Warner Chilcott PLC said Monday that its fourth-quarter loss narrowed as its acquisition of Procter & Gamble’s global branded prescription drug unit added to revenue.

The Irish company, which makes women’s health and dermatology products, recorded a loss of $9.5 million, or 4 cents per share, in the three months that ended Dec. 31. That compares with a loss of $115.7 million, or 46 cents per share, in the same quarter of 2008.

Revenue more than doubled to $686.2 million.

Not counting one-time items like a $127 million amortization charge, adjusted earnings were 65 cents per share for the quarter.

The company also recorded a $33.5 million gain in the quarter from the sale of certain inventories to Leo Pharma in connection with a deal it completed in the third quarter of 2009.

Analysts polled by Thomson Reuters expected, on average, earnings of 60 cents per share on $588.1 million in revenue business cards.

In October, Warner Chilcott completed a $3.1 billion buyout of P&G’s global branded prescription drug unit. The company gained a portfolio of products worth about $2.3 billion in annual revenue including blockbuster osteoporosis drug Actonel.

Products from P&G contributed a total of $351.8 million in revenue growth in the fourth quarter. Aside from Actonel, that included the ulcerative colitis treatment Asacol and Enablex, a treatment for overactive bladders.

Warner Chilcott also said selling, general and administrative expenses more than quintupled in the quarter, to $277.5 million, due in part to costs tied to the P&G deal.

The company’s shares fell 67 cents, or 2.5 percent, to close at $26.55.

New products help Warner Chilcott narrow 4Q loss

In the financial turmoil of the past decade, mutual fund investing has gotten decidedly more complicated. After all, over the course of just 10 years, investors have looked on as two bear markets ravished the economy, as a pair of bull markets jolted stocks back to life, and as the Internet and housing bubbles inflated to their breaking points and then burst.

For investors, the search for the perfect mutual fund has always been something of a holy grail quest. But in the midst of the past decade's abrupt market cycles, investors have approached their fund-hunting efforts with newfound intensity. With that in mind, U.S. News has created a unique rankings system that is designed for long-term investors looking for broad access to information about funds. In the process, U.S. News has assigned scores to upwards of 4,500 distinct mutual funds.

[Use the U.S. News Mutual Fund Score and the rankings of trusted fund analysts to find the best mutual funds for you.]

Overall, the scores–which are based on data from Morningstar, Zacks, Lipper, TheStreet.com, and Standard & Poor's–take into account short- and long-term performance, risk, expenses, and future prospects.

[See our methodology.]

So what do the best mutual funds look like? To explore this, U.S. News has analyzed its top-ranked fund from each of the following 11 Morningstar categories: large growth, large value, large blend ("blend" funds have both growth and value characteristics), foreign large blend, diversified emerging markets, health, short-term bond, intermediate-term bond, intermediate government bond, world bond, and moderate allocation. Overall, the 11 category-topping funds have quite a bit in common. Here are some traits that they share:

[Slide Show: 11 category-topping funds]

High-conviction portfolios. Pat English, a comanager of FMI Large Cap (FMIHX), which is the top-scoring large-blend fund in the U.S. News rankings, likes to say that only his team's best ideas will make it into the fund's portfolio. And he means it: FMI Large Cap generally owns just 25 to 30 stocks at a time. "We're not big believers in sheer numbers of names," says English.

Neither is Don Yacktman, a comanager of the Yacktman Fund (YACKX), which tops the large-value category. At the end of 2009, the fund owned fewer than 50 securities. "Beyond a certain point," Yacktman says, "the more diversification, the more likely one will get mediocre returns."

Meanwhile, for its part, Fidelity Select Medical Equipment and Systems (FSMEX), the best-ranked health fund, finished 2009 with just under 60 stock holdings.

Broadly speaking, running a heavily concentrated fund is a risky proposition. If even one bet goes sour, the fund is certain to feel the blow. At the same time, though, concentrated portfolios allow managers to invest only in companies they know intimately. "Concentrated portfolios can be more volatile but aren't necessarily so," says Adam Bold, the founder of the Mutual Fund Store, an investment management firm with more than 65 U.S. locations.

Another measure of portfolio conviction is a fund's turnover ratio, which quantifies how frequently management trades. Funds with low ratios have buy-and-hold mentalities and tend to have high degrees of confidence in their picks. Overall, the 11 funds have turnover ratios that are an average of 78.7 percent lower than their category averages.

Low costs. It's one of the perennial mutual fund debates: Should investors focus primarily on costs or on returns? In a vindication of cost-based fund picking, the 11 mutual funds examined by U.S. News have expense ratios (a measure of annual fees) that are, on average, 0.32 percent less than their category averages.

[See Should You Deep-Six Your Mutual Fund?]

"Costs play a big role in fund returns. You tend not to see it if you look too close up. In other words, if you look at a single year, that advantage of, say, 50 basis points or whatever isn't that big, especially in years like '08 or '09 when you've got huge negative or positive returns," says Russel Kinnel, Morningstar's director of mutual fund research. "But over time, it adds up to quite a significant difference."

Overall, this phenomenon is somewhat circular in nature. "Good performance leads to more assets, and more assets generally drive down expenses," says Kinnel.

Still, costs are one of the most contentious issues in the fund industry. "There are some things in life that are worth paying more for. There's a reason that a Mercedes-Benz costs more than a Kia," says Bold. "To me, it doesn't matter how much you pay the mutual fund company. What counts is how much they pay you cash till payday advance."

Ultimately, though, this tension between costs and returns may be more imagined than it is real: The funds that top the U.S. News rankings provide superior returns, and they do so at low costs.

Talented and consistent management. Six of the 11 category leaders have at least one manager who has been on board since the fund's inception. Overall, this continuity of management seems to boost a fund's ability to consistently apply strategies that will pay off in the long term.

English, who has been a comanager of FMI Large Cap since it launched in 2001, says low manager turnover helps funds develop coherent cultures. "The main thing is the culture," he says. "You need continuity because it's hard to spread that culture if you have a lot of change."

For his part, Bold says that picking a good management team is one of the most important decisions an investor can make. "The name of the fund doesn't matter," he says. "What counts are the people who are every day making the buy, sell, and hold decisions."

Among the top-performing funds in the U.S. News rankings, the biggest question mark in the management arena pertains to TCW Total Return (TGLMX), the best-scoring fund in the intermediate-term bond category.

Late last year, TCW fired Jeffrey Gundlach, who had served as the company's chief investment officer and was a celebrated comanager of the flagship Total Return fund. In the aftermath of the firing, Philip Barach, the other Total Return manager, also left TCW, as did dozens of other employees.

[For more on Gundlach's ouster, see The Decade's 10 Worst Fund Disasters.]

With the fund's two managers out the door, TCW quickly turned control of Total Return over to Tad Rivelle of Metropolitan West Asset Management. Rivelle brings significant experience to the job, but it remains to be seen how the shake-up will affect the fund's long-term performance.

Another management theme is that all 11 category leaders have active managers. "Actively managed funds are going to have a wider dispersal of performance," says Kinnel. "Those are the ones that are always going to be at the top and bottom of the rankings." At its most basic level, this cuts to the core of the active-passive debate. A good index fund, Kinnel says, will consistently earn investors market performance, but that's as far as it will go–its mandate isn't to beat the market.

Downside protection. After two bear markets in the course of a single decade, investors have learned the hard way that high-quality funds not only will earn more than the competition during strong markets but will also lose less during downturns.

The 11 top performers' returns beat their category averages by an average of 7.4 percent in 2008, primarily thanks to some well-timed defensive positions. Some residual indicators of these funds' defensive stakes still linger, largely in their cash holdings. As recently as the end of last month, for example, Sextant International (SSIFX), the top-ranked foreign large blend fund, had roughly 40 percent of its portfolio stashed away in cash.

Many of the other top-ranked funds also have large cash stakes. "When we feel that we've filled up on the really good ideas … we'd just as soon sit on some cash. If the opportunities are there, we'll buy things. It's just a matter of if they aren't attractive enough, we'd rather just sit on some [cash]," says Yacktman, whose fund had upwards of 11 percent of its portfolio in cash at the end of last year.

The reason large cash positions helped during the downturn is that they shielded funds from losses in the stock and bond markets. "A lot of the funds with good cash stakes naturally lost less in 2008," says Kinnel. "I don't think there's anything inherently good or bad about running with a lot of cash. I think it's just what works for the manager."

Another way the 11 funds protect their investors during bear markets is through careful stock picking. "We spend a great deal of time protecting the downside by making sure we don't overpay for anything on the front end," says English.

Meanwhile, some of the top-ranked funds hold up decently during recessions because of the very nature of their mandates. Health funds, for example, are commonly considered to be among the most defensive of investments, and they tend to outperform their competitors during weak markets. In 2008, Fidelity Select Medical Equipment & Systems lost 23.4 percent. By comparison, the S&P 500 was down by 38.5 percent that year.

The Best Mutual Funds for 2010

DETROIT — The chief executive of Toyota, Akio Toyoda, accepted an invitation on Thursday from the House Oversight and Government Affairs Committee to testify next week in Washington in the aftermath of the recall of millions of cars because of sudden unintended acceleration.

Mr. Toyoda’s decision to testify came in a brief statement released in late afternoon by the automaker, hours after the invitation was made by Representative Edolphus Towns, a Democrat of New York who chairs the committee.

“I have received Congressman Towns’ invitation to testify before the House Committee on Oversight and Government Reform on February 24 and I accept,” Mr. Toyoda said in the statement. “I look forward to speaking directly with Congress and the American people.”

In a letter earlier to Mr. Toyoda, Mr. Towns said it was important for Mr. Toyoda to appear to “help clarify the situation.”

Previously, the committee had invited the president of Toyota North America, Yoshimi Inaba, to appear at next Wednesday’s hearing, one of three scheduled in Congress in the next two weeks.

“We are pleased Mr. Toyoda accepted the invitation to testify before the committee,” Mr. Towns and the committee’s ranking Republican member, Darrell Issa of California, said in a statement. “We believe his testimony will be helpful in understanding the actions Toyota is taking to ensure the safety of American drivers.”

“As you know, there is widespread public concern regarding reports of sudden unintended acceleration in Toyota motor vehicles,” Mr. Towns wrote earlier in his letter. “Toyota has recalled millions of its vehicles and even halted production. In addition, there are reports that this problem may have been the direct cause of serious injury and even death.”

He continued, “There appears to be growing public confusion regarding which vehicles may be affected and how people should respond. In short, the public is unsure as to what exactly the problem is, whether it is safe to drive their cars, or what they should do about it.”

Mr. Towns said Mr. Toyoda could submit written testimony, but should be prepared to provide a five-minute opening statement and to answer questions.

The decision to testify now turns the spotlight on Toyota, where there has been debate inside the company in the United States and Japan over whether Mr. Toyoda should appear, or send company executives in his place. Until Thursday, neither of the two House or one Senate committees holding hearings on Toyota had invited him to attend.

Analysts and public relations experts say that it was in the company’s interest for Mr. Toyoda to appear.

“This is a moment when Toyota is going to be in the world’s eyes,” said Michael Useem, professor of management at the Wharton School at the University of Pennsylvania. “It’s going to be the most powerful and effective if the C.E.O. does appear.”

But there are enormous risks for any chief executive who testifies before Congress, as leaders from Wall Street and Detroit can attest, and that is causing concern within Toyota, people with knowledge of the company’s deliberations said Wednesday.

Just 14 months ago, the chief executives of the Detroit automakers endured hours of questions before Congressional committees, along with heated criticism over their use of corporate jets best humidifiers.

In 2000, Jacques Nasser, chief executive of Ford, and Masatoshi Ono, his counterpart at Japanese tire maker Bridgestone/Firestone, also were questioned by members of Congress after accidents involving exploding tires on the Ford Explorer. Both left their companies within about a year.

In the hearings next week, the role of N.H.T.S.A., the federal safety agency, is also expected to be addressed, including whether it acted promptly enough on information it received from consumers.

They are set for Tuesday, by the House Energy and Commerce Committee, and Wednesday, by the House Oversight and Government Reform Committee. (The energy panel moved up its hearing.)

The energy panel has invited James Lentz, the president of Toyota Motor Sales U.S.A., to testify at its hearing on Tuesday.

On Thursday, the Texas governor, Rick Perry, sent a letter to a member of the committee, reminding him of the importance of the company to the Texas economy. Toyota has a truck plant in San Antonio that employs 3,000 people, while the state’s 83 dealers employ another 7,500 people.

In the letter to Representative Joe L. Barton, a Republican of Texas, Mr. Perry said it appeared negative news about the company “is being encouraged by plaintiffs’ trial lawyers, union activists and those interested in cutting Toyota’s market share.”

Mr. Perry went on, “Toyota is a valued employer and corporate citizen and an integral part of the Texas economy. Many Texas families depend on Toyota not only for safe, reliable transportation but for a good paycheck.”

Mr. Perry is the latest governor to come to the company’s defense. The governors of Mississippi, Indiana, Kentucky and Alabama, which all have Toyota plants, also have written letters to members of Congress backing the automaker.

Mr. Toyoda would probably find a more hospitable audience if he were to appear on March 2 at a hearing by the Senate Commerce Committee. Its chairman, John D. Rockefeller IV, Democrat of West Virginia, has known the Toyoda family for decades and has a Toyota plant in his home state.

A spokeswoman for the Senate committee said no decision had been made on whether to invite Mr. Toyoda.

One complexity in inviting Mr. Toyoda is that he most likely would speak through a translator during the question-and-answer session, though he is conversant in English. Mr. Toyoda, who attended business school at Babson College and lived in New York and California, spoke in English to an industry conference held last August in northern Michigan, and uses it in interviews. But he has spoken primarily in Japanese during the recent series of news conferences that he has held in Japan.

Mr. Toyoda has traveled to Washington in the past, for meetings with dealers and members of Congress, and has met a number of representatives who have Toyota facilities in their districts. Company executives had planned for him to visit the United States in March and have been exploring ways he could meet with lawmakers outside of a formal Congressional setting.

Toyota Chief Agrees to Testify Before House Panel

Hot News: Personal Finance Daily: What do you want from your bank?

NEW YORK (MarketWatch) — The dollar advanced Thursday, while the euro fell to a seven-month low and the Japanese yen attracted some buyers, amid renewed fears about fiscal problems facing a handful of European countries and as a U.S. report showed an unexpected increased in jobless claims last week.

The dollar index , which tracks the greenback against a trade-weighted basket of six major currencies, rose to 79.950 from 79.369 late Wednesday.

ECB’s Trichet Sees Major Challenges Ahead

European Central Bank President Jean-Claude Trichet told reporters Thursday the euro zone still faces major challenges but is heading in the right direction. He was speaking shortly after the ECB kept interest rates steady.

For its part, the euro tumbled on renewed fears over debt problems in the 16-nation euro zone, and as the European Central Bank kept a key benchmark rate steady.

The single currency declined 1% to $1.3736, down from $1.3906 in North American trading late Wednesday.

The British pound also fell after the Bank of England kept rates steady, down 0.3% to $1.5851.

But the dollar lost ground to trade at 88.65 Japanese yen, down from 91.01 yen late Wednesday. The yen’s a frequent beneficiary of movements out of riskier assets to a more stable one.

The euro enjoyed a short-lived respite from pressure Wednesday after the European Commission cautiously endorsed Greece’s plans to slash its budget deficit over the next three years. But the selling pressure resurfaced as the focus turned to Portugal and Spain.

‘We’re short-term bearish on the euro.’

Ray Farris, Credit Suisse

The spread between government bonds issued by Greece and Portugal widened versus comparable German bunds, highlighting worries about the fiscal outlook for nations on the so-called periphery of the euro zone. Concerns over those countries also pushed the cost of insurance for sovereign debt above the cost for U.S. companies for the first time payday advance. Read about the euro zone’s persistent credit worries.

“Over the next several months, we’ll probably have a succession of negative news associated the fiscal stress coming, first with Greece but increasingly into other sovereigns,” said Ray Farris, head of foreign-exchange strategy at Credit Suisse. “We’re short-term bearish on the euro.”

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Those concerns also weighed down U.S. stocks, with the Standard & Poor’s 500 index dropping nearly 2.5%. While less consistent in recent months, since the beginning of the credit crisis the dollar has tended to benefit when stocks fall, which traders take as a flight from risky assets to the relative safety of the U.S. currency.

That dynamic was overshadowing weak employment data in the U.S. during the session — one day before the government’s pivotal report on nonfarm payrolls for January, due out Friday.

The Labor Department said first-time claims for state unemployment benefits rose to the highest level since mid-December, up 8,000 to 480,000. The consensus forecast of Wall Street economists had been for claims to drop to 455,000. See more on U.S. jobless claims.

Also affecting trading in the British pound, Bank of England policy makers called a halt to its 200 billion pound ($319 billion) program of asset purchases but left the door open to resume purchases if it’s deemed necessary.

Currencies: Dollar up to 7-month high as risks seen in Europe

Hot News: Toyota posts $1.7B profit, raises annual forecast

TOKYO – Japan’s trade minister is urging Toyota Motor Corp. to secure the confidence of car buyers in the wake of massive global recalls.

“The scale of the recalls is huge. The situation is serious. It points to the possible dangers a global economy can bring,” Trade Minister Masayuki Naoshima told reporters Friday.

“I would like Toyota to respond properly to secure consumer confidence.”

Toyota — the world’s largest automaker — has recalled 7 payday loans.65 million vehicles in the U.S. over problems with gas pedals and floor mats. It recalled 75,500 vehicles in China for the same acceleration pedal problem.

The auto giant also said it would recall vehicles in Europe due to the accelerator problem, but said the number of recalled vehicles has yet to be determined.

Japan urges Toyota to secure consumer confidence

SHANGHAI — On Dec. 31, Chinese regulators announced that they had arrested three executives and shut down a dairy company here for selling products contaminated with an industrial chemical called melamine.

It looked like another sign that regulators had stepped up their food safety campaign after 6 children died and 300,000 others were sickened in 2008 from drinking milk formula tainted with melamine.

But Wednesday, a government official here acknowledged that the arrests actually took place last April, and that the investigation into tainted dairy products at the Shanghai Panda Dairy Company had begun two months before that.

“In February 2009, the Shanghai Fengxian prosecutor found that these products were contaminated and started the investigation,” said Shen Weiping, an officer at the Fengxian prosecutor’s office, reading from a prepared statement. “On April 28, the three executives from Panda Dairy were arrested.”

Mr. Shen declined to comment on why the announcement was delayed so long and why the public was not alerted to the dangers of Shanghai Panda milk last year, before or shortly after the company was shut down. The lack of an alert was particularly surprising because in June, China passed a new food safety law that required food producers to alert consumers and other businesspeople of serious food safety problems.

The government did not say whether the contaminated milk from Shanghai Panda had sickened anyone, but said only that regulators believed that they had confiscated dangerous milk during the investigation.

The prosecutor’s office statement came a day after the 21st Century Business Herald, a Guangzhou-based newspaper, first reported that the investigation into Shanghai Panda may have been conducted months earlier.

Calls on Wednesday to Shanghai Panda went unanswered. The General Administration for Quality Supervision Inspection and Quarantine, the nation’s top quality watchdog, did not respond to requests for an interview on Wednesday.

Some legal experts called the delay in announcing the case troubling.

“If Shanghai Panda’s crime is confirmed, the quality supervision bureaus, both local and national, violated the law,” said Wang Xixin, a professor of constitutional law at Peking University allstate insurance. “The government hid the truth from the public and behaved extremely irresponsibly to public safety.”

Shanghai officials said Wednesday that executives at Shanghai Panda held a meeting in December 2008, after a nationwide recall of melamine-tainted milk powder, and decided to resell contaminated milk that had been returned to the company in the earlier recall of melamine-tainted goods.

“Panda Dairy decided to mix the contaminated, condensed milk with standard products and resell it,” said Mr. Shen, at the Shanghai prosecutor’s office, reading from a statement.

At the time, China’s state-run media were filled with stories about parents outraged over their children’s melamine-related ailments, which included kidney stones and urinary tract infections.

The government had just announced a nationwide crackdown on melamine-tainted milk and said that 22 of the country’s biggest dairy producers, including Shanghai Panda, had failed quality inspection tests and had milk containing high levels of melamine.

Shanghai Panda products were found to have some of the highest levels of contamination, regulators said.

Since then, Chinese regulators say they have stepped up their monitoring and arrested dozens of people involved in intentionally doctoring milk formula with melamine.

Melamine has often been used in China as a cheap additive to cheat on quality tests, because its nitrogen content can falsely inflate protein scores.

Last November, China executed two milk producers for selling millions of pounds of melamine-contaminated milk.

A few weeks ago, the police arrested three other people in north China’s Shaanxi Province for selling milk powder contaminated with melamine. In that case, regulators said they confiscated the tainted milk before it could reach stores.

Bao Beibei contributed research.

China Admits New Tainted-Milk Case Is Older

IT may not feel that way right now, but the last 10 years may go down in world history as a big success. That idea may be hard to accept in the United States. After all, it was the decade of 9/11, the wars in Iraq and Afghanistan, and the financial crisis, all dramatic and painful events. But in economic terms, at least, the decade was a remarkably good one for many people around the globe.

The raging economic growth rates of China and India are well known, though their rise is part of a broader trend in the economic development of poorer countries. Ideals of prosperity, freedom and the rule of law have probably never been more resonant globally than they’ve been over the last 10 years, even if practice often falls short. And for all of the anticapitalistic rhetoric that has emerged from the financial crisis, national leaders around the world are embracing the commercialization of their economies.

Putting aside the United States, which ranks third, the four most populous countries are China, India, Indonesia and Brazil, accounting for more than 40 percent of the world’s people. And all four have made great strides. Indonesia had solid economic growth during the entire decade, mostly in the 5 to 6 percent annual range. That came after its very turbulent 1990s, marked by a disastrous financial crisis and plummeting standards of living.

Brazil also had a consistently good decade, with growth at times exceeding 5 percent a year. There is lots of talk that the country has finally turned the corner, and, within its borders, there is major worry that its currency is too strong — a problem that many other countries would envy.

Elsewhere in South America, Colombia and Peru have made enormous progress and Chile is on the verge of becoming a “developed” country; it will soon be joining the Organization for Economic Cooperation and Development.

To be sure, in Africa, there is still enormous misery. Nonetheless, overall standards of living rose in a wide variety of countries there, with economic growth for the continent as a whole at more than 5 percent in most years. Many basic essentials, like water, sanitation, electricity and especially telephones, are more commonly available.

One lesson from all of this is that steady economic growth is an underreported news story — and to our own detriment. As human beings, we are prone to focus on very dramatic, visible events, such as confrontations with political enemies or the personal qualities of leaders, whether good or bad. We turn information about politics and economics into stories of good guys versus bad guys and identify progress with the triumph of the good guys. In the process, it’s easy to neglect the underlying forces that improve life in small, hard-to-observe ways, culminating in important changes.

In a given year, an extra percentage point of economic growth may not seem to matter much no fax pay day loan. But, over time, the difference between annual growth of 1 percent and 2 percent determines whether you can double your standard of living every 35 years or every 70 years. At 5 percent annual economic growth, living standards double about every 14 years.

Nonetheless, despite the positive news in much of the world, it’s questionable whether the decade as a whole has been good for Americans, economically speaking. Median wages have not risen much, if at all, and the costs of the financial crisis and irresponsible fiscal policies have become increasingly obvious. Those facts support a pessimistic interpretation.

Still, most economic models suggest that the fundamental source of growth is new ideas, which enable us to produce more from a given set of resources. To the extent that the rest of the world becomes wealthier, there’s more innovation, as my colleague and co-blogger Alex Tabarrok, professor of economics at George Mason University, argued recently. China, for instance, is moving toward the research frontier in areas such as solar power, scientific instruments, engineering and nanoscience, all of which can benefit the United States. Unlike the situation of just a few decades ago, a genius born in Mumbai now stands a good chance of becoming a notable scientist, whether at home or abroad.

It might be pleasant to boast that America is — or should be — a world leader in every area, but the practical reality is that if some other country solves the problem of green energy, so much the better for us.

The subtler point is that a wealthier China, India, Brazil and Indonesia will lead to more customers for new innovations, thereby producing greater rewards for successful entrepreneurs, no matter where they live. There are so many improvements in cellphones these days because there are so many cellphone customers in so many countries.

TO put it bluntly, if the United States takes one step back and the rest of the world takes two steps forward, even in purely selfish terms we should consider accepting the trade-off, if only for the longer run. Most of us gain from the wealth and creativity of other countries, even if we can’t always feel like the top dog.

When asked what he thought of the French Revolution, Zhou Enlai, the premier of China from 1949 until his death in 1976, reportedly replied, “It is too soon to tell.”

That is also a fair response to the last 10 years, and it will be for some time to come. The point remains that if we look beneath the surface just a bit, the picture is a good deal rosier than we might otherwise think.

Tyler Cowen is a professor of economics at George Mason University.

Economic View: For Much of the World, a Fruitful Decade

SHANGHAI — UTStarcom, an American telecommunications company, has agreed to pay $3 million in fines after U.S. officials accused it of a long-running plan to bribe Chinese and other foreign officials with cash, travel junkets and other gifts.

The U.S. Department of Justice and the Securities and Exchange Commission said Thursday that UTStarcom paid nearly $7 million from 2002 to 2007 for hundreds of employees of China’s state-owned telecommunications companies to visit the United States for “training programs” that were often sightseeing vacations to Hawaii, Las Vegas and other tourist spots.

The company, based in Alameda, California, was also accused of offering jobs to the family members of clients, paying clients’ university tuition, helping secure travel visas and arranging for a “consultant” to bribe a government official in Mongolia in order to secure a business deal.

U.S. officials did not say why UTStarcom and its executives were not prosecuted. But the authorities said the actions appeared to have violated the Foreign Corrupt Practices Act, which forbids Americans from bribing government officials while doing business overseas.

Often, U.S. officials choose not to prosecute violators because of the complexities in proving a case beyond a reasonable doubt. Instead, they put pressure on companies to settle with large fines and pledges to change their operations.

In a statement released Thursday, UTStarcom agreed to the fine and said it took responsibility for the actions listed in the government complaints. A company spokesperson could not be reached for comment.

The settlement is a window into how U.S. and European companies sometimes do business in China, where bribery and corruption are widespread.

Every year, tens of thousands of Chinese officials are arrested for corruption. Many legal experts say that steering clear of bribery here has become increasingly difficult, largely because state officials control access to most markets in a booming economy. And often, they want to sell that access.

Two years ago, the S.E.C. accused Lucent Technologies, another telecommunications giant that since 2006 has been a part of Alcatel-Lucent, of spending $10 million for about 1,000 employees of Chinese state-owned companies to travel to the United States and elsewhere from about 2000 to 2003 to inspect Lucent’s facilities and for training payday loan. The S.E.C. said most of those trips did not involve visits to Lucent facilities but instead were sightseeing tours for potential customers to see Hawaii, Las Vegas, the Grand Canyon, Disney World, Universal Studios and other tourist spots. Lucent settled the allegations without admitting or denying wrongdoing.

This past week, China Mobile, one of China’s big state-owned telecommunications companies, said it had removed its vice chairman, Zhang Chunjiang, for “serious economic issues” and “discipline breach,” the Communist Party’s code words for corruption.

For UTStarcom, which designs, produces and sells networking equipment and handsets, China is a key market. From 1998 to 2004, about 75 percent of the company’s sales were to Chinese state-owned companies, according to the Justice Department.

UTStarcom engaged in complex swindle to please its customers in China, according to U.S. officials. Company executives arranged for Chinese officials and their relatives to travel to the United States and falsely recorded some of those trips as “training sessions,” even though no training took place, the officials said. The S.E.C. alleged that there were also “lavish gifts and all-expense paid executive training sessions” in the United States for customers.

“This was apparently a standard practice,” Steven D. Buchholz, an attorney with the S.E.C.’s San Francisco office, said of the junkets. Sometimes, the government said, customers were given cash allowances and on other occasions UTStarcom hired a relative and put them on the payroll, even though they never worked at the company. The company “paid and provided benefits to at least three of these individuals for a period of two years each as if they were real employees, even though they never worked,” the S.E.C. said in its complaint.

U.S. Telecom Firm Pays $3 Million in Fines Over China Business

TOKYO, Dec 30 (Reuters) - Shares of Japan Airlines Corp tumbled 32 percent to a record low on Wednesday on growing investor worries the struggling carrier will be restructured in bankruptcy court as part of a state bailout.

Sources have told Reuters that a state-backed turnaround fund now weighing whether to support JAL is considering using a bankruptcy procedure similar to Chapter 11 in the United States as part of its restructuring plan.

“Today’s slide reflects mounting expectations that JAL is headed for a court-led reorganisation,” said Takahiko Kishi, an airline analyst at Mizuho Investors Securities.

Shares of JAL were down 32 percent at 60 yen as of 0047 GMT, a record low for the carrier. The benchmark Nikkei average was virtually flat.

Japan Airlines applied for a bailout in late October from the Enterprise Turnaround Initiative Corp of Japan (ETIC), an organisation of turnaround specialists that can draw on state-guaranteed funding to offer financial aid to ailing firms.

The ETIC is expected to make a decision on whether to support JAL next month easy payday loans. The ETIC can draw on 1.6 trillion yen in state-guaranteed funding in the current fiscal year to March for loans and investments into struggling but viable firms.

The ETIC has told JAL’s creditors that it was considering a plan under which the airline would apply for court protection under the Corporate Rehabilitation Law, but it has not ruled out a private, out-of-court restructuring, sources have said.

Bankruptcy proceedings usually lead to a sharp cut in the payment of sales receivables and other creditor claims. There is a risk JAL would not be able to make payments for fuel, parts and other transactions needed to keep flying.

The ETIC plans to keep paying for such transactions if JAL files for bankruptcy, the Nikkei newspaper reported earlier on Wednesday, adding that airport usage fees and insurance policy premiums would also be guaranteed.

Shares of Japan Airlines Drop to Record Low

NEW YORK, Dec. 24 (Xinhua) — Crude prices topped 78 U.S. dollars a barrel Thursday on upbeat economic reports.

The reports showing a drop in initial jobless claims and growth in durable goods orders in November boosted economic optimism.

Jobless claims, reached their lowest levels since last September, helped push energy futures higher Thursday before the long weekend.

Light, sweet crude futures for February delivery rose nearly 2 percent, or 1 easy fast payday loans.38 dollars to settle at 78.05 dollars on the New York Mercantile Exchange.

In London, Brent crude for February delivery rose 86 cents to 76.31 dollars on the ICE Futures exchange.

Crude prices rallied more than 3 percent on Wednesday due to a larger-than-expected fall in U.S. crude inventories last week.

Crude prices top $78 on upbeat reports

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