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Facebook oversight board overrules company on most cases in first test

Deciding its first-ever cases, Facebook Inc’s oversight board ruled on Thursday that the social media company was wrong to remove four of five pieces of content the board reviewed, including posts Facebook took down for violating rules on hate speech and harmful COVID-19…

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(Reuters) – Deciding its first-ever cases, Facebook Inc’s oversight board ruled on Thursday that the social media company was wrong to remove four of five pieces of content the board reviewed, including posts Facebook took down for violating rules on hate speech and harmful COVID-19 misinformation.

FILE PHOTO: The Facebook logo is displayed on a mobile phone in this picture illustration taken December 2, 2019. REUTERS/Johanna Geron/Illustration

The first rulings will be scrutinized to see how independent the board appears from the world’s largest social media platform and how it may rule in the future, particularly ahead of its high-profile decision on whether Facebook was right to suspend former U.S. President Donald Trump.

Facebook blocked Trump’s access to his Facebook and Instagram accounts over concerns of further violent unrest following the Jan. 6 storming of the U.S. Capitol by the former president’s supporters. The board said the Trump case would be opened for public comment on Friday and that he had not yet provided a statement to the board.

Facebook said it would abide by the board’s decisions. The group, which was created by Facebook in response to criticism of the way it treats problematic content, also called for the company to be clearer about its rules on what is allowed on its platforms.

Here is the full list of the board’s rulings:

DECISIONS OVERTURNED:

* A post from a user in Myanmar with photos of a deceased child that included commentary on a perceived inconsistency between Muslims’ reactions to killings in France and to China’s treatment of Uighur Muslims.

* An alleged quote from Nazi propaganda minister Joseph Goebbels that Facebook removed for violating its policy on “dangerous individuals and organizations.”

* A post in a group claiming certain drugs could cure COVID-19, which criticized the French government’s response to the pandemic. This case was submitted by Facebook, rather than a user.

* Instagram photos showing female nipples that the user in Brazil said aimed to raise awareness of breast cancer symptoms. Facebook had also said this removal was an error and restored the post.

DECISION UPHELD:

* A post that purported to show historical photos of churches in Baku, Azerbaijan, with a caption that Facebook said indicated “disdain” for Azerbaijani people and support for Armenia.

See a factbox on the decisions.

Facebook now has seven days to restore the pieces of content that the board ruled should not have been taken down. The board said it would shortly announce one more decision from its first batch, as well as the next round of cases.

The board also issued nine nonbinding policy recommendations – for example that Facebook should tell users the specific rule they have violated and better define their rules on issues like dangerous groups and health misinformation. Facebook doesn’t have to act on these, but it does have to publicly respond within 30 days.

“We can see that there are some policy problems at Facebook,” said board member Katherine Chen in an interview. “We want their policy to be clear – especially those policies involved in human rights and freedom of speech. They have to be precise, accessible, clearly defined,” she added.

In a blog post responding to the decisions, Facebook said it would publish updated COVID-19 misinformation policies. However, it said it would not change its approach to removing misinformation during the global pandemic.

Facebook has long faced criticism for high-profile content moderation issues.

The board said on Thursday that it had received 150,000 appeals since it started accepting cases in October. It will rule on a limited number of controversial decisions.

The board has 20 members including former Danish Prime Minister Helle Thorning-Schmidt and Nobel Peace Prize laureate Tawakkol Karman.

Some Facebook critics and civil rights groups slammed the board’s rulings. A group dubbed The Real Facebook Oversight Board said the decisions showed “deep inconsistencies and troubling precedent for human rights.”

Eric Naing, a spokesman for Muslim Advocates, also a member of the group, said that “instead of taking meaningful action to curb dangerous hate speech on the platform, Facebook punted responsibility” and that the board’s ruling had reinstated “a dangerous, anti-Muslim post in Myanmar.”

The group hears cases from users who have exhausted the company’s appeals process on content removed from Facebook’s platforms, not content that has been left up. The board’s limited remit has been the subject of criticism. Facebook itself can ask the board to review a wider range of content problems.

Facebook has pledged $130 million to fund the board for at least six years.

Reporting by Elizabeth Culliford; Editing by Kenneth Li, Cynthia Osterman and Steve Orlofsky

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Source: https://www.reuters.com/article/facebook-oversight/update-2-facebook-oversight-board-overrules-company-on-most-cases-in-first-test-idUSL1N2K31G7

Reuters

U.S. SEC says Chinese IPO hopefuls must provide additional risk disclosures

The U.S. securities regulator will not allow Chinese companies to raise money in the United States unless they fully explain their legal structures and disclose the risk of Beijing interfering in their businesses, the agency said on Friday, confirming an exclusive report by Reuters.

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July 30 (Reuters) – The U.S. securities regulator will not allow Chinese companies to raise money in the United States unless they fully explain their legal structures and disclose the risk of Beijing interfering in their businesses, the agency said on Friday, confirming an exclusive report by Reuters.

In a statement, Securities and Exchange Commission Chair Gary Gensler said he had also asked staff to “engage in targeted additional reviews of filings for companies with significant China-based operations.”

The development underscores U.S. policymakers’ concerns that Chinese companies are systematically flouting U.S. rules that require public companies to disclose to investors a range of potential risks to their financial performance.

Chinese listings in the United States have reached a record $12.8 billion so far this year, according to Refinitiv data, as companies swooped in to capitalize on the U.S. stock market reaching daily record highs.

Deal flows slowed substantially this month after Chinese regulators banned ride-sharing giant Didi Global Inc (DIDI.N) from signing up new users just days after its blockbuster IPO. They followed up with crack-downs on technology and private education companies.

In an interview with Reuters earlier this week, SEC Commissioner Allison Lee said that Chinese companies listed on U.S. stock exchanges must disclose to investors the risks of the Chinese government interfering in their businesses as part of their regular reporting obligations. read more

On Friday, Reuters reported that the agency was not processing registrations for the issuance of Chinese company securities pending SEC guidance on how to disclose the risks they face in China.

Following that report, Gensler issued Friday’s statement saying that in light of Beijing’s crackdown, he had asked staff to seek additional disclosures from Chinese companies before making their registrations effective.

These should include that investors face “uncertainty about future actions by the government of China that could significantly affect the operating company’s financial performance” and the enforceability of certain contractual arrangements.

Chinese issuers must also disclose if they were denied permission from Chinese authorities to list on U.S. exchanges and the risks that such approval could be denied or rescinded.

In addition, Chinese companies should disclose when Chinese law requires them to list in the United States via an offshore shell company, which carries additional legal risks.

The seal of the U.S. Securities and Exchange Commission (SEC) is seen at their headquarters in Washington, D.C., U.S., May 12, 2021. REUTERS/Andrew Kelly/

“I believe these changes will enhance the overall quality of disclosure in registration statements of offshore issuers that have affiliations with China-based operating companies,” said Gensler.

For a FACTBOX see: read more

LATEST SALVO

The SEC’s move represents the latest salvo by U.S. regulators against corporate China, which has frustrated Wall Street for years with its reluctance to submit to U.S. auditing standards and improve the governance of companies held closely by founders.

The agency has been under intense pressure from U.S. lawmakers to take a tougher line. A group of senators including Republicans John Kennedy and Bill Hagerty wrote to Gensler this week urging “thorough investigations of U.S. listed Chinese companies’ concerning lack of transparency.”

Last month, the SEC removed the chairman of the Public Company Accounting Oversight Board (PCAOB), which has been unsuccessful in a push to ensure independent auditing of U.S.-listed Chinese companies. The SEC is also under pressure to finalize rules on the delisting of Chinese companies that do not comply with U.S. auditing requirements.

A total of 418 Chinese companies are listed on U.S. exchanges, according to Refinitiv. The S&P/BNY Mellon China Select ADR Index, which tracks the American depositary receipts of major U.S.-listed Chinese companies, has lost 22% of its value year-to-date, compared with an 18% rise in the S&P 500 index.

No major U.S. IPO of a Chinese company is in the works following Didi, as the business community in China tries to come to grips with the regulators’ intentions.

Chinese officials said last week they would bar tutoring for profit in core school subjects to ease financial pressures on families that have contributed to low birth rates, sending shockwaves through the country’s private education sector. This came on the heels of a broad crackdown on China’s massive internet sector amid concern in Beijing over the safety of the personal data of its citizens. read more

China’s securities regulator met with executives of global investment banks on Wednesday to calm financial market nerves, reassuring them that policies will be rolled out more steadily to avoid volatility, people familiar with the matter told Reuters. read more

State-backed newspaper China Daily also said Beijing remained supportive of domestic companies seeking to list overseas.

Some Chinese companies canceled their U.S. IPOs this month proactively. LinkDoc Technologies pulled its offering to raise $211 million soon after Didi’s troubles emerged, while Hello Inc this week announced its U.S. listing plans were on hold. read more ,

Reporting by Echo Wang in New York, Scott Murdoch and Kane Wu in Hong Kong; additional reporting by Katanga Johnson in Washington, D.C.; editing by Greg Roumeliotis, Richard Pullin and Dan Grebler

Our Standards: The Thomson Reuters Trust Principles.

Chinese listings in the United States have reached a record $12.8 billion so far this year, according to Refinitiv data, as companies swooped in to capitalize on the U.S. stock market reaching daily record highs.

Source: https://www.reuters.com/business/finance/exclusive-us-regulator-freezes-chinese-company-ipos-over-risk-disclosures-2021-07-30/

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Stellantis makes 30 billion euro wager on electric vehicle market

Stellantis (STLA.MI), the world’s No. 4 automaker, said on Thursday it plans to invest more than 30 billion euros ($35.54 billion) through 2025 on electrifying its vehicle lineup.

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A view shows the logo of Stellantis at the entrance of the company’s factory in Hordain, France, July 7, 2021. REUTERS/Pascal Rossignol/Files

MILAN/DETROIT, July 8 (Reuters) – Stellantis (STLA.MI), the world’s No. 4 automaker, said on Thursday it plans to invest more than 30 billion euros ($35.54 billion) through 2025 on electrifying its vehicle lineup.

The company, formed in January from the merger of Italian-American automaker Fiat Chrysler and France’s PSA, said its strategy will be supported by five battery plants in Europe and North America as it gears up to compete with electric vehicle (EV) leader Tesla (TSLA.O) and other automakers globally.

“This transformation period is a wonderful opportunity to reset the clock and start a new race,” Stellantis Chief Executive Carlos Tavares said on a webcast during the company’s “EV Day 2021” event. “The group is at full speed on its electrification journey.”

Dario Duse, of consulting firm AlixPartners, said the 30 billion euros earmarked for the EV program were a “conspicuous amount.”

“Former PSA Group already had a good electrified offer that Stellantis will surely try to leverage at best and even the former FCA made steps ahead recently, so the big step up in electrification by 2025 seems achievable,” he said.

Stellantis said it is targeting more than 70% of sales in Europe and over 40% in the United States to be low-emission vehicles – either battery or hybrid electric – by 2030. It aims to make the total cost of owning an EV equal to that of a gasoline-powered model by 2026.

It said all 14 of its vehicle brands – including Peugeot, Jeep, Ram, Fiat and Opel – will offer fully electrified vehicles. Another focus will be electrifying its commercial vehicle lineup, and rolling out hydrogen fuel-cell medium vans by the end of 2021.

Stellantis said on Thursday that one of the five battery plants will be at its engine facility in Termoli, Italy, joining previously announced factories in Germany and France. The automaker also is in final steps of securing a partner in North America. A source told Reuters that Samsung SDI (006400.KS) may build a U.S. battery cell plant and has been in talks with automakers, including Stellantis. read more

Battery partners include Automotive Cells Co, a Stellantis joint venture with TotalEnergies (TTEF.PA); Contemporary Amperex Technology Co Ltd (CATL) (300750.SZ), BYD Co Ltd (002594.SZ), SVOLT, Samsung SDI and LG Chem’s (051910.KS) wholly-owned battery subsidiary LG Energy Solution.

Stellantis said it wants to secure more than 130 gigawatt hours (GWh) of battery capacity by 2025 and more than 260 GWh by 2030. It said it has signed memorandums of understanding with two lithium geothermal brine process partners in North America and Europe to ensure supplies of lithium, a critical raw material for batteries.

Stellantis said it aims to cut battery pack costs by more than 40% from 2020 to 2024 and by more than an additional 20% by 2030. It plans to use two battery chemistries by 2024 – a high energy-density option and a nickel cobalt-free alternative. By 2026, it intends to introduce solid-state batteries.

The automaker said its EVs will be built on four electric platforms and have driving ranges of 500 to 800 km (300 to 500 miles) on a single charge and fast charging capability of 32 km (20 miles) per minute.

“Stellantis seems to have put in place quite rapidly a unified platform strategy, same thing for the powertrain modularity, which will allow the company to benefit as fast as possible from scale effects,” IHS analyst Romain Gillet said, adding that the company’s targets are in line with its competitors.

MERGER SYNERGIES

At a separate EV strategy event last week, French rival Renault (RENA.PA) said 90% of its main brand models would be all-electric by 2030, whereas previously it had included hybrids in its target. read more

Germany’s Volkswagen (VOWG_p.DE), the world’s second-biggest automaker after Toyota (7203.T), expects all-electric vehicles to account for 55% of its total sales in Europe by 2030, and more than 70% of sales at its Volkswagen brand. read more

General Motors Co (GM.N) said last month it planned to spend $35 billion through 2025 on electric and self-driving vehicles. It has set a target of selling all new light cars and trucks with zero tailpipe emissions by 2035. read more

Earlier on Thursday, Stellantis flagged that 2021 got off to a better-than-expected start despite a global semiconductor chip shortage.

Stellantis said its margins on adjusted operating profits in the first half of 2021 were expected to exceed an annual target of between 5.5% and 7.5%, despite production losses due to the semiconductor supply crunch.

It said synergies from its merger were well on track to exceed the first year’s target and would help to contribute to a positive cash flow for the year as a whole. Stellantis has promised more than 5 billion euros ($5.9 billion) in annual synergies.

Shares of Stellantis extended losses after the automaker’s EV announcement and were last down about 3.9% in Milan.

($1 = 0.8442 euros)

Additional reporting by Clement Martinot, Stephen Jewkes in Milan, Gilles Guillaume in Paris and Heekyong Yang in Seoul; Editing by Agnieszka Flak, David Clarke and Paul Simao

Our Standards: The Thomson Reuters Trust Principles.

“Former PSA Group already had a good electrified offer that Stellantis will surely try to leverage at best and even the former FCA made steps ahead recently, so the big step up in electrification by 2025 seems achievable,” he said.

Source: https://www.reuters.com/business/autos-transportation/stellantis-says-h1-margin-expected-top-annual-target-55-75-2021-07-08/

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EXCLUSIVE Weibo chairman, state firm plan to take China’s Twitter private – sources

Nasdaq-listed Weibo Corp’s (WB.O) chairman and a Chinese state investor plan to take China’s answer to Twitter private, sources told Reuters, sending its shares as much as 50% higher on Tuesday.

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The booth of Sina Weibo is pictured at the Beijing International Cultural and Creative Industry Expo, in Beijing, China May 29, 2019. REUTERS/Stringer/Files

HONG KONG, July 6 (Reuters) – Nasdaq-listed Weibo Corp’s (WB.O) chairman and a Chinese state investor plan to take China’s answer to Twitter private, sources told Reuters, sending its shares as much as 50% higher on Tuesday.

A deal could value Weibo at more than $20 billion, facilitate shareholder Alibaba’s exit and see Weibo eventually relist in China to capitalise on higher valuations, the sources said.

Chairman Charles Chao’s holding company New Wave, Weibo’s top stakeholder, is teaming up with a Shanghai-based state company to form a consortium for the deal, three sources said, without disclosing the state firm’s identity.

The consortium is looking to offer about $90-$100 per share to take Weibo private, two of the sources said, representing a premium of 80%-100% to the stock’s $50 average price over the past month.

The group aims to finalise the deal this year, they said.

Weibo said in a statement that Chao and a state investor being in talks to take the company private was untrue. It cited Chao as saying he had had no discussion with anyone regarding delisting the company.

Weibo and Alibaba did not respond to Reuters requests for further comments. Chao did not respond to request for comment via Weibo parent company Sina.

Shares in Weibo, which operates a platform similar to Twitter (TWTR.N), surged more than 50% in premarket trading after the Reuters report. Those gains have shrunk to just over 6% after the opening bell.

BEIJING DRIVE

Three separate sources with knowledge of the matter told Reuters the plans stem from Beijing’s drive to have Alibaba Group Holding Ltd (9988.HK) and affiliate Ant divest their media holdings to rein in their sway over Chinese public opinion.

All the sources declined to be named due to confidentiality constraints.

Reuters reported in February that Weibo had hired banks to work on a Hong Kong secondary listing in the final half of 2021. Sources said this is no longer the plan. read more

Alibaba held 30% of Weibo as of February, the latter’s annual report showed, which was worth $3.7 billion as of Friday’s close.

REGULATORY CRACKDOWN

Beijing has looked to rein in Chinese billionaire Jack Ma’s Alibaba business empire by unleashing a series of investigations and new regulations since last year.

The crackdown followed Ma’s public criticism of regulators in a speech in October last year and has swept across China’s money-spinning internet sector in recent months.

E-commerce giant Alibaba has invested in nearly 30 media and entertainment firms including Hong Kong’s flagship English-language newspaper South China Morning Post, Refinitiv data shows.

Chao’s mooted deal would likely see it exit Weibo, two of the sources said.

The plan also reflects China’s efforts to tighten control over private media and internet businesses, sources added.

U.S.-listed Chinese firms also face heightened scrutiny and potentially stricter audit requirements from U.S. regulators, amid political tensions between Beijing and Washington.

A number of Chinese companies have already opted out of U.S. stock exchanges, by going private or returning to equity markets closer to home via second listings.

There were 16 announced delistings of U.S.-listed Chinese companies worth $19 billion last year, Dealogic data showed, compared to just five such deals worth $8 billion in 2019.

China’s cabinet said on Tuesday that it would step up supervision of firms listed offshore citing the need to improve regulation of cross-border data flows and security. read more

FIERCE COMPETITION

Weibo has grown at a fast clip since its launch in 2009 in a market where Twitter is blocked by the government. More than 500 million Chinese use Weibo to opine on everything from Korean soap operas to China’s latest political intrigue.

Alibaba acquired an 18% stake in Weibo in 2013 via a $586 million investment as its first big move into selling advertisement on China’s social networks. It has since raised its stake.

Weibo, which went public on the Nasdaq in 2014, makes most of its revenue from online advertising.

That has worried investors as the growth rate of Chinese online advertising slows and Weibo has also lost ground amid competition with other tech giants such as ByteDance and Tencent (0700.HK).

The Beijing-based company advertising and marketing revenue fell 3% last year to $1.5 billion.

Its shares were up 33% this year, after a fall of 12% in 2020.

Reporting by Julie Zhu and Pei Li in Hong Kong; Editing by Sumeet Chatterjee, Jason Neely and David Goodman

Our Standards: The Thomson Reuters Trust Principles.

The consortium is looking to offer about $90-$100 per share to take Weibo private, two of the sources said, representing a premium of 80%-100% to the stock’s $50 average price over the past month.

Source: https://www.reuters.com/technology/exclusive-weibo-chairman-state-firm-plan-take-chinas-twitter-private-sources-2021-07-06/

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