The headline couldn't be more sensational, nor could the article be more obscurely and confusingly written. That said, I think that the headline is subtly inaccurate:
> “[The claim] was based on a rationale that American companies purchased large volumes of Korean semiconductors and thus contributed to the Korean firms' earnings,” the source said. “So, if the Korean chipmakers’ partner firms in Korea are entitled to parts of the profits, the American ones are, too.”
If I'm understanding this correctly, the Korean firms are reinvesting their profits in local partners, and a US trade delegation is trying to induce them to invest similarly in US firms. "US seeks share of Korean chipmakers' 'excess profits'" implies transfers to the US federal government, like a special windfall tax, which doesn't appear to be the case here. (And it would be outrageous, of course...)
It’s always good to see of the reverse holds: if a U.S. company (say Google) made excess profits in the EU, would the EU be entitled to the excess profits?
The US is a massive economy that businesses want access to. If it wasn't extremely profitable they would exit, but they don't. That should tell you all you need to know about any "risk".
The headline couldn't be more sensational, nor could the article be more obscurely and confusingly written. That said, I think that the headline is subtly inaccurate:
> “[The claim] was based on a rationale that American companies purchased large volumes of Korean semiconductors and thus contributed to the Korean firms' earnings,” the source said. “So, if the Korean chipmakers’ partner firms in Korea are entitled to parts of the profits, the American ones are, too.”
If I'm understanding this correctly, the Korean firms are reinvesting their profits in local partners, and a US trade delegation is trying to induce them to invest similarly in US firms. "US seeks share of Korean chipmakers' 'excess profits'" implies transfers to the US federal government, like a special windfall tax, which doesn't appear to be the case here. (And it would be outrageous, of course...)
I wonder if the complaint is Korean firms are recognizing profits in Korea by overpricing products sold to subsidiaries in the US.
In theory that's illegal, though I've never seen a company get busted for it.
It’s always good to see of the reverse holds: if a U.S. company (say Google) made excess profits in the EU, would the EU be entitled to the excess profits?
I would imagine a lot of pushback…
No, because the rule is not that excess profits must go to the buyer's country - the rule is that excess profits must go to the US.
See also the story of TikTok.
At this point, doing business in the US is an existential risk to any company.
The US is a massive economy that businesses want access to. If it wasn't extremely profitable they would exit, but they don't. That should tell you all you need to know about any "risk".
Isn't that the real reason the EU keeps suing/fining FAANG companies?