Blogs > International Business Law Blog

REWIND: International Business News #60

  • Prime Minister Sinzo Abe is pushing Japan to enter negotiations to join the Trans-Pacific Partnership, which is a free-trade pact that includes the U.S. and other Pacific nations. Viewing the move as a “last chance” to prevent Japan from being “left out,” Abe is facing strong opposition from Japan’s agricultural sector, which has historically been adverse to trade liberalization. Some of the effects of free trade would be the elimination of tariffs, and the lessening of governmental regulations and subsidiaries. Proponents argue that the move would result in an expansion of “Japan’s economy by at least 3.2 trillion Yen, or $33 billion – about 0.66 percent”, while others, such as the agricultural cooperatives, are concerned about the effect free trade would have on the Japanese lifestyle, and in particular Japan’s universal insurance system.
  • India is again being criticized by a member of the business community for the country’s efforts to bolster its generic drug industry. The complaint, which was levied by Chief Intellectual Property Counsel of Pfizer, reflects the view that India has created a “‘protectionist intellectual property regime’ that is deterring U.S. investment in the South Asian nation.” Citing last year’s patent revocation for a Pfizer cancer medication, and the nation’s use of compulsory licensing, the Pfizer representative contended that these moves by the country reflect efforts to further the interests of domestic generic drug manufacturers and intimated that such efforts are being done at the expense of multinational drug companies. India’s “new patent law still sets a high bar for drug companies to receive patents on new innovations, and allows generics companies – not just the government – to apply for compulsory licenses to override them.” The resulting tension between market participants may be a contributing factor to the uptick in filed disputes at the WTO arising out of U.S.-India trade relations.
  • Deal news: SoftLayer Technologies. Reports have privately held database web hosting company SoftLayer Technologies Inc. being considered as a target for acquisition. Among the potential suitors are IBM and EMC, although neither company (nor Softlayer) has commented. Based on other purchases that involved similar businesses, including CentruyLink’s purchase of Savvis for $2.5 billion and Verizon Communications’ purchase of Terremark Worldwide for $1.4 billion, some are anticipating that the purchase price for any deal involving SoftLayer could reach the $2 billion level. Hostess Brands. McKee Foods Corp. is set to acquire Hostess’ Drake’s snack cake business for approximately $27.5 million. The transaction is part of the ongoing liquidation of Hostess, which has already seen a sale to Apollo Global Management of its snack cake business, a sale to Flower Foods Inc. of most of its bread business, and will next see an auction of other Hostess brands in the coming days.