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Commercial Awareness Update - June 2019
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<blockquote data-quote="Jaysen" data-source="post: 11535" data-attributes="member: 1"><p>Hi All,</p><p></p><p>Welcome to the next commercial news update.</p><p></p><p>Happy reading!</p><p></p><p><strong>Commercial News Update – 12th June 2019</strong></p><p></p><p>Topics covered this week:</p><ol> <li data-xf-list-type="ol"><span style="color: #0059b3">Beyond Meat’s Share Price (by [USER=201]@bugsy malone[/USER])</span></li> <li data-xf-list-type="ol"><span style="color: #0059b3">US-Mexico Tariffs (by [USER=1643]@Moni[/USER])</span></li> <li data-xf-list-type="ol"><span style="color: #0059b3">India’s Slow Economic Growth (by [USER=525]@Sara Moon[/USER])</span></li> <li data-xf-list-type="ol"><span style="color: #0059b3">Philip Green and Arcadia (by [USER=1160]@Alice G[/USER])</span></li> <li data-xf-list-type="ol"><span style="color: #0059b3">YouTube’s Crackdown on Hate Speech (by [USER=1]@Jaysen[/USER])</span></li> </ol><p><strong><u>Beyond Meat’s Share Price (by [USER=201]@bugsy malone [/USER])</u></strong></p><p></p><p><strong>The story</strong></p><p></p><p>This year Beyond Meat was the first plant-based meat company to publicly list. Its share price has been unbelievably strong, up 21% since its first day listing (starting at $25 and now around $114). It is one of the best performing IPOs of 2019 so far. With analysts projecting a $100 billion plant-based market over the next 15 years, it is no wonder the IPO has caught so much investor attention.</p><p></p><p><strong>Impact on businesses and law firms</strong></p><p></p><p>Beyond Meat’s IPO raised $240 million. This financial power has allowed Beyond Meat to expand its retail and restaurant partnerships, as well as its plans for production in Europe. This will help them to compete with rivals such as Impossible Foods, which have agreed a distribution deal with Burger King. Additionally, Tyson Foods (one of the US’s largest meat producers) recently sold its 6.5% stake in Beyond Meat to partner with Nestle and produce their own plant-based meats.</p><p></p><p>A legal movement against companies using terms such as ‘meat’ and ‘burger’ to describe plant-based products is growing. The US have passed bills in Missouri, Arkansas and elsewhere against such terms being used. In April the European Parliament’s agriculture committee passed a measure to prohibit makers of vegetarian meat alternatives from using marketing terms such as “burger” and “steak”. This is a win for farmers and established meat producers but presents challenges for companies, as mentioned above. Beyond Meat now sees the movement as a legitimate threat to how it does business and have appointed new General Counsel. It is unclear whether such laws could affect Beyond Meat’s own name. Alternatively, Impossible Foods’ CEO has argued its plant-based products are actually meat because “it is more about the experience people have when eating it, than how the product is made”.</p><p></p><p>Plant-based meat companies will need assistance from commercial law firms to negotiate deals, such as the distribution agreement between Impossible Foods and Burger King, and to help navigate through regulation. It will be interesting to see whether global authorities continue to adopt such regulation in favour of conventional meat producers.</p><p></p><p><strong><u>US-Mexico Tariffs (by [USER=1643]@Moni[/USER])</u></strong></p><p></p><p><strong>The story</strong></p><p></p><p>Last Month, Donald Trump threatened 5% tariffs on Mexican goods that would go into effect on June 10th unless Mexico “stopped sending” undocumented migrants to the United States. The threats brought Mexico back to the table and on Friday both countries announced that a deal had been struck and the tariffs had been suspended indefinitely. This was celebrated as a win in Mexico, even before the content of the deal was revealed. Following the announcement Trump tweeted that he was pleased that Mexico would take “strong measures” towards stemming the inflow of migrants from Central America. These measures include the expansion of “Remain in Mexico” a scheme that forces migrants to wait in Mexico while their claims for asylum In the US are processed and an agreement from Mexico to deploy 6,000 troops of its newly national guard to two states to stop migrants and people-smugglers.</p><p></p><p><strong>Impact on businesses and law firms</strong></p><p></p><p>Trump’s threat of tariffs was a novel threat that came at an interesting time for the United States, Mexico and markets globally. President Trump is in the middle of a heated battle over his border wall in the US and in some ways, he is attempting to use Mexico as the wall he has so far failed to build. Although the deal presents a small win for Trump, many argue that it is simply an acceleration of plans that were already in motion. For Andrés Manuel Lòpez Obrador. the President of Mexico, Trump’s threats were a difficult and unwelcome challenge that threatened to cast a shadow on the early stages of his presidency.</p><p></p><p>The peso tumbled following Trump’s initial tweets and is yet to recover completely following the announcement of the deal. US stocks also tumbled following the announcement of potential tariffs and rallied slightly when they were called off. The market reaction suggests that investors are expecting a return to conflict, which is unsurprising given that Donald Trump has shown significant willingness to impose tariffs on key trading partners despite the potential damage to US companies. Given that Mexico is a key trading partner for the US, any potential tariffs could have significant ramifications for companies in the region. Moreover, it could have significant ramifications for the USMCA, the trade deal that is expected to replace NAFTA and affect some of the world’s largest companies.</p><p></p><p><strong><u>India’s Slow Economic Growth (by [USER=525]@Sara Moon[/USER])</u></strong></p><p></p><p><strong>The story</strong></p><p> </p><p>India lost its ‘world’s fastest-growing economy’ title after recording a GDP growth of 5.8% in the first quarter of 2019, the slowest growth in two years. The growth rate declined from 6.6% in the previous quarter and is lower than the 6.4% growth recorded by China in the same period. The reasons for the slow economic growth were a fall in domestic demand, which the Indian economy heavily relies on, and a fall in investment. In response to the unsatisfactory economic growth, the Reserve Bank of India (RBI) cut the interest rate from 6% to 5.75%.</p><p></p><p><strong>Impact on businesses and law firms:</strong></p><p></p><p>India has been heavily relying on its domestic market for economic growth and it has been the recently re-elected Prime Minister Narendra Modi’s policy to protect this market. Domestic demand is indeed crucial especially in the current economic situation, where the US-China trade war is creating uncertainties in global trade. However, with India’s domestic demand falling, it seems necessary for the country to increase foreign investments and exports to cushion poor domestic market outlook. With government recently admitting that the mistaken economic policy has led to the economic crisis, it seems like there may be greater attempt by the country to connect with the world market in the near future. This will include, among other things, establishing transparent regulations and dispute settlement mechanisms. This then may attract greater foreign investment and bring cases to law firms with departments specialising in emerging markets. This is because foreign companies attempting to invest in, merge with, or acquire Indian companies must comply with necessary domestic regulations.</p></blockquote><p></p>
[QUOTE="Jaysen, post: 11535, member: 1"] Hi All, Welcome to the next commercial news update. Happy reading! [B]Commercial News Update – 12th June 2019[/B] Topics covered this week: [LIST=1] [*][COLOR=#0059b3]Beyond Meat’s Share Price (by [USER=201]@bugsy malone[/USER])[/COLOR] [*][COLOR=#0059b3]US-Mexico Tariffs (by [USER=1643]@Moni[/USER])[/COLOR] [*][COLOR=#0059b3]India’s Slow Economic Growth (by [USER=525]@Sara Moon[/USER])[/COLOR] [*][COLOR=#0059b3]Philip Green and Arcadia (by [USER=1160]@Alice G[/USER])[/COLOR] [*][COLOR=#0059b3]YouTube’s Crackdown on Hate Speech (by [USER=1]@Jaysen[/USER])[/COLOR] [/LIST] [B][U]Beyond Meat’s Share Price (by [USER=201]@bugsy malone [/USER])[/U][/B] [B]The story[/B] This year Beyond Meat was the first plant-based meat company to publicly list. Its share price has been unbelievably strong, up 21% since its first day listing (starting at $25 and now around $114). It is one of the best performing IPOs of 2019 so far. With analysts projecting a $100 billion plant-based market over the next 15 years, it is no wonder the IPO has caught so much investor attention. [B]Impact on businesses and law firms[/B] Beyond Meat’s IPO raised $240 million. This financial power has allowed Beyond Meat to expand its retail and restaurant partnerships, as well as its plans for production in Europe. This will help them to compete with rivals such as Impossible Foods, which have agreed a distribution deal with Burger King. Additionally, Tyson Foods (one of the US’s largest meat producers) recently sold its 6.5% stake in Beyond Meat to partner with Nestle and produce their own plant-based meats. A legal movement against companies using terms such as ‘meat’ and ‘burger’ to describe plant-based products is growing. The US have passed bills in Missouri, Arkansas and elsewhere against such terms being used. In April the European Parliament’s agriculture committee passed a measure to prohibit makers of vegetarian meat alternatives from using marketing terms such as “burger” and “steak”. This is a win for farmers and established meat producers but presents challenges for companies, as mentioned above. Beyond Meat now sees the movement as a legitimate threat to how it does business and have appointed new General Counsel. It is unclear whether such laws could affect Beyond Meat’s own name. Alternatively, Impossible Foods’ CEO has argued its plant-based products are actually meat because “it is more about the experience people have when eating it, than how the product is made”. Plant-based meat companies will need assistance from commercial law firms to negotiate deals, such as the distribution agreement between Impossible Foods and Burger King, and to help navigate through regulation. It will be interesting to see whether global authorities continue to adopt such regulation in favour of conventional meat producers. [B][U]US-Mexico Tariffs (by [USER=1643]@Moni[/USER])[/U][/B] [B]The story[/B] Last Month, Donald Trump threatened 5% tariffs on Mexican goods that would go into effect on June 10th unless Mexico “stopped sending” undocumented migrants to the United States. The threats brought Mexico back to the table and on Friday both countries announced that a deal had been struck and the tariffs had been suspended indefinitely. This was celebrated as a win in Mexico, even before the content of the deal was revealed. Following the announcement Trump tweeted that he was pleased that Mexico would take “strong measures” towards stemming the inflow of migrants from Central America. These measures include the expansion of “Remain in Mexico” a scheme that forces migrants to wait in Mexico while their claims for asylum In the US are processed and an agreement from Mexico to deploy 6,000 troops of its newly national guard to two states to stop migrants and people-smugglers. [B]Impact on businesses and law firms[/B] Trump’s threat of tariffs was a novel threat that came at an interesting time for the United States, Mexico and markets globally. President Trump is in the middle of a heated battle over his border wall in the US and in some ways, he is attempting to use Mexico as the wall he has so far failed to build. Although the deal presents a small win for Trump, many argue that it is simply an acceleration of plans that were already in motion. For Andrés Manuel Lòpez Obrador. the President of Mexico, Trump’s threats were a difficult and unwelcome challenge that threatened to cast a shadow on the early stages of his presidency. The peso tumbled following Trump’s initial tweets and is yet to recover completely following the announcement of the deal. US stocks also tumbled following the announcement of potential tariffs and rallied slightly when they were called off. The market reaction suggests that investors are expecting a return to conflict, which is unsurprising given that Donald Trump has shown significant willingness to impose tariffs on key trading partners despite the potential damage to US companies. Given that Mexico is a key trading partner for the US, any potential tariffs could have significant ramifications for companies in the region. Moreover, it could have significant ramifications for the USMCA, the trade deal that is expected to replace NAFTA and affect some of the world’s largest companies. [B][U]India’s Slow Economic Growth (by [USER=525]@Sara Moon[/USER])[/U][/B] [B]The story[/B] India lost its ‘world’s fastest-growing economy’ title after recording a GDP growth of 5.8% in the first quarter of 2019, the slowest growth in two years. The growth rate declined from 6.6% in the previous quarter and is lower than the 6.4% growth recorded by China in the same period. The reasons for the slow economic growth were a fall in domestic demand, which the Indian economy heavily relies on, and a fall in investment. In response to the unsatisfactory economic growth, the Reserve Bank of India (RBI) cut the interest rate from 6% to 5.75%. [B]Impact on businesses and law firms:[/B] India has been heavily relying on its domestic market for economic growth and it has been the recently re-elected Prime Minister Narendra Modi’s policy to protect this market. Domestic demand is indeed crucial especially in the current economic situation, where the US-China trade war is creating uncertainties in global trade. However, with India’s domestic demand falling, it seems necessary for the country to increase foreign investments and exports to cushion poor domestic market outlook. With government recently admitting that the mistaken economic policy has led to the economic crisis, it seems like there may be greater attempt by the country to connect with the world market in the near future. This will include, among other things, establishing transparent regulations and dispute settlement mechanisms. This then may attract greater foreign investment and bring cases to law firms with departments specialising in emerging markets. This is because foreign companies attempting to invest in, merge with, or acquire Indian companies must comply with necessary domestic regulations. [/QUOTE]
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