Booking.com to repay €65M Dutch State aid after €28M in bonuses for 3 US execs

[neom]

Similar conversation happening in Canada (but no repayment):

"Bloc Québécois MP Xavier Barsalou-Duval put forward the motion, which states “that this House condemn the decision of senior management of Air Canada to pay themselves $20 million in executive bonuses when they’re received $6 billion in public assistance.”

Air Canada informed shareholders on Monday that its top executives and managers were getting a combined $10 million in stock options and bonuses for their response to the COVID-19 pandemic."

https://globalnews.ca/news/7918875/air-canada-executive-bonu...

[jlos]

The issue is (only slightly) more nuanced: while the executives collected bonuses, they did go for a few months without pay and their overall bonus' for 2020 were lower than in previous years.

It does reveals the reality of our managerial class--in a sort of distributed, quasi-feudalism they are entitled (legally and practically) to extract massive amounts of wealth from large corporate entities regardless of any negative impact on the company.

- Running the business into the ground (Target Canada)

- Running the business into the ground while underfunding the company pension (Sears)

- Lobbying for billions of dollars of tax dollars while cutting thousands of jobs (Bombardier, Air Canada)

[namdnay]

AC are particularly disgusting, because their execs spent the last year posting sob stories about how the Canadian government was forcing them to lay off their brave staff (going so far as to convince the people they were firing to post on linkedin that it was all the government’s fault)

[koblas]

Was listening to CBC and they made an excellent point. Which is that the Air Canada board of directors has nobody on it from any union or "representing" the employees. When you look at the compensation committee you see other people in executive roles.

Could you see any union representative on the board of directors voting for executive bonuses after they layoffs over the last year. Until such biases at the BOD level are addresses you will only continue to see similar actions.

[notsureaboutpg]

But that's 1/300 of the amount of aid they received spent on exec bonuses.

In the booking.com case it's almost half the amount of aid spent on exec bonuses

[Daishiman]

It must be so nice being a corporation and saying "oops, our bad, we'll get right on it" instead of going straight to prison if I were to personally defraud a state of so much money.

[AbortedLaunch]

There’s no fraud involved. Booking was legally allowed to keep the money.

[adflux]

I am tired of governments deciding to not pursue justice because it would be more expensive, because of the negative impact on the investment climate and the litigation costs. Justice isn't meant to be profitable. Let's bite the fucking bullet and jail the people responsible for this kind of behavior

[MattGaiser]

There is no fraud here at all. No rules were broken.

[ramenmeal]

It would be negligent on the booking.com executives behalf if they did not take this money when it was available. If there's an issue, it's in the relief program itself.

[gargs]

https://outline.com/Nf5eNe

Here's a little bit of background from an article at the start of the pandemic. The company had originally announced that they would cancel bonuses in exchange for government support. They even promised to protect jobs, which they didn't, and laid off around 5000 anyway.

[s1artibartfast]

Would like to see more info about what exactly they said about bonuses and to whom. The article only mentions it in passing

[Arrath]

Just despicable.

[mkl95]

A quick Google search reveals Booking's net income is two orders of magnitude above those figures. The Dutch State should ask themselves if Booking ever needed those €65M and review the process that got them that money.

[gargs]

They get close to €400 million a year in 'innovation subsidies', so this probably didn't warrant any checks.

https://www.quotenet.nl/financien/belasting/a27160874/nederl...

[the-dude]

Are those figures for 2020 / 2021, aka the COVID era?

I don't have those figures either, but at the time I think everybody agreed nobody knew what would happen. Booking.com's revenue might have fallen to close to nil.

[Raqbit]

This process was revised after the first round of aid to no longer allow the companies to give bonuses.

[stuaxo]

Given the choice of paying back the 28 million in bonuses or the paying back the 65 million in state aid, the execs took the hard choice and decided to keep the bonuses.

[ocdtrekkie]

This feels like something stockholders should sue over, as it's a deliberate choice for executives to screw the company to pad their personal profits.

[s1artibartfast]

Why do you think there was a choice? I don't see anything supporting that in the article.

The governments position was stated as follows: it was more important to maintain a consistent government than to apply the bonus rule retroactively and without warning.

Seems like the company payback was entirely voluntary and this is an example no good deed going unpunished.

[amelius]

Perhaps time for a new law concept: "jury by referendum".

[greydius]

Hard choice indeed

[the-dude]

Not only that, but TIL : HN automatically converts 'million' to 'M' and pulls the amount together, even if the title submitted is too long.

[mosselman]

I love simple-looking software that has nifty features hidden away behind the scenes where you’d never expect it.

I pointed a non-tech recruiter of ours to HN the other day and she said “that’s a weird looking site”. Yes, yes it is and I like it.

[fnord77]

it's funny - in the banking world, at least with bonds, 'M' is 1000 and 'MM' is 1 million

then you have fox news who uses "G" for 1000, as in 1 grand.

[barkingcat]

automation is overrated. I wouldn't be surprised if it was manually done by one of the backend admins or editors

[ta1234567890]

> Social Affairs Minister Wouter Koolmees told Parliament there was little the government could legally do to force Booking.com to return the money because the bonus provision was not immediately included in the rules. He said it was more important to maintain a consistent government than to apply the bonus rule retroactively and without warning.

This sounds either lazy or corrupt. There’s no need to retroactively apply the rule, but there are consequences that could be applied in the future, like forbidding companies that used the money for bonuses to apply for other government grants. Doing nothing because it’s “more important to maintain a consistent government” is messed up.

[the-dude]

As a Dutch citizen, I like my government to be consistent and not retroactively petty because of their own failings.

[sam0x17]

Wish this kind of stuff would happen with U.S. bailouts when they spend it all on bonuses.

[alephu5]

I don't know much about economics but I do wonder why governments don't finance companies during crises by buying shares, and subsequently recoup our taxes buy selling them in times of prosperity. The UK government did this for the banks in 2008 but have recently been selling shares below market price. Is it corruption or is something you else at play?

[sva_]

FWIW, Germany bought 25% of Lufthansa for 9 billion EUR in summer 2020[0] amid the Covid-19 losses, while the market capitalization was less than 4 billion. So they paid more than double the market capitalization to get a quarter of the company.

[0] https://www.spiegel.de/wirtschaft/unternehmen/coronakrise-re...

[mathattack]

This reminds me of the Wall Street execs paying themselves huge bonuses after the 2007/2008 bailouts. (And nobody went to jail) The mentality was “The government should have struck a tougher deal!”

[cosmodisk]

Similar discussions in Lithuania: lots of companies that claimed state aid due to Covid went on to purchase supercars, boats, etc.

[Vinnl]

One caveat that I haven't seen mentioned yet is that the bonuses were awarded in shares, ie they did not affect Booking's liquidity. Not relevant for every (valid) opinion you might have, but relevant when judging e.g. Booking's consideration between not awarding the bonuses and paying back the aid.

[stefan_]

That is not a thing. There is no free lunch; the company could have sold those shares and raised money that way for the same dilution.

[eyelovewe]

I guess that I won’t be using Booking.com in the future.

[hugoromano]

With interests please, and penalties for not abiding by contract.

[jbverschoor]

They'll also pay back the subsidies in all other countries

[durnygbur]

This is so extraordinarily corrupted. Dutch employees of Booking, your income tax on the income above 68k EUR is 51% but don't worry the wealth will trickle down. Just work hard, wake up early, and be nice to people. Not.

[newdude116]

OT. Where do you book hotels?

[suetoniusp]

What does US execs mean here? I see nothing in the article about the US

[tyingq]

"Some 5.8 million euros in shares and cash went to CEO Glenn Fogel, and 2.8 million euros went to Peter Millones, the vice president. Nearly 20 million euros, mostly in shares, went to CFO David Goulden, according to company documents reviewed by NRC"

All 3 are Americans.

https://nltimes.nl/2021/05/28/bookingcom-gives-eu28m-bonuses...

[thanatos519]

US execs, as in, the people who imported US tech management and fskced the whole thing up.

[fnord77]

from a previous article I read on this, the executives were based in the US. I don't have a link

[h_anna_h]

I wonder if Mozilla received state aid.