Sun, Jul 01, 2012 - Page 15 News List

Business Quick Take

Agencies

AEROSPACE

Airbus to build US factory

European planemaker Airbus is poised to invest US$600 million in a new US production facility in Mobile, Alabama, for its A320 passenger jet that is expected to produce four planes a month by 2017, according to two people familiar with the company’s plans. US rival Boeing Co on Friday argued that a US-based plant would not dilute Washington’s case against European aircraft loans that the WTO has found illegal. The same body has also faulted some US aid to Boeing. Airbus, owned by Europe’s EADS, and Boeing, the world’s dominant jetmakers, are involved in the largest-ever dispute at the WTO over mutual accusations of billions of US dollars of illegal aircraft subsidies.

BANKING

Regulator seeks wider remit

A US government agency is seeking to expand its authority to regulate risky trading overseas by affiliates of US banks. The proposal from the Commodity Futures Trading Commission (CTFC) comes just weeks after JPMorgan Chase & Co announced it lost billions of US dollars because of high-risk trades that took place at its London offices. The CFTC commissioners voted this week without public debate to send the proposal out for public comment. It calls for extending the agency’s oversight of derivatives to cover trading that takes place overseas. Derivatives are financial instruments often used to hedge against future price fluctuations of an underlying commodity or security, but they have grown increasingly complex and risky. The 2010 financial overhaul law gave the CFTC the authority to define which overseas transactions should be subject to oversight. The change would take effect in about a year.

ENTERTAINMENT

Sony buys part of EMI

A group led by Sony Corp said on Friday it has purchased Britain’s EMI Music Publishing for US$2.2 billion from Citigroup, creating the world’s largest music copyrights company with a catalog that includes hits from Motown, The Beatles, Jay-Z and Norah Jones. Now all that remains of the storied British label group is its recorded music division, which Vivendi’s Universal Music Group has offered to buy for US$1.9 billion. That deal is being looked at by European and US regulators. Recorded music companies have argued that they need to combine resources to survive in an industry crippled by piracy, as the legitimate digital distribution of music is still in its infancy around the globe. By acquiring EMI, Sony/ATV, a 50-50 joint venture between Sony and the Michael Jackson estate, will control just over 2 million copyrighted songs.

BANGLADESH

World Bank cancels loan

The World Bank on Friday canceled a US$1.2 billion loan for the country’s Padma bridge project, saying the government had not cooperated in investigating “high level” corruption in the project. The proposed 6.2km bridge over the Padma river — the local name for the Ganges — will connect the capital Dhaka to the country’s coastal districts. The US$3 billion bridge, planned to go into service in 2014, is designed to carry a highway and rail line and is aimed at transforming the country’s impoverished south. The loan was originally approved in February last year, but allegations of corruption in the tender process led the bank to freeze the loan by October.

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