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France's Hollande criticises huge U.S. fines against corporate Europe

Published 12/10/2016, 15:02
© Reuters. French President Francois Hollande delivers his speech during a symposium on re-founding democracy (Refaire la democratie) at the Hotel de Lassay in Paris
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By Michel Rose

PARIS (Reuters) - French President Francois Hollande on Wednesday accused the United States of abusing its power by demanding multi-billion dollar fines from European companies while shielding its own firms.

In an interview, Hollande said the fines - most recently $14 billion against Germany's Deutsche Bank (DE:DBKGn) for selling toxic mortgage-backed securities in the United States - were one reason why he could not support a U.S./EU free-trade deal.

"When the (European) Commission goes after Google (NASDAQ:GOOGL) or digital giants which do not pay the taxes they should in Europe, America takes offence," the Socialist leader told L'Obs magazine six months before presidential elections.

"And yet, they quite shamelessly demand 8 billion from BNP or 5 billion from Deutsche Bank."

Hollande's comment contrasted with the far more muted reaction from Berlin. Finance Minister Wolfgang Schaeuble said in Washington on Saturday there had been "far too much talk" about Deutsche Bank since the fine was imposed.

Deutsche Bank has said it does not expect to pay the full $14 billion and is negotiating a final sum with Washington. It has set aside 5.5 billion euros ($6.16 billion) to cover all ongoing litigation cases against it.

The Department of Justice has also penalised major U.S. banks over mis-selling MBS, with the highest fine, of $5.9 billion, levied against Bank of America (NYSE:BAC).

BNP was fined for violating U.S. sanctions against Iran and Sudan.

The French president said Europe should adopt the same tools to be able to sanction American companies.

Google is expected to face a large fine from the European Commission for competition violations, while the EU executive ordered iPhone maker Apple (NASDAQ:AAPL) to pay up to 13 billion euros in back taxes in August.

Hollande's comments come days after a French parliamentary report criticised what it called increasingly aggressive use by the United States of extra-territorial laws that have cost European companies billions in fines and other settlements.

Since 2009, European banks have paid about $16 billion to the United States over breaches of sanction regimes and European firms have accounted for 14 of the 15 biggest penalties handed down, the report said.

In the interview Hollande, France's most unpopular president on record, stuck to a December deadline to announce if he will run for a second term.

© Reuters. French President Francois Hollande delivers his speech during a symposium on re-founding democracy (Refaire la democratie) at the Hotel de Lassay in Paris

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