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This is an audio transcript of the FT News Briefing podcast episode: Ukraine in the EU?

Joanna Kao
Good morning from the Financial Times. Today is Friday, June 24th, and this is your FT News Briefing.

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Joanna Kao
Ukraine is now one step closer to becoming a part of the EU. Russian businesses are getting some help from Iran in skirting US sanctions. Plus, who regulates the porn industry? The answer might be in your wallet. I’m Joanna Kao, in for Marc Filippino, and here’s the news you need to start your day.

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Joanna Kao
Ukraine is now officially a candidate for membership in the European Union. EU leaders made the announcement yesterday. Here’s European Commission president Ursula von der Leyen at a press conference in Brussels.

Ursula von der Leyen
Let me stress that I’m deeply convinced that our decision that we have taken today strengthens us all because it shows once again to the world that the European Union is united and strong in the face of external threats.

Joanna Kao
Here to break down what this all means is the FT’s Henry Foy. Hi, Henry.

Henry Foy
Hi.

Joanna Kao
To be clear, this does not mean that Ukraine has been granted member status in the EU. So what comes next?

Henry Foy
That’s exactly right. So now you have essentially the start of a very long, very arduous bureaucratic process where Ukraine will be asked to enact a plethora of reforms from judiciary to rule of law, corruption, through trade, immigration, to essentially meet all the rules and requirements of the EU. Only when they’re through all of those and they’ve jumped through all those hoops, if you like, will the EU then make a decision. This could be decades away and I’m not overexaggerating. The last country that joined the EU, Croatia in 2013, took nine years to go from candidate status to a full member. So it’s a big step, but it’s certainly only the first step.

Joanna Kao
How significant is this decision?

Henry Foy
So leaders last night in Brussels were calling it a historic step by the EU. It’s certainly a huge deal for Ukraine and its pro-western integration efforts across a country at war. It’s extraordinary how quickly this happened. Ukraine only applied for membership four months ago. The EU’s never moved this fast before to get a country into official candidate status. And it’s an incredible moment for the country to have achieved this, in amongst everything else that’s going on.

Joanna Kao
What does this mean for the country’s war with Russia?

Henry Foy
On the ground, it changes very little at all. I mean, in a way, it formalises the EU’s commitment to Ukraine, if you like. But of course, the reality on the ground is that Ukraine needs much more weapons. They need much more Western support in both financial, military means. So in terms of Ukraine’s short-term outlook, this doesn’t really change anything, but it’s certainly a morale booster.

Joanna Kao
Henry Foy is the FT’s European diplomatic correspondent. Thanks, Henry.

Henry Foy
Thanks a lot.

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Joanna Kao
Russians are visiting Tehran in greater numbers this year, but it’s not for tourism. Russia’s under new sanctions from the west because of its invasion of Ukraine. So they want to know how Iran’s been able to get by under similar restrictions. Here’s the FT’s Tehran correspondent Najmeh Bozorgmehr.

Najmeh Bozorgmehr
Now, Russians know that their southern neighbour is more experienced than them or than many other countries in terms of going around sanctions. So basically, everything is available. Maybe in the industrial sector, there are many things that are not easy to import, but in daily life we don’t see a shortage. The problem in this country is high prices, more than shortage of any goods. So it seems this has been striking for Russian businessmen who have been visiting Iran in recent months that how come, for instance, iPhone is available.

Joanna Kao
So how exactly have Iranians been managing to get around the sanctions?

Najmeh Bozorgmehr
Iran has 15 neighbours and has a long experience of going around sanctions. I’m not saying everything is smuggled into the country, but smuggling is one way, bringing things through neighbouring countries, especially United Arab Emirates and Turkey and also Afghanistan, even Pakistan. There is almost no way to control entrance of goods into Iran.

Joanna Kao
What do you think Iran can offer Russia in terms of the potential to increase trade?

Najmeh Bozorgmehr
I think what Russians are doing is now testing waters to see what kind of potentials are in Iran. What Iranians are doing is not to necessarily teach them all the tricks, rather be the middle businessmen. Last year’s figures show exports to Russia around half a billion dollars and imports from Russia around $1.6bn. So the mutual trade is not big. But Iranians now, Iranian officials say they are thinking of increasing this small level of trade to maybe $40bn. Iran wants huge increase and Iran wants long-term agreement with Russia to help increase trade and business ties.

Joanna Kao
Are there any drawbacks in this relationship for Iran?

Najmeh Bozorgmehr
There is a lot of concern that Russia could turn into Iran’s main rival as two countries which are hit by sanctions target the same clients and notably China. Iran sells most of its crude to China on their sanctions, but pro-government analysts shrug off this concern and say that the global market is so big and there should not be a problem in this regard.

Joanna Kao
Najmeh Bozorgmehr is the FT’s Tehran correspondent.

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Joanna Kao
Porn makes up nearly 8 per cent of all internet traffic, according to data provider Similarweb. But who regulates the content? You might find the answer surprising.

Alex Barker
Actually, we realised that a lot of power and influence in business lies with financial gatekeepers: Visa, Mastercard, payment processors, banks.

Joanna Kao
That’s Alex Barker, the FT’s global media editor. He’s been investigating the porn industry with reporter Patricia Nilsson in a podcast series called Hot Money. Hi, Alex.

Alex Barker
Hello.

Joanna Kao
Why has regulation of the porn industry fallen to these financial companies?

Alex Barker
Porn has never been regulated very closely by governments. Some governments have tried to tighten up rules around porn to put age verification up, for instance. But it’s very difficult for them to manage and achieve because a lot of porn sites are based outside of their jurisdictions. They don’t even respond to their messages. And so financial gatekeepers have become the de facto regulators. And it’s because their brands, their services are facilitating this commerce. And they have to draw some boundaries themselves to protect their brands. And all of them have in different ways, developed lists and rules and systems for regulating content. And this isn’t just a case of, like, what are legal or not. It goes right down to what can be made on a studio set, and often to very detailed and sometimes bizarre distinctions. You know, can you make porn in a fairy costume or not?

Joanna Kao
So the story evolved this week with the departure of two executives from MindGeek who own Pornhub, the online porn company. Do we know why they left?

Alex Barker
Well, MindGeek has had a pretty terrible couple of years, to be honest. They are probably the most powerful, influential porn company in the world. They transformed the business in the era of video streaming. But at the end of 2020, they got in some real trouble. There was a piece in the New York Times about the business model and allegations of illegal content on there, revenge porn, under-age material. And in the wake of that, Mastercard and Visa basically cut Pornhub and some other MindGeek properties off. And with that, their cash dried up. They got into financial difficulties and they’ve been trying to rebuild since. But there’s been a lot of tension within the company over how to do that. And this has really culminated in these two top executives, who’ve been with the company for about ten years and who are part-owners, leaving. And the owner is now looking for a new team.

Joanna Kao
Thanks, Alex. Alex Barker is the FT’s global media editor. He co-hosts the FT’s new podcast, Hot Money. New episodes come out on Tuesday. Stick around until the end of the episode to hear the Hot Money trailer, and we’ll put a link to subscribe in the show notes.

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Joanna Kao
Before we go, Juul’s business in the US is getting vaporised, at least for now. Federal regulators announced yesterday they’re blocking the company from selling e-cigarettes. The Food and Drug Administration said Juul played a central role in fuelling an epidemic of youth vaping. This is a big deal for Juul. Over 90 per cent of its sales are in the US. The company could appeal the decision to the FDA or the courts, but it’s not clear yet if it will.

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Joanna Kao
You can read more on all of these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back next week for the latest business news. The FT News Briefing is produced by Sonja Hutson, Fiona Symon and Marc Filippino. Our editor is Jess Smith. We had help this week from Michael Lello, David da Silva, Peter Barber and Gavin Kallmann. Our executive producer is Topher Forhecz. Cheryl Brumley is the FT’s global head of audio, and our theme song is by Metaphor Music.

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Patricia Nilsson
I’m Patricia Nilsson.

Alex Barker
And I’m Alex Barker.

Patricia Nilsson
We’re journalists for the Financial Times. We write about business.

Alex Barker
But over the last year, we found an amazing financial story in an unexpected place, the porn industry.

Patricia Nilsson
No one really likes to talk about porn. We’re embarrassed to, even though most of us have watched it at some point.

Alex Barker
And there’s a contradiction at the heart of it. Porn relies on performers to literally bare it all, yet information about the people and businesses who run the industry is kept like a state secret.

Unnamed interviewee
I am so exposed and the people who really own these tube sites get to be reclusive and not publicly held to account.

Unnamed interviewee
Obviously, it’s not fair that the person who get (sic) the least say get (sic) the most money.

Unnamed interviewee
That is so unfair. I don’t like it.

Patricia Nilsson
Who are these secret owners? We wanted to follow the money and work out who really controls online porn.

Unnamed interviewee
It was, who’s got the largest penis here kind of thing and they hate each other. So it was all about that.

Unnamed interviewee
People with nefarious backgrounds and companies that are hidden, who are not part of the industry come into the industry, make a lot of money in the industry.

Alex Barker
On our mission, we met directors and adult performers.

Patricia Nilsson
Plus people with real power: tech pioneers and Wall Street billionaires.

Alex Barker
You probably were a catalyst for one of the biggest takedowns of media content in the history of the internet, like when did 9mn videos ever been taken down overnight.

Unnamed interviewee
I felt good about it (laughter). It felt good.

Alex Barker
Over the course of eight episodes, we’ll be taking you inside the porn industry.

Patricia Nilsson
So this man who was getting very nervous about us standing around and recording here, he chased me up the stairs and he very politely escorted me off the premises.

Alex Barker
Do you have regrets on how you handled it looking back?

Unnamed interviewee
For a lot of people, it was, it’s like being cut down at the knees.

Alex Barker
Telling you about the rivalries, the power battles.

Unnamed interviewee
You can make a choice in business to be friendly competitors or you can be enemies. And I think that that was just the decision that was made between the two of them — to be completely antagonistic.

Patricia Nilsson
We were surprised by what we discovered and by who’s really in charge.

Unnamed interviewee
There is (sic) two players on this planet that can kill porn online and they can literally kill it. And if they decide to, then, it’s dead.

Alex Barker
This is Hot Money, a show about power and finance.

Patricia Nilsson
Coming June 7th from Pushkin Industries and the Financial Times. Listen, wherever.

This transcript has been automatically generated. If by any chance there is an error please send the details for a correction to: typo@ft.com. We will do our best to make the amendment as soon as possible.

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