Subject: Fw: OTP, OECD and tax collection

From: John Messing <[email-masked]>
Date: Tue, 6 Oct 1998 14:05:00 -0700

-----Original Message-----
From: John Messing <[email-masked]>
To: Steve Howard <[email-masked]>
Date: Tuesday, October 06, 1998 9:38 AM
Subject: Re: OTP, OECD and tax collection

>There is an excellent website which maintains current information on the
>state of digital signature laws on a jurisdiction by jurisdiction basis.
>Check out www.mbc.com. I am giving a course over the Internet in November
>for attorneys seeking professional legal education credit on the subject,
>and will be happy to provide updates via private email on the various
>subjects of interest to anyone who requests me to do so via private email
to
>me.
>
>-----Original Message-----
>From: Steve Howard <[email-masked]>
>To: John Messing <[email-masked]>
>Date: Tuesday, October 06, 1998 10:20 AM
>Subject: Re: OTP, OECD and tax collection
>
>
>>Hi John,
>>
>>Do you have any insight/shareable info on digital signature law?  Have
>>there been any court cases upholding digital signatures?
>>
>>Steve
>>
>>
>>
>>
>>
>>John Messing <[email-masked]> on 10/04/98 01:09:27 PM
>>
>>To:   [email-masked], Steve Schear <[email-masked]>
>>cc:    (bcc: Steve Howard/Certicom)
>>Subject:  Re: OTP, OECD and tax collection
>>
>>
>>
>>
>>This is one of those issues which is not as straightforward as it may
first
>>appear. Apart from merchants whose businesses are physically located
within
>>the borders of an EEC state, the power of the state to tax may depend upon
>>notions of extraterritorial application of the tax laws. Thus, if an
>>American corporation sells goods to a German citizen and has no office or
>>outlet in Germany, then in a non-virtual transaction, there is little
legal
>>basis for Germany to claim the right to tax the transaction. The German
>>citizen had to have been physically located in another jurisdiction to
have
>>completed the purchase. But in a virtual transaction where the Internet
>>server and the seller are located physically outside of Germany, the
>>situation may be less clear. If Germany claims the right to tax any
>>transaction involving a buyer whose computer or delivery address is
located
>>within its borders, a question will arise about the basis in international
>>law of the power to tax. To the extent that consent to tax is one such
>>basis, then inclusion of software at the Internet server used by the
seller
>>which permits German taxation through OTP could arguably be implied
consent
>>to tax -- a result perhaps never intended by OTP or the buyer. It is quite
>>conceivable that Germany would hire an American attorney to collect such
>>taxes as postulated by this example through the American courts, which an
>>American corporation could not ignore. Apart from the issue of taxation,
>>there are other questions about extraterritorial applicable of laws, such
>>as
>>digital signature legislation, which involve similar considerations. In
>>order to avoid such questions, OTP refused to consider them in earlier
>>drafts. Taking a position or refusing to take a position on such issues in
>>light of the German request probably will result practically in a
>>substantive decision one way or the other, like it or not, which means
that
>>such questions can no longer continue to be ignored as either a
theoretical
>>or practical matter.
>>
>>-----Original Message-----
>>From: Steve Schear <[email-masked]>
>>To: [email-masked] <[email-masked]>
>>Date: Saturday, October 03, 1998 10:23 PM
>>Subject: RE: OTP, OECD and tax collection
>>
>>
>>>David Burdett <[email-masked]> wrote:
>>>>Tax evasion is as old as the centuries. I doubt that OTP if its used for
>>>>tax collection by the governments will change peoples inclination to pay
>>>>(or not pay) one bit. The point is, if governments want to collect taxes
>>>>then they will find a way to do it and most merchants who have a
>>>>reputation to protect will follow it.
>>>
>>>This is really a rear-view outlook.  If we were in the 16th century, its
>>>like saying that because the Church has all this authority we're not
going
>>>to use the press to print anything secular.
>>>
>>>While it may be true that in the short run merchants with reputation may
>>go
>>>along with this foolishness, as long as their risks are low consumers
will
>>>shop wherever the price is lowest. 10% or more tax is enough separate
most
>>>consumers from their guilt and place the loyal merchants at a
considerable
>>>disadvantage. The complaint merchants will pressure the governments to
get
>>>tough (regulation always favors the regulated). If governments are not
>>able
>>>to pressure the non-complaint merchants, as I believe they will not (as
>>>they were unable to stem the Eurodollar trading), this is the beginning
of
>>>the end game for such taxes on the Net and perhaps in a broader sense as
>>>more commerce moves to the Net and places local merchants at an
increasing
>>>disadvantage.
>>>
>>>--Steve
>>>
>>>
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>>
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>>
>>
>>
>

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---

From: "Donald E. Eastlake 3rd" <[email-masked]>
Date: Sun, 11 Oct 1998 00:29:39 -0400

Since the consensus is against it in the working group, there will be
no special legal disclaimers or warning on the documents we produce
other than those normally required by IETF procedures.

Donald
WG Chair
============================================================
 Donald E. Eastlake 3rd +1 978-287-4877 [email-masked]
 318 Acton Street       +1 978-371-7148 (fax)   [email-masked]
 Carlisle, MA 01741 USA
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