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Europe Cracks Down on American Tech Firms; Firms Covered by "Safe Harbor" Deal; French Prime Minister Condemns Air France Attacks; European Markets Rise on Oil and Auto Stocks; Volkswagen CEO Says Massive Cutbacks on the Way; Fantasy Football Furor. Aired 4-5:00p ET

Aired October 06, 2015 - 16:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[16:00:00]

ISA SOARES, CNN HOST: Wall Street struggles to hang onto its winning streak. It is Tuesday, October the 6th.

(MUSIC PLAYING)

SOARES (voice-over): Tonight, Edward Snowden celebrates as Europe cracks down on American tech firms.

France's prime minister says the attacks on Air France bosses could leave the country's reputation in tatters.

And if it's a real fraud, is this just fantasy? Two sports gaming sites caught in a gambling controversy.

I'm Isa Soares and this is QUEST MEANS BUSINESS.

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SOARES: A very good evening to you.

Tonight, Edward Snowden hails a landmark decision that may change the way tech companies do business on both sides of the Atlantic. The European

Court of Justice has thrown out an agreement that allows businesses to transfer data on European users to the U.S.

Now Snowden, his revelations about U.S. government surveillance set off the legal fight, praised the court. This is his tweet. This is what

he had to say.

"This is the second time in as many years the world has rallied upon the Court of Justice of European Union to defend digital rights," he said.

"Thank you, Europe." Those were his words.

Well, the so-called safe harbor law was set up back in 2000. What it did, it allowed American firms to store European data in the U.S., removing

the need for extra data centers right here in Europe.

In its ruling, the European court said it was worried that data could be subject to, quote, "mass indiscriminate surveillance as well as

interception." Now companies may be forced to make their service more secure or even move into Europe.

On top of that individual member states are now required to investigate complaints on their own and could impose additional bans.

So you can see how this is all shaping up. And it could be made particularly onerous for the 4,400 companies both big and small that are

covered by safe harbor laws.

Speaking after the ruling was announced, European Commission vice president Frans Timmermans said work to strengthen private protections

would continue. Take a listen.

(BEGIN VIDEO CLIP)

FRANS TIMMERMANS, EUROPEAN COMMISSION VICE PRESIDENT: In the meantime trans-Atlantic data flows between companies can continue using other

mechanisms for international transfers of personal data available under E.U. data protection law.

Our priorities as commissioner are, first of all the protection of personal data transferred across the Atlantic; secondly, the continuation

of trans-Atlantic data, flows which are important for our economy with adequate safeguards; thirdly, the uniform application of E.U. law in the

internal market.

(END VIDEO CLIP)

SOARES: To put all this all into perspective for us is our business correspondent, Samuel Burke.

And Samuel, this pact has basically existed for 15 years.

So why change it now?

And more importantly, why is this a big deal?

Explain to viewers around the world why it matters to them.

SAMUEL BURKE, CNN CORRESPONDENT: What we have is a perfect situation here, a European on one side of this table and an American on the other

side of the table because what we are seeing here is a real divergence in the way Americans are handling privacy, treating it more as a consumer

protection.

And the way you that you guys, the Europeans are treating it, more as a civil right. And we're seeing this over and over again in the courts.

We're seeing it in rules and laws. And we're seeing it in how governments are approaching this.

This is part of a bigger picture that's happening here in Europe. I want to just put up on the screen where we can see this, the right to be

forgotten. Remember, Google now has to comply with each local regulator.

If somebody doesn't like a Google result, they can go to their local regulator and say I want it removed. We even have reports of Germany

considering building its own Internet. They're, of course, upset about some of the reports that they have heard about Americans spying allegedly.

So maybe their own Internet to protect them. And now this safe harbor agreement ruled invalid. So what this means is a lot like the Google

situation. People will now have to go to their local regulator.

That's what it's going to mean for each of these companies. Each country in Europe will now have a say over how their data is handled. So

if you're a German citizen, you're upset, you might go to the German regulators and say I want this change and now all those companies are going

to have to comply with that.

But this picture you're painting, it means it's going to be a bureaucratic nightmare, just red tape after red tape in every single

country. For the big companies we've been talking about, the big tech giants, they have the financial means.

What about the small companies? What do they do?

I've been talking to analysts all day long who say, oh, you guys on television, in the news you're talking about Facebook, Google, Twitter.

They all have the money to deal with this.

Some of them will find ways to get around it, in some ways but they also find ways to comply with it with their lawyers. If you're a small

company in the U.S. like many of these small businesses we profile on CNN and you've just set up shop in Europe, can you imagine --

[16:05:00]

BURKE: -- dealing with a regulator in Germany, in Austria, in the U.K.?

It's going to be a real headache for those people.

I want to just read you what Facebook said in their statement because I think it really summed it up really quite well.

They said, "This case is not about Facebook," even though it was originally about Facebook but they're right.

"The advocate general himself said that Facebook has done nothing wrong. What is at issue is one of the mechanisms that European law

provides to enable essential trans-Atlantic data flows."

So Facebook is right. Yes, the case was specifically about them but it applies to everybody. For the moment, data's going to keep on flowing

from Europe to the United States. But we're in a gray zone right now. In the coming weeks and coming months, each country with their own set of

regulations.

SOARES: Samuel Burke, putting it into context for us; as always, great job. Thanks very much, Samuel.

Now Vera Jourova is the European Commissioner for Justice, Consumers and Gender Equality. She told me the ruling was not a surprise.

(BEGIN VIDEOTAPE)

VERA JOUROVA, EUROPEAN COMMISSIONER FOR JUSTICE: The ruling of the court, which was announced today, in fact, was not a big surprise for the

commission because it confirmed we need to negotiate a better and safer system for the protection of data of European citizens when the data is

transferred to the United States.

SOARES: The understanding is, the analysis seems to be, that with this, with the suspension of safe harbor then that will impact the economy,

in particular hurt small and medium-size companies.

What is your view on this?

JOUROVA: Yes. Of course, we have a specific system for transfer of data between E.U. and U.S. for a very good purpose, because there is a very

large scope of data transferring between business to business. We have 4,400 companies subscribed under the safe harbor system.

So what do we need to do now is to provide clear guidance for the companies, what to do under the changed legal conditions. And what they

should do, of course, they will have to comply with the rules provided for in the current directive for data protection.

SOARES: What would this new guidance, this new framework, what would that look like?

JOUROVA: Well, the guidance will refer to the existing rules, which, as I said are coming from the directive. So it means that companies will

have to make agreements, the contracts with the special clause on data protection.

Or they would or should have the binding corporate rules in case we speak about corporations which are based in E.U. and U.S. at the same time.

And there are some other rules which can be applied. Simply said, now without having safe harbor, there will be other mechanisms used.

Commissioner, many may say that this is just another sign of Europe being unfriendly to the big tech companies.

What do you have to say to that?

JOUROVA: Well, I don't want to speak about what's friendly or unfriendly. Our main duty is to ensure very high standard of the

protection of the data of European citizens when the data is transferred to third countries, which is the case of European -- of the United States.

And the second big priority for me is now to make sure that the businesses will know the conditions under which they will continue

transferring the data.

And I must say that I find this as a very strong commitment on our side because the companies act in good faith and we need to help them to

overcome this, let's say, difficult moment.

(END VIDEOTAPE)

SOARES: Still to come right here on QUEST MEANS BUSINESS, an attack on Air France bosses is an attack on France's reputation. The French prime

minister vows to crack down on violent protesters. We're live in Paris, just ahead.

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[16:10:00]

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SOARES: France's Prime Minister Manuel Valls says Monday's attack on Air France executives has damaged his country's reputation right around the

world.

Furious protesters ripped the shirts off the backs of HR bosses after the company revealed plans to cut nearly 3,000 jobs. Several executives

needed help from security staff to flee the crowds.

(BEGIN VIDEO CLIP)

SOARES (voice-over): As you can see there, some climbed those fences to try to get away. Air France said the majority of demonstrators were

peaceful. Manuel Valls visited the airline's headquarters on Tuesday and said those responsible will be brought to account.

MANUEL VALLS, FRENCH PRIME MINISTER (through translator): Nothing can justify such acts. These acts are the work of thugs. The criminal justice

system will have to identify those who behaved with such unspeakable violence.

Violence is unacceptable in our society. It has to be condemned. And those who perpetrated such acts should be severely punished.

(END VIDEO CLIP)

SOARES: Now it's not the first time we've seen things turn nasty at French labor protests. Take a look at some of these examples. These are

Goodyear protests. Goodyear employees, who feared job cuts, set tires on fire and then clashed with officers back in 2013. That's actually near

Paris.

When those cuts were announced the following year, the workers held two executives hostage for two days.

But it doesn't stop here. In another case of boss-napping, as it's called, workers detained a 3M factory director for more than 24 hours in a

spat over severance pay in 2009.

Now after he was released, a court awarded 800,000 euros to be shared between more than 100 laid-off employees.

And if we stay in that year, also in 2009, workers in Central France rigged an auto factory booby trap and then threatened to set off explosions

lest they were given the desired payouts.

You're starting to get the picture.

Christian Malard is an international diplomatic consultant. He's a very familiar voice here on the show, QUEST MEANS BUSINESS.

Christian, always good to have you on the show. We've seen the protests taking place in France the last few days, some of them pretty

heated and combative.

Do you think they'll make any difference when it comes to reaching an agreement?

CHRISTIAN MALARD, INTERNATIONAL DIPLOMATIC CONSULTANT: Well, you have to understand, Isa, that Air France is a company which has been undergoing

for weeks and years now a lot of crisis but now we come to a peak with 2,900 jobs which are going to be suppressed by the chairman, by the

company.

So on the one hand you have a company which has been doing great in the past with a lot of privileges for the employees but the timing, the

world has changed. The world has modernized. And it seems that the company has not been following all this.

So we need to really reform this company like we need to reform the country in France, economically speaking. And a lot of the employees are

just mad at the way the chairman of the company has been managing it. So it's clear that the situation is going to harden in the future. It seems

that the social dialogue in this country --

[16:15:00]

MALARD: -- is broken. Let's say two months before regional elections and 17 months before presidential elections, it seems that the crisis is

going to go up and up. And the unions are not helping.

When the prime minister -- you probably put it on the CNN on air -- when the prime minister qualified a part of the demonstrators as thugs, I

think he is right.

Not all the people who have been trying to attack the Air France people, the representative of the company, are steward or stewardesses or

pilots. It seems like the word, "thugs," used by the prime minister Valls is the right things. So the situation is seriously deteriorating.

SOARES: And Christian, I mean, the prime minister basically said the images of the protests, he said, hurts our economy. Those were his words.

How damaging do you think this can be for the French economy?

MALARD: Well, Air France is representing France. It's something very important, Air France. And definitely when the French president says it's

damaging the image and the reputation of the country, on this he is right.

But I think the economy of this country has been handled the wrong way. I think President Hollande has been responsible. He's been asking

for -- putting so many promises. He made so many promises. And he didn't even all the promises. So people are very disappointed.

There is a social climate which is very bad in this country right now. And this is why you would see a lot of people has been shocked by what

happened today with the Air France and they are shocked also by the way things go in this country.

The rate of unemployment has been rising and rising. And it seems to us that the government don't have any solutions. And this is why it's

becoming political.

And the lead -- one of the top leader of the opposition, former President Sarkozy, used the word today, "chienlit." It was a word used by

General de Gaulle in 1968 when we had this social student revolution. And it seems to say in a certain way that the country is not under control

anymore. And this is what we worry about here.

SOARES: So these combative feelings definitely go much deeper.

Christian Malard there for us in Paris.

Thanks very much, Christian.

We'll take a quick look at how European stocks closed the day today. Markets were led by mostly auto and oil sector stocks.

Let's look at the markets. At the end of the day, well, they finished -- well, the CAC 40 was probably the best performer at 1 percent; FTSE

didn't do too bad.

But look at the Xetra DAX, that's pretty much flat. A lot of these stock prices, share markets were boosted by expectations the Fed will

maintain easy monetary policy. And a lot of the big gain is there for auto shares. It's quite a turnaround from what we've seen in the last two weeks

also.

Now painful cutbacks on the way at Volkswagen. That's what the company's new CEO told 20,000 employees as they gathered at the VW

headquarters. Muller said massive savings. Those were the words. Are needed because of the emissions scandal.

All non-essential investments will be canceled as well as postponed. Volkswagen shares closed almost 4 percent higher today.

Well, Alan Brown is chairman of the Volkswagen National Dealer Advisory Council in the U.S. He's also partner at largest freestanding VW

dealership in the country. He told Richard Quest that the brand can indeed recover. Take a listen.

(BEGIN VIDEOTAPE)

ALAN BROWN, CHAIRMAN, VOLKSWAGEN NATIONAL DEALER ADVISORY COUNCIL: Our hope and prayer as a dealer network and as a brand is that we get the

fix and the fix has no interruption in fuel economy and performance on what the customer paid for on their vehicle.

RICHARD QUEST, CNN HOST: And, I know sir, I'm taking you into speculative waters. But you must be having many clients and customers and

other dealers ringing you, calling you up and saying, what if, what if people are not getting it?

What if people want their money back?

What if people say the car isn't worth as much?

These are real practical problems that you, sir, as a dealer are going to have to face.

BROWN: No, you're absolutely right. And you know every customer's need, every customer's question is going to be very specific and unique to

them in that particular moment. That's what we're preparing for as a brand and as a dealer body, is how we take each one of those questions and walk

down through it to make everyone feel like they've come out of the other end of this situation better than the way we went into it.

QUEST: Have you had, in terms of people coming into your showrooms, are -- do you get the feeling that people are shunning Volkswagen, at least

for the time being?

BROWN: You know we have a very iconic brand here in North America. We have a very loyal customer.

[16:20:00]

BROWN: The customers that I've talked with so far have been very forgiving through the process. And obviously, down here in Texas, we've

got a lot of customers who are saying, hey, don't touch my car; leave it just the way it is.

QUEST: Ah. Now. Ha, ha. You've said exactly the point.

"Don't touch my car. Leave it just the way it is."

Do you think that is even going to be an option for people to say "Don't touch my car, leave it just the way it is"?

Or effectively will those cars that aren't touched become unsellable?

BROWN: You know we don't know. And those are some of the questions, obviously, that the dealer network has.

I know those are questions that the brand is working through day and night to make sure we check all the boxes of every single question we're

going to come up against but it is something that we're going to have to be prepared for.

QUEST: Finally -- and you've been very kind and very honest in dealing with this.

Finally, can the brand recover?

I suspect you'll say yes.

But how does it recover?

BROWN: Well, my immediate response is, "Absolutely." We have a brand with tremendous resources. And they are, as you've seen, pouring those

resources into this situation at light speed, with restructuring of management, with putting their arms around the dealer network so that we

can get prepared to put the customer first through this process.

I'm very reassured and it is exciting to see that I believe, truly, this will be our finest hour and we will come out better than the way we

went in.

(END VIDEOTAPE)

SOARES: Positive thinking there.

Still ahead right here on QUEST MEANS BUSINESS, it's a multibillion- dollar industry that trades on the imagination of its fans. It's the real world of fantasy sports. And it's been rocked by accusations of insider

cheating. We'll break it down for you next.

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SOARES: Two of its biggest players in fantasy sports is staring at real trouble. DraftKings and FanDuel have had to ban employees from

playing fantasy games for money. This ultra allegation they use inside information to win big.

Let me talk you through how fantasy sports works and this is how it works. Users choose a line-up and they create a team from a list of real

players.

[16:25:00]

SOARES: Those players' statistics on the field are given point values and then added up to give the fantasy team a whole score.

Now on DraftKings and FanDuel, users pay to enter competitions, comparing their scores to thousands of others with a chance to win cash

prizes if they come out clearly on top.

Now the allegation here is that employees at these companies could see which players were being used the most and, therefore, they placed bets

using different players to increase their chances of actually winning.

In a joint statement, DraftKings and FanDuel refuted these claims. This is what they had to say.

"Employees with access to this data are rigorously monitored by internal fraud control teams and we have no evidence that anyone has

misused it."

Well, in the last hour, CNN has learned that the sports network, ESPN, is pulling all segments sponsored by DraftKings from its air. That's the

concerns.

Well, I spoke to "WORLD SPORT's" Rachel Nichols and asked her to talk us through this scandal.

(BEGIN VIDEOTAPE)

RACHEL NICHOLS, CNN CORRESPONDENT: Fantasy football probably sounds like your kid in his back yard, trying to pretend he's some big star.

That's not what we're talking about here.

We're talking about an industry worth billions of dollars in revenue a year; 58 million Americans play. Fantasy football started out as a much

more mom-and-pop kind of operation, the things college friends would play with each other, maybe a couple hundred bucks on the line for an entire

season.

It has turned into an industry. These websites, instead of just pitting you and three or four buddies against each other, pit you against

millions of other players. And the allure is that you get a quick payout and you know the stakes are high. If you win, then you get these million

high-money dollar payouts.

The problem is that you have to come up with a line-up of players that is better than everyone else's line-up. And if you are competing against

someone who has some inside information, who is an employee of one these companies and knows from a bunch of aggregate algorithms who the best

players are to pick, well, that's not fair.

So these companies had previously had a rule that their own employees couldn't compete on their own sites but their employees just went and

competed on another site, maybe using some of that inside information. It hasn't been proven yet.

But the truth is we'll never know because, right now, this is not regulated. There's no oversight. All we have are the companies saying,

no, no, no, everything's fine, nothing to see here. And with all the money changing hands, people think, maybe that's not the best approach.

SOARES: Absolutely. You're talking about the money changing hands as you bet, as you pick your team.

But we're also talking about a lot of advertising money that goes behind these companies really, doesn't it?

NICHOLS: Well, it's a tremendous amount of money. A lot of sports networks, it seems, just from watching them, that these websites are paying

up to 30 percent to 40 percent of their advertising budget -- sports teams.

The NFL doesn't have any kind official deal with these websites but many sports teams have marketing deals with them. I believe 29 of the 32

NFL teams do. The NBA has an actual investment in one of these websites. Major League Baseball has an actual investment in one these websites.

So the problem is these websites need oversight but there are some very powerful figures in the world of sports -- the NBA, Major League

Baseball -- that maybe don't have the interest in getting them regulated.

Well, that's a big conflict, right?

SOARES: Oh, absolutely, which begs the question, many people would say, look, this is getting close to online gambling. This, of course, is

legal.

So how do you go on to regulate these sites like this, Rachel?

NICHOLS: It's a great question because, look, the United States is a little different than a lot of countries in Europe, where online gambling

is completely acceptable. But here in the U.S., online gambling was outlawed. There was a rule passed in Congress, a law passed in 2006. But

it had a loophole. That was back when it was just most people with their college friends for a couple hundred bucks.

And so Congress decided, hey, we don't want to get involved in regulating that. So there was a loophole in that 2006 legislation against

online gambling.

Well, now it's turned into not just you and your friends. It's turned into what appears to be gambling to a lot of the naked eye, that judgment

test.

And the question is, will Congress take steps to close the loophole if individual sporting organizations don't?

There is a Democratic representative from New Jersey, who has said that he wants to take another look at this. But we also have powerful

lobbyists in Washington, D.C., from all these sports franchises, from these websites, that are going to try to convince other congressmen and senators

not to look at it.

(END VIDEOTAPE)

SOARES: Rachel Nichols there.

Still to come right here on QUEST MEANS BUSINESS, a stark warning from the International Monetary Fund. Global growth at its worst level since

the financial crisis. We'll tell you why -- just ahead.

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[16:30:00] SOARES: Hello, I'm Isa Soares. Coming up on the next half hour of "Quest Means Business," the UAE's economy minister tells us why his

country will rise and fall with the rest of the world.

And shiny Rolexes and tailored suits - the former president of the U.N. General Assembly is caught up in an extraordinary bribery scandal.

Before that though, these are the top news headlines we're following for you this hour.

The U.S. Secretary of Defense says the bombing of a Doctors without Borders hospital was a mistake. Ash Carter said he deeply regrets

Saturday's attack at Kunduz, Afghanistan which killed 22 people.

Earlier, the head of U.S. forces in Afghanistan said that he may have had to adjust his recommendation for troop levels there.

NATO confirms Russian combat planes had violated Turkish airspace for a second time. Secretary General Jens Soltenberg said the violations do

not appear to have been accidental and that ISIS may not be the primary target of Russian airstrikes in neighboring Syria.

He told CNN that Russian activity in the region is increasing.

(BEGIN VIDEOCLIP)

JENS STOLTENBERG, NATO SECRETARY GENERAL: We have seen a substantial military buildup by Russia in Syria, both in the air with combat planes and

air defense systems but also an increasing number of ground troops.

In addition to that, they have deployed naval assets - a large number naval assets - close to the Syrian shores. And they continue to do so.

I'm not able to provide any exact numbers but they have increased their military presence very much over the last weeks.

(END VIDEOCLIP)

SOARES: Meanwhile, Turkey's president says NATO airspace must not be violated. Recep Tayyip Erdogan says Turkish relations with Russia would be

jeopardized if the incursions continue.

(END VIDEOCLIP)

[16:35:00] RECEP TAYYIP ERDOGAN, TURKISH PRESIDENT, VIA INTERPRETER: An attack against Turkey is an attack against NATO. I want people to know

that. We know our relationship with Russia. But if Russia wants to lose Turkey as a friend with whom it has a great cooperation, then Russia will

lose a lot of things. Russia needs to know that.

(END VIDEOCLIP)

SOARES: Palestinian authorities President Palestinian authorities President Mahmoud Abbas says he does not want an escalation of violence

with Israel as days of unrest threaten to spiral out of control. Palestinian protestors clashed again with Israeli forces in the West Bank.

The Palestinian Red Crescent said at least 90 Palestinians were hurt. Israel's military says it has no report of injuries.

Return you now to business news and the weakest global growth since the financial crisis. That's not my assessment, that's what the IMF is

warning of as it cuts its forecast once again.

It now believes the world economy will grow 3.1 percent this year and 3.6 percent in 2016. The IMF says the following, "The holy grail robust

growth and synchronized growth remains elusive. Market volatility and the depreciation of China's currency is fueling uncertainty."

On top of that, falling commodity prices hit emerging economies particularly hard. Now although oil prices spiked 5 percent on Tuesday,

it's still down around 40 percent also over the past year.

Take a look at how it's fallen, and there you go. You see really what we have seen in terms of Brent crude for the past two weeks. It's been

extremely, extremely volatile.

Well the UAE's economy minister says his economy will grow 3 1/2 percent this year. That's largely thanks to diversification, away from

things like oil.

Sultan Al Mansouri told our emerging markets editor John Defterios there are still some factors though they just can't control.

(BEGIN VIDEOCLIP)

SULTAN BIN SAEED AL MANSOURI, UAE MINISTER OF ECONOMY: With the UAE I think we have spent the 3 1/2 percent is based on that other economies are

not growing. And of course we are very much export-oriented nation, whether it is oil or other products.

And definitely if the other nations start to grow, we will grow with it. If not, we will also be affected more. I do believe that the UAE also

have the tools and the abilities and we have seen that during the crisis 2008 to turn around, open new markets, diversify the economy more,

including of course the Islamic economy, introduction into the UAE economy and creating a niche for the UAE and for the world - for the Islamic world

and the world also.

JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: You know, I've covered this region for about a quarter century. I don' think I've seen as much

dislocation now, even going back to the first Gulf War.

How do you protect the role as a safe haven? It's a very fine line where people start to panic - pull money out of the banks, move away from

the Middle East.

AL MANSOURI: History, history. The UAE if you look at it during (AUDIO GAP) crisis where it was the Iran/Iraq war or the Kuwait crisis, the

Iraq situation and eventually many other crises that the whole region went through, the UAE came up with really flying colors when it comes to

supporting and standing behind the issue of stability in the region and - number one of course the UAE.

And also that's an example for the others that the UAE really sustained its policy of stability and the leadership --- where they

promise, they deliver.

DEFTERIOS: You have a very tough job right now. I mean, $50 oil or less cuts your revenues in half. That is extremely painful and this could

be the new normal. Are you OK riding this storm out as the Gulf countries fight for their market share?

Can this economy withstand?

AL MANSOURI: Absolutely, because we are just - you know, remember - the UAE has been able to grow over the years in many directions including

of course diversification of the economy.

And oil only contributes less than 50 percent of the GDP of the UAE.

And hence the effect of that is not as big as so many other countries. But also in a way it give us a strong message that has been passed by the

leadership, and that is continue with your diversification, use the oil resources and then if it comes out as someday oil will not be here, so we

are ever ready to grow and develop a proper (ph) economy.

DEFTERIOS: Fuel prices have gone up 20 percent, you're looking at introducing a VAT, power prices have gone up substantially. Is this the

new reality?

AL MANSOURI: (AUDIO GAP) International prices has been affected of course on reality of the prices as a whole around the world including of

course the UAE.

And hence this is why we took this step which is really important that were a bit worried about in the beginning. But it has proven to be

acceptable by the masses of people which is really excellent.

And now I think many other nations around us and the GCC are looking at what the UAE has done on this.

(END VIDEOCLIP)

[16:40:05] SOARES: We showed you how European markets fared today. I want to show you how U.S. stocks ended the day. And mostly they ended

pretty mixed after what we've seen as two days of strong gains.

Have a look at the Dow. They've eked out about 13 points or so -- a rise. But what a comparison that is to what we've seen the last two days

both on Monday as well. On Friday, really strong gains.

Now the S&P500 and the NASDAQ both finished lower. Shares of Yum! brands are down around 16 percent - that's in after-hours trading. Yum!

owns brands such as - that you know very well - Pizza Hut, KFC and Taco Bell.

They warned of disappointment sales in China and then cut its forecast there for the rest of the year. Many companies obviously still concerned

about China and slowing growth there.

Well still to come right here on "Quest Means Business," luxury watches, fine clothes - allegedly the price of influence at the United

Nations.

A U.S. attorney says the former president of the U.N. General Assembly sold himself and the global institution he led. More when we return.

(COMMERCIAL BREAK)

SOARES: Welcome back to "Quest Means Business." Now, the former president of the United Nations General Assembly has been arrested and

charged with taking more than $1 million in bribes. U.S. attorneys in New York said John Ash was given Rolexes, Spokes suits and even a private

basketball - a basketball court - in exchange for favors at the U.N.'s biggest event.

Our senior U.N. correspondent Richard Roth joins me now to explain the details of all this. And, Richard, this is pretty damning.

If he was receiving all this money and bribes, the question is what was he offering in exchange? Because as we know, nothing is free these

days.

RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: That's right. What he was offering according to federal prosecutors was he was given the money to

help set up a conference center on Macaw, there were other Chinese business officials who were arrested along with the president - former president -

of the General Assembly today in New York, John Ash.

He was the president of the General Assembly two years ago. Largely ceremonial posts, but definitely with some influence. This is what the

U.S. attorney said at a press conference a few hours ago about the level of bribes he received.

(BEGIN VIDEOCLIP)

PREET BHARARA, U.S. ATTORNEY FOR MANHATTAN: So what did these bribers do for Ash, the then-U.N. General Assembly president.

First, they gave him money, lots of it. From 2011 to 2014, they allegedly transferred over a million dollars in cash and in wire transfers

to Ash's bank accounts in New York, often in installments of up to $200,000 or $300,000 at a time.

[16:45:16] As alleged, Ash spent this cash lavishly on himself and on his family -- $59,000 on a single order of custom tailored suits, $54,000

for a pair of Rolex watches and $40,000 to lease a new BMW.

(END VIDEOCLIP)

ROTH: And as you mentioned, there was a $30,000 basketball court at his suburban in Dobbs Ferry, New York. And that is where he was arrested

at 6 a.m. today.

It is an astounding development for the U.N., a real thunderbolt coming just days after the 70th anniversary hoopla of the U.N. Isa.

SOARES: Absolutely. And you said, Richard, this is mostly a ceremonial role, but nevertheless highly embarrassing for the U.N.

So what is the U.N. saying about this? Is it commenting on it?

ROTH: They're saying they're shocked and sad. And the secretary- general through his spokesman said how disturbed he was. And even the man who now has the job the alleged corrupt John Ash has, the president of the

General Assembly, someone from Denmark said that if proven, this is an attack at the very heart of the integrity of the U.N.

He had just learned of it like all the U.N. officials this morning, Isa.

SOARES: Richard Roth there for us in New York. Thanks very much, Richard.

Still to come right here on "Quest Means Business," the world's biggest tech companies are looking to space as they race to bring internet

access to the entire globe. That's next.

(COMMERCIAL BREAK)

SOARES: Facebook has just announced its first project to deliver the internet from space - you heard it right. It is the latest move in a new

technology race that's gripping many of the world's biggest tech companies.

The race really is to connect billions of people who don't have - yet have - access to the Web. Our Claire Sebastian reports on the challenges

as well as the opportunities of this new frontier.

(BEGIN VIDEOCLIP)

CLAIRE SEBASTIAN, CNN PRODUCER: This is the AMOS-6, Facebook's latest salvo in the race to bring the internet to the entire world.

Facebook has partnered with French telecoms company Eutelsat to share all the broadband of the AMOS-6 satellite.

[16:50:04] You can see here the bits of dark orange are exactly where this particular satellite covers. Now take a look at the exact same map,

this shows internet usage in Africa, the darker colors are the higher number of users.

So you can see just how sparse it is. Put all that together and the need for this technology is very clear.

MARK ZUCKERBERG, CEO, FACEBOOK: We believe that connectivity is a human right.

SEBASTIAN: The AMOS-6 is the latest feature of a broader Facebook-led initiative called internet.org, a project that connects the 4 billion

people globally who still have no internet access.

Behind the altruistic campaign is a clear business message.

IAN BREMMER, PRESIDENT AND FOUNDER, EURASIA GROUP: If you're telling me that you're going to connect a billion people into Facebook that

potentially didn't have it before, it's great that those people will have that access, but this isn't like water, right?

I mean, this is something that you're absolutely going to be able to monetize and I suspect that the people that are holding Facebook shares

that want to be optimistic about Facebook will be looking at this very carefully.

SEBASTIAN: The challenge of connecting remote areas like Africa has galvanized Silicon Valley into action. Google is building more than 1,000

kilometers of fiber for broadband in Uganda and Ghana, an initiative known as Project Link.

And Microsoft is exploiting a new technology - the gaps between TV channels, unused spectrum known as white space.

BREMMER: We think TV white space is the type of technology that can help to get that last few billion people in the world connected.

SEBASTIAN: Still, in the quest to provide internet access to that last few billion, space is emerging as a leading candidate.

Elan Musk's SpaceX will be launching the AMOS-6 and that's alongside Musk's own plan to launch a network of 4,000 broadband satellites within

five years.

In June Richard Branson's Virgin Galactic also announced it was funding SpaceX rival OneWeb to create a similar network.

BREMMER: In the internet space, we've moved very, very fast over the course of the past years. I expect that's only going to speed up and right

now this is the big shiny object we should be talking about it.

SEBASTIAN: Facebook's big shiny object is still under construction, set to launch next year - a small step towards a new frontier for the

Worldwide Web.

Claire Sebastian, CNN New York.

(END VIDEOCLIP)

SOARES: Now to the world this world (ph) idea. Now the British businessman Ashish Thakkar is among those lobbying for internet access for

all.

He's the author of "The Lion Awakes" and told Richard that the African economy is stirring from its slumber.

(BEGIN VIDEOCLIP)

ASHISH THAKKAR, AUTHOR, "THE LION AWAKES" AND FOUNDER, MARA GROUP: We do have real opportunities and they are waiting to be tapped.

I mean, there's a lot of - I mean, our businesses are kind of growing extremely well across the continent. So it just proves that there are

things happening.

Yes, there are challenges, but that increases the entry level barrier and therefore the opportunities' even that much more.

RICHARD QUEST, CNN INTERNATIONAL ANCHOR AND REPORTER HOST OF "QUEST MEANS BUSINESS" SHOW: I suggest to you that what happens is people become

so subsumed and rosy and misty-eyed about the opportunities, but they don't deal with issues like corruption, transparency, the rule of law, anti-gay

laws.

All these things that are to some extent prevalent or present in different countries in Africa. They don't deal with these because

everybody's so busy thinking about the latest bank or the latest telecoms.

THAKKAR: I disagree. I think these issues are being addressed. I advise a few heads of state - I'm on the Global Agenda Council for Africa

for the World Economic Forum - I am seeing it firsthand.

Every single day that the continent is transforming, there's more governance, there's more transparency coming into the system.

Again, I can't generally - generalize - it positively the way we can't generalize it negatively. There are parts of the continent which are truly

being transformed.

QUEST: Why am I more pessimistic than you?

THAKKAR: Because you haven't spent enough time there. I think seeing it is believing it. Actually seeing the opportunities -

QUEST: Seeing what?

THAKKAR: The continent's opportunities, the countries meeting the government officials and seeing what kind of passion they have about

transforming their country.

President Ka -

QUEST: Seeing a variety of countries that couldn't deal with an Ebola crisis - that let it get completely out of control.

THAKKAR: But that was three countries out of the 54 countries which have been affected by Ebola.

QUEST: You see, that's the problem with this - with your argument. It's always 'that was this country,' 'that was Nigeria,' 'that was this' -

THAKKAR: No, but Nigeria fought Ebola and cleared it but it's never been celebrated because they did fight it and clear it. Like Nigeria had

peaceful free and fair democratic elections. Why isn't it talked about? Because they were peaceful, free and fair.

That's the issue.

QUEST: They were talked about.

THAKKAR: Not enough, not enough. And everybody expected the result to be different, yet the it was a peaceful, free and fair and we're going

to have an amazing transformation in the country.

But no one talks about that. And that's the issue we have.

QUEST: South Africa's economy is in a terrible state. Have you looked at the electricity, the provision of supply and energy - it's

appalling.

THAKKAR: South Africa's growth is a lot slower than the rest of the continent - I agree. And that's why our group is -

QUEST: But isn't that a classic example of mismanagement of an economy that used - that was in very good stead?

THAKKAR: But that is a classic example of again being generalized. That one county has that issue - and I agree. There's a few countries like

that. But we are a continent, Richard, and that's where it keeps on going wrong.

[16:55:00] QUEST: With respect, you seem to only what to generalize when it's positive in your book. You don't want to generalize the moment

it becomes something more critical.

THAKKAR: No, because it's a one-sided story right now. And this is why I'm trying to give you a real story of what I have been living every

day.

QUEST: So what does Africa need if it's going to reach its potential?

THAKKAR: In my opinion, I think we've had enough. We don't need the pity, we don't need people to feel sorry for us. What we need is

investment, we need partners and we need to do trade. We don't need aid.

(END VIDEOCLIP)

SOARES: Very heated discussion there. If you're an African, let us know your thoughts. Why don't you tweet Richard rather than me I should

say. @richardquest is his Twitter account.

Still to come right here on "Quest Means Business," he's scored more goals than any other player in history. Next, Pele tells me that modern-

day footballers have a very different goal in mind. What that is, just ahead.

(COMMERCIAL BREAK)

SOARES: We told you earlier how money's affecting fantasy sports and it's no secret how it affects the real game as well.

Pele says modern-day players are only concerned with getting paid. I sat down with him at a new exhibition in London devoted to his life.

(BEGIN VIDEOCLIP)

SOARES: Have players lost their passion for the game?

PELE, RETIRED BRAZILIAN PROFESSIONAL FOOTBALLER: The player has lost his passion for his country, for his club. But for football itself? No.

He'll continue to play and have passion for it.

But nobody is loyal to a single club anymore. Now they play for the country or club that pays the most money.

(END VIDEOCLIP)

[17:00:00] SOARES: And you can see my full interview with Pele in around half an hour from now on World Sport, only here on CNN.

And that does it for "Quest Means Business." I'm Isa Soares. Do stay here with CNN, the world's news leader.

END