What to Watch: Starbucks and Google rulings, Nissan settlement, TUI resilient

Edmund Heaphy
·Finance and news reporter
Updated
En esta imagen de archivo, tomada el 26 de junio de 2019, se muestra un logo de Starbucks en el exterior de una cafetería en el centro de Pittsburgh, Pennsylvania. (AP Foto/Gene J. Puskar, archivo)
The Netherlands won its case against the European Commission regarding a Starbucks tax ruling. Photo: Gene J Puskar/AP

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:

EU court strikes down Starbucks tax ruling

The European Union’s second-highest court on Tuesday quashed an order from the European Commission that required Starbucks to pay back €30m (£26.5m) in taxes to the Netherlands.

The court said that the commission, the EU’s executive arm, was not able to demonstrate that the US coffee chain received preferential tax arrangements from the country.

The commission’s competition arm, headed by Margrethe Vestager, had ruled in 2015 that a corporate tax arrangement with Starbucks constituted illegal state aid.

But the bloc’s general court said that the commission was “unable to demonstrate the existence of an advantage in favour of Starbucks,” noting that it had not proved that the chain had an “economic advantage” as a result of the arrangement.

The Netherlands appealed the decision of the commission.

Google wins landmark privacy case against France

Google emerged victorious in a landmark privacy case at the European Union Court of Justice on Tuesday, after Europe’s top court ruled that the US search-engine giant did not have to apply European right to be forgotten requests across its global search results.

The right to be forgotten allows individuals to have search engines remove results linked to their names that are irrelevant or outdated.

The dispute between Google and the CNIL, France’s privacy regulator, over people’s right to be delisted from Google’s search results began in 2015. CNIL demanded that Google delist results globally for European right to be forgotten requests, and fined Google €100,000 (£88,000) for refusing to comply.

Google challenged the ruling and the case was escalated to the ECJ in Luxembourg, which today said that Google did not have to apply EU right to be forgotten actions to global search results, just results appearing within the 28-country EU bloc.

Nissan pays SEC $15m but Carlos Ghosn puts up just $1m

Japanese car maker Nissan agreed to pay the US Securities and Exchange Commission (SEC) $15m (£12m) to settle fraud charges over the false reporting of $140m in compensation and retirement benefits for former chairman Carlos Ghosn.

Ghosn himself will pay just $1m, while former director Greg Kelly got a fine of $100,000 for aiding and abetting Ghosn.

Ghosn has a reported net worth of $120m. The former chairman of Renault-Nissan-Mitsubishi group was arrested on charges of financial misconduct in Tokyo in November in 2018 and held in prison in Japan until March 2019.

He was arrested again in April and is currently free on bail awaiting a criminal trial on charges that include abusing corporate trust, using company funds for personal gain, and failing to report $80m income.

Travel operator TUI says it's 'resilient' in wake of Thomas Cook collapse

Travel operator TUI (TUI.L) said on Tuesday that its business model was “resilient” even after its rival Thomas Cook collapsed.

Though the company noted that there was a “challenging market environment,” TUI said in a trading update that it expected its full-year results, which will be reported in December, to be in line with previous forecasts.

Shares in the FTSE 100 travel operator, which surged on Monday by as much as 9.2%, rose slightly on Tuesday.

The company, which expects its full-year underlying earnings to fall by 26% to around €1.2bn (£1bn), said that the challenges would continue.

But it said that it believed its “vertically integrated business model proves to be resilient,” and noted that its holiday experiences business continued to deliver strong results.

European stocks climb

European stocks climbed on Tuesday, with the FTSE 100 (^FTSE) up 0.05%, Germany’s DAX (^GDAXI) up 0.15%, and France’s CAC 40 (^FCHI) up by 0.30%.

The pound climbed by more than 0.2% against the dollar (GBPUSD=X) to around £1.247 following the UK Supreme Court’s ruling that prime minister Boris Johnson’s suspension of parliament was unlawful. It similarly surged against the euro (GBPEUR=X).

What to expect in the US

Futures are pointing to a higher open for US stocks.

S&P 500 futures (ES=F) are up by 0.28% and Dow Jones Industrial Average futures (YM=F) are down by 0.28%. Nasdaq futures (NQ=F) are up by 0.34%.