Companies in the news ... and how they were assessed
Amazon: Brussels cracks whip
The French president, Emmanuel Macron, “could not hide his jubilation” last week when the European Commission slapped a s250m tax bill on Amazon, said Simon Duke in The Sunday Times. “Bravo to Europe,” he tweeted. And, in fact, “this is one issue over which it is hard not to be on the side of Brussels”, said Alex Brummer in the Daily Mail. Thanks to an illegal “sweetheart” deal with Luxembourg in the early 2000s, most of Amazon’s European profits went untaxed. The s250m being clawed back by the Commission’s competition tsar, Margrethe Vestager, is less than the s13bn she is seeking from Apple for a comparable offence in Ireland, but is nonetheless significant. Vestager’s ruling will “add to the discomfort” of the Commission’s president, Jean-claude Juncker, who was PM of Luxembourg when “the tax arrangement was hammered out”, said The Economist. “It could also stoke transatlantic tensions.” Many US politicians see Brussels’ tax probes as being “driven by tech envy”. But though international corporate tax rules certainly need reforming (Macron proposes taxing multinationals on their revenues, rather than profits, in particular territories), punishing a firm for a 14-year-old ruling, happily accepted at the time, “looks harsh”. Don’t expect Vestager, who is currently getting stuck into the tax affairs of Mcdonald’s and Fiat Chrysler, to worry too much.
Ryanair/monarch: continuing turbulence
Now that Ryanair chief Michael O’leary has apologised to his pilots, and plied them with better terms and conditions, the airline will be hoping to head off further trouble, said Michael Bow in the London Evening Standard. The City seems sanguine about the debacle, which saw Ryanair cancel more than 20,000 flights “due to a cock-up in organising its pilots’ holiday plans”. Shares have tumbled, but several of the airline’s biggest investors have declared their “rock solid” support. Ryanair’s travails certainly look trivial compared with those of its defunct rival Monarch, said John Collingridge in The Sunday Times. Creditors – customers, suppliers, credit card companies – and the British taxpayer now “face bills totalling hundreds of millions of pounds”. But the airline’s owner, the “secretive” private equity firm, Greybull, is likely to walk away with losses that are a fraction of the £250m hit reported – not least because, as a secured creditor, it is “the first in line to get paid”. Having already presided over a string of other failures, Greybull, which last year bought Tata Steel’s vast Scunthorpe steelworks for £1, now faces renewed questions about its opaque style of investment.
Unilever: soap duds
Unilever’s soap brand, Dove, has in the past enjoyed plaudits for its “real women” campaign, “using females of all shapes and sizes for ads”, said Scheherazade Daneshkhu in the FT. But the Anglo-dutch group has been forced to pull a new campaign, following “an outcry over alleged racism”. Aimed at Facebook users, it “showed a black woman removing a brown T-shirt and revealing a white woman in a white T-shirt underneath. She then takes off her shirt to reveal an Asian woman.” Critics complain that it seems to show “a black woman turning white after using the soap”; Unilever has apologised. But will its apology wash? This, after all, is the second time the company has been accused of racism: it ran a very similar campaign, which also caused great offence, in 2011.