:00:00. > :00:14.Those are the new headlines. And now for the biggest business stories.
:00:15. > :00:16.Hopes of a European mega-exchange between London and Frankfurt
:00:17. > :00:24.The London Stock Exchange says the regulatory hurdles are too high.
:00:25. > :00:32.Nokia hopes to revive its flagging fortunes as it resurrects
:00:33. > :00:36.We'll get a hands-on preview from The Mobile World Congress in
:00:37. > :00:52.Welcome to World Business Report. I'm Sally Bundock.
:00:53. > :00:54.In a minute, we'll look at the potential collapse
:00:55. > :00:57.of the merger between the London Stock Exchange and Deutsche.
:00:58. > :01:00.The clock is ticking, with speculation mounting the UK
:01:01. > :01:03.Prime Minister may trigger Article 50 on the country's departure
:01:04. > :01:04.from the European Union in early March.
:01:05. > :01:07.Since the referendum, there have been major concerns
:01:08. > :01:10.in London it could lose its position as Europe's financial capital.
:01:11. > :01:13.But one of Germany's most senior central bankers tells us why
:01:14. > :01:24.he believes the city will retain its crown.
:01:25. > :01:26.At present, Britain benefits from so-called "Passporting Rights"
:01:27. > :01:29.which allow UK-based banks free access to the European Union.
:01:30. > :01:33.The City of London's main industry lobby group appears to have given up
:01:34. > :01:35.hope on maintaining these rights and is now campaigning
:01:36. > :01:38.for "equivalency" to form part of the UK's package when it leaves
:01:39. > :01:46.Equivalency is a relatively new legal concept which allows
:01:47. > :01:48.companies to trade freely within the EU, assuming it has
:01:49. > :01:52.But the Financial Times is reporting this diluted equivalency agreement
:01:53. > :01:55.may be tougher on Britain than was previously thought.
:01:56. > :01:58.Andreas Dombret is a board member of the Bundesbank that oversees
:01:59. > :02:02.He told the BBC he is open to consulting with banks wishing
:02:03. > :02:28.to relocate to Frankfurt, but he also issued a warning.
:02:29. > :02:37.From a German perspective, should a business or a bank be looking
:02:38. > :02:44.towards moving to Germany, we will not accept empty shells, letterbox
:02:45. > :02:48.companies. We will make sure that the management, the controlling, the
:02:49. > :02:54.risk controlling, etc, is done out of Germany. That does not mean we
:02:55. > :02:59.would have back-to-back booking models. But the structures and all
:03:00. > :03:14.the like is not something we would forgive. Andreas Dombret from
:03:15. > :03:15.Bundesbank. It's also being reported this
:03:16. > :03:17.morning the $31 billion merger of the London Stock Exchange
:03:18. > :03:20.and Deutsche Boerse could collapse. It looks like the regulatory hurdles
:03:21. > :03:23.are too high ending the companies efforts to create
:03:24. > :03:25.a European mega-exchange. Peter Hahn is the Henry Grunfeld
:03:26. > :03:33.Professor at The London Institute Good morning. Good morning. Good to
:03:34. > :03:35.see you. Let us start with the exchanges. Are you surprised they
:03:36. > :03:40.will not come together eventually? No. It is an amazingly complex
:03:41. > :03:44.issue, especially with Brexit. It was a contest in a certain way
:03:45. > :03:50.between Frankfurt and London for dominance. London was going to get
:03:51. > :03:55.the overall holding company. That was always presented, first with
:03:56. > :04:04.Germany and Brexit, and the bigger issue. What they are relying on is
:04:05. > :04:08.something more complex than a merger problem, a set of activities and a
:04:09. > :04:13.merger that has to happen. The city of London and the whole Brexit
:04:14. > :04:17.negotiations. As we mentioned, Theresa May is likely to trigger
:04:18. > :04:21.Article 50 in March, just a few days away, the month of March. This stops
:04:22. > :04:28.the process of the negotiation, the exit of the EU, and will take up to
:04:29. > :04:33.two years. Now, there is so much to negotiate within that. But the city
:04:34. > :04:39.of London is incredibly important, isn't it, to the UK economy, that
:04:40. > :04:43.they get a great deal. It is a major taxpayer, a disproportionately large
:04:44. > :04:48.one. Just from the income of business is. But from the people who
:04:49. > :04:51.work in the city as well, it is substantially above average and they
:04:52. > :04:57.pay a lot of income tax. We talked about the Passporting Rights issue
:04:58. > :05:05.and this so-called new equivalency, which is not quite an equivalency.
:05:06. > :05:10.Talk us through these two and what the outcome might be. Passporting
:05:11. > :05:14.Rights simply says that a bank in any EU country is able to do
:05:15. > :05:22.business in another EU country without having to set itself up and
:05:23. > :05:26.get a separate licence, et cetera. Equivalence means my country has
:05:27. > :05:31.rules and your country should have equivalent rules to ours. Even if
:05:32. > :05:36.they are not the same. Therefore, you can do business in my country
:05:37. > :05:42.and vice-versa. It has all been a kind of tentative races and hasn't
:05:43. > :05:47.really worked out. -- process. Because of that it could almost be
:05:48. > :05:56.shut off. 30 days if you do not like it. That has always been a bit of a
:05:57. > :06:00.charade. We have been trying to see the outcome but I do not know. What
:06:01. > :06:04.about the rules of banks operating outside London? It is important to
:06:05. > :06:12.London, but also to Europe, that it works well. Andreas said it clearly.
:06:13. > :06:16.Europe expects, and Germany in particular, he was almost speaking
:06:17. > :06:21.for Germany, it wants fully operational businesses to move to
:06:22. > :06:26.Germany, and not come from the UK any more. And that is relatively
:06:27. > :06:34.similar to the way Europeans do business in the US. Now, the US, a
:06:35. > :06:37.European bank of any size, it supposed have what is called an
:06:38. > :06:41.intermediate holding company, and that means a separate bank that is
:06:42. > :06:52.rig goodbye the United States. And that is what we are moving to with
:06:53. > :06:57.the use. -- that is seperate to the United States. There is a lot more
:06:58. > :07:05.detail and more of the interview on our website. Do take a look. Now,
:07:06. > :07:06.let us talk about Nokia! Nokia used to be synonymous
:07:07. > :07:09.with the mobile phone. And HMD, the company which recently
:07:10. > :07:12.bought the rights to the Nokia brand, is hoping a blast
:07:13. > :07:15.from the past will restore The handset on the left may not look
:07:16. > :07:20.immediately familiar to you. But the handset on the right
:07:21. > :07:23.should ring some bells. Nokia is resurrecting its iconic
:07:24. > :07:26.3310 model, but the latest version has a battery that can last
:07:27. > :07:27.an entire month on a single charge. That's Mobile World
:07:28. > :07:29.Congress in Barcelona. Rory Cellan-Jones sent us this
:07:30. > :07:38.report from The Mobile World Barcelona. And as the mobile phone
:07:39. > :07:45.industry arrives for its annual jamboree, there is the starter in
:07:46. > :07:52.the air. SINGING THE NOKIA TUNE. Nokia is making a comeback. This was
:07:53. > :08:00.its first chance to make a big splash. And with a range of new
:08:01. > :08:07.smartphones, it brought out something very retro. Let me
:08:08. > :08:12.reintroduce the Nokia 3310. You cannot do much with this phone
:08:13. > :08:20.except make calls and play a game of Snake, but the battery lasts
:08:21. > :08:25.forever. We ask consumers what is the best iConnect device from Nokia?
:08:26. > :08:31.We thought, let us have some fun and be creative with this device. This
:08:32. > :08:35.may be fun, but let us face it, it is a gimmick. If Nokia wants to be a
:08:36. > :08:42.major force in the world again, it will not be because of the 3310, but
:08:43. > :08:47.a new range of Android smartphones. This is already selling well in
:08:48. > :08:50.China. But in a market where it smartphones all look the same, the
:08:51. > :08:55.market is tough. They had to look backwards as well as forward. By
:08:56. > :08:58.bringing out this truly iconic device with bags of nostalgic, for
:08:59. > :09:03.many people it was their first mobile phone, it captures the
:09:04. > :09:14.attention of the people and let them know that Nokia is back. Will
:09:15. > :09:23.would switch my phone. Even if it had no Internet? Yes. I would change
:09:24. > :09:33.my mind. Here is another phone making a comeback. This is the
:09:34. > :09:37.Blackberry 31 launched by a Chinese firm. Two big names making an
:09:38. > :09:43.unlikely bet they could be big again in the future. BBC News, Barcelona.
:09:44. > :09:50.And there is a lot more on the website. Take a look. From me, it is
:09:51. > :10:02.goodbye. But I will be back soon to look at the papers. See you then.
:10:03. > :10:04.Chancellor Philip Hammond should make schools a priority
:10:05. > :10:06.in the budget, according to a teaching union
:10:07. > :10:10.and the National Association of Governors are calling for.