Major International Business Headlines Brief::: 08 March 2018

Thu Mar 8 08:20:32 CAT 2018

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Major International Business Headlines Brief::: 08 March 2018

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*  Coca-Cola plans to launch its first alcoholic drink

*  South Africa's rand to slip over 4 pct as Ramaphosa euphoria fades

*  South African insurer MMI to buy back shares as earnings fall

*  Air Cote d'Ivoire to raise $111.5 mln in 2018 for new aircraft

*  Oando drops lawsuit against Nigeria's SEC, regulator says

*  Ghana 2018 GDP growth seen at 8.3 pct vs 6.8 pct budget target

*  Kenya Airways looks upmarket for financial salvation

*  Gary Cohn: Key Trump economic policy adviser resigns

*  Weinstein Company rescue deal collapses

*  RBS to pay US $500m for mis-selling

*  Australia and East Timor sign historic maritime border deal

*  Trump tariffs: President says EU makes business 'impossible'

*  Concert ticket resellers ordered to disclose fees

*  McDonald's to switch to fresh beef in US restaurants

*   

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Coca-Cola plans to launch its first alcoholic drink

Coca-Cola is planning to produce an alcoholic drink for the first time in the company's 125-year history - with an alcopop-style product in Japan.

It is keen to cash in on the country's growing taste for Chu-Hi - canned sparkling flavoured drinks given a kick with a local spirit called shochu.

The product is typically between 3% and 8% alcohol by volume.

A senior Coke executive in Japan said the move was a "modest experiment for a specific slice of our market".

Highball

"We haven't experimented in the low alcohol category before, but it's an example of how we continue to explore opportunities outside our core areas," said Jorge Garduno, Coca-Cola's Japan president.

It was unlikely the drink would be sold outside of Japan, he suggested.

Chu-Hi - an abbreviation for shochu highball - has been marketed as an alternative to beer, proving especially popular with female drinkers.

Japan's big drinks firms including Kirin, Suntory and Asahi all have varieties of the drink, and continue to experiment with hundreds of flavours.

'Premium segments'

As younger consumers become more health conscious, Coca-Cola has been diversifying from fizzy drinks, including buying water and tea brands.

But last November, Wells Fargo analyst Bonnie Herzog speculated that Coca-Cola might move into alcohol, as it looked to "premium segments such as adult craft beverages".

The phrase alcopop typically refers to sweet but alcoholic drinks, and in 1990s UK brands such as Hooch, Reef, Smirnoff Ice and Bacardi Breezer became hugely popular.

But they were controversial. raising concerns that they encouraged young people to drink alcohol in large quantities because they were so easy to consume.--BBC

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South Africa's rand to slip over 4 pct as Ramaphosa euphoria fades

JOHANNESBURG (Reuters) - South Africa’s rand is expected to weaken more than 4 percent in 12 months as investors start to take profits from the over-bought currency on doubts of how much new President Cyril Ramaphosa can achieve in reforms.

A Reuters poll taken March 1-6 published on Wednesday showed the rand is expected to trade at 12.25 per dollar in a year, down from around 11.74 presently.

Markets have rallied since Ramaphosa was elected by parliament as South Africa’s president last month since Jacob Zuma resigned on orders from the ruling African National Congress. But he faces an uphill battle in revitalising growth and creating jobs.

“We see any rallies in the rand being met by profit taking and scepticism that President Ramaphosa can transform the economy,” said Christopher Shiells, emerging market strategist at Informa Global Markets.

The latest monthly Reuters poll of 34 currency strategists was taken before news that South Africa’s economy expanded by 3.1 percent in the final quarter of last year, more than forecast and easily ahead of 2.3 percent in the prior quarter.

A Reuters poll last month said South Africa’s economy is expected to grow 1.4 percent this year and 1.7 percent next year, suggesting those forecasts may already need to be revised higher. [ECILT/ZA]

“Ramaphosa has his work cut out for him - and his key objective should of course be to reduce constraints on GDP growth,” Shiells said.

South Africa has also benefited from an unusually synchronised global economic expansion, but some analysts say they fear this could be damaged by a proposal from U.S. President Donald Trump to slap tariffs on steel and aluminium imports.

“If full-scale trade wars unfold and commodity prices fall, the rand would struggle to hold onto its impressive gains,” said Piotr Matys, emerging markets strategist at Rabobank.

Moody’s is due to publish a review later this month, which economists said in February would offer the country a reprieve.

South Africa will announce details of wide-ranging reforms at state-owned firms within four weeks, the public enterprises minister said on Tuesday, as government seeks to return credibility to companies hobbled by graft and mismanagement.

South African insurer MMI to buy back shares as earnings fall

JOHANNESBURG (Reuters) - South Africa’s insurer MMI Holdings reported a 2.6 percent fall in half-year earnings on Wednesday and said it would start buying back some of its shares instead of paying dividends.

MMI, which sells life and short term insurance, said diluted core headline earnings per share (HEPS) for the six months to end-December came in at 97 cents from 99.6 cents in 2016.

HEPS is the main profit gauge in South Africa, which strips out certain one-off items.

“This was largely due to weaker persistency in Metropolitan Retail, weaker profitability in both new generation and legacy life products at Momentum Retail, and an increase in MMI’s share of losses, in line with business plans on new initiatives such as the India joint venture,” the firm said in a statement.

Persistency refers to the volume of business that a life insurance company is able to retain.

Operating profit after new initiatives rose 4 percent to 1.31 billion rand ($110.79 million) from 1.26 billion rand.

MMI, which recently underwent a management shake-up, said it will set aside 2 billion rand for a share buy-back in the next 12 months.

“Given the current discount to embedded value, we are of the opinion that a share buy-back is the most efficient use of capital and will enhance value to shareholders,” said MMI’s Financial Director, Risto Ketola.

The group also updated its dividend policy to target a dividend cover centred at 2.5x core headline earnings from a cover range of 1.5x to 1.7x previously.

($1 = 11.8237 rand)

Air Cote d'Ivoire to raise $111.5 mln in 2018 for new aircraft

ABIDJAN (Reuters) - Ivory Coast’s national airline Air Cote d’Ivoire aims to raise $111.5 million in the second half of the year to finalise its aircraft acquisition programme, the company’s chief executive told Reuters on Tuesday.

The company is seeking a bank to coordinate with the African Development Bank to co-arrange and structure the debt that will go towards acquiring five new Airbus A320 planes, Rene Decurey said.

Air Cote d’Ivoire already has a fleet of 10 planes and operates in 20 African and 5 domestic destinations. The five new five planes will make it one of Africa’s primary carriers.  

The African Development Bank (AfDB) in November approved 98 million euros ($114 million) in loans for the aircraft, two of which have already been delivered.

Oando drops lawsuit against Nigeria's SEC, regulator says

ABUJA (Reuters) - Nigerian oil company Oando has dropped its lawsuit against the domestic Securities and Exchange Commission (SEC), paving the way for a forensic audit of the firm, the regulator said in a statement on Tuesday.

Oando had filed a lawsuit against the SEC to halt the regulator’s suspension of the company’s shares and the planned audit, based on concerns about possible insider trading.

The SEC in 2017 investigated Oando on the basis of petitions from shareholders and a whistleblower, the statement said.

As a result, “the SEC placed the shares of Oando Plc on technical suspension and ordered a forensic audit of the affairs of Oando Plc,” the statement said.

An Oando spokeswoman said the firm is fully cooperating with the regulator.

With the lawsuit dropped, the SEC has asked Deloitte to conduct the audit, the regulator said.

Last month, Oando said it had settled a dispute with a key shareholder and was working on resolving remaining shareholder disputes and getting the suspension of its shares lifted.

Ghana 2018 GDP growth seen at 8.3 pct vs 6.8 pct budget target

ACCRA (Reuters) - Ghana’s economy is expected to grow 8.3 percent in 2018, higher than the 6.8 percent estimated in the government’s budget, President Nana Akufo-Addo said on Tuesday.

The major commodities exporter is in its final year of a $918 million International Monetary Fund aid programme designed to lift growth and reduce public debt and inflation.

“Our economy has grown from 3.6 percent in 2016, the lowest in 22 years, to 7.9 percent in 2017 and in this year expected to grow at 8.3 percent, which will make it the fastest growing economy in the world,” Akufo-Addo said at an annual independence parade attended by Nigerian president Muhammadu Buhari.

Akufo-Addo, who assumed office in January last year, vowed to continue to manage the economy in a disciplined and sound framework aimed at making Ghana less dependent on aid.

The West African country is on target to narrow fiscal deficit to 4.5 percent of GDP this year compared to 5.9 percent previously, he said.

Kenya Airways looks upmarket for financial salvation

NAIROBI (Reuters) - When Sebastian Mikosz took over as CEO of loss-making Kenya Airways last June, he immediately shut its outlet in Nairobi’s downmarket Accra Road, which served thousands of small traders who fly to the Far East to buy cheap goods in bulk.

The move marked the beginning of an aggressive hunt for cost savings and premium passengers, after years of losses following a slump in tourism and large debts incurred to buy new aircraft.

Polish native Mikosz, who helped turn around flag carrier LOT Polish Airlines as its chief executive, needs to stem those losses before it can begin to pay down $2 billion of debt restructured in November to stave off the airline’s collapse.

He told Reuters he plans to roll out a new economy plus class by the end of the year designed for business and wealthy leisure travellers, including growing numbers of American tourists and executives from dozens of Nairobi-based U.S. firms.

Coming first to wide-bodied planes, it will mean new seats with the same capacity by using space between them. “We are working on a pretty big reshape of the onboard experience,” Mikosz said.

The airline also plans a direct route to the Indian Ocean luxury tourism island of Mauritius and the first direct flight from Nairobi to New York by any airline from October, a plan Mikosz said was known as the “$100 million project” for the revenue the daily flight is expected to bring in.

The U.S. route will compete with indirect flights from established players such as Emirates, British Airways and Ethiopian Airlines and test Kenya Airways’ ability to reshape its image from an Africa-focused carrier.

“We still have to prove that we can produce an operating profit,” Mikosz said in an interview in his office overlooking airport service hangers. “That is the biggest challenge that we have in an environment where you have a lot of competition.”

Twenty five foreign airlines operate out of Nairobi’s main airport, including Turkish Airlines which is expanding in Africa and state-owned Emirates, South African Airways and Ethiopian.

Mikosz describes this state-backed competition as his biggest fear as he tries to turn around a publicly listed firm owned 48.9 percent by the government and 7.8 percent by Air France/KLM and attract a strategic investor.

“It is really sometimes very frustrating when you see that somebody can have much lower costs thanks to this protected environment and you have to face a real free market economy,” he said.

HEADWINDS

His plans mark a shift from a focus on African air passenger demand, which the International Air Transport Association (IATA) sees growing by almost 6 percent a year over the next decade due to increasing economic output and poor road and rail links.

Kenya hosts regional hubs for 48 U.S. or U.S.-based businesses like Google and IBM and the United States is the fastest-growing source of tourists, many changing planes in Europe or the Gulf in more than 20-hour trips.

Jan Mohamed, chief executive of TPS Eastern Africa, which runs the Serena chain of luxury hotels and safari lodges, said people would pay extra for direct flights, which take about 15 hours.

Tickets to New York have begun retailing for around $1,000 return, compared with about $1,500 for an indirect flight.

A former executive at Kenya Airways, who helped return it to profitability after years of losses in the early 1990s, said the new strategy was sensible, but held some risks.

“The money is in the business part of the operation. The leisure side will give you volume but it gives you volume at low rates,” he said, cautioning that the airline must be careful not to undermine Sky Team Alliance partners like Delta and Air France KLM, which feed it passengers from America.

Mikosz said there was plenty of room. The potential to Europe is “very big,” he said, adding that he planned to add a second daily flight to Amsterdam in high season alongside KLM.

Forty-year-old Kenya Airlines, which flies to 53 destinations with 38 Boeing and Embraer planes, has not said when it will return to profit.

It lost 80 engineers to higher paying Mideast rivals before the restructuring and Mikosz, who says the U.S. route will create 150 new jobs, fired 140 technical staff after a strike in November.

Politics provides other headwinds.

Kenya only got U.S. security clearance a year ago after a major refurbishment of Nairobi’s main airport and the United States extended a warning last week over the threat to aviation from militant activity in eastern Kenya, which borders Somalia.

The company, which reports full-year results in June, had a $251 million loss in the financial year 2016-17 and negative equity of 45 billion shillings.

The government restructured its debt in November, converting loans to build up its stake from just under a third to preserve a national carrier that serves the vital tourism sector and growing foreign investment.

Shareholders found their holdings diluted 95 percent by the restructuring but shares more than tripled to 18.50 shillings ($0.1829) before dropping back by around four shillings.

The government has guaranteed some of the airline’s debts and Mikosz and his team have 10 years to clear them.

“Sell more tickets and cut costs,” said the CEO, who has headed up major Central European online travel agent eSky.pl as well as helping to rescue LOT from bankruptcy.

“It’s always the same game.”

($1 = 101.1500 Kenyan shillings)

Gary Cohn: Key Trump economic policy adviser resigns

US President Donald Trump's top economic adviser Gary Cohn is resigning, the White House has said.

It is the latest in a series of high-profile departures from President Trump's team.

There has been speculation that Mr Cohn, a supporter of free trade, was angered by Mr Trump's plans to impose tariffs on aluminium and steel imports.

In a statement released by the White House, Mr Cohn said it had been "an honour to serve my country".

The 57-year-old former president of the Goldman Sachs bank had helped Mr Trump push through his sweeping tax reforms late last year.

Gary Cohn and President Trump were never believed to be close.

Mr Cohn wasn't specific about the reasons, saying in a statement it had been "an honour to serve my country and enact pro-growth economic policies to benefit the American people, in particular the passage of historic tax reform".

Once that mission had been achieved, a number of differences may have prompted the departure, including the possible looming trade tariff war and his differences on that issue with trade adviser Peter Navarro and Commerce Secretary Wilbur Ross.

Mr Cohn had reportedly set up a meeting between Mr Trump and business executives who opposed the tariffs move. But Mr Trump pulled out of that meeting and on Tuesday reportedly asked Mr Cohn in the Oval Office to back the tariffs publicly. Mr Cohn did not answer, sources told Bloomberg.

In August last year, Mr Cohn had also criticised Mr Trump over his reaction to a far-right rally in Charlottesville, Virginia, saying the administration "can and must do better". He was reported to have drafted a resignation letter after the event.

What has the White House said?

An official said: "For several weeks Gary had been discussing with the president that it was nearing time for him to transition out."

The exact departure date had yet to be determined.

In a statement, Mr Trump said: "Gary... did a superb job in driving our agenda, helping to deliver historic tax cuts and reforms and unleashing the American economy once again.

"He is a rare talent and I thank him for his dedicated service to the American people."

And the markets?

Analysts were pointing to the resignation of Mr Cohn, a free market advocate, as one reason behind a drop in shares across Asia on Wednesday. The Nikkei was off 0.77% and the Hang Seng 1.1%.

Rick Meckler of LibertyView Capital Management told Reuters that Mr Cohn was "very credible" and the resignation announcement "certainly causes short-term downward pressure".

The dollar continued its retreat against the yen, down from 113 at the start of the year to 105.6 on Wednesday.

Gary Cohn was a bit of a stranger in a strange land. He was a Democrat in a Republican White House; an economic globalist working for a president who campaigned on economic nationalism. Now, it seems, Donald Trump's protectionist bent has pushed the top administration economic adviser to the exit.

This was not an unexpected development. By many accounts, there had been a contentious White House fight over whether to impose sweeping sanctions on US steel and aluminium imports - a tug-of-war that was settled, precipitously, by the president himself last week.

There were the rumours that Mr Cohn was only sticking around to see last year's tax bill over the finish line, after his extreme discomfort following the president's warm words about some of the white nationalist marchers involved in violent clashes in Charlottesville last August.

Mr Cohn was reportedly viewed by many Trump loyalists in the White House as an unwelcome interloper. Some on the outside, particularly in the financial world, welcomed him as a moderating influence - along with son-in-law Jared Kushner and daughter Ivanka.

Now the former is leaving and the latter two seem greatly weakened. All this could mark a sharp new direction in White House policy.

What's the trade tariff dispute about?

Last week, Mr Trump announced he would be imposing steep tariffs on steel and aluminium imports - 25% and 10% respectively. He is yet to sign them into effect.

He has regularly argued that other countries have been "taking advantage of" the US on trade for decades.

Trading partners reacted angrily. The EU, which says the steel and aluminium tariffs could cost it €2.8bn ($3.48bn; £2.5bn) a year, has now drawn up a $3.5bn hit list of retaliatory tariffs.

There are now fears of a global trade war. Mr Trump said on Tuesday: "When we're behind on every single country, trade wars aren't so bad."

But there is disquiet at his proposals even among members of Mr Trump's Republican party.

House Speaker Paul Ryan was one of those urging Mr Trump to have a "smarter" plan that was "more surgical and more targeted" and avoided the "unintended consequences" of a trade war.

Who will replace Mr Cohn?

Mr Trump tweeted that he would pick Mr Cohn's replacement "soon".

"Many people wanting the job - will choose wisely!" he added.

Possible candidates mooted by US media include Peter Navarro and Larry Kudlow, a conservative commentator and 2016 campaign adviser.

President Trump tweeted that there was no chaos at the White House but there were "still... some people that I want to change".

Who else has left the White House this year?

A number have gone, adding to the string of senior figures who have left since Mr Trump took office.

Hope Hicks - Mr Trump's press secretary quit a day after testifying to a congressional panel investigating Russian influence on the 2016 election, telling them she had occasionally told "white lies" for her boss

Rob Porter - The White House staff secretary resigned after two of his ex-wives publicly accused him of physical and emotional domestic abuse

Andrew McCabe - The FBI deputy director was forced out amid repeated criticism from Mr Trump that he was impartial in the Russia investigation

The White House revolving door: Who's gone?--BBC

Weinstein Company rescue deal collapses

A deal to rescue The Weinstein Company from bankruptcy has collapsed at the last minute.

Businesswoman Maria Contreras-Sweet had led a team that was poised to buy the struggling film production and distribution company.

However, the deal was reportedly terminated after it was found the firm's debt was $280m (£201.4m) rather than the $225m previously disclosed.

The company was co-founded by disgraced US movie mogul Harvey Weinstein.

Mr Weinstein is facing dozens of allegations of sexual abuse, including rape, but he denies non-consensual sex.

Last week, it was revealed the investor group led by Ms Contreras-Sweet - who led the US Small Business Administration under President Barack Obama - was set to pay $500m for the company's assets.

That figure included a $90m victims' compensation fund.

"After signing and entering into the confirmatory diligence phase, we have received disappointing information about the viability of completing this transaction," said Ms Contreras-Sweet.

The deal would have seen the new owners launch a company with a board of directors made up of a majority of independent women. Ms Contreras-Sweet would have been chairwoman of the business.

It would also have saved about 150 jobs.

Prior to the deal, The Weinstein Company said it would file for bankruptcy.

Ms Contreras-Sweet said: "We will consider acquiring assets that may become available in the event of bankruptcy proceedings, as well as other opportunities that may become available in the entertainment industry."--BBC

RBS to pay US $500m for mis-selling

The Royal Bank of Scotland has agreed to a $500m (£359.7m) settlement with New York State over the mis-selling of financial products in the lead up to the 2008 global financial crisis.

RBS is the sixth bank to settle with the state over similar claims, linked to risky mortgages.

The agreement will see the bank pay $400m in relief to homeowners, as well as $100m to the state.

RBS still faces a potentially massive fine from the US Department of Justice.

The bank said last month that it had put aside £3.2bn ($4.4bn) to cover upcoming settlements with the US and others.

'Important step'

The sale of the risky mortgage-backed securities had contributed to a housing price crash during the financial crisis, the New York attorney general's office said.

"While the financial crisis may be behind us, New Yorkers are still feeling the effects of the housing crash," said state attorney-general Eric Schneiderman.

"Today's settlement is another important step in our comprehensive effort to help New Yorkers rebuild their lives and communities."

RBS reports first profit in 10 years

'Secret' report into RBS published

RBS to close one in four branches

RBS is majority owned by the UK government. It has been trying to return to financial health since the financial crisis, when it was bailed out for tens of billions of pounds.

The bank said last month that it had returned to profit for the first time in ten years.--BBC

Australia and East Timor sign historic maritime border deal

Australia and East Timor have signed a historic treaty on a permanent maritime border in the Timor Sea.

The deal ends a decade-long dispute between the neighbours over rights to the sea's rich oil and gas reserves.

East Timor, one of the world's poorest nations, will now gain the majority of any future revenue.

The countries signed the deal at the UN headquarters in New York, after negotiations in the international court of arbitration.

UN Secretary General António Guterres praised the "vision and determination" of both nations in achieving the agreement.

How did conflict arise?

After East Timor, also known as Timor-Leste, gained independence from Indonesia in 2002, no permanent maritime boundary was established between Australia and the new nation.

Instead, the two sides agreed on a temporary boundary, but East Timor later argued that deal had been unfairly forced upon them.

It believed its more powerful neighbour had an unfairly large share of access to oil and gas fields that are estimated to be worth tens of billions of dollars.

In 2016, East Timor contested the arrangements in the Permanent Court of Arbitration in the Hague. Mediation between the nations concluded last week.

What is in the new deal?

The landmark treaty sets out the maritime border at the midway point between the countries, in line with the United Nations Convention on the Law of the Sea (UNCLOS).

Australia had pushed for a border at the edge its continental shelf, which would have put the boundary closer to East Timor.

The new deal means East Timor will receive at least 70% of the largest oil field, Greater Sunrise, which is worth an estimated $40bn (£28bn; A$51bn). Previously, revenue was to be split evenly between the countries.

Australia will lose its jurisdiction in oil fields currently shared by both nations.

How did each nation react?

Australian Foreign Minister Julie Bishop said her nation had an "enduring interest" in East Timor's prosperity, acknowledging the treaty as an important step.

"As good friends and close neighbours, we want Timor Leste to achieve its economic potential," she said.

It was "momentous day" for East Timor, said Augusto Cabral Pereira, Deputy Minister of the Prime Minister for the Delimitation of Borders.

What will happen now?

The new deal is a big win for East Timor, which relies heavily on oil and gas for its economy, but had been running out of resources..

The Greater Sunrise oil field is yet to be mined, with a consortium of miners blaming delays on the long-running border dispute.

Canberra had faced accusations it was colluding with oil companies to have gas processed in Australia, according to media reports - an assertion Ms Bishop denied.

Under the agreement, East Timor will receive a greater slice of revenue - 80% - if gas is processed in Australia.--BBC

Trump tariffs: President says EU makes business 'impossible'

US President Donald Trump has said European Union trade rules make it "impossible" for American firms to do business with the bloc.

Defending his tariff plans as he hosted the Swedish PM at the White House, Mr Trump said other countries had "taken advantage of" the US for decades.

Shortly afterwards it was announced that White House economic adviser Gary Cohn, who opposes tariffs, would quit.

The EU has drawn up a $3.5bn (£2.5bn) hit list of retaliatory tariffs.

Motorbikes, whiskey and T-shirts are on the bloc's list of 100 American products, the BBC understands.

The US president's proposed global duties on steel and aluminium have raised the prospect of a tit-for-tat trade war.

"The European Union has been particularly tough on the United States," Mr Trump said at Tuesday's joint press conference with the Swedish prime minister.

"They make it almost impossible for us to do business with them," Mr Trump complained.

Mr Trump said if the EU retaliated, the US would impose a 25% tax on European cars.

But the US president also said America would levy tariffs in a "loving, loving way".

"They'll like us better and they'll respect us more," he said about US trade partners who object to the plan.

Mr Trump repeated his belief that the US would win any trade war, since it was running such a large trade deficit.

"When we're behind on every single country, trade wars aren't so bad," he told reporters at the White House.

Mr Trump's decision to raise import taxes on steel to 25% and aluminium to 10% prompted strong reactions around the world last week.

Swedish PM Stefan Lofven said: "I am convinced that increased tariffs will hurt us all in the long run."

Mr Lofven is the first European leader to visit the White House since the tariffs were announced last week.

Members of Mr Trump's Republican party have voicing disquiet at his proposal.

Just before Mr Trump spoke, Senate leader Mitch McConnell said: "There is a lot of concern among Republican senators that this could sort of metastasise into sort of a larger trade war."

Earlier on Tuesday, Speaker of the House Paul Ryan said the tariffs were too broad.

He urged Mr Trump "to be more surgical" when selecting which countries to target "so we do not have unintended consequences".

Congressman Mark Meadows, who chairs the ultraconservative Freedom Caucus, said most lawmakers had told him they did not support the president's decision.

Mexican Economy Minister Ildefonso Guajardo said his country was planning its own tariffs on US goods.

He said they would issue them in a way that is most politically damaging to Mr Trump.

"We would have to target our response at the things they export that are most politically sensitive and hit exactly those goods," he told Mexican broadcaster Televisa.--BBC

Concert ticket resellers ordered to disclose fees

The UK's four main secondary ticketing agencies have been banned from using certain "misleading" price strategies.

The Advertising Standards Authority (ASA) said they had not been clear enough about extra fees added at the end of the booking.

The four largest sites are Get Me In, Viagogo, StubHub and Seatwave.

Such firms have attracted increasing criticism and last month Google changed the way the sites are listed after pressure from Ed Sheeran's manager.

Secondary ticketing sites are designed to re-sell tickets to concerts, shows and events where the original buyer can no longer attend.

'Frustration'

The ASA's move is the latest in a string of actions taken against businesses who have been accused of misleading fans by claiming that they are official sellers of tickets, over-charging buyers or selling tickets that are invalid if they are re-sold.

Websites must now make the total ticket price, the VAT-inclusive booking fee and the delivery fee clear from the start.

The ASA has also banned Viagogo from claiming that it is an "official site" after it misleadingly implied it was an official primary ticket outlet rather than a second-hand ticket website.

Viagogo is also banned from offering a "100% Guarantee" claim which the ASA said misleadingly suggested that consumers were guaranteed entry.

The ASA's chief executive, Guy Parker, said: "Many of us will recognise the frustration of being happy with the initial price of tickets on a secondary website only to be stung by hefty fees when we come to book.

"The message from our rulings is simple and it's clear: The price you see at the start should be the price you pay at the end."

'Developing transparency'

A StubHub spokeswoman said: "As a consumer-first ticket marketplace, StubHub supports any measures which make ticket buying easier, more convenient and more transparent for fans."

It said it would be "fully compliant" with its decision.

Case study: 'I went from elation to complete panic'

Claire Turnham had decided to arrange something special for her children to mark a number of significant birthdays.

"I had this idea because it was my 50th, my son's 16th, my youngest daughter's 13th and my middle daughter's 21st that I would surprise them all with these amazing tickets for Ed Sheeran," she said.

After researching how much the tickets would cost, Ms Turnham went on Google: "I just saw tickets available and so I naturally clicked on it through the advert at the top of the search engine and typed in four tickets.

"There was a lot of pressure," she recalls. "It said 'last four tickets' and I genuinely believed that I was buying the last four tickets and so I was really, really excited."

She said that the four tickets on the secondary ticket selling site Viagogo came to £263, which she said was around the price she expected to pay.

"So I clicked buy and I went from that feeling of elation and joy to suddenly complete panic because what actually flashed up was the total cost was £1,421.

"I didn't consent to that at all and in fact I didn't have that much money in my back account so I went then into sheer panic mode."

As a single parent, Ms Turnham said she is very conscious about spending money but discovered that she could not cancel the transaction with her bank because it was a "pending payment".

Luckily, a friend stepped in to help out financially to give Ms Turnham time to claw back the money from Viagogo.

As a result of her experience, Ms Turnham started a group called Victim of Viagogo to help other people out who suffered the same fate as her.

She said: "The amazing thing is we're now up to £250,000 in refunds which is a massive, massive amount."

A spokeswoman for Ticketmaster, which owns Seatwave and GetMeIn, said: "We will continue to work with both the ASA and the CMA to further develop levels of transparency and consumer protection within the UK ticketing sector."

Last November, the competition watchdog, the Competition and Markets Authority (CMA), said it would take action against such ticketing websites suspected of breaking consumer law.

Last year, Ed Sheeran's promoter, Stuart Galbraith, asked Google to change how it listed secondary sites after Viagogo had paid to be listed top of the Google search, and said wrongly that it was an "official" seller of the singer's tickets.

Research by the campaign group FanFair Alliance showed that in 77% of searches for popular artists, a secondary website had paid to be top of the Google search result.--BBC

McDonald's to switch to fresh beef in US restaurants

Fast food chain McDonald's has started offering fresh beef in burgers sold at its US restaurants.

McDonald's is looking to improve food quality and ward off competition from premium burger chains.

Burgers containing fresh beef will be sold at most of the chain's 14,000 US restaurants by the end of June.

McDonald's UK business said: "We will watch what happens in the US and see if this innovation is something we should consider in the UK.

"Our patties are made from 100% British and Irish beef with nothing added aside from a little salt and pepper after cooking."

McDonald's UK said that its beef patties were still cooked from frozen in its restaurants using "a process perfected over decades".

How can a fast food chain ever make money from a $1 burger?

How the 'better burger' is taking over the world

Need for speed

The move to fresh beef is part of bigger changes at McDonald's, as new competitors, including burger chains such as Shake Shack, become a bigger part of the fast-food market, using fresh ingredients to differentiate themselves.

As part of its turnaround efforts in recent years, McDonald's has tweaked pricing and added to its menu. It has also ditched ingredients such as high fructose corn syrup in a bid to appeal to health-conscious customers.

"McDonald's is certainly responding to industry pressure, consumer pressure to make the change," said David Henkes, a senior principal at Technomic, a restaurant research consulting company.

"It's part and parcel of what they've been trying to do to create a different perception of McDonald's."

The firm has been testing the appetite for burgers made from fresh beef for about a year. The premium quarter pounder and other offerings are now available at about 3,500 McDonald's restaurants in the US, including in Miami, Orlando and Nashville.

These products are sold alongside existing burgers made using frozen meat.

Over the next month, fresh beef burgers will become available at restaurants in Los Angeles, Houston and San Francisco.

McDonald's US president Chris Kempczinski said that offering fresh beef was the most significant change to the restaurant chain's menu since it started offering all-day breakfast in 2015.

To keep service speedy, McDonald's had to make changes to its suppliers and kitchen crews.

"If it slows down the drive-through, that's the critical part of our business. And so we just had to spend a lot of time really making sure that as we were cooking only when someone ordered, we'd figured out a way to do it that wasn't going to slow down service time," said Mr Kempczinski.

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Proplastics

final dividend of 0.26c record date

02 Mar 2018

Simbisa Brands Limited

EGM

SAZ Building Northend Close, Northridge Park, Borrowdale

09 Mar 2018 8:15am

CFI

AGM

Farm & City Boardroom, 1st Floor, Farm & City Complex, 1 Wayne Street

12 Mar 2018 11am

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