Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.law,americast.usa-today.law From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: law Mon, Nov 9 1992 Date: Mon, 9 Nov 92 04:44:15 EST Message-ID: 11-09 0000 DECISIONLINE: Business Law USA TODAY Update Nov. 9, 1992 Source: USA TODAY:Gannett National Information Network BEER WAR DROWNS USA, CANADA: While the USA and Europe are talking themselves into a fight on trade rules affecting white wine and other products, a beer battle between the USA and Canada shows no sign of ending. Canada's top brewers are changing strategies to try to end the war, which has been going on since July. Molson Cos. said Friday it wants the Canadian government to present another offer to end the dispute. (For more, see special Beer package below.) EUROPE TRIES TO AVERT TRADE WAR: Europe appeared to blink over the weekend in its trade dispute with the USA. That reduces the likelihood of a trade war, which could gravely damage a global economy already weakened by recessions or slow growth. European Community diplomats told Reuters they'll reject a French request for a list of U.S. products that could be hit with tariffs in retaliation for U.S. plans. FOOD LION DEFENDS REPORTS: Executives of Food Lion Inc. have launched a series of TV ads and a lawsuit after damaging news reports caused the company's stock to plummet to a record low. Food Lion was hit with an ABC news charge its employees bleach, rewrap and sell spoiled meat. Food Lion is suing ABC for fraud. Food Lion President Tom Smith s ys the ABC report is full of "lies." CHILD LABOR LAWS BROKEN: The Washington Post eported this weekend that the 989-store Food Lion chain will be cited by the Labor Department for more than 1,400 violations of child labor laws. Among them: Allowing teenagers to work around meat slicers and other dangerous equipment. The company received calls all weekend, and one store invited shoppers to tour the meat department. CONTINENTAL MAKES CHOICE: Continental Airlines Monday tells its board's choice on the winning bid for the airline. Two groups are known to have bid: One teams Air Canada and two Fort Worth investors; the other pairs Maxxam Chairman Charles Hurwitz and Aeromexico. The bankruptcy court overseeing Continental's reorganization has the final say. ICAHN TARGETED BY IRS: The Internal Revenue Service says TWA owner Carl Icahn owes about $12.5 million in back taxes and penalties, the Washington Post reports. The IRS says he owes for deductions he took for money lost on horse-racing and on a business transaction the IRS says he made for tax benefits. The Pension Benefit Guaranty Corp. told Icahn to pay $1.2 billion for a gap in employees' pension funds. BUSH TRIES TO HURRY USAIR DEAL: The Bush administration is moving to settle British Airways' bid to buy a major stake in financially troubled USAir before President-elect Clinton takes office in January. Clinton opposes the deal. The Transportation Department on Thursday set in motion a process under which Secretary Andrew H. Card Jr. would decide by Dec. 24 whether to approve the controversial deal. MINERS' CONTRACT DISCUSSED: The United Mine Workers and the Bituminous Coal Operators' Association Friday opened negotiations on a contract covering 210,000 active and retired miners. Both sides expressed cautious hope that a timely agreement could be reached on a pact succeeding the one that expires Feb. 1. Job security will be a factor because union miners now dig only about one-third of the nation's coal. SUPERCUTS BROKE LABOR LAWS: The National Labor Relations Board accused Supercuts of breaking labor laws when it closed three Northern California stores and fired 35 employees for trying to organize a union. The board said in a complaint the union's allegations about unfair labor practices appear to be correct. The board is trying to force Supercuts to reopen the stores, rehire employees and recognize the union. SAVINGS BANK'S PLAN REJECTED: Poughkeepsie Savings Bank said Friday thrift regulators rejected its capital plan and toughened capital requirements for the bank, Bloomberg Business News reports. The Office of Thrift Supervision said it plans to issue a capital directive that will require Poughkeepsie to file a revised capital plan. The bank will still be subject to some operational limitations and limited asset growth. SEC LOOSENS RESTRICTIONS: The Securities and Exchange Commission plans to give public utility holding companies more leeway in how they handle their money. Bloomberg Business News reported Friday. The agency proposed a series of rule changes that would expand existing exemptions for utility holding companies wanting to invest in other businesses, purchase or sell securities, or buy utility assets. SECURITY SALES LESS REGULATED: Public utility holding companies and their subsidiaries will no longer need to obtain competitive bids when they sell securities, under a rule the Securities and Exchange Commission has eliminated. Amendments the SEC made last week will make it easier for a utility holding company to raise money and make investments. The SEC plans to seek comment on proposed rule changes for the next two months. SPECIAL PACKAGE ON BEER: ONTARIO BEGAN TAXING: The beer conflict between the USA and Canada egan after Ontario's gover ment imposed a 10-cent a can tax on beer imported into Canada. The money was to pay for environmental clean-up. The USA retaliated, saying the levy was unfair under the 1989 free trade agreement. It put a $3 a case duty on Canadian beer in July. Canada then put a $2.40 (Canadian) import tax on U.S. beer. MOLSON, LABATT HIT HARDEST: Molson and John Labatt are among the biggest losers in the beer trade war, as both are fully absorbing the new U.S. import duty. Molson, Canada's biggest brewery, ships about 12 million cases of beer to the U.S. from Ontario each year and Labatt ships 1.2 million. Molson's proposal: Have a third party, such as the General Agreement on Tariffs and Trade, decide a fair solution. MOLSON SALES ARE DRAINED: Molson says total volume of beer sales for Canada's beer industry slid an unprecedented 3.8% the first half of this year. The chances of a quick settlement look bleak. Canadian International Trade Minister Michael Wilson said Thursday that Canada would like to see an end to the trade war, but added that the U.S. had rejected Canada's latest proposals for a settlement. (End of package.) Business Law Editor: Kate Coughlin. (919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM