TIME Regulation

Obama Administration Unveils New Rules to Fight Tax Inversions

U.S. Treasury Secretary Jack Lew
U.S. Treasury Secretary Jack Lew Mark Wilson—Getty Images

The U.S. Treasury Department said Monday it will take steps to curb the practice of companies moving their headquarters overseas by trimming the tax benefits of those transactions — known as corporate tax inversions — and, in some cases, stopping them entirely.

“Inversion transactions erode our corporate tax base, unfairly placing a larger burden on all other taxpayers, including small businesses and hard-working Americans,” Treasury Secretary Jacob Lew said. “It’s critical that this unfair loophole be closed.”

Lew told reporters on a conference call that he believes the best way to curb a practice that is increasingly popular with corporations, which can generate millions of dollars in tax savings, is through comprehensive tax reform with anti-inversion provisions and he also urged Congress to pass new legislation to tackle the issue.

“Now that it’s clear that Congress won’t act before the lame-duck session, we’re taking initial steps that we believe will make companies think twice before undertaking an inversion to try to avoid U.S. taxes,” Lew said.

Lew announced a new set of measures meant to make inversions less appealing to U.S. companies, including by eliminating some of the ways those companies gain access to deferred earnings of foreign subsidiaries without incurring associated taxes. The Treasury will also require that owners of U.S. companies own less than 80% of a newly combined entity, thus making it more difficult for them to invert in the first place.

“These first, targeted steps make substantial progress in constraining the creative techniques used to avoid U.S. taxes, both in terms of meaningfully reducing the economic benefits of inversions after the fact, and when possible, stopping them altogether,” Lew said in a statement before adding that the “Treasury will continue to review a broad range of authorities for further anti-inversion measures as part of our continued work to close loopholes that allow some taxpayers to avoid paying their fair share.”

The Treasury’s new regulations will go into effect immediately, but will not be retroactive, meaning that they will affect any transactions that are completed after Monday, according to a senior Treasury official. “For some companies considering deals, today’s actions may mean that those transactions no longer make economic sense,” Lew said.

President Obama issued a statement applauding the actions taken Monday by Lew and the Treasury Department “to help reverse this trend.” Obama said that he has personally asked Congress “to lower our corporate tax rate, close wasteful loopholes, and simplify the tax code for everyone.”

Fortune magazine ran a cover story this summer detailing the practice of corporate inversions and the possibility of pending legislation to combat the transactions. A potential high-profile deal between Burger King and Canadian doughnuts and coffee chain Tim Horton’s, which would see the U.S. fast food company move its headquarters to the tax haven north of the border, is part of the wave of similar transactions invigorating the debate over the best way to keep U.S. companies’ tax dollars from going overseas.

This article originally appeared on Fortune.com

TIME relationships

Cuddlr Is a 100% Real App for Spooning With Random Strangers

But it's not for sex! The app promises!

Have you ever had the overwhelming urge to spoon with a complete stranger in a public place? Anybody? We’ll take that silence as a resounding maybe!

Cuddlr is a location-based app that finds people in the immediate vicinity who are game for a strictly “platonic” cuddle. Users are shown a name and picture (because cuddling compatibility knows no age) of potential snuggle buddies. If you approve one another within a 15-minute window, then you can send a message about where to meet up and then see real-time walking directions of where the other person is as he or she approaches. (You can also block a user at any time.)

Founder Charlie Williams talked to Salon about the app’s unique offerings (it’s not for sex, he promises!):

A cuddle is longer than a hug, but shorter than a date, so you’re not faced with having to sit through a drink or two if you’ve decided someone isn’t for you: you can politely end a cuddle any time. People uninterested in dating, whether because they’re already in a relationship, or not pursuing a relationship, will enjoy having a way to experience a connection with someone without any pressure to dress up, find an activity, exchange numbers or even see each other again.

This concept adds a whole new, fun level of “is this cheating?” to modern relationships.

Post-cuddle, users can then rank their partners’ performance … just like AirBNB.

TIME Companies

GM Expert Says 21 Deaths Eligible for Compensation

(DETROIT) — The death toll from crashes involving General Motors small cars with faulty ignition switches is at least 21.

Attorney Kenneth Feinberg, who was hired by the company to compensate victims, said Monday in an Internet posting that he received 143 death claims as of Friday, and 21 of those have been deemed eligible for payments.

A spokeswoman said the rest of the claims are under review and not all will be eligible. The death toll rose from a week ago, when Feinberg had determined 19 claims would get payments.

The website also said that Feinberg received 532 injury claims as of Friday. Of those, 16 are eligible for compensation thus far. The others are still being reviewed.

The defective switches can unexpectedly move to the “accessory” or “off” positions, shutting down the engine and knocking out power steering and brakes. With engines shut off, people can lose control of their cars and crash. If that happens, the air bags won’t inflate.

GM has admitted knowing about the problem for more than a decade in small cars such as the Chevrolet Cobalt. Yet it didn’t begin recalling the 2.6 million small cars until February.

For months, the company said at least 13 people died in crashes linked to the faulty switches, but GM acknowledged that the death toll would go higher. Some lawmakers have estimated that it’s close to 100.

Feinberg has said GM has not limited the total amount he can pay in compensation. GM has estimated the cost of compensating victims at $400 million, but says it could rise to $600 million.

A Feinberg spokeswoman said Monday that his office is in the process of sending out letters telling people how much money he is offering. Those filing claims can reject Feinberg’s offer and seek compensation through lawsuits.

Feinberg won’t identify those getting payments, citing confidentiality agreements. GM has not identified the 13 victims. The U.S. National Highway Traffic Safety Administration says it has not tallied the total number of deaths.

TIME Business

This Puppy Is the Face of Budweiser’s Tear Jerker Anti-Drunk Driving Campaign

This ad will melt your heart

Budweiser, a leading expert in interspecies friendship, released a poignant PSA Friday with a resonating message: Don’t drink and drive — You will break your puppy’s heart.

Anheuser-Busch InBev used ad agency Momentum Worldwide to create the 60-second spot, which shows the evolving relationship between an adorable man and his adorable yellow lab, the same breed used in Budweiser’s successful Super Bowl ad campaign.

In a moment of worry, the man is shown leaving his house with friends and a few buds and not coming home. The dog whimpers. The audience holds its collective breath. While we fear for the worst, in the end it turns out that he just spent the night at his friend’s house to stay safe. The puppy might have peed on the floor (that’s our guess of what cut footage holds), but at least the best friends will be able to play for years to come.

TIME Retail

Why Big Data Is This Season’s Big Fashion Trend

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Alexander Gatsenko—Getty Images

Editd and WGSN are two retail technology companies that hope to apply big data analytics to trend-making in the fashion industry

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This post is in partnership with Fortune, which offers the latest business and finance news. Read the article below originally published at Fortune.com.

By Katherine Noyes

When Julia Fowler was working as a fashion designer in Australia back in the early 2000s, she found herself frustrated by the lack of information available to help her understand and respond to the latest trends.

“We had internal data on the performance of previous seasons’ products and access to inspirational trend sites,” she recalls, “but no way to understand opportunities we’d missed or concrete data on how we could improve our product assortment.”

With nowhere to turn, Fowler decided to take it upon herself to develop a solution to the problem. Her timing was just right: A methodology and series of technologies collectively called “big data” was beginning to swell in the technology industry.

Fowler has since swapped her title of designer for that of co-founder at Editd (pronounced “edited” and stylized in all caps), a company she launched five years ago with technical co-founder Geoff Watts, who now serves as the company’s CEO. Their mission: to help the world’s apparel retailers, brands, and suppliers deliver the right products at the right price and the right time.

“Every time you see a product on discount, it’s because the wrong decisions were made,” Fowler says. “This leads to a lot of wastage in the industry. I wanted to fix that problem.”

Editd says it now has the biggest apparel data warehouse in the world. It offers that data up to customers along with real-time analytics and an assortment of other tools, powered by 120 servers and hundreds of terabytes of data. The London-based company, which has 27 employees and $6 million in investment, counts Gap and Target among its customers. It’s also profitable, Watts says, though he declined to disclose the company’s revenues.

For the rest of the story, please go to Fortune.com.

TIME Companies

Alibaba Is Officially the Biggest IPO Ever After Additional Shares Sold

China-Based Internet Company Alibaba Debuts On New York Stock Exchange
Alibaba Group signage is posted outside the New York Stock Exchange prior to the company's initial price offering (IPO) on September 19, 2014 in New York City. Andrew Burton—Getty Images

More shares were sold in order to cover high investor demand

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This post is in partnership with Fortune, which offers the latest business and finance news. Read the article below originally published at Fortune.com.

By Laura Lorenzetti

Alibaba Group’s record-breaking initial public offering is worth $25 billion after bankers released additional shares, commonly referred to as the “green shoe.”

Bankers leading Alibaba’s IPO maximized the size of the deal by issuing about 48 million additional shares, pushing up the offering value of the Chinese Internet giant. Alibaba surpassed Agricultural Bank of China’s $24.3 billion IPO to become the biggest ever.

The “green shoe” option allows bankers to sell more shares from the company in order to cover high investor demand. Had the IPO not attracted so many enthusiastic investors, the additional shares likely wouldn’t have been tapped, leaving Alibaba’s offering total at the original $21.8 billion.

Alibaba priced its IPO at $68 share to initially become the biggest U.S. offering ever. Its shares then opened over 36% higher than the offering price at $92.70 and finished out the first day of trading at $93.89.

The first-day pop was nearly two-times higher than usual. Most IPOs open 15% higher than the offering price, according to David Ethridge, head of capital markets for the New York Stock Exchange.

After its first day of trading, Alibaba’s market value is $231.4 billion, larger than other industry standard bearers like Amazon, Facebook and Twitter.

TIME Companies

Apple Sold More Than 10 Million New iPhones in Just 3 Days

iPhone 6 Apple
People wait to buy the new Apple iPhone 6 and 6 Plus devices outside an Apple store in Hong Kong on Sept. 19, 2014 Vincent Yu—AP

Sales tally represents a new record for the company

Apple sold over 10 million new iPhones over the weekend, the company said Monday, a new record for the gadgets maker and results that exceeded the company’s expectations.

Apple unveiled two new smartphones earlier this month — the iPhone 6 and iPhone 6 Plus — phones that feature trendy larger screens, faster speeds and fancier cameras. The iPhone 6 starts at $199 on a two-year carrier contract at 16GB, while the iPhone 6 Plus (the phone with an even larger screen) — starts at $299 for 16 GB.

For those keeping track, the sales milestone isn’t a huge leap from a year ago: Apple in September 2013 said it sold 9 million iPhone 5S and iPhone 5C models, at the time a record.

The latest launch kicked off on Friday across a handful of markets, including the U.S., Japan and the U.K., with more markets to be added this Friday. Apple expects to sell its newest iPhones in 115 countries by the end of the year.


Apple’s product launches typically generate strong early sales results and a lot of buzz — videos and news stories often focus on the long lines outside the electronics behemoth’s retail stores. Apple often touts such buzz, and even in the company press statement on Monday, CEO Tim Cook hinted demand was too hot to handle by saying, “We could have sold many more iPhones with greater supply and we are working hard to fill orders as quickly as possible.”

Though Apple continues to churn out strong sales, the company has also been ceding some market share in the worldwide smartphone market as other rivals produce low-cost smartphones, which contrasts with Apple’s strategy to focus on more premium-priced gadgets. Apple’s worldwide smartphone-market share, in terms of units shipped, stood at 11.7% in the second quarter of this year, down from 18.8% in the same quarter in 2011, according to research firm International Data Corp. Samsung’s smartphones have taken some of Apple’s market share, though even that company has faced pressure as more affordable options hit shelves.

This article originally appeared on Fortune.com

MONEY Sports

Marketing Jeter’s Farewell Season, by the Numbers

New York Yankees batter Derek Jeter follows through on his swing
Ray Stubblebine—Reuters

Derek Jeter, by far the most respected and marketable baseball star in the modern era, is retiring this season. To commemorate the end of the Captain's historic career, fans have been asked to open their wallets early and often.

No matter how widely Derek Jeter is beloved in the sports world, many have questioned the relentless marketing of this, his final season, including a few critics even in the New York City media. “It’s such bad taste,” former New York Jets quarterback and current sports radio personality Boomer Esiason said in early September, referring to the “cheese-ball move” of rolling out new products and endlessly merchandising Jeter’s farewell season. “It kind of goes against everything Derek Jeter has been.”

Nonetheless, the sales have rolled on throughout the season and have picked up pace as the end nears. Here are some numbers that show how #2 has undeniably been #1 in terms of marketing and merchandising during his final season in pinstripes:

2 Number of epic tribute commercials released by long-time Jeter sponsors (Nike, Gatorade) this season commemorating his goodbye.

29 Number of different styles of Jeter baseball hats listed for sale at the Major League Baseball site.

$8.95, $260 Lowest get-in prices listed of late at StubHub for Orioles-Yankees tickets on, respectively, Wednesday, September 24, and Thursday, September 25. The latter is the last regular season home game, and therefore Jeter’s final game at Yankee Stadium. According to the ticket resale aggregation site TiqIQ.com, the average price paid on the secondary market for the game on the 25th has been in the neighborhood of $650 to $750.

$50, $210 Lowest get-in prices listed of late at StubHub for the Yankees-Red Sox tickets on, respectively, Saturday, September 27, and Sunday, September 28. The latter is the final game of the regular season, and therefore Jeter’s final game, and it’s being played at Fenway Park. The average price on the secondary market for a seat to the final game has been around $550, according to TiqIQ.

50-50 How the vote broke down among fans weighing in at a Yankees blog as to whether it was a good or bad idea for the Yankees to wear a Jeter commemorative patch on their jerseys—an extremely rare way to honor a still-active player.

$149 Starting price for tickets to a Jeter Q&A session on Monday, September 22, at the Millennium Hotel in Manhattan. Steiner Sports, the event host, has advertising a package with a Mezzanine Level seat and a Derek Jeter Commemorative Final Season Bat for $299. VIP packages, which include lunch, a signed baseball, and premium seating, go as high as $2,999.

296 Number of Jeter products available for sale at the sports apparel site fanatics.com. The site reports that Jeter sales lately are up 2,700% compared with the same period a year ago, and that Jeter merchandise has been purchased this season in all 50 states and 30+ countries. Among the top sellers lately is a commemorative Jeter fitted Yankees hat retailing for $36.95.

$410 Asking price for one of Jeter’s game socks (used, of course, and highly collectible).

$500 Minimum bid for one of four special pairs of Derek Jeter Jordan cleats being auctioned off to benefit Jeter’s Turn 2 Foundation. At last check, bids were well over $2,000, with roughly four weeks to go before the auctions close.

$695 to $795 Range of prices for a Captains Series Celebrating Derek Jeter watch from Movado, which went on sale in recent weeks.

$12,500 Price paid by a collector for a home run ball hit by Jeter in August at a Toronto Blue Jays home game. The Blue Jays put the ball up for sale immediately after the game. “A collector from Tennessee offered $8,000, I said $15,000, we met in between,” a Blue Jays staffer explained. It’s the highest price ever commanded for a piece of baseball memorabilia sold by the team.

$50,000 Highest price Jeter item listed recently at Steiner Sports. It’s a game-used road grey jersey and pants worn by the Captain this past August, in a matchup against the Baltimore Orioles. On the cheap end of the spectrum are unsigned 6″ x 10″ photos of Jeter from 2009 and wrist bands commemorating his 3,000th hit that can be had for under $4.

$19 Million+ Amount in grants awarded by Derek Jeter’s Turn 2 Foundation since the nonprofit was launched in 1996.

$24 Million Estimated earnings by Derek Jeter for 2014, according to Forbes, including roughly $15 million in salary and $9 million in endorsements.

TIME energy

The Rockefellers Are Pulling Their Charity Fund Out of Fossil Fuels

Rockefeller Family Discusses Concerns About Direction Of ExxonMobil
Stephen Heintz, center, president of the Rockefeller Brothers Fund; Neva Rockefeller Goodwin, left, economist and great-granddaughter of John D. Rockefeller; and Connecticut state treasurer Denise Nappier attend a news conference in which the Rockefeller family's members voiced concern about the direction of the oil company ExxonMobil on April 30, 2008, in New York City Spencer Platt—Getty Images

A sign of the times from a family that made its fortune in oil

The Rockefeller oil dynasty is set to divest its charity foundation from fossil fuels.

The family, whose patriarch John D. Rockefeller founded Standard Oil in 1870, will put its Rockefeller Brothers Fund—an $860 million philanthropic organization—into the same category as around 180 other institutions, including religious organizations and pension funds, which have pledged to divest any assets tied to fossil fuels in lieu of cleaner and more-sustainable alternatives, the New York Times reports.

Hundreds of wealthy individuals have made similar moves. The Times cites a statement from Arabella Advisors that says a total of $50 billion from various groups, and $1 billion from individuals, has been divested from fossil fuels in recent years.

The Rockefeller fund has already replaced its investments in coal and tar sands entirely while investing in more alternative energy sources, but its president Stephen Heintz said that progress toward complete divestment from fossil fuels is being made slowly but surely. “We’re moving soberly, but with real commitment,” he said.

The announcement comes on the eve of a U.N. climate-change summit, with hundreds of thousands of people taking to the streets of New York City on Sunday demanding more concrete action on global warming.

[NYT]

TIME Autos

More Than 200,000 GM Cars Have Been Recalled for a Brake Defect

Los Angeles Auto Show Previews Latest Car Models
The Cadillac 2013 XTS is unveiled during the LA Auto Show on November 16, 2011 in Los Angeles. Kevork Djansezian—Getty Images

The problem has been reported in the 2013-2015 Cadillac XTS and the 2014-2015 Chevrolet Impala

The latest in a series of recalls from General Motors was announced over the weekend, with hundreds of thousands of cars being pulled off the roads due to defective parking brakes.

The National Highway Traffic Safety Administration (NHTSA) said that brake-indicator lights in at least two GM models failed to illuminate when the brake was not retracted completely, according to Reuters.

“Brake pads that remain partially engaged with the rotors may cause excessive brake heat that may result in a fire,” NHTSA said.

The problem has been reported in the 2013-2015 Cadillac XTS and the 2014-2015 Chevrolet Impala, and General Motors said 221,558 vehicles have been recalled so far.

“GM is not aware of any crashes, injuries or fatalities as a result of this condition,” the company said.

General Motors has already recalled more than 15 million cars this year, because of a problem with ignition switches that has resulted in at least 19 deaths.

[Reuters]

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