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Small US businesses fear TikTok ban after it turbocharged sales

REUTERS

LOS ANGELES — Everything changed for Paul Tran and his wife Lynda when the skincare brand they co-founded went viral on TikTok.

The Atlanta couple created @loveandpebble, and when they shared their Beauty Pops ice face masks on TikTok in 2021, it took their small business to another level.

“We sold out all of our inventory,” Paul Tran said, noting that after going viral, the brand was featured on The Today Show, Shark Tank and in mainstream publications.

Now the Trans are worried about a bill passed by the US Senate and signed into law by US President Joseph R. Biden in late April that bans TikTok in the United States if its owner, the Chinese tech firm ByteDance, fails to divest the short video app over the next year. Lawmakers are concerned that China could access data on Americans or spy on them with the app.

A group of TikTok creators sued the US in federal court on Tuesday seeking to block the law and keep the app used by 170 million Americans.

“TikTok has provided a way to the American Dream and this bill is killing that American Dream, my American Dream,” Tran said.

While they tried other apps for their brand, including Instagram and Facebook, it wasn’t until posting on TikTok that the couple found their audience. And they’re not alone.

Many small businesses benefiting from the app’s cultural dominance feel betrayed, as American-owned platforms like Meta, Alphabet and Snap have failed to give them the same prospects of going viral, which leads to more product sales, partnerships and sponsors.

“It’s called #TikTokmademebuyit for a reason,” eMarketer principal analyst Jasmine Enberg said.

“(TikTok) has become the center of the Internet for many young people in particular, and it’s where they go to discover new trends, new products. Brands, creators, and all of that creates this environment of FOMO (Fear of Missing Out) and inspiration really leads to purchase on those platforms, and that really isn’t replicated anywhere else,” she added.

TikTok’s algorithm not only made way for the Tran’s small business to have high audience viewership and engagement, the 2023 launch of TikTok Shop, which enables creators to sell goods directly within the app, “exploded our business,” Paul Tran said.

COMMUNITIES ‘BUILT WITHIN TIKTOK’
Historically, social media platforms like Instagram were more likely to recommend content based on follower engagement. That meant larger accounts could reach the most people, Jasmine Enberg explained, making it harder for small businesses to get their foot in the door.

Small business owner Summer Lucille, known as @juicybodygoddess, toiled for nearly a decade on Instagram and other apps before her plus-size clothing company gained traction on TikTok.

A month after joining TikTok in 2021, she attracted hundreds of thousands of followers, including customers at her physical boutique location in Charlotte, North Carolina, and eventually a television appearance on CBS Mornings.

“I’ve been on other platforms for almost a decade, and they never gave me this opportunity,” Ms. Lucille said. “This is an app that’s not even American. The American apps didn’t give me that same opportunity.”

Felicia Jackson, a Chattanooga, Tennessee, mom, who founded @CPRWrap, a company that sells packaged kits to save lives in the event of a cardiac emergency, said TikTok rescued her business when her presence on other apps including Facebook, X and Pinterest failed to generate sales.

“(TikTok viewers) engage with my content, and they don’t just buy my product. They take the product, buy it, and they take it to other people that they know who take it to their jobs. So, I love the communities that are built within TikTok. No other platform can touch it,” she said.

Rivals have taken notice. Meta’s recent updates to Instagram acknowledge the ways it could improve the experience and performance for small creators.

“Historically because of how we’ve ranked content, creators with large followings and aggregators of reposted content have gotten more reach in recommendations than smaller, original content creators,” according to an Instagram blog post on April 30.

“We think it’s important to correct this to give all creators a more equal chance of breaking through to new audiences.” — Reuters

North Korea laundered $147.5M in stolen crypto in March, say UN experts

REUTERS

UNITED NATIONS (UN) — North Korea laundered $147.5 million through virtual currency platform Tornado Cash in March after stealing it last year from a cryptocurrency exchange, according to confidential work by United Nations sanctions monitors seen by Reuters on Tuesday.

The monitors told a UN Security Council sanctions committee in a document submitted on Friday that they had been investigating 97 suspected North Korean cyberattacks on cryptocurrency companies between 2017 and 2024, valued at some $3.6 billion.

That included an attack late last year where $147.5 million was stolen from HTX cryptocurrency exchange before being laundered in March this year, the monitors told the committee, citing information from crypto analytics firm PeckShield and blockchain research firm Elliptic.

In 2024 alone, the monitors said they had been looking at “11 cryptocurrency thefts … valued at $54.7 million,” adding that many of those “may have been conducted by DPRK IT workers inadvertently hired by small crypto-related companies.”

The monitors said that according to UN member states and private companies, North Korean information technology (IT) workers operating abroad generate “substantial income for the country.”

Formally known as the Democratic People’s Republic of Korea (DPRK), North Korea has been under UN sanctions since 2006 and those measures have been strengthened over the years in a bid to cut funding for its ballistic missile and nuclear programs.

North Korea’s mission to the UN in New York did not immediately respond to a request for comment.

The US sanctioned Tornado Cash in 2022 over accusations it supports North Korea. Two of its co-founders were charged in 2023 with facilitating more than $1 billion in money laundering, including for a cybercrime group linked to North Korea.

Lawyers for Tornado Cash co-founder Roman Storm, who pleaded not guilty to the US charges in September, did not immediately respond to a request for comment.

So-called virtual currency “mixer” platforms such as Tornado Cash take the cryptocurrencies of many users and mash them together to help hide the source and owners of the funds.

The UN sanctions monitors were disbanded at the end of April after Russia vetoed the annual renewal of their mandate. Some of the monitors submitted unfinished work, which was shared with the council’s North Korea sanctions committee on Friday.

Traditionally, reports by the sanctions monitors are first agreed by all eight members. The unfinished work submitted to the committee did not go through that process.

The monitors said they had been investigating a Feb. 6 New York Times report that Russia released $9 million out of $30 million in frozen North Korean assets and allowed Pyongyang to open an account at a Russian bank in South Ossetia so it could better obtain access to international banking networks.

ILLICIT ARMS, COAL
The monitors also said ships suspected of involvement in arms trade between North Korea and Russia had continued voyages carrying containers between North Korea’s Rajin port and Russian ports, including Vladivostok and Vostochny.

The sanctions monitors said one particular ship called the Angara had been at China’s Ningbo port since February, where it may have been undergoing maintenance. Reuters has reported that China was providing moorage for the ship.

Russia’s mission to the UN in New York declined to comment on the monitors’ work. China’s UN mission did not immediately respond to a request for comment.

The US and others have accused North Korea of transferring weapons to Russia for use against Ukraine, which it invaded in February 2022. Both Moscow and Pyongyang have denied the accusations, but vowed last year to deepen military relations.

In a separate report last month, U.N. sanctions monitors told the Security Council that debris from a missile that landed in the Ukrainian city of Kharkiv on Jan. 2 was from a North Korean Hwasong-11 series ballistic missile.

The UN Security Council has banned North Korean exports including coal, iron, lead, textiles and seafood, and capped imports of crude oil and refined petroleum products.

“The DPRK and its facilitators continue to evade sanctions through maritime means, including with the ongoing acquisition by the DPRK of vessels, import of refined petroleum including via ship-to-ship transfer, and export of coal,” the monitors wrote.

The monitors said they had been investigating information from an unnamed member state about 208 voyages by North Korean cargo ships to offload coal in Chinese coastal waters, adding it was likely that most took place via ship-to-ship transfers.

“Chinese Coast Guard vessels were on several occasions identified in close proximity to DPRK vessels suspected of offloading coal in Chinese waters,” the monitors wrote.

China’s UN mission did not immediately respond to a request for comment. — Reuters

The convenience factor on why home buyers prefer investing in transit-oriented developments

Situated in the heart of Manila's bustling landscape, Vista Recto offers residents easy access to transportation hubs.

City dwellers who work or study speak in favor of the rise of transit-oriented condo properties in many locations across Metro Manila. Typically situated within walking distance to transport hubs and road networks, it is anticipated that these living spaces will relieve the daily monotony of lengthy commutes, offering office workers and students access to their schools and workplaces without the need for private vehicles or public conveyances. Indeed, residents of these high-rise developments can reduce their carbon footprint even as they save time, energy, and resources.

Potential homeowners who value hassle-free connectivity to different parts of the metro will likewise appreciate transit-oriented developments where getting a bus is as convenient as stepping out of the condominium.

Got a client meeting at a place across town? Meeting with friends in the next city this weekend? The smooth integration of various transit modes will take residents from their condominium property to their destination in relative comfort.

An American study highlights the importance of mobility in shaping perceptions of quality of life. Residents who view transit service within their communities, as well as road conditions, congestion, and traffic safety, favorably are more likely to have a positive overall impression. The rest of the world seems to concur with these findings, as countries with efficient public transportation and commute systems like Switzerland, Singapore, and The Netherlands rank in the top 15 of the global Human Development Index.

In dynamic urban centers like Metro Manila, the pursuit of convenient, sustainable housing options has become a top priority for residents. According to a 2022 study by Social Weather Stations, only six percent of households in the capital region own private vehicles, meaning most citizens in the metro rely on daily commutes to get them from place to place.

While the government is upgrading the national railway system, such as the Line 7 of the Metro Rail Transit (MRT) and the Metro Manila Subway, residing near a transportation hub ensures convenience. With lesser commute times and effortless connections to various city districts, residents — students and young professionals, in particular — will relish a lifestyle marked by unparalleled accessibility.

Towards this end, leading real estate developers have wisely focused on building transit-oriented developments, as the demand for improved accessibility among property owners grows more by the day.

Vista Taft’s proximity to various modes of transportation makes it the perfect choice for students and young professionals.

Vista Land, the Philippines’ leading integrated property developer, stands at the forefront of urban living with its diverse range of transit-oriented developments. Its ready-for-occupancy condominiums such as Vista Taft, Vista GL Taft, and Vista Recto offer residents unrivaled proximity to esteemed universities and transportation hubs. These strategically positioned residences redefine city living, seamlessly blending modern comforts with unmatched connectivity.

These three Vista Land properties, in particular, are conveniently situated near two of the current rapid transit systems’ major stations — Recto Station, which is the final station of the LRT-2 and connects to the Doroteo Jose station of the LRT-1, and Taft Station, the southernmost station of the MRT-3. This means that those who reside in any of these Vista Land properties have quick access to all the metro has to offer.

Vista Land is committed to urban living, crafting vertical communities that not only meet the needs of the residents but also enhance their overall lifestyles. These transit-oriented developments epitomize convenience, connectivity, and sustainability, reshaping the living experience in Metro Manila.

As Vista Land continues to lead with innovative real estate solutions, its pre-selling options, including Kizuna Heights and Plumeria Heights, expand the possibilities further for their residents. By offering vertical communities near key transportation hubs, the company empowers residents to embrace a lifestyle characterized by seamless connectivity and emerges as a symbol of progress, revolutionizing how residents live, work, and thrive in the heart of the city.

Vertical residences for the Filipinos of today

Vista GL Taft is a transit-oriented development that provides unit owners and guests convenience and connectivity.

Vista Land, the Philippines’ leading integrated property developer, is committed to providing exceptional living experiences through its innovative residential developments. With a portfolio of groundbreaking projects across the Philippines, Vista Land continues to redefine the standards of modern living and create communities that inspire and enrich the lives of its residents.

For more information on Vista Residences, visit www.vistaresidences.com.ph, follow @VistaResidencesOfficial on Facebook, Instagram, and YouTube, or get in touch at 0999-886-4262 and 0917-582-5167.

 

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MILA App to help Filipino mothers with children’s medical records

Filipino start-up company MILA Business Solutions Corp. recently launched a health record management system, where moms can digitally store children’s medical records, a digital baby book, a family health plan, personalized health notes, medication, and appointment reminders. 

MILA Chief Project Officer Albert Acejo shared that their personal experiences are part of the inspiration that pushed them to create the My Inspiration and Lab Access (MILA) application. 

“We didn’t have baby books back then,” Mr. Acejo said in his statement on having fragmented medical records as a child.  

In line with this, the company’s Chief Marketing Officer, Ma. Jezzika Kierulf claimed that parents often struggle to keep track of their children’s health history, which causes inefficiencies in healthcare management and other complications.  

Ms. Kierulf added that despite seeing a lot of health record management applications in the market, there was nothing made for kids. 

“It is more than a digital tool; it’s a way for mothers to remain organized and proactive about their family’s health,” MILA Chief Executive Officer Faustino Salvador Jr. stated.  

Mr. Salvador says that the application ensures mothers’ peace of mind, confidence, and ease through effortless assistance in managing their families’ health and well-being. 

The MILA App is now available on the company’s official website. — Almira Louise S. Martinez

Huawei flagship store surge in China signals showdown with Apple

REUTERS

HONG KONG – Huawei is revamping its retail strategy and aggressively opening flagship stores in China, with some just a stone’s throw away from Apple shops, as it seeks to retake the premium electronics throne in the world’s biggest smartphone market.

Situated directly across from Apple’s Shanghai flagship store, Huawei’s recently renovated shop spans three floors of a famous heritage architecture building in the financial hub’s busy shopping district and includes a coffee shop and a gym.

Huawei opened four such stores in major Chinese cities between December and February, an aggressive marketing blitz by a company that had largely relied on licensed distributors and is rebounding from U.S. sanctions imposed in 2019 that had crippled its smartphone business for four years until it could source domestic replacement parts.

“The Huawei flagship store is very nice. It looks much brighter inside compared to the Apple Store across the street,” said Amy Chen, a 27-year-old physiotherapist who visited the Shanghai store this week to switch to Huawei’s top-end Pura 70 Ultra from the iPhone 15 Pro in hopes of better mobile reception.

Apple has 47 stores in mainland China. Huawei, which did not open a flagship store until 2019, now has 11 of them.

“I think they will open more than 20 of them. Then it will eventually catch up to Apple,” said Ethan Qi, associate director at research firm Counterpoint.

It marks a stark contrast to 2021 when the company’s licensed stores were shuttered across China due to product shortages caused by the US sanctions.

Huawei has since developed its own chips, introduced highly popular 5G-capable products and, according to sources, has started aggressively recruiting dealers in recent months.

“As Huawei now manages to ship in large quantities, given the good profit margin they could provide, (distributors) have become willing to purchase Huawei devices again,” Qi said. “Previously, many couldn’t get stock and their 4G devices didn’t sell well.”

Huawei has been actively bargaining with distributors, touting the above industry average profit margins of its phones and sometimes demanding exclusionary clauses to turn them into its exclusive partners, according to two industry sources.

More than 5,200 stores licensed to sell Huawei products sprang up through the first 10 months of 2023, with more than half of them in third and fourth-tier cities, according to market research firm GeoQ, helping Huawei expand its army of distribution partners nationwide.

Its renewed marketing push poses a major challenge to Apple, which suffered a 6.6% plunge in iPhone sales in China to 10.8 million in the first quarter, according to IDC data. By contrast, Huawei boosted its smartphone shipments by 110% to 11.7 million in the first quarter and overtook Apple as the No.2 smartphone vendor in China.

Huawei and Apple did not respond to requests for comment.

 

PREMIUM PUSH

Lucas Zhong, an analyst at research firm Canalys, said Huawei had plans to build out its flagship stores since 2020 but the progress was slowed by the U.S. sanctions, which led to a much slower iteration of its high-end products.

There are still supply chain issues leading to shortages of specific models, but they are under much better control and the new phones are garnering good reviews. That means Huawei is now putting its focus squarely on selling premium products that compete with Apple, according to analysts.

Its latest Pura 70 Ultra smartphone, for example, starts at 9,999 yuan ($1,300), matching the price tag of the iPhone 15 Pro Max, while Samsung 005930.KS and Xiaomi 1810.HK are keeping prices for their premium models lower amid soft market demand.

Huawei’s luxurious flagship stores display premium products ranging from smartphones to tablets, smartwatches, televisions and even electric vehicles made in partnership with Chinese automakers.

“Huawei now has a long product line,” Qi said. “They need big demo areas… They will have to do it themselves because their distributors don’t have the capability to rent such a massive area.”

The push to build more of its own stores also underscores Huawei’s heavy reliance on offline sales. Between 70% and 80% of Huawei’s sales come from physical stores, while Apple sees about 40% of its sales coming from online, according to Toby Zhu, another analyst at Canalys.

“Xiaomi, Oppo and Vivo are all being affected (by Huawei’s comeback),” Zhu said, referring to other Chinese smartphone makers. “But for now, the biggest impact has been on Apple.”

And the impact is beginning to be felt beyond mainland China.

Simon Lam, owner of a popular smartphone shop named Trinity Electronics in Hong Kong, said more independent smartphone shops had started selling Huawei devices in recent months.

“Everybody is stocking up on some Huawei right now. Some more, some less,” he said. “People are willing to pay a lot of money for high-end Huawei, something other brands really can’t compare with.” – Reuters

Putin backs China’s Ukraine peace plan, says Beijing understands the conflict

COMMONS.WIKIMEDIA.ORG -WWW.KREMLIN.RU

Russian President Vladimir Putin, in an interview published early on Wednesday, said he backed China’s plan for a peaceful settlement of the Ukraine crisis, saying Beijing had a full understanding of what lay behind the crisis.

Mr. Putin, speaking to China’s Xinhua news agency ahead of his visit to Beijing this week, said Russia remained open to dialogue and talks to solve the more than two-year-old conflict.

China’s plan and further “principles” made public by President Xi Jinping last month took account of factors behind the conflict, Putin said.

“We are positive in our assessment of China’s approach to solving the Ukrainian crisis,” Mr. Putin said, according to a Russian-language transcript on the Kremlin website. “In Beijing, they truly understand its root causes and its global geopolitical meaning.”

And the additional principles, set down by Mr. Xi in talks with German Chancellor Olaf Scholz, were “realistic and constructive steps” that “develop the idea of the necessity to overcome the cold war mentality”.

Beijing put forward a 12-point paper more than a year ago that set out general principles for ending the war, but did not get into specifics.

It received a lukewarm reception at the time in both Russia and Ukraine, while the US said China was presenting itself as a peacemaker but reflecting Russia’s “false narrative” and failing to condemn its invasion.

Russian Foreign Minister Sergei Lavrov last month called the proposal a “reasonable plan that the great Chinese civilization proposed for discussion.”

Mr. Xi’s additional principles call for a “cooling down” of the situation, conditions for restoring peace and creating stability and minimizing the impacts on the world economy.

Russia views the conflict as a struggle pitting it against the “collective West” which took no account of Moscow’s security concerns by promoting the eastward expansion of NATO and military activity close to its borders.

Russia calls its actions in Ukraine a “special operation” to disarm Ukraine and protect it from fascists. Ukraine and the West say the fascist allegation is baseless and that the war is an unprovoked act of aggression.

Russia and China proclaimed a “no limits” relationship just days before Moscow launched its invasion of Ukraine in February 2022, but Beijing has so far avoided providing actual weapons and ammunition for Russia’s war effort.

Ukrainian President Volodymyr Zelenskiy’s peace plan calls for a withdrawal of Russian troops, the restoration of its 1991 post-Soviet borders and bringing Russia to account for its actions.

A “peace summit” is scheduled for Switzerland in June. But Russia is not invited, dismisses the initiative as meaningless and says talks must take account of “new realities”.

China has attended some preparatory talks for the summit and Ukraine has deployed great efforts to persuade it to attend. – Reuters

Singapore to inaugurate new PM as Lee makes way after 20 years in charge

THE FINANCIAL DISTRICT is seen shrouded by haze in Singapore, Sept. 18, 2019. — REUTERS/FELINE LIM

SINGAPORE – Singapore will inaugurate Lawrence Wong on Wednesday as its new prime minister and fourth leader since independence six decades ago, completing a carefully calibrated power transfer designed to guarantee continuity in the wealthy city-state.

Mr. Wong, 51, comes from among a crop of so-called “4G” leaders, a new generation of politicians hand-picked by the long-ruling People’s Action Party (PAP) to take over the reins of the key Asian trade and financial center.

Mr. Wong will retain his current position as finance minister and takes charge of a country led for two decades by Lee Hsien Loong, the 72-year-old son of Lee Kuan Yew, the founder of modern Singapore who stayed in politics until his death in 2015.

The succession has been long coming, with Lee’s plans of stepping down before he turned 70 upended by the pandemic, and by a transition fumble when his anointed successor unexpectedly ruled himself out of the running in 2021.

Wong’s inauguration will take place on Wednesday evening.

When the date for the handover was announced last month, Wong said he accepted the responsibility “with humility and a deep sense of duty” towards Singapore and its 5.9 million people.

“Every ounce of my energy shall be devoted to the service of our country and our people,” Wong pledged in a video on his social media accounts.

 

STABLE POLITICS

Mr. Wong rose to prominence in 2020 as co-chair of the pandemic taskforce and was named Lee’s successor in April 2022 after a series of consultations between the political leadership and Wong’s peers.

He was promoted to deputy prime minister and led a high-profile public consultation exercise to chart a “social compact” between the government and the people on dealing with issues like sustainability, inequality and employment.

Mr. Wong made a very minor cabinet reshuffle on Monday, promoting the trade minister to become his deputy, noting that continuity and stability were key considerations. He has pledged a bigger reshuffle after an election due by next year.

Mr. Lee will remain in Mr. Wong’s cabinet as senior minister, as former Singapore prime ministers have done, preserving the political clout of the long-serving Lee family.

His father stepped down as leader in 1990 and stayed on in the cabinets of his successors for 21 years, initially as senior minister then as “minister mentor” in his son’s government.

In his final major speech last week, Mr. Lee urged the people to rally behind Wong and emphasized that Singapore’s stable politics had enabled long-term planning.

“As I prepare to hand over Singapore in good order to my successor, I feel a sense of satisfaction and completeness,” an emotional Mr. Lee told the crowd. – Reuters

El Salvador mined nearly 474 bitcoins, adding to state crypto holding, in last three years

ANDRÉ FRANÇOIS MCKENZIE-UNSPLASH

SAN SALVADOR – El Salvador has mined nearly 474 bitcoins since 2021 thanks to a volcano-fueled geothermal power plant, official data showed on Tuesday, bringing the government’s total bitcoin portfolio to nearly $354 million at current prices.

The country’s “Bitcoin Office,” an official government entity, reports that government coffers now hold 5,750 bitcoins.

The new additions, 473.5 bitcoins worth some $29 million since September of 2021, were powered by a small amount of geothermal energy generated by the country’s imposing Tecapa volcano, touted as a green way to accumulate the well-known cryptocurrency, which is not regulated by any central bank.

The administration of Bitcoin enthusiast President Nayib Bukele, who earlier this year was reelected to a second term, has installed 300 processors to “mine” bitcoins from the volcano.

Of the 102 megawatts (MW) produced by the state-owned power plant, 1.5 MW are devoted to cryptocurrency mining. The so-called crypto mining process requires large amounts of energy for computing and cooling data processing centers, which perform complex math equations in order to secure cryptocurrencies like bitcoin.

Elsewhere in the world, cryptocurrency miners have recently come under increased scrutiny for their electricity-sapping operations, and for the impact their activity has on power grids and carbon emissions.

In 2021, El Salvador became the first country to adopt bitcoin as legal tender, alongside the U.S. dollar which it adopted two decades earlier. The bitcoin move earned Nayib’s government harsh criticism for its embrace of the volatile cryptocurrency, including from the International Monetary Fund (IMF).

Cryptocurrency miners Foundry USA, Ant pool, ViaBTC, F2Pool and Binance Pool pooled their resources to win a reward for opening a blockchain that can verify the last three years of bitcoin transactions originating from the power plant, according to the government Bitcoin Office. – Reuters

TikTok creators file suit to block US divestment or ban law

WASHINGTON – A group of TikTok creators said Tuesday they filed suit in US federal court seeking to block a law signed by President Joe Biden that would force the divestiture of the short video app used by 170 million Americans or ban it, saying it has had “a profound effect on American life.”

The TikTok users suing include a Texas Marine Corps veteran who sells his ranch products, a Tennessee woman selling cookies and discussing parenting, a North Dakota college coach who makes sports commentary videos, a Mississippi hip hop artist who shares Biblical quizzes and a recent college graduate in North Carolina who advocates for the rights of sexual-assault survivors.

“Although they come from different places, professions, walks of life, and political persuasions, they are united in their view that TikTok provides them a unique and irreplaceable means to express themselves and form community,” said the lawsuit.

Davis Wright Tremaine LLP, a law firm representing the creators, provided a copy of the lawsuit to Reuters it said had been filed in the US Court of Appeals for the District of Columbia Circuit.

The White House declined comment. A Justice Department spokesperson said the TikTok law “addresses critical national security concerns in a manner that is consistent with the First Amendment and other constitutional limitations. We look forward to defending the legislation in court.”

The suit, which seeks injunctive relief, says the law threatens free speech and “promises to shutter a discrete medium of communication that has become part of American life.”

Last week, TikTok and its Chinese parent company ByteDance filed a similar lawsuit, arguing that the law violates the US Constitution on a number of grounds including running afoul of First Amendment free speech protections.

TikTok creators filed a similar suit in 2020 to block a prior attempt to block the app under then President Donald Trump, and also sued last year in Montana asking a court to block a state ban. In both instances, courts blocked the bans.

Trump has since reversed course and criticized efforts to ban TikTok but has not joined the app.

The law, signed by Mr. Biden on April 24, gives ByteDance until Jan. 19 to sell TikTok or face a ban. The White House has said it wants to see Chinese-based ownership ended on national security grounds but not a ban on TikTok.

The law prohibits app stores like Apple, and Alphabet’s Google, from offering TikTok and bars internet hosting services from supporting TikTok unless ByteDance divests TikTok.

The creators’ suit said “because TikTok currently has approximately 170 million users in the United States, the fine for continuing to enable access to TikTok would be roughly $850 billion.”

The suit says to the extent the government may claim the law is needed to protect Americans’ data, “it has tried that strategy before and lost.” The suit says “the concerns are speculative, and even if they were not, they could be addressed with legislation much more narrowly tailored to any purported concern.”

The TikTok lawsuit said last week the divestiture “is simply not possible: not commercially, not technologically, not legally … There is no question: the Act (law) will force a shutdown of TikTok by January 19, 2025.”

Driven by worries among US lawmakers that China could access data on Americans or spy on them with the app, the measure was passed overwhelmingly in Congress just weeks after being introduced.

The four-year battle over TikTok is a significant front in the ongoing conflict over the internet and technology between the United States and China. In April, Apple said China had ordered it to remove Meta Platform’s WhatsApp and Threads from its App Store in China over Chinese national security concerns.

Biden could extend the Jan. 19 deadline by three months if he determines ByteDance is making progress. The creators’ suit notes Biden’s campaign uses TikTok, quoting his campaign’s deputy manager as saying it “would be silly to write off any place where people are getting information about the president.” – Reuters

Elon Musk ordered to testify again in US SEC probe of Twitter takeover

FILE PHOTO: Elon Musk, CEO of SpaceX and Tesla and owner of X, formerly known as Twitter, attends the Viva Technology conference dedicated to innovation and startups at the Porte de Versailles exhibition centre in Paris, France, June 16, 2023. REUTERS/Gonzalo Fuentes/File Photo

SAN FRANCISCO – A federal court ordered on Tuesday that Elon Musk must testify again in the US Securities and Exchange Commission’s investigation into his $44 billion takeover of Twitter.

The SEC sued Mr. Musk in October to compel the CEO of electric carmaker Tesla and rocket company SpaceX to testify after he refused to attend a September interview for the investigation. The billionaire said the SEC was trying to “harass” him with a number of subpoenas.

The investigation concerns whether Mr. Musk broke federal securities laws in 2022 when he bought stock in Twitter, which he later renamed X. It is also reviewing statements and SEC filings he made in relation to the deal, the agency has previously said.

US Magistrate Judge Laurel Beeler in February ruled in favor of the agency to compel the deposition and Musk requested a review of the decision.

“As Judge Beeler explained, the investigations Musk contends constitute harassment are ‘legitimate government investigations’,” US District Judge Jacqueline Scott Corley said on Tuesday.

“Musk has not met his burden of demonstrating the subpoena is unreasonable.”

This marks the latest dispute in a years-long feud between Mr. Musk and the top US markets regulator, dating back to 2018 when he tweeted that he had “funding secured” to take Tesla private.

In 2022, Mr. Musk supplied the SEC with documents for its probe and also testified via videoconference for two half-day sessions in July of that year, the SEC has said in court documents. Agency lawyers have said they have more questions for Mr. Musk after receiving new documents, and had sought additional testimony.

Mr. Musk was not immediately available for comment. – Reuters

House OK’s rice tariffication law amendments on 2nd reading

The House of Representatives on Tuesday approved on second reading a bill amending the Rice Tariffication Law, in an effort to address spiraling prices of rice. — PHILIPPINE STAR/RYAN BALDEMOR

By Kenneth Christiane L. Basilio

THE HOUSE of Representatives on Tuesday approved on second reading a bill that seeks to allow the National Food Authority (NFA) to sell rice at subsidized prices during emergencies including shortages.

Philippine congressmen through a voice vote agreed to expand the agency’s regulatory functions over the rice industry through House Bill No. 10381 amid spiraling prices of the staple.

The bill seeks to amend the Rice Tariffication Law (RTL), which gave private traders full control over rice imports in 2019.

The measure also extends the validity period for the Rice Competitiveness Enhancement Fund (RCEF) for six more years and increases its budget to P15 billion from P10 billion, congressmen said during plenary debates.

“The House’s expeditious action on the Rice Tariffication Law amendments comes from… the current rice price crisis,” Albay Rep. Jose Maria Clemente S. Salceda told BusinessWorld in a Viber message. “It has exposed the shortcomings of the global rice trade and why domestic support remains crucial.”

The House of Representatives is expediting its deliberations on the rice law to address the expensive costs of rice in markets by allowing the NFA to restore its price stabilization and supply regulation functions. 

Retail prices of staple grain range between P50 and P65 per kilo, according to latest Philippine Statistics Authority data.

House Speaker Ferdinand Martin G. Romualdez said amending the Rice Tariffication Law would reduce rice prices to less than P30 a kilo.

“By amending the RTL, we aim to bring about tangible reductions in rice prices,” Mr. Romualdez said in a statement. “Lowering rice prices to less than P30 is a crucial step towards ensuring food security and economic stability.”

Under the bill, the NFA would be allowed to intervene in the market under the direction of the National Price Coordinating Council — comprised of state economic managers — during food security emergencies caused by rice shortages and sustained increases in the price of the staple grain.

“An empowered NFA really would have a role to play in ensuring food and especially rice security,” IBON Foundation Executive Director Jose Enrique A. Africa told BusinessWorld in a Viber message before the bill’s approval.

He said addressing rice inflation requires the government to look beyond reinstating NFA’s regulatory functions.

In April, rice inflation surged by 23.9%, but easing from the 24.4% a month prior as world rice prices declined.

Mr. Africa said the Philippines should reduce its dependence on imported rice given the peso’s weakness.

“The import content of palay is over 30%, and a large part of rice inflation is through this channel,” Mr. Africa said. “Reducing the import content of food and the vulnerability of food prices to foreign exchange movements goes far beyond the NFA.”

Developing the industrial capability of the agriculture sector is needed to strengthen the domestic production of rice, he added.

Amendments to the Rice Tariffication Law would also modify how RCEF is allocated. Around 53.5% of the fund would go to farm mechanization projects, up from the current 50%. This increase would help in modernizing the country’s rice sector, according to proponents of the measure.

The allocation for the propagation and distribution of rice seeds under the bill was reduced to 29.7% from the current 30%, while rice seed allocation was trimmed to 29.7% from 30% currently.

Farm credit assistance for farmers has been cut to 6% from 10% while extension services for agricultural training was reduced to  3.3% from 10% of the rice fund.

During the bill’s period of amendments, Albay Rep. Edcel C. Lagman, Sr. moved for the deletion of a provision allowing the NFA to regulate foreign investment in the rice and corn industry, which the House adopted.

“This deletion will also send the message that as much as practicable, the rice and corn industry must remain with Filipino farmers and entrepreneurs to protect the production and sale of the Philippines’ staple grain and cereal from foreign influence,” Mr. Lagman said.

Action for Economic Reforms Coordinator Filomeno S. Sta Ana, III. agreed with Mr. Lagman’s amendment to the bill, saying that is not part of the NFA’s role.

Peso’s prolonged weakness could stoke inflation — analysts

PHILIPPINE STAR/WALTER BOLLOZOS

By Luisa Maria Jacinta C. Jocson, Reporter

THE PROLONGED weakness of the Philippine peso could potentially fan inflation, but the central bank does not need to intervene unless the currency significantly drops, analysts said.

“Peso weakness becomes worrisome if, for instance, over a period of one year, the peso depreciates by P5, or to P63,” GlobalSource Partners country analyst Diwa C. Guinigundo said in a Viber message. 

“This could potentially give rise to an additional 0.4 ppt (percentage point) or if the risk-adjusted inflation forecast of the peso is now at 4%, we might be looking at 4.4%.”

The peso closed at P57.84 against the dollar on Tuesday, strengthening by two centavos from its P57.86 finish on Monday. Its finish on Monday was its lowest in 18 months or since the P58.19-per-dollar close on Nov. 10, 2022.

The Bangko Sentral ng Pilipinas (BSP) does not need to intervene immediately unless the local currency drops sharply, Mr. Guinigundo said.

“Unless the peso shows sharp, disorderly fluctuations or some speculation persists, I don’t think the BSP will immediately go into active play in the foreign exchange market. Not worth losing its ammunition,” he said.

Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc. said that the BSP may need to act if the peso further depreciates.

“I think that the BSP has established that their line-in-the-sand is the P58 level. I think they will intervene further with the US dollar-peso rate further weakening,” he said in a Viber message.

“However, I think that the market is being cautious but positioning with the release of US inflation data this week that may give further clues on how the Fed will proceed with its rate cuts,” he added.

BSP Governor Eli M. Remolona, Jr. earlier said that the central bank has only intervened in the foreign exchange market in “small amounts” to “maintain orderly markets.”

The BSP previously intervened in the foreign exchange market when the peso reached a record low of P59 against the dollar in October 2022.

Meanwhile, Mr. Guinigundo noted that the recent depreciation so far “may not necessarily translate into higher inflation” for the rest of the year.

“Short-term exchange rate pass-through for every P1 depreciation now stands at .08 percentage point additional inflation,” he added.

Inflation accelerated for a third straight month to 3.8% in April but marked the fifth straight month that inflation fell within the 2-4% target range.

However, Mr. Guinigundo said the peso would only sink drastically amid conditions such as a “significant reduction in economic growth, sharp increase in fiscal deficit and public debt, and huge increase in the balance of payments deficit.”

The Philippines’ gross domestic product (GDP) grew by a weaker-than-expected 5.7% in the first quarter, faster than 5.5% in the previous quarter but slower than 6.4% a year ago.

The National Government’s (NG) debt as a share of GDP stood at 60.2% as of the first quarter, below the 61.1% a year earlier and the 60.3% target set this year.

Meanwhile, the deficit-to-GDP ratio stood at 4.46% at end-March, easing from 4.82% a year ago and below the 5.6% deficit ceiling this year.

“If the market perceives the government not to be doing anything to address the huge imports of rice and other commodities, or stop smuggling and corruption, or improve governance in general, then that could cumulatively trigger a substantial weakening of the peso,” Mr. Guinigundo said.

Mr. Guinigundo said that a global economic slowdown and a spike in oil prices “could also contribute to upside risks for the peso to lose ground against the US dollar.”

Latest Development Budget Coordination Committee assumptions show that the peso may range from P55 to P57 for 2024.

Meanwhile, Fitch Ratings in a report said that investment-grade sovereigns in the Asia and the Pacific (APAC) face “limited risks” from exchange rate pressures.

“Fitch Ratings believes that policies designed to support exchange rates are unlikely to pose significant near-term risks to the credit profiles of APAC investment-grade sovereigns, but any deterioration of official reserve buffers could pose greater risks to vulnerable ‘frontier markets’ in the region,” it said.

The credit rater said that using reserves to mitigate foreign exchange volatilities has not had a “significant impact” on APAC credit profiles.

It also said that even though US interest rates remain higher-for-longer, APAC sovereigns would be able to “generally allow their exchange rates to depreciate gradually against the dollar rather than deploying reserves aggressively to resist depreciation.”

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