Tech Law


Google Scolded on Taxes by British MPs

In what likely amounts to a combination of headline-chasing and genuine frustration, members of the British Parliament sounded off this week on Google and the company’s tax practices.

Margaret Hodge, chair of the public accounts committee, told Matt Brittin, Google’s northern Europe boss, that Google’s behavior on taxes was “devious” and “unethical.”

She added, for posterity, that Google does indeed “do evil,” a reference to Google’s longstanding motto, “Don’t be evil.”

Brittin was called before members of parliament (again) after having been accused of misleading them about Google’s tax affairs six months ago.

At least Brittin is in good company. Amazon, too, has been taking loads of flak over its UK tax practices. Amazon utilizes the tricky — though legal — strategy of sending sales through its Luxembourg offices, which allow it to pay Luxembourg taxes (small) as opposed to UK taxes (less so).

The UK is a hotbed for both Google and Amazon: For both companies, sales grew by about 20 percent in 2012.

Google’s Eric Schmidt has been outspoken defending Google’s UK tax practices.

[Source: The Guardian]

British Hackers Sentenced

Four British men were sentenced for a series of high-profile cyberattacks.

The quartet, linked to the hacking group Lulzsec, received jail sentences ranging from 32 months to two years.

The youngest of the group — comprised of gents aged 26, 21, 20 and 18 — received a 20-month suspended sentence.

Hacking targets included Sony Pictures, EA, News International — which came with a fake news story claiming the suicide of Rupert Murdoch — and more.

The U.S. has lodged indictments against some of the hackers, so they could face extradition when they’re done with their UK punishments.

[Source: BBC]

Labor Monitor: Foxconn Has Work to Do

Foxconn still faces challenges to meet a July deadline for improving working condition, according to a labor monitor appointed by Apple.

Foxconn, which assembles iPhone and iPads and which is famous for working condition-induced riots and suicides, has reportedly resolved 98 percent of the 350-plus issues raised by the U.S.-based Fair Labor Association. Improvements have been made in safety conditions, for instance, as well as wages, which have more than doubled.

However, the world’s biggest contract manufacturer of electronics still has work to do on cutting back hours and union participation. The former issue is particularly tricky for the company. Foxconn has faced worker shortages, plus Apple, for whom Foxconn is the biggest supplier, employs a seasonal production cycle.

As for union participation, most Foxconn employees generally only stay one year, which doesn’t inspire a lot of union pride.

[Source: Bloomberg]

Samsung Courts Apple Suppliers

Samsung may begin leaning on Apple suppliers as the two companies fight for smartphone supremacy.

Samsung has an enormous in-house supply chain, but it is now looking to broaden its operations and utilize external suppliers. Such a move could drive up costs and even lead to a bottleneck for component parts, according to Reuters.

Samsung has reached out to Apple partners such as Sharp Corp (Japan) and SK Hynix (South Korea). Samsung, incidentally, bought a 3 percent stake in Sharp earlier this year.

Toshiba, Sony and Gorilla Glass are all suppliers which currently provide products for both Apple and Samsung.

To be fair, the overlap between the companies’ suppliers is minimal. However, even a small overlap could affect the smartphone market. Taiwanese manufacturer HTC, for instance, posted record-low quarterly profits in April after a shortage of cameras led to a delay of its flagship smartphone.

[Source: Reuters]

David Vranicar is a freelance journalist and author ofThe Lost Graduation: Stepping off campus and into a crisis. You can check out hisECT News archive here, and you can email him at david[dot]vranicar[at]newsroom[dot]ectnews[dot]com.

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