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Breakfast Briefing: MiFID II Implemented, Spotify’s Woes and Trump’s Button

MiFID II Comes into Force

The much-awaited piece of regulation will affect financial institutions worldwide from today.

Editor’s Remarks: After having been sculpted for seven years and costing a total of $2bn for firms in the financial industry, the biggest piece of regulation in the EU for a decade has come into force. The Markets in Financial Instruments Directive, or MiFID II, aims to give more protection to investors by increasing the transparency, competitiveness and efficiency of European markets. Research providers will be required to collect and record more data about their transactions and asset managers will now have to pay banks directly for research. Experts say that the overall cost of research will now become cheaper, investor confidence shall improve and the financial industry as a whole will be ‘strengthened’ in the years following the seismic regulation.

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Spotify Facing $1.6bn Lawsuit

The music streaming company has been accused of copyright infringement.

Editor’s Remarks: Music streaming giant Spotify is facing a further copyright headache as 2018 gets underway. Wixen Music Publishing, a leading music publishing company that represents the rights of music artists, has accused the Swedish firm of infringing the rights of publishers and songwriters – Spotify now faces a lawsuit of $1.6bn. According to the Wixen Music Publishing, Spotify illegally streamed millions of unlicensed songs (without providing compensation to the artists) and has accused the company of “massive, systemic copyright infringement”. This issue has troubled Spotify in the past – in 2016, the firm reached a $30m settlement with the National Music Publishers Association over similar accusations.

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Sale of MoneyGram Blocked

The proposed $1.2bn acquisition of MoneyGram has been halted by the US government.

Editor’s Remarks: MoneyGram, the US money transfer company, will no longer be sold to a Chinese financial services firm after the US government blocked the move. The acquisition had originally been announced in January 2017, where it was agreed that Ant Financial, an affiliate company of Chinese billionaire Jack Ma‘s Alibaba Group, would take over MoneyGram. The price of the proposed acquisition had originally been $880m, but this was increased to $1.2bn in April. The CEO of MoneyGram, Alex Holmes, blamed strained political relations between the US and China for the deal being blocked, in his words: “the geopolitical environment has changed considerably since we first announced the proposed transaction with Ant Financial nearly a year ago”.

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Trump Says His Nuclear Button is ‘Bigger and Better’

Trump hits back at North Korean leader Kim Jong-un on Twitter.

Editor’s Remarks: The verbal warfare between Donald Trump and Kim Jong-un continues in 2018, as Donald Trump responds to Kim Jong-un’s jibes in a typically aggressive manner. Earlier this week, the leader of the rogue state had issued a threat stating that a nuclear launch button ‘is always on the table’ and that the US would never be able to start a war. Donald Trump took to Twitter to respond, retorting: “will someone from his depleted and food starved regime please inform him that I too have a Nuclear Button, but it is a much bigger & more powerful one than his.” This will add to the already mountainous tension between the two states, especially given North Korea’s announcement that it will carry out more ballistic missile launches in the new year.

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Mexicans Send Record Amount of Money Back Home

2017 saw the largest amount of money sent from Mexicans in the US to their homeland.

Editor’s Remarks:  Figures released by the central bank of Mexico revealed that a total of $26.1bn was sent back to Mexico – mainly from the US – an increase of $2bn from 2016. Analysts state that there are two central reasons for the high volume of cash sent: the weakening of the country’s currency, the peso (which is currently just above its all-time low, at 19.45 pesos for one dollar) and President Donald Trump‘s avowal to implement a tax on cash shipments – or remittances – from the US to Mexico. Commentators also speculate that the destructive earthquake in Mexico City and the surrounding region prompted Mexicans to send extra cash to the area in order to aid family and friends.

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