World Events Summary: 28th July – 3rd August 2018

U.S. Trade: Trump appears (for the moment) to be conducting useful dialogues with the EU (Kudlow – Director of the National Economic Council – expects announcements within 30 days) and Mexico (the incoming negotiating team appear ready to deal around a common desire for higher Mexican wages) allowing for a greater focus on China, where additional tariffs levels have been threatened, on more goods.

FDI Screening: the updated CFIUS process in the U.S. has been turned into final legislation. In Germany the government used a state bank to prevent the Chinese national grid from buying a 20% stake in 50Hertz, regardless of it being below the 25% threshold for formal review. The lack of reply from Chinese regulators killed the long-running Qualcomm-NXP deal, showing China’s power to influence big company actions.

U.S. Tax Changes: the detailed guidance regarding tax liabilities when repatriating foreign-earned profits was published. This will give corporations the opportunity to conduct detailed reviews and to lobby for more beneficial treatment. The Trump administration is looking at favourable changes to capital gains tax.