NATO allies with forces stationed around the Baltic Sea went on high alert after the December 25 incident

International News via Reuters:

The captain of an oil tanker and two officers accused of severing five undersea power and telecoms cables in the Baltic Sea last December, blamed technical faults for the damage as their trial began in Helsinki on Monday.

NATO allies with forces stationed around the Baltic Sea went on high alert after the December 25 incident, one of a string of suspicious cable and gas pipeline outages in the region since Russia invaded Ukraine in February 2022.

Prosecutors say the Eagle S tanker deliberately dragged its 11,000 kg (24,250 lb) anchor along the seabed to sever the Estlink 2 power cable linking Finland and Estonia and four internet cables as the vessel sailed from a Russian port via the Gulf of Finland.

Finnish security forces intercepted the Cook Islands-registered ship and boarded it from helicopters after ordering it to move into Finnish territorial waters.

The tanker’s Georgian captain, Davit Vadatchkoria, and its Georgian first and Indian second officers pleaded not guilty, saying the vessel’s anchor had dropped due to technical faults in the securing of the anchor winch.

State prosecutor Heidi Nummela said that, while investigators did not find proof that the anchor’s fastening had been manipulated, the failure of all three available backstops was at minimum a sign of gross negligence on the crew’s part.

Finnish prosecutors are seeking 2.5 years in prison for aggravated criminal mischief and aggravated interference with telecommunications for the defendants who deny all charges and reject the cable owners’ claims for damages that amount to tens of millions of euros.

They also questioned the court’s jurisdiction in the matter, given the cable cuts occurred in international waters.

“This was a normal marine accident, not any sabotage,” second officer Santosh Kumar Chuarasia told reporters during a break.

He said that the anchor dropped due to bad weather and mechanical malfunction and that he trusted the court to rule in the defendants’ favour.

Vadatchkoria declined comment, while his lawyer Tommi Heinonen told the court the incident was “a marine accident”.

On December 25, the Eagle S sailed on for three hours at a reduced speed after severing the first power cable at 12:26 p.m. (1026 GMT), prosecutors told the court. When contacted by Finnish marine authorities at 3:20 p.m. and asked whether its anchor was up and secured, its crew replied in the affirmative, which was not true, prosecutors said.

Defence lawyers said the defendants had no reason to believe the anchor had sunk to the seabed as the tanker’s mechanical engineer, who is not on trial, had told them the drop in speed was caused by “an engine problem”.

Prosecutors said the tanker sailed on and cut four more cables between 6 p.m. and 7 p.m. that day, which they said showed clear criminal intent.

Last week, a Ukrainian was arrested over the 2022 attacks on the Nord Stream gas pipelines in the Baltic Sea. Both Moscow and the West have described the explosions, which largely severed Russian gas supplies to Europe, as sabotage.

($1 = 0.8619 euros)

Reporting by Anne Kauranen; writing by Anna Ringstrom; editing by Hugh Lawson, Mark Heinrich and Tomasz Janowski

Musk earlier this month had threatened to sue Cupertino, California-based Apple

International News via Reuters:

Billionaire entrepreneur Elon Musk’s artificial intelligence startup xAI sued Apple and ChatGPT maker OpenAI in U.S. federal court in Texas on Monday, accusing them of illegally conspiring to thwart competition for artificial intelligence.

Musk earlier this month had threatened to sue Cupertino, California-based Apple, saying in a post on his social media platform X that “Apple is behaving in a manner that makes it impossible for any AI company besides OpenAI to reach #1 in the App Store.”

Reporting by Mike Scarcella;

The Chinese government has been seeking to boost domestic consumption to revive a sluggish economy that is navigating several pressures

International News via Reuters:

E-commerce company PDD Holdings, which operates low-cost platforms Pinduoduo in China and Temu internationally, beat quarterly revenue estimates on Monday, although net profit fell due to investments to ward off growing competition.

U.S.-listed shares of the company were up 1%, after having jumped more than 11% in premarket trading, following executive comments that increased investments will cause choppiness in near-term financials.

The Chinese government has been seeking to boost domestic consumption to revive a sluggish economy that is navigating several pressures, including a weak property sector and U.S. President Donald Trump’s trade policies.

To help prop up demand, e-commerce majors, including Pinduoduo, JD.com and Alibaba, have resorted to steep discounts and promotional offers. But that has sparked a price war.

Along with the need to keep prices low in China, PDD’s margins came under pressure in recent quarters due to a multibillion-dollar investment in merchant support programs and as U.S. tariffs drove up costs tied to international shipping.

The second-quarter earnings showed PDD has increased spending across the board on everything from server costs to sales and marketing expenses as part of its drive to improve the ecosystem for merchants and consumers alike.

INTENSIFIED COMPETITION

“In the past quarter, industry competition has intensified further … against this backdrop our revenue growth slowed and operating profit declined meaningfully for the second quarter,” Jiazhen Zhao, co-chief executive of PDD, said during a call with analysts.

“We do not believe this quarter’s profit levels are sustainable and expect fluctuations in profits in future quarters,” he said.

To cushion pressures, PDD’s Temu has been promoting products already in U.S. warehouses and trying to tap more local sellers. Still, it is facing competition from global e-commerce giant Amazon, which has used its scale to negotiate favourable pricing with suppliers.

Temu has also been pivoting to a “fully-managed” model where the company has more control over product selection, pricing and logistics, with hopes of leveraging its vast supply-chain network to keep prices low.

Even so, a survey released this month by online marketing firm Omnisend found 30% of American shoppers have noticed price hikes on Temu.

PDD’s revenue rose 7% to 103.98 billion yuan ($14.53 billion) during the quarter ended June, beating analysts’ estimate of 103.34 billion yuan, according to data compiled by LSEG.

Its operating profit fell 21%. Adjusted earnings per American depository shares stood at 22.07 yuan, exceeding the estimate of 15.74 yuan. 

“With earnings already on a declining trend, the market may adopt a ‘wait-and-see’ approach to gauge the extent of further potential erosion … Compared to peers, we think PDD’s heavier exposure to the U.S. through Temu will dampen its revenue growth,” CFRA analyst Jian Xiong Lim said.

($1 = 7.1561 Chinese yuan renminbi)

Reporting by Deborah Sophia in Bengaluru and Casey Hall in Shanghai; Editing by Shilpi Majumdar, Susan Fenton and Helen Popper