CHINA
Internet firm scrutiny stays
China yesterday ordered 34 Internet firms to rectify their anti-competitive practices within the next month, signaling that Beijing’s scrutiny of its most powerful firms has not ended with the conclusion of a probe into Alibaba Group Holding Ltd (阿里巴巴). The State Administration for Market Regulation said in a statement that it would continue to eradicate abuses of information and market dominance. Regulators said that Internet companies should “heed Alibaba’s example.”
DENMARK
Six charged over tax scams
The State Prosecutor for Serious Economic and International Crime yesterday said that it had charged six people from the US and Britain with defrauding tax authorities of more than 1.1 billion kroner (US$176 million) in a sham trading scheme. The charges against three US and three British citizens are connected to the so-called “cum-ex” trading schemes — which exploited a loophole on dividend payments that enabled more than one party to claim the same tax refund — in which the state has lost more than 12.7 billion kroner. The six were charged with running the scheme via Germany’s North Channel Bank in 2014 and 2015, the prosecutor said.
UNITED STATES
Federal debt hits record
The government posted a record deficit in the six months ended last month, a 130 percent surge reflecting the impact of stimulus money amid the COVID-19 pandemic, the Department of the Treasury said on Monday. Spending spiked by more than US$1 billion from October last year to last month compared with the same period in the previous fiscal year, which concluded before the virus shutdowns took hold and before any major rescue packages were implemented. The fiscal year-to-date deficit at the end of last month totaled US$1.7 trillion, compared with US$743 billion at the end of March last year, the monthly report showed.
BANKING
Losses prune bank bonuses
Credit Suisse Group AG slashed the amount of money set aside for bonuses by hundreds of millions of dollars and used the savings to limit the financial hit from the implosion of Archegos Capital Management, the Financial Times reported. Cuts to bonus pool accruals and other one-off items added about US$600 million to underlying profit before tax for the first quarter, which is expected to be about US$3.7 billion, the newspaper said, citing unnamed people familiar with the matter. Bonuses are accrued every quarter on a pro-rata basis, so the bank could set aside more in the remainder of the year to make up for the cuts, the Financial Times said.
INDIA
Tax collection to continue
A growth in tax collections is to continue despite concerns that economic activity could fall because of a second wave of COVID-19 infections this month, a Ministry of Finance official said yesterday. Some business leaders have expressed concerns over the lockdowns in many states after a surge in infections, fearing that it could hit consumer demand and sales, as well as tax collections. Indirect tax receipts, mainly comprising customs, a nationwide goods tax and a services tax, in the financial year ending on March 31 increased more than 12 percent year-on-year to 10.71 trillion rupees (US$142 billion), said M Ajit Kumar, chairman of the Central Board of Indirect Taxes and Customs.
Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier. Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT. Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year
CRESTING WAVE: Companies are still buying in, but the shivers in the market could be the first signs that the AI wave has peaked and the collapse is upon the world Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported a new monthly record of NT$367.47 billion (US$11.85 billion) in consolidated sales for last month thanks to global demand for artificial intelligence (AI) applications. Last month’s figure represented 16.9 percent annual growth, the slowest pace since February last year. On a monthly basis, sales rose 11 percent. Cumulative sales in the first 10 months of the year grew 33.8 percent year-on-year to NT$3.13 trillion, a record for the same period in the company’s history. However, the slowing growth in monthly sales last month highlights uncertainty over the sustainability of the AI boom even as
BUST FEARS: While a KMT legislator asked if an AI bubble could affect Taiwan, the DGBAS minister said the sector appears on track to continue growing The local property market has cooled down moderately following a series of credit control measures designed to contain speculation, the central bank said yesterday, while remaining tight-lipped about potential rule relaxations. Lawmakers in a meeting of the legislature’s Finance Committee voiced concerns to central bank officials that the credit control measures have adversely affected the government’s tax income and small and medium-sized property developers, with limited positive effects. Housing prices have been climbing since 2016, even when the central bank imposed its first set of control measures in 2020, Chinese Nationalist Party (KMT) Legislator Lo Ting-wei (羅廷瑋) said. “Since the second half of
AI BOOST: Next year, the cloud and networking product business is expected to remain a key revenue pillar for the company, Hon Hai chairman Young Liu said Manufacturing giant Hon Hai Precision Industry Co (鴻海精密) yesterday posted its best third-quarter profit in the company’s history, backed by strong demand for artificial intelligence (AI) servers. Net profit expanded 17 percent annually to NT$57.67 billion (US$1.86 billion) from NT$44.36 billion, the company said. On a quarterly basis, net profit soared 30 percent from NT$44.36 billion, it said. Hon Hai, which is Apple Inc’s primary iPhone assembler and makes servers powered by Nvidia Corp’s AI accelerators, said earnings per share expanded to NT$4.15 from NT$3.55 a year earlier and NT$3.19 in the second quarter. Gross margin improved to 6.35 percent,
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