Archive for February, 2013

EU: No Country Can Extend Labor Restrictions for Bulgarians, Romanians

Thursday, February 28th, 2013

European Employment Commissioner Laszlo Andor has reminded that no EU member state State can unilaterally extend the existing labor market restrictions for Bulgarians and Romanians beyond the end of 2013.

“Free movement of workers is a fundamental principle of the Single Market and indeed of the European Union. It brings very considerable benefits to the individuals concerned, and to the economies of both the host and home countries,” Andor has declared in a statement.

“Derogations from this principle must be very strictly limited in time. The remaining restrictions on the free movement of workers from Bulgaria and Romania will end on 31st December 2013,” he has reminded.

The European Commissioner’s statement follows claims made by several British tabloids and politicians that the UK should brace for an “influx” of Bulgarian and Romanian migrants after the end of 2013.

Later on Thursday, Andor will brief the Council on the free movement of workers from Bulgaria and Romania.

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EU Agrees to Cap Bankers’ Bonuses

Thursday, February 28th, 2013

European Union officials have struck a provisional deal on new financial rules, including capping bank bonuses.

Under the agreement, bonuses will be capped at a year’s salary, but can rise to two year’s pay if there is explicit approval from shareholders.

Top bankers and financial traders can earn bonuses multiple times their base salaries. But there has been public outrage over bonuses following the huge bail-outs of banks.

The agreement was reached during eight hours of intense talks in Brussels between members of the European parliament, the European Commission and representatives of the bloc’s 27 governments.

Othmar Karas, the European Parliament’s chief negotiator, said: “For the first time in the history of EU financial market regulation, we will cap bankers’ bonuses.

“The essence is that from 2014, European banks will have to set aside more money to be more stable and concentrate on their core business, namely financing the real economy, that of small and medium-sized enterprises and jobs.”

But Joe Rundle, head of trading at ETX Capital, in London, said the cap would backfire. He told the BBC: “It will drive up fixed salaries to compensate. Businesses that do not need to be inside the European Union will leave. And when banks invest in future divisions, it will be outside the EU.”

The deal paves the way for Basel III, an overhaul of banking rules.

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What You Need to Know About the S Corporation Deadline of March 15th

Thursday, February 28th, 2013

s corporation deadlineChoosing the right business structure for your small business can seem like a daunting task. After all, the decision can have pretty significant implications, from how much you pay in taxes to how much paperwork you need to contend with.

March 15th is the deadline for existing businesses to elect S Corporation status, making it a good time to examine this business entity.

Double taxation

You may have heard that the traditional C Corporation is overkill for most small businesses and results in higher overall tax payments through something known as double taxation. That’s because when it comes to taxes, a C Corp is a separate taxpayer that files its own federal and state (where applicable) tax returns.

This means that profits are first taxed with the corporation. Then if the corporation decides to take that profit and distribute dividends to shareholders, the dividends are taxed again (this time, on each shareholder’s personal tax statement).

The LLC (Limited Liability Company) and S Corporation are popular structures for small businesses since they avoid this double taxation burden. With these business structures, the company is taxed like a sole proprietor or partnership, meaning the company itself doesn’t file its own taxes: all company profits are ‘passed through’ and reported on the personal income tax return of the shareholders (S Corporation) or members (LLC).

If you’re interested in setting up an LLC or S Corporation for your business, you’re probably wondering which business structure is right for your business. While circumstances vary among individuals and individual businesses, here are some general guidelines to help you understand the differences and their impact on your business.

As always, you should consult with a tax advisor or CPA to discuss the specifics of your own situation:

Liability

Both the LLC and S Corp will separate your personal assets from any liabilities of the company (whether from an unhappy customer, unpaid supplier or anyone else who might pursue legal action).

Business Formality

An S Corporation actually begins as a C Corporation. After the corporation has been formed, it can elect ‘S Corporation Status’ by filing Form 2553 with the IRS in a timely manner in order to get pass-through tax treatment (more on the deadline later). This means that the S Corporation involves the formalities and compliance obligations of the C Corporations.

If you incorporate as an S Corporation, keep in mind that you’ll need to set up a board of directors, file annual reports and other business filings, hold shareholder’s meetings, keep records of your meeting minutes and generally operate at a higher level of regulatory compliance than your business might need or want to deal with.

With the LLC, this isn’t the case. LLCs just use an informal operating agreement. Think about how much formality you want to deal with. In some cases, the S Corporation can seem too burdensome for the small business or solo entrepreneur.

Shareholder Eligibility

The IRS places restrictions on who can be a shareholder of the S Corporation. An S Corp cannot have more than 100 shareholders (of course, this may not be too significant for the small business). In addition, all individual shareholders of an S Corp must be either U.S. citizens or permanent residents.

How Income is Allocated

The two structures differ in terms of how profits can be divided among the owners. An LLC gives you flexibility to decide how profits should be divvied up. But in an S Corp, income and loss are assigned to each shareholder strictly based on their pro-rata share of ownership.

Here’s an example: Let’s say you open a business with a colleague, each owning 50 percent. As the year goes on, your colleague gets busy elsewhere and you start taking on the bulk of the work. At the end of the year, the two of you decide that because you have done more work, you should keep 75 percent of the profits and your colleague gets 25 percent.

With an LLC, this type of agreement is fine. Owners simply need to agree to the arrangement and they will be taxed accordingly to their ‘operating agreement.’ By contrast, this type of flexible arrangement won’t work with an S Corporation. Because you and your colleague are each 50 percent owners, you each will be allocated 50 percent of the corporation’s income (at least when it comes to computing income tax).

Class of Stock

If you are concerned about the type of stock you can offer, take note that the two business structures are different. An S Corporation can have voting and non-voting shares, but cannot have distinctions like common stock and preferred stock. In an LLC, however, these priorities and preferences are allowed and you can have different membership classes.

When is the S Corporation Deadline?

If you’re interested in the S Corporation for your business, keep in mind that there’s an upcoming deadline to apply for S Corporation treatment. If you have an existing Corporation (C Corp) or LLC, March 15th is your deadline for filing IRS Form 2553 with the IRS and electing S Corporation status for this tax year and forward.

In other words, if your corporation/LLC existed on January 1 of this year, then you need to get your Form 2553 in by March 15, 2013 in order to have your S Corp in effect for the 2013 tax year. If you’re forming a new corporation this year, then your S Corporation deadline is 75 days from the date of incorporation.

The right business structure for you will ultimately depend on all the unique aspects of your business. But regardless of which business type you choose, taking a serious look at your legal structure is creating a strong foundation for your business.

S Corp Business Photo via Shutterstock

The post What You Need to Know About the S Corporation Deadline of March 15th appeared first on Small Business Trends.

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Thessaloniki Ex-Mayor Gets Life Sentence for Embezzlement

Thursday, February 28th, 2013

A Greek court sentenced Thessaloniki former mayor to life in prison for embezzling millions of euros from the municipal budget of Greece’s second-largest city.

The judges found Vassilis Papageorgopoulos guilty of embezzling about EUR 20 M, – which accounted for half of his city’s public works budget – in the first big corruption trial since the debt crisis erupted.

Vassilis Papageorgopoulos was mayor of Thessaloniki from 1999 to 2010 after serving as deputy sports minister in the early 1990s.

Papageorgopoulos was convicted along with Thessaloniki’s former treasurer, who was found guilty of money laundering and forgery, and three other officials.

“I have nothing to do with this case. I’m sure that some people will die of guilt,” he told the court after the ruling, according to Greek news websites.

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Bulgarian Nominated for Netizen of the Year Award

Thursday, February 28th, 2013

Bulgarian investigative journalist Assen Yordanov has been nominated for Reporters Without Borders and Google’s Netizen Prize 2013.

Yordanov is one of the co-founders of BalkanLeaks, an anonymous leaking site which over the last two years has released documents through its news site Bivol that deal with alleged corruption in Bulgaria’s banks, widespread bribery in the Bulgarian judiciary and claims of Prime Minister Boyko Borisov’s mob ties, among others.

To support their efforts and to mark World Day Against Cyber-Censorship, Reporters Without Borders and Google award the Netizen Prize every 12 March with the aim of drawing the public’s attention to the need to defend online free expression.

Since 2008, this prize has been awarded to journalists, bloggers and other netizens who have made a distinguished contribution to the defence of freedom of expression on the Internet.

Besides Yordanov, the nominees for the 2013 Netizen Prize are: Itsmania Pineda Platero (Honduras), Cheikh Fall (Senegal), Oumarou Mohamed Lamine (Mali), Suren Gazaryan (Russia), Murat Tungishbayev (Kazakhstan), Huynh Ngoc Chenh (Vietnam), Mosireen (Egypt) and Shiva Nazar Ahari (Iran).

To stimulate online interest, the winner of the Netizen Prize will this year for the first time be elected by the Internet public, who are invited to cast their vote online.

From today until 5 March, Internet users can vote for the nominee they think best represents the fight for online freedom of information by going to the Reporters Without Borders YouTube channel (www.youtube.com/netizen2013).

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Now You Can Buy Cloud Services Through Comcast

Thursday, February 28th, 2013

Comcast is getting into the cloud service reselling business, giving small businesses one more place to shop – the Comcast Upware Marketplace.

The company’s new Upware app store, launched last week, is targeting small to medium-sized businesses by offering cloud storage, security, and collaboration products from Box, YouSendIt, and Microsoft.

The photo below shows a search page within the Upware store. Results include the name of the product and company along with a brief description and price. Users can choose to narrow their searches by category, price, industry, and whether discounts or free trials are available.

comcast upware marketplace

Stores like this one are nothing new in the industry, reports Giga Om. However, the new reselling portal does represent an additional revenue stream for the Internet service provider and one more choice for small businesses seeking cloud services like storage and security.

The company is marketing cloud services offered through its store as specially selected for business customers. It is  positioning Upware as a simpler way of buying and managing cloud services through a single portal.

If your business already buys Internet services from Comcast, you might find it easier to shop for cloud services there. In any case, business owners will need to compare prices with other cloud providers including direct pricing with companies whose services Comcast resells.  Also, small businesses already buying cloud storage, security, and collaboration tools from some other provider will need to evaluate the new Comcast Upware Marketplace services to determine how they compare for quality.

Comcast’s Upware marketplace contains software products organized into three categories, or “aisles” as they’re called on the site: data backup, data security, and Web and document collaboration.

Other companies teaming up to provide services, according to Comcast, include Carbonite, Norton, and DigitalSafe.

Upware will also offer Comcast tools like website hosting and Business VoiceEdge phone service.

Only nine third-party applications are available through the Upware store so far, but Comcast has promised it will add more to the portal in the future.

The post Now You Can Buy Cloud Services Through Comcast appeared first on Small Business Trends.

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Outgoing Bulgarian PM Leaves Hospital

Thursday, February 28th, 2013

Outgoing Bulgarian Prime Minister Boyko Borisov has been discharged from hospital, according to local media.

Doctors have told Borisov to avoid stress and physical exertion, according to the Bulgarian National TV.

Borisov, 53, was admitted to the Lozenets hospital in Sofa around 5 pm Monday with a hypertensive crisis. He had a blood pressure of 190/110.

Doctors put him on medications to normalize his blood pressure and advised him to stay in the hospital for a couple of days so that they can monitor his condition.

Doctors also asked the outgoing PM to refrain from sports activities for several days as it is known that he is an avid amateur football player.

It was made clear that Borisov has myocardial hypertrophy, a result from too much sports training over the years.

Borisov and his GERB government resigned last week amidst mass protest rallies against unbearable utility bills and wide-spread poverty that turned into a civil unrest against the political model of ruling the country.

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Suzlon falls after management stake sale

Thursday, February 28th, 2013

The Indian wind turbine manufacturer suffers another blow as its management sells off shares to fund a forthcoming debt restructuring

Benedict Vows Unconditional Obedience to New Pope

Thursday, February 28th, 2013

Pope Benedict XVI has vowed “unconditional obedience and reverence” to his eventual successor.

He was speaking on his final day in office at the Vatican to his cardinals, one of whom will be elected next month to replace him.

Benedict, 85, will leave for the papal retreat at Castel Gandolfo, near Rome, later on Thursday.

“I will continue to serve you in prayer, in particular in the coming days” as the cardinals work to select a new pontiff, he said.

Benedict told the cardinals it was a “joy to walk with you” during his eight years as pope.

Vatican spokesman the Rev. Thomas Roscia said 144 cardinals had attended Benedict XVI’s farewell to them as pope.

That includes both cardinal-electors, who are under the age of 80, and cardinals who are not eligible to vote for the next pope.

Not all those eligible to vote were present, said Vatican spokesman the Rev. Federico Lombardi.

The final number of cardinal-electors has not been confirmed but is thought to be 115.

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Rosatom Yet to Give Up on Bulgaria’s Abandoned Belene N-Plant

Thursday, February 28th, 2013

Russian state-owned energy company Rosatom is yet to give up on the construction of the Belene nuclear power plant project in Bulgaria.

Bulgaria’s Parliament confirmed Wednesday the country’s decision to abandon the project.

The vote was prompted by a recent referendum on the construction of a new nuclear power plant in the country.

Under the law, the recent referendum results imposed for the Belene NPP to be put back on the Parliament’s agenda, as voter turnout slightly exceeded 20%. 61% of the voters said “yes” to the construction of a new nuclear power plant; 39% cast a “no” ballot.

Rosatom spokesman Sergey Novikov has told the Bulgarian National Radio that Wednesday’s vote was “no surprise.”

“The current Parliament basically confirmed the decision taken some time ago, thus disregarding the opinion of the Bulgarian citizens who took part in the referendum,” he said.

However, Novikov noted that Wednesday’s vote does not put an end to the project for good.

He suggested that Bulgaria’s new government and Parliament may decide to revive the Belene nuclear power plant.

Bulgarian Prime Minister Boyko Borisov and his GERB government resigned last week amidst mass protest rallies against unbearable utility bills and wide-spread poverty that turned into a civil unrest against the political model of ruling the country.

On Thursday, Bulgaria’s President Rosen Plevneliev set a date for early elections – May 12, 2013.

Borisov’s GERB government scrapped the project for the construction of Belene back in March 2012, declaring it economically unfeasible. The move led Russia’s Rosatom to file a suit with an international arbitration court in Paris.

After it was first started in the 1980s, the construction of Bulgaria’s second nuclear power plant at Belene on the Danube was stopped in the early 1990s over lack of money and environmental protests.

The Belene NPP has been de facto frozen since the fall of 2009 when the previously selected strategic investor, the German company RWE, which was supposed to provide EUR 2 B in exchange for a 49% stake, pulled out.

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