12/04/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson


Corporate giants forced to come clean -


the EU cracks down on tax avoidance, with plans to force big firms


Live from London, that's our top story on Tuesday 12th of April.


The European Union prepares to unveil new tax rules


for the world's biggest companies, forcing them to reveal how much tax


But will the EU target tax havens too?


Japan's biggest brokerage Nomura plans cost cuts


Around 1,000 employees in Europe and the Americas are expected


to lose their jobs in a massive reorganisation of the business.


This is how Europe has opened in the first few minutes of trade, we will


assess the movers. And it's International Record


Store Day this Saturday. We'll be getting the inside track


on vinyl, when we speak to the company that makes


these record players. We will make the boss of, the


company that makes these record players. What other retro- tech


would you like to see? It is a busy show, let's get


started. Plans to force corporate giants


to disclose more about their tax affairs will be unveiled


by the European Union later today. Even before the leak


of the Panama Papers - which shone a spotlight on tax


avoidance globally - the European Commission


was debating new rules Tax avoidance currently costs the EU


between $60 and 80 million dollars That's big bucks when


many EU countries are So the new proposals


would require big companies - those earning over $850 million


a year - will have to publish their income and tax reports


from whichever EU country they operate in, on a


country-by-country basis. It would cover 6,500 companies


around the world, including But tax transparency campaigners say


the rules won't go far enough. They argue tax havens should also


fall under the new rules, with data from outside


the EU to be published Thanks for being on the programme.


Just to start with, hearing what Ben outlined sounds like a huge headache


for these global companies to have to come up with all this new


information? This draft proposal was put forward by the European


Commission today and if it gets through, multinational companies and


big companies would have to disclose that rough it, income and tax bills


that they make within the EU, that would be available to the public --


disclose their profits, income and tax bills. This could get a real


boost because of the Panama Papers, there is more interest because tax


avoidance is bigger news. They are talking about drawing up and EU list


of tax havens. They would need to get member countries on board to


list tax havens. Basically, it would mean that if a multinational or big


company which does business within the EU has interests in a tax haven,


they would have to declare. The EU can't enforce anything, it would be


up to the parent nation to deal with it. It is the idea of putting it out


there for the public. Transparency campaigners are saying, oh, well, it


does not go far enough, it means that multinationals would not have


to publish their income in tax payment outside of the EU. -- income


and tax payments. At the EU would like this to pass, they did not


think it would go through if they made multinationals do that. Just to


say, which is typical of Europe, this will take quite some time


before it comes into force, assuming the announced plans are approved?


This is draft legislation being proposed today. It will have to be


accepted by EU leaders and then it will have to go through the European


Parliament. They are hoping that, because of the Panama Papers


scandal, there will be political will. It might be embarrassing for


EU leaders to oppose it too strongly. Also, it needs a qualified


majority vote to pass, it has been put into financial services, it does


not need unanimous voting, so they are hopeful that it will move


through, but the process takes months. For now, Leana, thank you


very much. She will keep us up to date. Some of the other business


News... Metals giant Alcoa has


cut its forecasts for revenue and earnings as it downgraded


expectations for global growth. The firm - which is often


seen as an indicator of the health of US industry -


says first-quarter earnings fell by 92%,


hurt by weak aluminium prices. The company also says it's


considering up to 2,000 job cuts. Luxury goods retailer LVMH says


revenues were up 4% in the first three months of this year,


compared to the same LVMH owns more than 60 luxury


brands, including Kenzo, The company said the US


market remained strong, but France has been affected


by a fall in tourism. Particularly sends the November


terrorist attacks in Paris. -- particularly since.


Brazil's President Dilma Rousseff has suffered a blow to her hopes


A special committee in Brazil's lower house of Congress has voted


in favour of recommending her impeachment over allegations


Looking at what is being discussed online today, there is a lot of


detail on some of the stories we have mentioned. If you want to dig


into the tax story you can look at that Onana Business Life page. There


are many of the stories, Nomura, which we will talk about with a team


in Singapore in a moment, but it is the London Book Fair starting this


morning. Some nice old tech to get your teeth into! In the wake of the


Kindle and the growth of e-readers, the book is making a bid of a


comeback. That is a bit like story about vinyl. Let's mention Japan.


Japan's largest brokerage, Nomura, plans to shut down its European


equity operations as it cuts costs after years of failing to become


Nomura, this is interesting, we have heard about the implications of a


slowdown around the world and what it means for many organisations, to


some extent the financial world has survived most of this unscathed, but


not yet getting through quite so cleanly? Global investment banks in


recent years, many have been selling off Origi sing the size of non-core


or non-performing businesses. Japan 's Nomura is the latest to join


them. We understand they are downsizing the size of a European


cash equities business. They are not shutting it down, they are getting


rid of basic and proportion, meaning lots of jobs will go -- getting rid


of a significant proportion. They say that will be 500 to 600 jobs in


North America and Europe, but another source says around 1000 jobs


could go as well. This is a big load from Nomura, they have wanted to be


an international player on the banking stage. In 2008 they bought


Lehman Brothers' European and Asian businesses when the firm went under


chewing the height of the financial crisis, they wanted to build their


brands abroad. Ultimately, it has not performed, they have not made


money, and so like their peers they have suffered from market volatility


and they are shrinking the size of businesses that are not doing well.


Thank you, Leisha Chi in Singapore bureau.


Let's look at what the numbers are doing at the moment.


Worries over earnings on the minds of investors this week.


The worry that it could be another disappointing quarter and there's


lots of speculation about just how bad it could get.


Major banks announcing their earnings this week


and if they come in below expectations, it starts raising


tough questions for policymakers, not least the Fed and whether it


Mariko Oi has the details from New York.


The International Monetary Fund issues its latest world economic


Outlook on Tuesday, this comes just ahead of the IMF's Spring meetings


with the World Bank taking place this week in Washington, DC. In the


forecast, expect warnings that the global economy is at risk, because


of China's downturn, lower commodity prices and the slowdown in emerging


market economies. This week brings plenty of fresh US economic data. On


Tuesday, look out the numbers on the federal budget in addition to import


and export prices. In tech news, Facebook holds its annual developers


conference this week in San Francisco. It kicks off on Tuesday


and CEO Mark Zuckerberg will be delivering the keynote address. That


is the lovely Mariko, she is normally in Singapore but she is in


New York at the moment. Joining us is Tom Stevenson,


Investment Director Good morning, Tom. As Mariko


mentioned, it is about earnings. The news last night did not look good?


Earnings are a big focus, Alcoa always kicks it off, they were


pretty disappointing. 92% fall. They downgraded the outlook for global


growth and demand for aluminium. The thing about earnings season this


quarter is the expectations are very low, we expect earnings to be as


much as 8% lower, year-on-year. In a way, that could be good, markets


react to what they expect. If earnings expectations are as low as


they are, things could turn out better than expected. That


fascinates me about earnings season, it is managing expectations. Lots of


organisations have said that things are terrible, the reality is


difficult, but if you speak to them privately, they say, things are not


bad, we are coping, there is a real mismatch between what they want to


publicly admit this is what they are preparing us for? Lots of it is


managing expectations, if you can get the market to think that things


will be pretty bad, when you announce your figures it can give


your share price a boost. Oil is in focus, at the end of last week in


particular? One of the reasons why earnings season is expected to be so


bad is because the energy sector profits will be very, very low,


almost wiped out. All eyes will be on the Doha negotiations, they are


talking about whether they can cut production in order to boost the


price. Expectations for a positive outcome through those talks has


already seen the oil price push-up to about $43 a barrel, a lot higher


than six weeks ago or so. Thank you, Tom. He will talk as do some of the


stories later. Vinyl revival - they were once


destined for museums and history books, but vinyl records


are making a comeback. And that's good news


for the makers of record players! We meet the man behind one


of the world's most respected makers of turntables -


the Glasgow-based firm Linn You're with Business


Live from BBC News. We've had an update from the online


retailer ASOS this morning. It says profits are up


18% to ?21.2 million The firm began life at the height


of the dotcom boom in 2000, has had a tough few years but now


says it's on track to meet sales and profit guidance for the full


year. I think ASOS stands for As Seen On


Screen? Absolutely. Kate Hardcastle is a retail expert


at Insight With Passion. Good morning. Talk is through this


turnaround. It has been pretty tough in recent times, but we are told


that things are looking much better? What I think ASOS have done


brilliantly is determine what their core purposes, they have understood


that, for a 20-something customer, of which they want to be the world


leading retailer to supply them, they had to change their business to


suit. You have got offers to that 20-something customer, free returns,


free delivery, categorisation not only by-product but by fashion trend


and celebrity, which makes the ASOS site very appealing, there


easy-to-use and, for a 20-something, very exciting. Hind the scenes they


have operations to conform a lot better, they have their


international situation sorted out by pulling out of China are little


bits, they have ensured that their operational/ chair, their returns


policy etc, is healthier for the customer -- their operational


structure. That said, you will still see consumers complaining about the


challenges they find contacting somebody at the business.


Interesting that ASOS should see a turnaround, companies like Marks


Spencer, that dignity with their women's clothing, are struggling. Do


they look at these companies and try to pick from them the best bits of


turnaround plans? That is what you have with ASOS, they will be


spending money and leading the way, others will be quick to follow,


adding not gone down some of the dead-end roots that they will have


to invest in. -- having not gone down. They have listened to the


customer and are delivering, that they have a very fickle customer in


the 20-something. Marks Spencer 's have such a wider group of customers


to be able to offer two, it is a much more difficult challenge. Thank


you, Kate. Things looking much better, Kate,


thank you. Our top story: Corporate giants


forced to come clean. The EU cracks down on tax avoidance,


with plans to force big firms to publish where


they make their profits. And therefore pay tax in the


jurisdiction in which it is earned. The EU says that could be about to


end. This Saturday is International


Record Store Day, an initiative designed to promote sales


of vinyl records. After being consigned


to the history books, sales of vinyl have soared


and that's boosted demand And it's something our next guest


knows all too well. The company is one of


the world's most respected Linn was founded by Gilad's


father, Ivor, in 1973. While the company still sells


its original turntable and new home music systems,


it also makes revenue from the sale of digital downloads


from its recorded music division, and from its recently added line


of digital streaming players. Gilad Tiefenbrun is


Managing Director of Linn. A very warm welcome to Business


Live. Thank you. There is so much to your business, I think people


generally think of the turntable, don't they? Because that's really


what you were about and what many sort of associate you with, isn't


it? That's right. My father invented the Linn LP12 turntable in 1973. He


was a mechanical engineer with a passion for music and people were


designing turntables so they wouldn't skip on the record and


through trial and error he realised if you focussed on getting


information out of the groove of the record, you could actually achieve a


much better sound. So you grew newspaper a home where you were


being blasted by music all the time! Your dad and his colleagues testing


things out. You told me there was a lot of Pink Floyd? Yes, I was kept


awake by Darkside Of The Moon and ELO, that's what it was like back in


the 70s. The vinyl and the record player has stood the test of time as


we said there, making a come back now and in the meantime, we have


seen CD players come and go, we have seen cassettes come and go, what is


it about vinyl that people keep coming back to? There is something


magical about the experience of taking that record out of its sleeve


and you have to take really good care of it, putting it down on the


platter and there is something interactive that makes you connect


with the music and encourages you to listen to the full side of an album


which is so different to the flipping mentality that there is


today. So there is a real kind of enduring, enjoyment that goes with


vinyl that really attracts people plus it sounds better than the other


formats that you mentioned. It doesn't sound better than digital


though and during the digital era, that was something that you


introduced to the company, wasn't it? Well, that's right. Modern


digital recordings are best experienced just played directly


through a digital streamer like our range of players, but to a beguning


generation they will only have experienced MP3, probably through


portable players, so vinyl for them is a big jump up in quality,


probably the best quality they will have experienced. We are talking


about the comeback, but it will always be a niche business, I can't


imagine this will see the full-scale appeal that it once did, but it is


an important niche and one that will keep making money for you, but


digital and streaming services are the majority of your business, how


do you balance the two conflicting demands? Well, my father had the


fore sight to design his turntable so it was upgradeable. So if you


bought it the LP12 in 1973 you could upgrade it step by step to the 2016


specification. We take a similar approach on the digital side, but it


is software upgrades so if new formats come out, we make sure our


customers can experience the improvements in sound quality. So


what's the next step? Where do we go next? Well, I think people want to


listen to whatever they want, wherever they are and I think what


we are seeing then is higher quality digital coming along through


streaming services like Tidal and they integrate to a system like Linn


and allow you to access the huge libraries in the Cloud and not


necessarily at MP3 quality, there is now higher quality music becoming


available for everyone. It is fascinating. We could talk much


more, but time is against us. Thank you for coming in. We appreciate it.


We were asking you what other retro tech would you like to see make a


comeback? A surprising number said you want to see cassettes back. I


really don't understand that. I don't either. I remember them


unRAFFing and the whole thing getting messy! And you had to do it


with your pencil and the rubbish quality! A lot of you commenting on


the difference in the quality as we touched on, the difference between


CDs, records, vinyls and cassettes, clearly quality is a big issue. Are


you too young for vinyl? No, I remember vinyl. He is not that young


then you see! Not that young! Let's move swiftly on, shall we?


. Well, how about adding


17 more rotor blades? Entrepreneur Alex Zosel says


that his unusual looking device with 18 rotors can still fly


even if some of its batteries It can even land itself


when battery power is low. But the multicopter can only fly


for 25 minutes and is expected to cost nearly $300,000


when it goes on sale. With 18 rotors we have a really safe


system so we can lose more than two rotors with no problems and also


in very hard and So we have a lot of people


who want to buy it. So the first step is we want


to sell to flight schools. So the challenge is


with the authorities. The German authorities are working


very, very good with us. So we are sure that we can have


in two-and-a-half years a type certification so we can produce


a large scale and sell it We were so.


Busy having a chat there, welcome back!


They didn't go anywhere. They were just listening to helicopter news.


Welcome back to our conversation and Tom is with us to talk about the


newspapers and Tom, we are going to talk about this tall tower. Dubai,


home, of course, to the world's tallest, but they are going to build


an even taller one? Yeah, funny that, isn't it? I can see why they


are building another tall tower because the Saudis just next door


are about to open an even taller, a one kilometre high kingdom tower.


Unsurprisingly the UAE, Dubai are coming back by 2020 they will have


an even taller tower and it will sit within a megaretail district, you


would have thought Dubai probably had enough retail space, but who


knows. Someone has done the research about when you build the towers and


it tends to be, you build during a downturn when stuff is cheap and


labour is cheap and building materials are cheap and you get the


fruits of your labour when the economy picks up again. There is so


there is a strange correlation between what the economy is doing


and when you build these things? The cycle is wrong which is why property


companies make a lot of money and lose a lot of money. That's the


nature of the business. On from the tall tower to the new ?5 in


Australia which viewers will see in a moment when this loads up. Sorry


Australia dollars. A picture of the Queen on it? Yes, I have seen only


seen a black and white picture. If you look at the comments below the


story on the online version of this. We have got a colour one, Tom.


Rather unfavourable comments about the colours, could have been drawn


by a child in kindergarten. Plus the Queen is grey. A lot of comments


about the Queen perhaps unsurprise grid in Australia. So --


unsurprisingly in Australia. So it is not an uncontroversial note. It


makes h look rather young. On to the Guardian, Kraft beer, we have a lack


of hops. This is another industry that we used to do very well and


stopped doing. We used to grow lots of hops, we stopped growing hops and


now they are grown in America and Germany, but there has been a


problem with the German harvest. There is a shortage of hops. The


price are soaring and one of the reason the price is soaring is


because of Kraft beer, they use a lot of hops, Kraft beers. Are you a


craft beer fan? I like a beer once in a while. Let's ignore that. My


tablet is doing funny things. Sally has broken the tablet so it means we


have got to go! That's all from Business Live for


another day. We are back tomorrow. We are, same time, same place. Have


a great day. Bye-bye.


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