:59. > :24:08.the world and we want to hear from you too. Get involved with the BBC
:24:09. > :24:17.business news live web page, and you can find us on Facebook and BBC
:24:18. > :24:24.business news. Whenever you need to know. So get in touch, Mike is back.
:24:25. > :24:29.We talked about Twitter already, let us talk about gap which is the top
:24:30. > :24:36.story. Mind the Gap. This is the latest to be named and shamed, as to
:24:37. > :24:40.not pay enough taxing the UK. It is a classic example of the challenges,
:24:41. > :24:46.they have basically paid no corporation tax since 2011, despite
:24:47. > :24:51.having annual sales of ?300 million. There is a classic example of the
:24:52. > :24:56.challenges that you face, with a company, they have got a Dutch
:24:57. > :24:59.components, so there is a question of how much, of the profits they put
:25:00. > :25:09.through Holland and the UK and the US. And how you get that money off
:25:10. > :25:16.them basically. Yes, 40 seconds left, beer, big deals coming up,
:25:17. > :25:19.nearly $300 million work? SAB Miller, and another are trying to
:25:20. > :25:25.merge, they had to sell some of their brands. The Japanese yen going
:25:26. > :25:31.up so it makes it cheaper to buy other companies, so, there is a
:25:32. > :25:41.Japanese company called Asahi, which is going to buy. And SAB Miller, are
:25:42. > :25:47.going to look at the deal? They have $60 billion worth of sales year, so
:25:48. > :25:56.there is an anti-competitive risk, if they don't sell something. Good
:25:57. > :26:09.on you. He can come back. That is business live, see you soon.
:26:10. > :26:14.Hello we are remaining with the cold theme for the foreseeable future, a
:26:15. > :26:16.good-looking day on the cards for much of