Posts Tagged ‘France’

What EU’s record fine will mean for Google

July 18, 2018

US tech company must pay a €4.3bn penalty but also overhaul its Android model

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Android over money

By Rochelle Toplensky in Brussels

The EU has fined Google a record €4.3bn for imposing anti-competitive terms on companies using the Android mobile operating system, the second time Brussels has penalised the US tech company for abusing its market dominance.

Beyond the financial cost, the European Commission’s antitrust decision has significant implications for Google’s business operations as the company must now overhaul one of the most important computing platforms of the smartphone era.

Antitrust decisions come in two parts. First, EU officials must prove the company is dominant in relevant markets — which they did for Google in general search, licensed mobile operating systems and app stores. (Apple, which does not license its iOS operating system and App Store to rivals, was not considered a competitor to Android.)

Then it must be established that the company unlawfully exploited its strength to stymie competition. The commission found that restrictive terms required makers of Android phones to install Google products as a condition of using Play, the Android app store. Other conditions prevented manufacturers from selling phones that use other operating systems, and paid phonemakers to exclusively pre-install Google search. Google denies wrongdoing.

Why is the case important to Google?

Since its launch in 2007, Android has helped Google preserve its pre-eminence as consumers moved from desktop computers to mobile devices. More than half of worldwide internet traffic is now on mobile devices, 80 per cent of which run on Android, providing a showcase for Google services and mobile apps.

Google gives away Android and keeps it updated for free, covering its costs with the revenues made from people using its services. Licences for the official version of Android are conditional on devicemakers following certain rules.

As a result of the EU decision, Google will be expected to revise the terms of service that made this model viable, notably the guaranteed distribution of Google products. Such changes would leave Google with less control, potentially opening up opportunities for rivals.

How has Google responded?

Google rejects the commission’s case on three main grounds. It argues that the refusal of EU investigators to accept that Android competes with Apple’s iOS system misconstrues the market.

The company also says the commission fails to acknowledge how easy it is for users to switch. Even if apps are pre-installed, Google argues that consumers can easily “swipe away” the Google products and download something else.

And it thinks the commission is underestimating the importance of rules for developers and users. App developers rely on a degree of consistency to distribute products. Making Android more open, in other words, could degrade the user experience.

What triggered the investigation?

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Microsoft, Oracle and Nokia were among 14 companies that complained to the EU in April 2013, claiming Google unfairly supported Android and its mobile services by offering cut-price licensing and exclusivity deals. The commission began an investigation, sending formal charges to Google in 2016.

Brussels launched two other investigations into the tech company. The first, concluded last summer, resulted in a €2.4bn fine for illegally favouring its shopping service over rivals. Google has appealed against the decision. The remaining probe relates to how the company prevented websites that use its search bar and ads from also showing competing ads.

What happens next?

Google will pay the fine and has 90 days to decide how to change its Android contracts to remove illegal provisions. The commission will ultimately review whether the company’s solution complies with its ruling.

If the changes fall short, Google’s parent company Alphabet could be liable for further fines of up to 5 per cent of daily revenues, which would be roughly $12m a day. Google is expected to appeal against the decision in court.

It is too early to tell how Android will change in Europe, or beyond. Google might start to charge a licence fee to cover its software costs and device suppliers might be given more freedom to develop their own version of Android. Google could even mimic Apple and keep Android for use only in its own Pixel phones. Any changes are unlikely to be noticed by users for many months.

https://www.ft.com/content/60502464-8a57-11e8-bf9e-8771d5404543

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Google to Be Fined Record $5 Billion by EU Over Android

July 18, 2018

Google will be fined about 4.3 billion euros ($5 billion) by the European Union over apps for Android mobile devices, setting a record for antitrust penalties, according to a person familiar with the EU decision.

The penalty — the same amount the Netherlands contributes to the EU budget every year — is due to be announced by EU Competition Commissioner Margrethe Vestager at 1 p.m. in Brussels.

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The EU’s decision would bring the running total of Google fines to 6.7 billion euros after last year’s penalty over shopping-search services. It could soon be followed by more fines from a probe into online advertising contracts.

Google has built a massive business of banner and videos ads, thanks largely to its central role on Android devices. Google will account for a third of all global mobile ads in 2018, according to research firm eMarketer, giving the company around $40 billion in sales outside the U.S. Google risks losing that traction if it is forced to surrender its real estate on millions of Android phones.

QuickTake: Why Google Is Again in the EU’s Antitrust Crosshairs

Google Chief Executive Officer Sundar Pichai had a call with EU Competition Commissioner Margrethe Vestager late Tuesday for a so-called state of play meeting, a usual step to alert companies of an impending penalty, according to one of the people, who asked not to be named because the discussion is private. The probe targets Google’s contracts with smartphone manufacturers and telecoms operators.

The European Commission exceeds last year’s then-record 2.4 billion-euro penalty following an investigation into Google’s shopping-search service. Google owner Alphabet Inc. and the commission both declined to comment on the Android fines.

Despite being a record fine, Alphabet generated about the same amount of money every 16 days in 2017, based on the company’s reported annual revenue of $110.9 billion for the year.

Alphabet shares were down 1.2 percent in pre-market trading in New York on Wednesday.

EU Attack on Android Boosts Rivals in the Battle of the Apps

Levies are based on revenue in the market being probed and can’t exceed 10 percent of a company’s global annual revenue. Google raked in around 25 billion euros in digital advertising in Europe in 2017, equity research firm Pivotal Research estimates.

More significant than a blockbuster fine could be an accompanying order freeing up phone manufacturers to choose non-Google apps to install on Android phones. That would yield crucial real estate for app developers given that about 80 percent of smart mobile devices use Android.

EU officials have been investigating Google contracts that require manufacturers of Android phones to take Google’s search and browser apps and other Google services when they want to license the Play app store.

The EU is also targeting Google’s payments to telecoms operators and manufacturers who exclusively install Google search on devices and contracts that prevent handset makers selling phones using other versions of Android.

Google has a market share of more than 90 percent for general Internet search, licensed smart mobile operating systems and app stores for Android software, the EU said in 2016.

— With assistance by Stephanie Bodoni, and Natalia Drozdiak

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Google braces for huge EU fine over Android

July 18, 2018

Google prepared Wednesday to be hit with huge EU fine for freezing out rivals of its Android mobile phone system in a ruling that could spark new tensions between Brussels and Washington.

EU Competition Commissioner Margrethe Vestager spoke by telephone with Google chief Sundar Pichai on Tuesday night to tell him about the decision in advance, a source close to the matter told AFP.

Vestager is expected to announce that Google abused its dominant position in the market by making tie-ups with phone makers like South Korea’s Samsung and China’s Huawei.

Two European sources told AFP the fine would be “several billion euros” without giving further details. EU rules say Google could be fined up to 10 percent of parent company Alphabet’s annual revenue, which hit $110.9 billion in 2017.

“The fine is based on the length of the infraction, but also on whether antitrust authorities believe there was an intention to commit the offence, and whether they excluded competitors or not,” said another source close to the matter.

The Android pavilion at the Mobile World Congress (MWC) in Barcelona.

The European Commission, the 28-nation EU’s executive arm, refused to comment.

The long-awaited decision comes as fears of a transatlantic trade war mount due to President Donald Trump’s shock decision to impose tariffs on European steel and aluminium exports.

Denmark’s Vestager has targeted a series of Silicon Valley giants in her four years as the 28-nation European Union’s antitrust chief, winning praise in Europe but angering Washington.

The case against Android is the most significant of three complaints by the EU against the search titan, which has already been hit with a record-breaking 2.4-billion-euro fine in a Google shopping case.

Brussels has repeatedly targeted Google over the past decade amid concerns about the Silicon Valley giant’s dominance of internet search across Europe, where it commands about 90 percent of the market.

– ‘Financial incentives’ –

In the Android file, the European Commission has accused Google of requiring mobile manufacturers such as Samsung and Huawei to pre-install its search engine and Google Chrome browser on phones, and to set Google Search as the default, as a condition of licensing some Google apps.

Google Search and Chrome are as a result pre-installed on the “significant majority” of devices sold in the EU, the commission says.

The complaint formally lodged in April also accuses Google of preventing manufacturers from selling smartphones that run on rival operating systems based on the Android open source code.

Google also gave “financial incentives” to manufacturers and mobile network operators if they pre-installed Google Search on their devices, the commission said.

Vestager’s other scalps include Amazon and Apple.

The EU’s biggest ever punishment targeted Apple in 2016 when it ordered the iconic maker of iPhones and iPads to pay Ireland 13 billion euros ($16 billion) in back taxes that it had avoided by a tax deal with Dublin.

The EU has also taken on Facebook over privacy issues after it admitted that millions of users may have had their data hijacked by British consultancy firm Cambridge Analytica, which was working for Trump’s 2016 election campaign.

The Google decision comes just one week before European Commission chief Jean-Claude Juncker is due to travel to the United States for crucial talks with Trump on the tariffs dispute and other issues.

Transatlantic tensions are also high after Trump berated NATO allies over defence spending at a summit last week, over his summit with Russian leader Vladimir Putin, and over the US president’s pull-out from the Iran nuclear agreement and Paris climate deal.

AFP

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IMF warns of rising risks to global growth amid trade tensions

July 16, 2018

The global economy is still expected to grow at a solid pace this year, but worsening trade confrontations pose serious risks to the outlook, the International Monetary Fund said Monday.

The IMF’s updated World Economic Outlook (WEO) forecast global growth of 3.9 percent this year and next, despite sharp downgrades to estimates for Germany, France and Japan.

The US economy is still seen growing by 2.9 percent this year, and the estimate for China remains 6.6 percent, with little impact expected near term from the tariffs on tens of billions of dollars in exports the countries have imposed on each other so far.

© AFP/File | The IMF’s updated World Economic Outlook (WEO) forecast global growth of 3.9 percent this year and next, despite sharp downgrades to estimates for Germany, France and Japan

“But the risk that current trade tensions escalate further — with adverse effects on confidence, asset prices, and investment — is the greatest near-term threat to global growth,” IMF Chief Economist Maurice Obstfeld said.

The fund warns growth could be cut by a half point by 2020 if tariff threats are carried out.

Although the global recovery is in its second year, growth has “plateaued” and become less balanced, and “the risk of worse outcomes has increased,” Obstfeld said in a statement.

– Addressing ‘disenchantment’ –

The report comes as US President Donald Trump has imposed steep tariffs duties on $34 billion in imports from China, with another $200 billion coming as soon as September, on top of duties on steel and aluminum from around the world including key allies.

China has matched US tariffs dollar for dollar and threatened to take other steps to retaliate, while US exports face retaliatory taxes from Canada, Mexico and the European Union.

“An escalation of trade tensions could undermine business and financial market sentiment, denting investment and trade,” the IMF report said.

In addition, “higher trade barriers would make tradable goods less affordable, disrupt global supply chains, and slow the spread of new technologies, thus lowering productivity.”

The IMF said growth prospects are below average in many countries and urged governments to take steps to ensure economic growth will continue.

The fund said global cooperation and a “rule-based trade system has a vital role to play in preserving the global expansion.”

However, without steps to “ensure the benefits are shared by all, disenchantment with existing economic arrangements could well fuel further support for growth-detracting inward-looking policies.”

– Europe, Japan slowing –

The sweeping US tax cuts approved in December will help the economy “strengthen temporarily,” but growth is expected to moderate to 2.7 percent for 2019.

And while the fiscal stimulus will boost US demand, is also will increase inflationary pressures, the WEO warned.

China’s growth also is seen slowing in 2019 to 6.4 percent.

After upgrading growth projections for the euro area in the April WEO, the IMF revised them down by two-tenths in 2018 to 2.2 percent, due to “negative surprises to activity in early 2018,” and another tenth in 2019 to 1.9 percent.

The estimates for Germany, France and Italy were cut by 0.3 points each, with Germany seen expanding by 2.2 percent this year and 2.1 percent in 2019. France’s GDP is expected to grow 1.8 percent and 1.7 percent.

Meanwhile, Britain is now forecast to grow 1.4 percent this year, 0.2 points less than the April estimate, and 1.5 percent in 2019.

Japan’s GDP is seen slowing to 1.0 percent this year, two-tenths less than previously forecast, “following a contraction in the first quarter, owing to weak private consumption and investment.” It should grow 0.9 percent the following year.

India remains a key drivers of global growth, but the GDP outlook was cut one-tenth for this year and three-tenths for next year to 7.3 percent and 7.5 percent, respectively.

Brazil saw an even sharper 0.5-point downward revisions from the April forecast, to 1.8 percent this year.

AFP

Mnuchin says U.S. will consider some waivers on Iran sanctions

July 16, 2018

The United States wants to avoid disrupting global oil markets as it reimposes sanctions against Tehran and in certain cases will consider waivers for countries which need more time to wind down their oil imports from Iran, U.S. Treasury Secretary Steven Mnuchin said.

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FILE PHOTO: U.S. Secretary of the Treasury Steven Mnuchin 

“We want people to reduce oil purchases to zero, but in certain cases if people can’t do that overnight, we’ll consider exceptions,” Mnuchin told reporters on Friday, clarifying some U.S. officials’ comments that there would be no exemptions. Mnuchin’s comments were embargoed for release on Monday.

Mnuchin was talking to reporters en route from Mexico where he was part of a high-level U.S. delegation led by Secretary of State Mike Pompeo to meet Mexico’s next president, Andres Manuel Lopez Obrador.

The Trump administration is pushing countries to cut all imports of Iranian oil from November when the United States reimposes sanctions against Tehran, after Trump withdrew from the 2015 nuclear deal agreed between Iran and six major powers, against the advice of allies in Europe and elsewhere.

Mnuchin said he would meet with counterparts from developed and developing countries on the sidelines of a G20 finance ministers’ meeting in Buenos Aires on July 19-22. U.S. sanctions against Iran are likely to be raised in his talks.

“We’ve said very specifically, there’s no blanket waivers, there’s no grandfathering,” Mnuchin said, “We want to be very careful in the wind-down around the energy markets to make sure that people have the time.”

He added: “The State Department has the ability to issue waivers around significant reductions in the oil markets, that’s something that Treasury and State will be doing.”

Mnuchin said Washington had made clear to allies that it expects them to enforce the sanctions against Iran “but if there are specific situations we’re open to listening.”

French Finance Minister Bruno Le Maire said at the weekend that Washington had rejected a French request for waivers for its companies operating in Iran, according to Le Figaro.

Paris had singled out key areas where it expected either exemptions or extended wind-down periods for French companies, including energy, banking, pharmaceuticals and automotive.

The Trump administration has said there are more than 50 foreign companies that have withdrawn their business from Iran since Trump announced the U.S. was withdrawing from the 2015 nuclear deal between Iran and the United States, Germany, France, Britain, China and Russia.

Pompeo, also speaking to reporters on Friday, said he had discussed U.S. plans to reimpose sanctions on Iran with “all but one” country. He did not name the country he had not yet consulted.

“What they’ve asked us to do is review how we get there and the timeline for that,” he said, “and so I’m very confident they understand.”

Iranian President Hassan Rouhani, speaking in remarks carried live on state television on Saturday, said Washington was more isolated than ever over sanctions against Iran, even among its allies.

His comments appeared to be trying to ease popular concerns fueled by Trump’s decision to withdraw from the deal with Iran on its nuclear program.

The likely return of U.S. economic sanctions has triggered a rapid fall of Iran’s currency and protests by bazaar traders usually loyal to the Islamist rulers.

Trump has said he asked Saudi Arabia to raise oil production if needed to ensure global oil supplies and the country has 2 million barrels per day of spare capacity.

The Organization of the Petroleum Exporting Countries agreed with Russia and other oil-producing allies on June 23 to raise output from July, with Saudi Arabia pledging a “measurable” supply boost, but giving no specific numbers.

Reporting by Lesley Wroughton; Editing by Phil Berlowitz

Reuters

Italy’s request to take migrants is “road to hell”: Czech PM

July 15, 2018

Billionaire Czech Prime Minister Andrej Babis said Sunday he saw Italy’s request that EU peers take some of 450 migrants stranded at sea on two Frontex vessels as “a road to hell.”

While France and Malta have already agreed to take 50 each, the Czech government chief held on to his anti-migrant stance which he shares with other leaders in the region including Hungary, Poland and Slovakia.

© POOL/AFP/File | Czech Prime Minister Andrej Babis’s minority government won a confidence vote this week

“Just like the other EU prime ministers, I got a copy of a letter from Italian Prime Minister (Giuseppe) Conte… in which he asks the EU to take care of some of 450 people now stranded at sea,” Babis tweeted.

“Such an approach is a road to hell,” added the 63-year-old Slovak-born populist, whose minority coalition government won a confidence vote Thursday thanks to backing from the Communist Party.

This approach “only motivates smugglers and increases their income. Our country won’t take any migrants,” Babis added, calling for “a principle of voluntariness.”

“We have to help migrants in the countries from which they come, beyond Europe’s borders, to stop them from setting out on their journey,” said Babis.

Migration is a hot political issue in the Czech Republic, an EU and NATO member of 10.6 million people, where just a handful of refugees have settled since the migrant crisis of 2015.

In an April poll by the Czech Academy of Sciences, 58 percent of Czechs said the country should accept no migrants from war-ravaged regions.

Some 35 percent of its 1,115 respondents said it should accept them temporarily and only three percent were willing to let them stay in the country.

AFP

France, Malta to take quarter of Italy’s 450 rescued ship migrants

July 15, 2018

Italy said Saturday that Malta and France had agreed to take 100 of the 450 migrants who were rescued from a fishing boat in the Mediterranean, claiming victory in the latest standoff but demanding even greater European solidarity.

Premier Giuseppe Conte said that Malta and France had come forward in response to his request to all 27 other members of the European Union to share the burden of welcoming the migrants.

“It’s an important result,” Conte wrote on Facebook, along with a copy of the letter he wrote to top European Commission officials demanding that other European countries make good on their verbal pledges to help Italy deal with the influx.

© Giovanni Isolino, AFP | Would be immigrants wait to disembark in the port of Catania, on the island of Sicily on March 21, 2017

The migrants had been aboard a large fishing boat when the Italian and Maltese coast guard control centers began squabbling Friday over who was responsible for taking them in.

Malta said it had fulfilled its obligations by monitoring the vessel to see if it needed help. Malta says the ship’s crew made clear they didn’t need help and were heading toward the Italian island of Lampedusa.

Italy insisted Malta should have opened its ports to the ship.

Early Saturday, the migrants were taken off the boat and transferred onto a rescue vessel from the EU border patrol agency Frontex and a ship from the Italian border police.

The Maltese government said Prime Minister Joseph Muscat had agreed to participate in the migrant relocation initiative, similar to one involving the Lifeline ship of a German aid group several weeks ago. But he stressed that Malta at all times followed international law.

In just one month in office, Italy under the hard-line, anti-migrant Interior Minister Matteo Salvini has upended years of Italian policy toward migrants by refusing them entry.

Italy in general feels that the European Union has left it alone to handle the tens of thousands of migrants coming across the sea every year. Salvini is pressing the EU to step up and take in the migrants who land in Italy and is trying to help Libya prevent them from leaving.

Aid officials say migrants who are being returned to Libya are at risk of facing abuse, rape, beatings and slavery.

(AP)

EU’s Attack on Android Boosts Rivals in the Battle of the Apps

July 15, 2018
App developers may be able to get a foothold on Android phones — Android investigation expected to be wrapped up in coming days
The Android pavilion at the Mobile World Congress (MWC) in Barcelona.

Photographer: Simon Dawson/Bloomberg

Google’s latest European Union woes could mean opportunity knocks for app developers stymied by contracts that pre-install the U.S. giant’s own services on Android phones and tablets, according to analysts and companies.

The Alphabet Inc. unit is expected to face an antitrust fine over Android in the coming days that could top last year’s record 2.4 billion-euro ($2.8 billion) penalty for shutting out rivals to its shopping search service.

But more significant could be an accompanying order freeing up phone manufacturers to choose non-Google apps to install on Android phones. That would yield crucial real estate for app developers given that about 80 percent of smart mobile devices use Android.

“It would dramatically help us,” said Gabriel Weinberg, chief executive officer of Paoli, Pennsylvania-based DuckDuckGo Inc., a search engine that doesn’t track users. “It’s clear to me that people would choose other options if the choice was easier to make.” DuckDuckGo said it hasn’t complained to the EU about Google, pointing to the effort involved.

Google dominates mobile search in Europe, with 97 percent of the market, while its Chrome web browser has a 64 percent market share on mobile, according to web traffic analysis firm StatCounter. The company’s control of ads on millions of Android phones will help it capture a third of all global mobile ads in 2018, bringing in some $40 billion in sales outside the U.S., said research firm eMarketer.

The EU’s investigation targets contracts that require smartphone makers who want to install Google’s Play store to add a bundle of Google services, including search, web browser, email and mapping. EU officials worry that users stick with the default they get on their phones.

Email is “probably the most vulnerable one for Google” if device makers were able to install their own email app as default or add Microsoft Corp.’s Outlook, said Daniel Gleeson, a senior analyst at research firm Ovum Plc.There is “definitely potential in maps” where any advertising revenue loss for Google from location services would be very serious, he said, citing Here Technologies as a potential rival.

Google and the Brussels-based European Commission declined to comment for this article. Microsoft declined to comment about possible opportunities for its services. Here Technologies didn’t respond to a request for comment.

OsmAnd, an offline mapping application, reported “a really huge difference” when it was pre-installed on a small manufacturer’s tablet in 2013, said Chief Executive Officer Victor Shcherb. “It created a huge traffic from day zero on that device,” which was later discontinued.

Shcherb said his company competes only indirectly with Google Maps since his application tends to cater to users looking for specialist mapping services, such as for hiking. Still the EU’s decision could help the app reach a wider audience, he said.

Google ceded some market share to Russian search engine Yandex NV after it agreed to allow users in the nation to choose their own preferred search engine on Android phones. Yandex says it now has nearly 48 percentof the search market, up from around 37 percent. Google also paid a fine as part of a settlement of an antitrust probe by Russia’s Federal Anti-Monopoly Service last year.

Nudging computer users to choose their own internet browser was also the EU’s preferred way to end more than a decade of antitrust disputes with Microsoft in 2009, which helped push some web users to shiny new web software made by Google — at that time just a precocious new kid on the block.

Android is “a multi-lane highway of choice” and people can download competing apps at any time, the company’s general counsel Kent Walker said in a 2016 blog post. Google’s apps account for less than one-third of preloaded apps on a device, he said, and “a consumer can swipe away any of our apps at any time.”

Why Google Is Again in the EU’s Antitrust Crosshairs: QuickTake

Google also argues that its actions to police the Android ecosystem and prevent multiple versions of Android — also part of the EU probe — help app developers to make products that work across millions of devices. Giving away Android for free also helps reduce smartphone costs, it said. Google relies instead on advertising to make money from Android.

People download lots of other apps, according to a survey by the Developers Alliance, an association of 70,000 developers, which counts Google as a member.

Among 2,000 Android users surveyed in France, Germany, Italy and Spain, around 28 percent download additional search apps, 29 percent download at least one new app store, and 23 percent download at least one alternative web browser to the apps that come pre-installed, the alliance said.

Critics say it’s hard to challenge Google. Aptoide, an app store that competes with Google Play, filed an antitrust complaint with the EU in 2014 over contracts that prevent device makers engaging with it.

Aptoide Chief Executive Paulo Trezentos said the company has been growing “but not so much in the [handset] manufacturing side.” It is increasingly relying on users downloading the store via the web browser. The app store is rarely pre-installed, partly because it can’t counter Google’s offer to device-makers to bundle its app store with other Google apps.

Some analysts see little hope for increased competition in markets where Google has become well-entrenched.

“This order will come way too late because user addiction has moved from the [Play] store to the Google services,” said Richard Windsor, owner of research company Radio Free Mobile. It’s “going to be a tough call” for anyone to come up with a better range of products than Google.

— With assistance by Mark Bergen, and Ilya Khrennikov

https://www.bloomberg.com/news/articles/2018-07-15/eu-s-attack-on-android-boosts-rivals-in-the-battle-of-the-apps

With Trump strategy unclear, U.S. allies turn to Moscow to secure their interests in Syria

July 15, 2018

As President Trump began a six-day trip to Europe, due to culminate Monday in a meeting with Russian President Vladi­mir Putin, Putin was having some meetings of his own.

In Moscow on Wednesday, he hosted Israeli Prime Minister Benjamin Netanyahu, a frequent visitor, who said he wanted to talk to the Russian leader “without intermediaries.” Hours later, Putin sat down with Ali Akbar Velayati, the foreign policy adviser to Iran’s supreme leader.

The main subject of the meetings was Syria, also a top item on Trump’s agenda.

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Russian President Vladimir Putin shakes hands with Israeli Prime Minister Benjamin Netanyahu during their meeting Wednesday, July 11, at the Kremlin to discuss Syria.

“Of course I’m going to bring that up” with Putin, Trump said Friday during a stop in Britain. “I’m not going in with high expectations,” he said, “but we may come out with some surprising things.”

By Karen DeYoung and Joby Warrick
The Washington Post

As Trump and Putin prepare to meet in Helsinki, both allies and adversaries in the Middle East are turning to Putin for reassurance and understanding of how such surprises might affect them. For Iran, which has partnered with Russia to keep Syrian President Bashar al-Assad in power and decimate his U.S.-backed opposition, keeping Moscow close is a no-brainer.

But for many of America’s allies in the region, who say they have little understanding of Trump’s long-term strategy in Syria, there is growing anxiety about what he is prepared to offer Putin in exchange for help in attaining what he says is his primary goal of expelling Iran.

Russian President Vladimir Putin, center, shakes hands with Ali Akbar Velayati, a senior adviser to Iran’s Supreme Leader Ayatollah Ali Khamenei, as Russian Foreign Minister Sergey Lavrov, stands at right, at Novo-Ograyovo outside in Moscow on July 12, 2018. (Alexei Druzhinin, Sputnik, Kremlin Pool Photo via AP)

Among the possibilities raised by senior officials in a number of regional governments, some of which also concern administration officials, are that Trump will agree to a partial or complete withdrawal of U.S. forces from Syria — as both Syria and Russia have demanded — or even to recognize Russia’s annexation of Crimea and drop U.S. sanctions.

Trump signed Wednesday’s NATO communique declaring that it would never accept Russia’s “illegal and illegitimate” takeover of Crimea. If he breaks ranks, it would be his most direct slap yet at the alliance, at a moment when NATO unity already hangs in the balance.

Removing the 2,200-strong U.S. military contingent in Syria, however, is seen as a more realistic possibility. Trump’s suggestion earlier this year that the United States would withdraw troops from Syria “very soon,” widely interpreted to mean six months, continues to create confusion within the U.S. military as well as among Washington’s regional partners.

U.S. military officials see the changing dynamics in southwest Syria, as Assad strengthens his control over remaining rebel-held areas, as disconnected from their ongoing campaign against the Islamic State. But they also see the situation as a signal of Syria’s new reality — one in which Assad will remain in power, aided by Russia and Iran. Although the officials said Friday that they have seen no plans to begin to remove troops, they said they are bracing for such a decision.

Israel, Jordan, Saudi Arabia and others, according to senior Middle Eastern officials who spoke on the condition of anonymity of name and country to avoid publicly questioning Trump, agree that such a step would be disastrous, eliminating whatever leverage the United States still has to push for an acceptable outcome in Syria.

In the lead-up to the Trump-Putin summit, Russia has continued to defend Iran’s presence in Syria and demand complete U.S. withdrawal, charging that its military deployments are a sham.

“Let me remind you that they talked about defeating ISIL at first, [and] declared the prevention of ISIL’s rebirth as their goal later,” Russian Defense Minister Sergei Shoigu told an Italian newspaper on Thursday, using an acronym for the Islamic State. Now, he said, the Americans “say [their] presence in Syria should continue to deter the hypothetical ‘Iranian influence.’ ”

President Vladimir Putin with the French leader Emmanuel Macron in St. Petersburg, Russia, in May.CreditPool photo by Dmitri Lovetsky. MAcron is meeting with Putin on Sunday, July 15, 2018.

“If our American colleagues are pursuing any course of action in Syria, it is too contradictory to be called a strategy,” Shoigu said.

U.S. regional allies share the objective of preventing Iran from establishing an unhindered corridor through Syria from Tehran to Beirut. But they worry that Trump may be too willing to accept guarantees that Putin has neither the desire nor ability to deliver.

Security officials in several countries in the region are skeptical that the Russians could force an Iranian withdrawal, even if they wanted to. “Assad owes everything to Iran, and he’s playing a game between the Russians and Iranians,” said one official in the region.

At the same time, another senior official from the region said, “the Russians play good chess. Putin wouldn’t make a move without thinking 10 moves ahead.”

Confused by apparently conflicting administration messages, and doubtful that the United States has a plan for achieving its own long-term goals in Syria, regional allies have reached out to Russia. “For years, there has been a growing disappointment with the U.S. posture in the region,” a third official said. “Countries are beginning to make their own calculations.”

Assad’s recent offensive in southwestern Syria, bordered by Jordan and the Israeli-occupied Golan Heights, is a case in point. The area had been largely peaceful since last summer, when Putin and Trump endorsed a cease-fire deal that froze Russian-backed Syrian government forces and U.S.-backed opposition fighters in place along a demarcation line patrolled by Russian police.

Late last month, however, Assad’s forces, aided by Russian airstrikes and Iranian-directed militias, began heading south from Damascus for an announced takeover of the area. As the offensive got underway, the administration publicly denounced Russia for violating the cease-fire agreement, even as it privately told regional allies that it would not oppose the move and messaged opposition forces that they would get no assistance and were better off giving up.

The administration apparently asked Russia for nothing in return. As refugees from ground attacks and Russian bombing fled to nearby borders, and humanitarian organizations warned of catastrophe, Israel and Jordan turned to Moscow to ensure that their interests would be protected.

For Jordan, whose foreign minister traveled there shortly after hearing the news from Washington, Russia came through. Early this week at the Naseeb border crossing into Jordan, where days earlier tens of thousands of refugees were crowded in dire conditions against the closed border, only several hundred remained under the watch of Syrian soldiers who had arrived with a small Russian-flagged convoy.

While the Russians kept a discreet presence at the border, their impact has been palpable, and Jordan, despite its not-so-secret support for the rebel groups in the past, welcomed the outcome. “Now, I believe that even within a week, most of the [rebel] groups will agree on terms, and some will be integrated back into their communities,” Brig. Gen. Khaled Massaid, the head of Jordan’s northern military district, said in an interview at his command center a few dozen yards from the crossing.

As Syria’s civil conflict has dragged on for years, Jordan’s economy has come under increasing strain, including the costs of coping with an estimated 1.3 million refugees. “The Naseeb border has reopened, and the regime is in charge again,” Massaid said. “It is better for Jordan if Syria is able to control its own border.”

While Israel, like the United States, continues to demand Iran’s complete withdrawal from Syria, its immediate concern is keeping the Iranians at least 50 miles or more away from its border. Netanyahu left Moscow last week — his third visit in recent months — with what the Israeli media reported was a deal with Russia, both to keep Iran and its militias away from the border area and to continue turning a blind eye to Israeli airstrikes against Iranian targets in Syria — the latest of which occurred last week.

“It’s very clear that Russia and Israel are cooperating on Syria. The Saudis and Russia are cooperating,” said a senior international diplomat closely involved in the conflict, who spoke on the condition of anonymity and described those contacts as a “good thing” to the extent that they “helped cool things down.”

“The Americans,” the diplomat said, now consider “Syria . . . a Russian thing.”

But Sen. Lindsey O. Graham (R-S.C.), a strong proponent of keeping U.S. troops in Syria and a skeptic of Russia, tweeted a warning to Netanyahu. “To our friends in Israel,” he wrote, “be very careful making agreements with Russia re Syria that affect U.S. interests. I don’t trust Russia to police Iran or anyone else in Syria.”

Warrick reported from the Naseeb border crossing in Jordan. Missy Ryan in Washington contributed
to this report.

https://www.washingtonpost.com/world/national-security/with-trump-strategy-unclear-us-allies-turn-to-moscow-to-secure-their-interests-in-syria/2018/07/14/0a2a3b34-8551-11e8-8f6c-46cb43e3f306_story.html?utm_term=.c0d2c32e48ea

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U.S. Rejects French Request for Waivers from Sanctions on Iran

July 13, 2018

The United States has rejected a French request for waivers for its companies operating in Iran that Paris sought after President Donald Trump imposed sanctions on the Islamic Republic, French Finance Minister Bruno Le Maire told Le Figaro.

Image result for French Finance Minister Bruno Le Maire, photos

French Finance Minister Bruno Le Maire 

Paris had singled out key areas where it expected either exemptions or extended wind-down periods for French companies, including energy, banking, pharmaceuticals and automotive.

Officials had expressed little hope for securing the waivers, which were critical for oil and gas major Total (TOTF.PA) to continue a multibillion-dollar gas project in Iran and for carmaker PSA Group (PEUP.PA) to pursue its joint venture.

French reinsurer Scor SE (SCOR.PA) said on Friday it will not seek new contracts or renew existing business in Iran, given the U.S. sanctions.

Most international insurers in Iran are working with the shipping and energy industries in the country.

“We have just received Treasury Secretary Steve Mnuchin’s response: it’s negative,” Le Maire told Le Figaro in an interview published on Friday.

Le Maire said Europe needed to react quickly and protect its economic sovereignty.

“Europe must provide itself with the tools it needs to defend itself against extra-territorial sanctions,” Le Maire added.

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Washington announced in May it was imposing new economic penalties on Tehran after pulling out of a multilateral 2015 agreement, under which Tehran had agreed to curb its nuclear activities in return for sanctions relief.

Trump’s sanctions are aimed at pressuring Iran to negotiate a new agreement to halt its nuclear programs that might include Tehran’s regional activities and ballistics development. In particular, Washington wants to curtail the oil exports that are key to Iran’s economic revival.

Earlier this month, Iranian President Hassan Rouhani appeared to threaten to disrupt oil shipments from its neighbors if Washington pressed ahead with trying to force countries to stop buying Iranian oil.

Reuters

Reporting by Richard Lough and Inti Landauro, editng by Larry King and Laurence Frost