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A_D_E_P_T 3 hours ago [-]
The headline couldn't be more sensational, nor could the article be more obscurely and confusingly written. That said, I think that the headline is subtly inaccurate:
> “[The claim] was based on a rationale that American companies purchased large volumes of Korean semiconductors and thus contributed to the Korean firms' earnings,” the source said. “So, if the Korean chipmakers’ partner firms in Korea are entitled to parts of the profits, the American ones are, too.”
If I'm understanding this correctly, the Korean firms are reinvesting their profits in local partners, and a US trade delegation is trying to induce them to invest similarly in US firms. "US seeks share of Korean chipmakers' 'excess profits'" implies transfers to the US federal government, like a special windfall tax, which doesn't appear to be the case here. (And it would be outrageous, of course...)
golem14 3 hours ago [-]
It’s always good to see of the reverse holds: if a U.S. company (say Google) made excess profits in the EU, would the EU be entitled to the excess profits?
I would imagine a lot of pushback…
inigyou 2 hours ago [-]
No, because the rule is not that excess profits must go to the buyer's country - the rule is that excess profits must go to the US.
See also the story of TikTok.
At this point, doing business in the US is an existential risk to any company.
villish 2 hours ago [-]
The US is a massive economy that businesses want access to. If it wasn't extremely profitable they would exit, but they don't. That should tell you all you need to know about any "risk".
laughing_man 3 hours ago [-]
Isn't that the real reason the EU keeps suing/fining FAANG companies?
lovich 1 hours ago [-]
No, it’s because they keep breaking the law in the jurisdiction they are operating in.
alex43578 42 minutes ago [-]
Easy to say they break the law when it’s a law the EU just makes up and arbitrarily enforces.
lovich 17 minutes ago [-]
The EU is the government literally making the laws. It’s as arbitrary as any government making laws. US law does not apply outside of US jurisdictions unless we are willing to use our military power to take over their sovereignty.
Do you think when the US applies its laws to foreign companies operating in their borders that it’s just made up and arbitrarily enforced?(ignoring the current admin, I would agree they are doing that by ignoring our own laws)
SpicyLemonZest 2 hours ago [-]
The EU has a law, the Digital Markets Act, which is pretty explicitly based on that principle. It does generate pushback from some corners, and it’s not a style of regulation that I would personally want to do if I were in charge, but my sense is that most people think the debate is kinda overheated and the EU can do what it wants.
laughing_man 3 hours ago [-]
I wonder if the complaint is Korean firms are recognizing profits in Korea by overpricing products sold to subsidiaries in the US.
In theory that's illegal, though I've never seen a company get busted for it.
lovich 1 hours ago [-]
They used the word “entitled” if the article is to be believed. How is this sensational? This is on par with the current admin taking 10% of Intel in exchange for giving them funds that were already awarded to Intel and were required to be given.
Edit: to be clear, the current admin is treating American companies like their property, demanding that foreign countries invest in our businesses because they made “excess profits” is only a single indirection to a windfall tax.
Also lol at the idea that these guys believe in the idea of “excess profits”. I’d put money down that they would never accept that framing for themselves.
cyanydeez 2 hours ago [-]
under fascism, there's not much difference; maybe your assumptions are outdated.
> “[The claim] was based on a rationale that American companies purchased large volumes of Korean semiconductors and thus contributed to the Korean firms' earnings,” the source said. “So, if the Korean chipmakers’ partner firms in Korea are entitled to parts of the profits, the American ones are, too.”
If I'm understanding this correctly, the Korean firms are reinvesting their profits in local partners, and a US trade delegation is trying to induce them to invest similarly in US firms. "US seeks share of Korean chipmakers' 'excess profits'" implies transfers to the US federal government, like a special windfall tax, which doesn't appear to be the case here. (And it would be outrageous, of course...)
I would imagine a lot of pushback…
See also the story of TikTok.
At this point, doing business in the US is an existential risk to any company.
Do you think when the US applies its laws to foreign companies operating in their borders that it’s just made up and arbitrarily enforced?(ignoring the current admin, I would agree they are doing that by ignoring our own laws)
In theory that's illegal, though I've never seen a company get busted for it.
Edit: to be clear, the current admin is treating American companies like their property, demanding that foreign countries invest in our businesses because they made “excess profits” is only a single indirection to a windfall tax.
Also lol at the idea that these guys believe in the idea of “excess profits”. I’d put money down that they would never accept that framing for themselves.