Airbus ordered to pay $99m fine in Eurofighter case

European aircraft manufacturer Airbus on February 9 said it had agreed to pay a fine of 81.25 million euros ($99 million) to end a German corruption probe into the 2003 sale of Eurofighter jets to Austria. (AFP)
Updated 09 February 2018
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Airbus ordered to pay $99m fine in Eurofighter case

FRANKFURT: German prosecutors have ordered Airbus to pay 81.25 million euros ($99 million) to settle one of two investigations into alleged corruption surrounding the sale of Eurofighter combat jets to Austria in 2003, the two sides said on Friday.
The settlement includes an administrative fine of 250,000 euros and “disgorgement” — which legal experts broadly define as the recovery of ill-gotten gains — of 81 million euros.
Munich prosecutors have been investigating whether Airbus issued bribes to win the $2 billion contract: charges it denies.
In a statement, prosecutors said they had not found evidence of bribery but that Airbus had been unable to account for over 100 million euros in payments to two shell companies.
EADS, as the main Airbus parent group was known at the time, sent funds totalling a triple-digit-million euro amount to Vector Aerospace LLP and City Chambers Limited, they added.
Most of these funds, by evading internal control mechanisms, had been used for what the prosecutors said were “unclear purposes,” adding it could not be finally determined what the funds had been spent on.
Airbus said in a statement the penalty, which it had agreed to pay, related to the “negligent breach of supervisory duties” by unidentified members of Airbus Defense and Space’s former management.
The former managers failed to ensure proper controls that would have prevented payments to “business partners” without the company getting proven services in exchange.
Airbus regularly uses the term “business partners” to refer to foreign sales agents or intermediaries.
It is being investigated separately in France and Britain over the handling of agents in the sale of commercial jets.
While Friday’s settlement ends the Munich investigation, Airbus and individuals including Chief Executive Tom Enders, who headed the company’s defense business from 2000 to 2005, face an ongoing investigation in Vienna into the Eurofighter deal.
Airbus and Enders have denied wrongdoing and accused the Austrian government of playing politics with the investigation.


Turkish industrial output slides in April on lira weakness

Updated 10 min 29 sec ago
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Turkish industrial output slides in April on lira weakness

  • Industrial production, regarded as a signal of growth data, declined in the wake of last year’s currency crisis
  • Manufacturing activity contracted in May, shrinking for the 14th month in a row due to slowing purchasing activity and moderation in new orders

ISTANBUL: Turkish industrial production fell a greater-than-expected 4 percent year-on-year in April, the Turkish Statistical Institute said on Tuesday, reflecting the impact of renewed lira weakness as the index declined for an eighth consecutive month.
Industrial production, regarded as a signal of growth data, declined in the wake of last year’s currency crisis, which caused the economy to contract annually in the last two quarters.
In a Reuters poll, the calendar-adjusted industrial output figure was forecast to fall 2.5 percent year-on-year. Month-on-month, industrial production was down 1 percent in April on a calendar and seasonally adjusted basis, the institute said.
Despite some signs of recovery in previous months, industrial output was hit by another bout of lira weakness in late March and April.
The currency has lost nearly 10 percent of its value this year, extending a 30 percent slide in 2018, fueled mainly by Ankara’s strained ties with Washington as well as uncertainty over the outcome of Istanbul mayoral election.
Confidence indices and the Purchasing Managers’ Index (PMI) data for March and April had signalled that the increased volatility in markets would be reflected on the real economy, said Muammer Komurcuoglu, research director at Is Investment.
“The industrial production data announced today shows the negative impact is being felt beginning in April,” he said, adding that the negative outlook is expected to continue in May. “This situation points to the continuation of the contraction of growth in the second quarter,” he said.
Turkish manufacturing activity contracted in May, shrinking for the 14th month in a row due to slowing purchasing activity and moderation in new orders, a business survey showed earlier this month. Manufacturing PMI stood at 45.3, indicating contraction.
Economic confidence tumbled 8.5 percent in May, while consumer confidence dropped to its lowest level on record.