LONDON: Uber told a British employment appeal tribunal on Wednesday its drivers were self-employed, not workers entitled to a range of benefits, less than a week after it heard it would lose its London license.
The US ride-hailing service has faced regulatory and legal setbacks around the world amid opposition from traditional taxi services and concern among some regulators. It has been forced to quit several countries, such as Denmark and Hungary.
Losing its license in London, one of the world’s wealthiest cities, is one of the US technology firm’s biggest setbacks so far. The London regulator cited the firm’s approach to reporting serious criminal offenses and background checks on drivers.
Uber can operate during its appeal, which could last months.
Last year, two drivers successfully argued at a tribunal that Uber exerted significant control over them to provide an on-demand taxi service and had responsibilities in terms of workers’ rights.
At the two-day appeal hearing starting on Wednesday, Uber said its drivers were self-employed and worked the same way as those at long-established local taxi firms.
The self-employed are entitled to only basic protections such as health and safety, but workers receive benefits such as the minimum wage, paid holidays and rest breaks. This would add to Uber’s costs and bureaucracy across Britain.
“The position of drivers who use the app is materially identical to the (familiar and long-established) position of self-employed private hire drivers who operate under the auspices of traditional minicab firms,” Uber said in its court submission.
Minicabs, or private hire vehicles, sprung up in Britain more than 50 years ago. Minicabs cannot be hailed in the street like traditional taxis, but can be booked for specific times and places via a registered office with a call or via the Internet.
Uber’s lawyer Dinah Rose said she would not discuss the firm’s loss of license except to say: “It’s quite apparent from that decision that Uber is right to point out to this tribunal the regulatory constraints under which it operates.”
Around 200 trade-union-led protesters marched through central London on Wednesday against what they called “precarious labor” in the “gig economy,” where people work for various employers at the same time without fixed contracts.
“All Uber want to do is flood the market with drivers, with no responsibility nor liability — keep reducing fares to attract more customers, while drivers carry all the risks,” Yaseen Aslam, one of the two drivers involved in the tribunal claim, told the protest.
Some, however, opposed the decision by London’s regulator to strip Uber of its license, saying the firm should be allowed to operate but must grant workers’ rights.
In a bid to strengthen itself in Britain, Uber said on Wednesday it was seeking to appoint a UK chairman, in a newly created non-executive role which it began recruiting for around six weeks ago.
In a further challenge for Uber, law firm Leigh Day said it would represent a female driver who says Uber is putting her and other women at risk as drivers do not know the passenger’s destination until they get in the car, and that could mean traveling to a remote or unsafe area.
An Uber spokesman said drivers could cancel trips without penalty and did not have to go to a particular area if they did not want to. He said many women worked for Uber due to its safety features.
“One of the main reasons why women choose to drive with Uber is because of the safety features in the app. All trips are GPS tracked and a driver is able to share a live map of their trip with a friend or loved one,” he said.
Uber defends business model at UK tribunal on worker rights
Uber defends business model at UK tribunal on worker rights
Saudi Arabia opens door for foreign investment in Makkah and Madinah real estate
RIYADH: Foreigners can now invest in Saudi-listed companies owning real estate in Makkah and Madinah, following a landmark decision by the Saudi Capital Market Authority.
Effective immediately, the move aims to boost the capital market’s competitiveness and align with the Kingdom’s Vision 2030 economic diversification objectives, the CMA announced in a press release.
While non-Saudis are allowed to purchase properties in the Kingdom, there are specific restrictions, and in the holy cities ownership is generally limited to Saudi nationals — although foreigners are allowed to lease properties there.
Under the new guidelines, foreign investments are limited to shares or convertible debt instruments of listed companies. Total non-Saudi ownership, including individuals and legal entities, is capped at 49 percent of a company’s shares.
However, strategic foreign investors are prohibited from holding stakes in these companies.
The move comes amid reforms across the region, with most neighboring countries allowing foreigners to own properties, primarily in free zones or designated areas under certain restrictions.
“Through this announcement, the Capital Market Authority aims to stimulate investment, enhance the attractiveness and efficiency of the capital market, and strengthen its regional and international competitiveness while supporting the local economy,” said the CMA.
The changes are also designed to stimulate foreign direct investment in the Kingdom’s capital market, as well as bolster its regional and international competitiveness.
“This includes attracting foreign capital and providing the necessary liquidity for current and future projects in Makkah and Madinah through the investment products available in the Saudi market, positioning it as a key funding source for these distinctive developmental projects,” added the CMA.
Strengthening the real estate sector and attracting more FDI into the Kingdom is one of the key goals outlined under the Vision 2030 program, as Saudi Arabia aims to reduce its dependence on crude revenues and diversify its economy.
The Kingdom aims to attract $100 billion in FDI by the end of this decade, and the government body has been implementing various initiatives and reforms to enhance the attractiveness of the capital market.
Some of these efforts include allowing foreign residents to directly invest in the stock market, enabling non-Saudi investors to access the market through swap agreements, and permitting qualified foreign capital institutions to invest in listed securities.
The CMA has also allowed foreign strategic investors to acquire strategic stakes in listed companies and directly invest in debt instruments.
In 2021, the CMA also allowed non-Saudis to subscribe to real estate funds investing within the boundaries of Makkah and Madinah, which played a crucial role in increasing the attractiveness of the capital market to both regional and international investors.
Oil Updates — crude falls as Trump repeats call for OPEC to cut prices
- Trump reiterated call for OPEC to cut oil prices
- OPEC+ yet to react to Trump’s call for lower prices
- US puts on hold threat to slap tariffs on Colombia
SINGAPORE: Oil prices slipped on Monday after US President Trump called on OPEC to reduce prices following the announcement of wide-ranging measures to boost US oil and gas output in his first week in office.
Brent crude futures dropped 53 cents, or 0.68 percent, to $77.97 a barrel by 7:30 a.m. Saudi time after settling up 21 cents on Friday.
US West Texas Intermediate crude was at $74.16 a barrel, down 50 cents, or 0.67 percent.
Trump on Friday reiterated his call for the Organization of the Petroleum Exporting Countries to cut oil prices to hurt oil-rich Russia’s finances and help bring an end to the war in Ukraine.
“One way to stop it quickly is for OPEC to stop making so much money and drop the price of oil ... That war will stop right away,” Trump said.
Trump has also threatened to hit Russia “and other participating countries” with taxes, tariffs and sanctions if a deal to end the war in Ukraine is not struck soon.
Russian President Vladimir Putin said on Friday that he and Trump should meet to talk about the Ukraine war and energy prices.
“They are positioning for negotiations,” said John Driscoll of Singapore-based consultancy JTD Energy, adding that this creates volatility in oil markets.
He added that oil markets are probably skewed a little bit to the downside with Trump’s policies aimed at boosting US output as he seeks to secure overseas markets for US crude.
“He’s going to want to muscle into some of the OPEC market share so in that sense he’s kind of a competitor,” Driscoll said.
However, OPEC and its allies including Russia have yet to react to Trump’s call, with OPEC+ delegates pointing to a plan already in place to start raising oil output from April.
Both benchmarks posted their first decline in five weeks last week as concerns eased about sanctions on Russia disrupting supplies.
Goldman Sachs analysts said they do not expect a big hit to Russian production as higher freight rates have incentivized higher supply of non-sanctioned ships to move Russian oil while the deepening in the discount on the affected Russian ESPO grade attracts price-sensitive buyers to keep purchasing the oil.
“As the ultimate goal of sanctions is to reduce Russian oil revenues, we assume that Western policymakers will prioritize maximizing discounts on Russian barrels over reducing Russian volumes,” the analysts said in a note.
Still, JP Morgan analysts said some risk premium is justified given that nearly 20 percent of the global Aframax fleet currently faces sanctions.
“The application of sanctions on the Russian energy sector as leverage in future negotiations could go either way, indicating that a zero risk premium is not appropriate,” they added in a note.
On another front, Washington swiftly reversed plans to impose sanctions and tariffs on Colombia, after the South American nation agreed to accept deported migrants from the US, the White House said in a statement late on Sunday.
Sanctions could have disrupted oil supply, as Colombia last year sent about 41 percent of its seaborne crude exports to the US, according to data from analytics firm Kpler.
Global sustainable bond issuance to reach $1tn in 2025: Moody’s
- Impending maturity wave is set to escalate, signifying additional refinancing requirements alongside regular issuance goals
- Moody’s said ESG risks this year will be influenced by policy decisions and financing.
RIYADH: Global sustainable bond issuance is projected to reach $1 trillion in 2025, driven by a worldwide focus on green development, according to global credit rating agency Moody’s.
In their latest report, the New York-based firm said that increased examination of greenwashing, changes in market norms and regulations, and a more intricate landscape, which includes political challenges in certain nations, are expected to impede growth.
This aligns with the green bond market, which has advanced a decade beyond the international treaty on climate change that was signed in 2016, known as the Paris Agreement. The market provides a boost to the sector as initial issuances are gradually approaching maturity.
The impending maturity wave is set to escalate this year and 2026, signifying additional refinancing requirements alongside regular issuance goals, according to capital market firm AXA Investment Managers.
“We expect global sustainable bond issuance to total $1 trillion in 2025, in line with 2024. Social bonds will be constrained by a lack of benchmark-sized projects, while transition-labeled bonds and sustainability-linked bonds will remain niche segments as they navigate evolving market sentiment,” Moody’s report said.
“A continued focus on climate mitigation financing, as well as growing interest in climate adaptation and nature, will spur green and sustainability bond issuance,” it added. “Meanwhile, the widening gaps between decarbonization ambitions and implementation will be brought into focus by the contrast of fresh pledges and increasingly destructive climate events.”
Regarding the outlook on environmental, social, and governance factors, Moody’s said the risks this year will be influenced by policy decisions and financing.
“Companies will encounter challenges in handling environmental and social risks within their supply chains. Additionally, technological disruptions, climate change, and demographic shifts could exacerbate social risks and pose policy obstacles for governments,” the agency added.
In November, Moody’s said that global issuance of sustainable bonds in the third quarter of last year reached $216 billion, marking a 9 percent annual increase.
It said at the time that the year-on-year increase in green, social, sustainability, and sustainability-linked bonds came despite a quarter-on-quarter drop, with the volume issued down 14 percent in the three months to the end of September compared to the preceding period.
For the first nine months of 2024, sustainable bond volumes reached $769 billion, marking a 3 percent decline compared to the same period last year.
Despite the quarterly dip, Moody’s forecasted that the total sustainable bond volumes will reach $950 billion in 2024 “buoyed by relatively robust volumes in the first half of the year and continued issuer appetite for funding environmental and social projects with labeled bonds.”
Saudi benchmark index inches up 0.26% to close at 12,386
RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Sunday, gaining 32.12 points, or 0.26 percent, to close at 12,386.16.
The total trading turnover on the benchmark index reached SR5.11 billion ($1.36 billion), with 161 stocks advancing and 69 retreating.
The Kingdom’s parallel market, Nomu, also saw a modest gain, rising 49.70 points, or 0.16 percent, to close at 30,896.29, as 49 stocks advanced and 42 declined.
The MSCI Tadawul Index closed up by 2.01 points, or 0.13 percent, finishing at 1,545.39.
Kingdom Holding Co. emerged as the day’s top performer, with its share price surging 9.80 percent to SR10.20. Other notable performers included Al-Baha Investment and Development Co., which rose 9.30 percent to SR0.47, and Saudi Fisheries Co., whose share price jumped 7.84 percent to SR24.28.
On the downside, Al-Jouf Cement Co. recorded the largest drop, falling 3.57 percent to SR12.44. Arabian Pipes Co. also saw its stock decline by 2.50 percent, closing at SR13.26, while Rasan Information Technology Co. dropped 1.94 percent to SR90.80.
On the announcements front, Al-Baha Investment and Development Co. announced its annual financial results for the period ending Dec. 31. The company reported a net profit of SR8.37 million for 2024, a 69.48 percent increase compared to 2023. The growth was primarily driven by a 13 percent rise in revenues, a 98 percent drop in zakat provisions, a 39 percent reduction in financing costs, and a decline of SR1.18 million in investment properties.
Al-Moammar Information Systems Co. has signed a SR58.6 million contract with the Saudi Authority for Data and Artificial Intelligence to enhance the AI network through software and services.
According to a bourse filing, the 36-month deal is expected to generate positive financial impacts starting in Q1 2025. The stock closed at SR160.40, up 0.51 percent.
Al-Sagr Cooperative Insurance Co. received an Insurer Financial Strength Rating of “BBB” and a National IFS Rating of “A+” with a stable outlook from Fitch Ratings.
The ratings reflect Al-Sagr’s strong capitalization, solid financial performance, and well-diversified insurance portfolio, despite its moderate operating scale within the Saudi insurance market. Al-Sagr’s stock closed at SR18.10, up 3.20 percent.
Saudi-based Walaa Cooperative Insurance Co. maintains ‘A-’ rating: S&P Global
- S&P expects Walaa to maintain this level of capital adequacy over the next two years
- It also expects the company to gradually improve its combined ratio to about 98% in 2025—2026
RIYADH: Saudi Arabia’s Walaa Cooperative Insurance Co. maintained its “A-” long-term insurer financial strength rating by S&P Global, with a stable outlook.
The New York-based credit rating agency also affirmed its “gcAAA” long-term Gulf Cooperation Council regional scale rating and “ksaAAA” long-term Saudi national scale assessment for Walaa, highlighting the insurer’s capital position and planned business growth initiatives.
This comes as the company completed an SR468 million ($124.8 million) rights issue in December 2024, initially announced in September 2023.
The additional capital will support the firm’s growth strategy and enhance its regulatory solvency margin.
S&P said Walaa’s capital adequacy exceeded its 99.99 percent confidence level before the reserve increase, with the recent capital injection further strengthening the company’s financial stability.
The rating agency expects Walaa to maintain this level of capital adequacy over the next two years, underpinning its stable outlook.
The firm’s stock price has already seen a significant 5.26 percent increase by 2:20 p.m. Saudi time to reach SR24.
Despite its strong capital position, Walaa’s operating performance has lagged behind similarly rated peers, according to S&P.
At the end of the third quarter of last year, the company ranked as the fifth largest insurer in the Kingdom, with insurance revenue reaching SR2.4 million and a growth rate of 17 percent.
However, the insurer faced challenges in profitability, driven by its medical insurance segment.
The combined ratio — a key measure of underwriting performance — stood at 101 percent for the third quarter of 2024, compared to 98 percent during the same period the previous year.
While the motor insurance segment, which experienced losses between 2021 and 2023, returned to profitability in 2024, reporting a service result of SR18 million for the third quarter, Walaa’s medical insurance business posted a significant loss of SR85 million during the same period.
This marks a sharp decline from the SR4 million loss recorded in the third quarter of 2023. The company plans to expand its medical insurance segment over the next two years, aiming for breakeven by the year’s end.
S&P said the goal may be challenging due to the competitive and concentrated nature of the medical insurance market in Saudi Arabia, which is projected to reach $4.33 billion this year, according to German online data gathering platform Statista.
The medical segment is dominated by The Co. for Cooperative Insurance and Bupa Arabia for Cooperative Insurance, which collectively accounted for 76 percent of market revenue and most of the segment’s profitability in the third quarter of 2024, according to S&P.
Walaa’s ability to achieve breakeven in this segment will play a critical role in the recovery of its overall performance.
S&P expects Walaa to gradually improve its combined ratio to about 98 percent in 2025— 2026 as it continues to diversify its business and recover its operating performance.
The agency also flagged potential risks, including the possibility of a negative rating action if Walaa’s underwriting performance is weaker than its local and regional peers or if its capital adequacy falls below the 99.95 percent confidence level.
S&P views the likelihood of a rating upgrade as limited during the outlook period. Any positive rating action would depend on Walaa’s ability to significantly increase and diversify its premium income without impairing operating performance, while maintaining capital adequacy at the 99.99 percent confidence level and a low-risk investment portfolio.
