Russian law requires pre-installed domestic software on smart devices

(Reuters) – Smartphones, computers and other smart devices purchased in Russia must come pre-installed with Russian software after legislation came into force on Thursday, in a move that seeks to help Russian IT firms compete with foreign counterparts.

Moscow is trying to strengthen control of the internet and reduce its dependence on foreign companies and countries. A number of additional proposals are in the works, ranging from compelling foreign firms to open offices on Russian territory, to tax breaks for Russian IT companies.

One potential stumbling block for the law’s introduction was the reaction of U.S. tech giant Apple, which dragged its feet before agreeing last month to offer a way for users to install Russian software during iPhone setups.

The legislation has become known colloquially in Russia as ‘the law against Apple.’

Apple said it would offer a selection of apps from Russian developers as part of activation screens for new devices. It said it intended to comply with the new Russian law, but noted that all apps are reviewed to ensure they comply with Apple’s standards for privacy, security and content.

Russia’s digital ministry has said the law applies to smartphones, tablets, smart TVs, laptops and PCs produced after April 1.

“Russian apps from the pre-installation list should be placed next to other programmes of the same class: both from the same category next to each other on the same screen of the device.”

The apps on the list include internet browsers, search engines, maps and navigations providers, and apps for using the payment system Mir, Russia’s answer to Visa and Mastercard, according to a government decree published in November.

Russia’s IT industry has the opportunity and potential to become a “locomotive in the process of modernising the country,” Deputy Prime Minister Dmitry Chernyshenko said at a meeting with representatives of the IT industry last month.

A second package of more than 60 support measures for the industry is being discussed in government, he added.

Russia’s cellphone market is dominated by foreign companies like Apple, Samsung and Huawei.

Russian IT giants Yandex, which dominates in search, and Mail.Ru look best poised to benefit.

BlackRock hires law firm for internal review after executive conduct complaints

BOSTON (Reuters) – BlackRock Inc said on Monday it is hiring a prominent law firm to conduct an internal review after a report in a trade publication detailed new employee complaints about the conduct of executives, including senior leader Mark Wiedman.

BlackRock CEO Larry Fink said in a staffwide memo on Monday that the company is retaining the law firm Paul, Weiss to conduct a review, following the complaints and other incidents that have come to light in recent weeks.

A copy of the memo was provided to Reuters by a company spokesman and is the latest in a series of penitent statements by the world’s largest asset manager.

This time, Fink was responding to an article published by Institutional Investor that described a “bro culture” within BlackRock and detailed inappropriate remarks made by Wiedman, for which he apologized.

Such incidents “should not happen at BlackRock,” Fink wrote. A Paul, Weiss spokesperson did not immediately respond to a request for comment.

With some $8.7 trillion under management, BlackRock has become one of the most influential voices pushing for more boardroom diversity and minority representation at other companies whose shares it owns.

Yet BlackRock itself has faced a rising number of complaints from women and minority employees about their treatment.

Last month, BlackRock described plans to beef up its process to investigate workers’ concerns and expand training after former employees shared accounts on social media of racial and sexual harassment.

On Monday, the trade publication Institutional Investor said it had spoken with a number of current and former BlackRock employees who described how their experiences clashed with BlackRock’s rhetoric. The report described how Wiedman, the company’s head of international and of corporate strategy, made inappropriate remarks like publicly asking a woman about a choice of underwear at an employee dinner, held about a decade ago.

In a statement sent by the spokesman to Reuters and to Institutional Investor, Wiedman said that “Those comments were a clumsy and misguided attempt at building camaraderie that failed terribly, and I am sorry.”

In response to the Institutional Investor article, a company spokesman said: “BlackRock is committed to building a diverse firm and an inclusive culture. There are episodes recounted in this story that are appalling and behavior of that kind should never take place at BlackRock.”

Top Democrat speaks to Biden staff about key internet law

U.S. Senator Mark Warner said on Monday he has been talking to President Joe Biden’s staff about Section 230 – a law protecting tech companies – and expects his recent legislation to reform the law to find a Republican co-sponsor.

The bill would make U.S. social media companies like Alphabet Inc’s Google, Twitter Inc and Facebook Inc more accountable for allegedly enabling cyber-stalking, targeted harassment and discrimination on their platforms by amending Section 230, which protects tech platforms from liability over content users post.

In February, Warner, who chairs the U.S. Senate Intelligence committee, introduced a bill with Democratic Senators Amy Klobuchar and Mazie Hirono called the Safe Tech Act.

“I have a hope and expectation that our legislation will shortly become bipartisan,” Warner said, without giving details. He made his comments on a public panel hosted by tech publication Protocol.

Warner also said he has spoken to Biden’s staff and that they are interested in having a debate on Section 230. The White House, Warner said, is still developing its broader position on technology policy.

During the campaign, Biden had said he supported Section 230 being revoked. His staff has since indicated he is keen to hearing different arguments on the topic.

There are several pieces of legislation from Democrats to reform Section 230 that are doing the rounds in Congress. Several Republican lawmakers have also been pushing separately to scrap the law entirely over decisions by tech platforms to moderate content.

The chief executives of Google, Twitter and Facebook have previously said the law is crucial to free expression on the internet and gives them the tools to strike a balance between preserving free speech and moderating content.

Australian media firms squeeze more from Google as new law looms

(Reuters) – Australia claimed an early win in a protracted licencing battle with Google on Wednesday as media companies lined up to announce content deals with the internet giant that were reportedly far more lucrative than their global rivals.

A month after the Alphabet Inc-owned company threatened to shut down its search engine in Australia to avoid what it called “unworkable” content laws, the country’s two largest free-to-air television broadcasters have struck deals collectively worth A$60 million ($47 million) a year, according to media reports.

That dwarfs the $76 million Google will split between 121 publishers in France over three years, which averages $209,000 a year per publisher, as reported by Reuters.

The Australian deals come days before the government plans to pass laws that would allow it to appoint an arbitrator to set Google’s content fees if it can’t strike a deal privately, a factor that government and media figures held up as a turning point for negotiations which stalled a year earlier.

“I don’t think that they would have been able to get that sort of money if they had to follow the normal sort of negotiations with a company that’s so powerful,” said Paul Budde, an independent internet analyst, referring to the Australian media companies.

Google and Nine declined to comment on unsourced reports in Nine’s newspapers on Wednesday that said the companies had reached an agreement. Seven and Google said two days earlier they had struck a deal, without giving financials.

Though the individual deals mean Google avoids a government-appointed arbitrator with those companies, Australian Treasurer Josh Frydenberg said he would still press ahead with the law.

The local arm of Rupert Murdoch’s News Corp, which has led a years-long campaign to make internet giants pay for content that drives traffic to their platforms, is yet to sign a Google deal. News Corp, owner of two-thirds of Australia’s major city newspapers, did not respond to requests for comment.

“None of these deals would be happening if we didn’t have the legislation before the Parliament,” Frydenberg told reporters.

Australian antitrust commissioner Rod Sims, who drafted the media laws, declined to comment but a spokesman directed Reuters to an earlier statement in which Sims called the law a “back-up” that prevented internet platforms forcing “terms on a take-it-or-leave-it basis”.


Though specifics of the Australian deals have not been disclosed, smaller outlets that inked Google deals last year ahead of their larger rivals said they were approached individually by the U.S. company and asked to present their own valuation methods for content that would appear on Google’s “Showcase” news platform.

That contrasts with the French negotiations, which were conducted on behalf of publishers by the Alliance de la presse d’information generale (APIG), a lobby group representing most major French publishers.

Unlike the Australian law, through which the government could intervene if the parties cannot reach a deal, the French rules, enacted under a recent European Union law, require only that Big Tech platforms open talks with publishers seeking payment.

“The context of the (Australian) bargaining was very much one in which the government legislation was putting pressure on the digital platforms to come to the table, and that has strengthened the hand of publishers and contributed to these outcomes,” said Misha Ketchell, editor of The Conversation, an academic-focused website that signed a Google deal last year.

Separately, the Reuters news agency, a division of Thomson Reuters Corp, struck a deal with Google in January, becoming the first global news provider to Google News Showcase.

($1 = 1.2903 Australian dollars)

Uber defends contractors ahead of EU law on gig workers’ rights

(Reuters) – Uber on Monday called on EU regulators to recognise the value of independent contracts in job creation as they consider new rules to protect gig economy workers.

The company has been criticised for classifying its drivers as independent contractors rather than employees entitled to rights, such as a minimum wage, paid holidays and rest breaks.

Uber has a mixed record in defending its business model. It scored a victory in California in November last year when voters passed a proposition allowing it to treat its drivers as contractors. One of its biggest tests so far will be on Feb. 19 when the UK Supreme Court will rule on workers’ rights.

Uber’s comments in a white paper to the European Commission precede a consultation on Feb. 24 when the EU executive will seek feedback from workers and employers’ representatives on gig workers’ rights before drafting laws on the subject by year-end.

“This standard (for platform work) needs to recognise the value of independent work, and be grounded in principles drivers and couriers say are most important to them,” Uber CEO Dara Khosrowshahi said in a blog post.

He said workers should have flexibility and control over when and where they want to work and that any changes should apply to the sector and not just one company.

“We believe a new approach is possible – one where having access to protections and benefits doesn’t come at the cost of flexibility and of job creation,” Khosrowshahi said.

The Commission said it will first seek feedback on whether a law is needed to improve the working conditions of gig workers, followed by a second consultation on the content of the law.

“As part of the social partners’ consultation, the European Commission is considering issues, such as precarious working conditions, transparency and predictability of contractual arrangements, health and safety challenges and adequate access to social protection,” a spokeswoman said.

Poland proposes social media ‘free speech’ law

Poland’s government has proposed a new law to stop social media platforms deleting content or banning users who do not break Polish laws.

The proposed bill would see social networks fined up to 50 million zloty (£9.8m, $13.4m) for failing to restore deleted posts or accounts.

Justice Minister Zbigniew Ziobro announced the “freedom of speech protection” bill on Friday.

The law would also establish a “freedom of speech council”.

The council would be able to order social networks such as Facebook or Twitter to restore deleted content, or unblock a user’s account following a review, Mr Ziobro said.

Social media users in Poland who had been blocked or had content deleted would be able to complain directly to the platform, which would have to respond within 24 hours.

If a social media company refused to comply with an order, the council would be able to issue a fine of between 50,000 and 50 million zloty.

Mr Ziobro leads a hard-right junior coalition partner in the Polish government. His party claims that traditional Roman Catholic values are under threat from LGBT rights.

He said large internet corporations were increasingly limiting freedom of speech.

“Often, the victims of ideological censorship are also representatives of various groups operating in Poland, whose content is removed or blocked just because they express views and refer to values that are unacceptable,” Mr Ziobro said recently.

Under the proposed bill, members of the free speech council would be appointed for six-year terms by a three-fifths majority vote in parliament, in an attempt to safeguard pluralism, Mr Ziobro said. They would be experts, not politicians.

Poland’s prime minister Mateusz Morawiecki has said that protecting freedom of speech on the internet is a priority for him and has warned against “political correctness”.

“Censorship is not and cannot be accepted,” he wrote on Facebook, which has suspended US President Donald Trump’s account.

On Friday, the Rzeczpospolita daily newspaper quoted an anonymous government source who said Mr Morawiecki was going to lobby the EU to regulate the issue, because domestic regulations would be ineffective without EU-wide backing.

According to Sebastian Kaleta, a deputy justice minister, the measures could come into effect by next January.

Twitter’s banning of President Trump has attracted some criticism in Europe, with German Chancellor Angela Merkel calling it “problematic”.

By Adam Easton
Warsaw correspondent

China brings in new law to fight Trump’s sanctions

China is pushing back against a flurry of US sanctions with new rules that protect its firms from “unjustified” foreign laws”.

Changes announced over the weekend allow Chinese courts to punish companies that comply with such restrictions.

US President Donald Trump has continued to target Chinese companies he believes are a threat to US national security.

Measures include punishing companies that supply parts to blacklisted firms.

On Monday, three large Chinese telecoms firms listed on the New York Stock Exchange (NYSE) are expected to see their shares delisted based on alleged ties with its military.

The NYSE is removing China Mobile, China Telecom and China Unicom Hong Kong, based on an executive order signed by Mr Trump in November.

The delistings follow a raft of actions against Chinese firms in recent months including TikTok, Huawei and microchip maker Semiconductor Manufacturing International Corporation (SMIC).

Last week, Mr Trump signed an executive order banning transactions with eight Chinese apps including popular payments platform Alipay, as well as WeChat Pay.

The US president claims such tech companies share data with the Chinese government – allegations they have denied.

In a statement on Saturday, China’s Ministry of Commerce introduced the new rules on “counteracting unjustified extra-territorial application” of foreign laws.

“Legal persons that are hurt by the application of foreign legislation can issue legal proceedings in court and claim compensation for the damage done,” said Bert Hofman, director of the East Asian Institute at the National University of Singapore. “The government can also take other countermeasures.”

Hitting back

The measures, which came into effect immediately, do not mention the US directly, although China has long complained about US sanctions and restrictions on trade. 

But legal experts say it is unclear how the new law will be implemented. 

“One point that remains to be clarified is whether the order is intended to target sanctions against China specifically or sanctions targeting a third country, such as Iran or Russia, which has a detrimental impact on Chinese companies,” Nicholas Turner, a lawyer at Steptoe & Johnson in Hong Kong, told the BBC.

“Companies with significant business interests in China may need to tread carefully.”

Mr Turner believes China is also protecting itself against future sanctions that Mr Trump may bring in before he leaves the White House later this month.

“I am expecting more actions to be taken before the 20th [January] based on statements from the US state department, although it remains to be seen whether they can push any new ones out in time, given the situation,” he added.

By Justin Harper
Business reporter