Introduction

There are more than 100 offshore jurisdictions (many of them, perplexingly, firmly onshore) which provide low-tax regimes to their inhabitants and/or to non-resident companies or individuals, and almost without exception they have nailed their colours firmly to the mast of e-commerce, understanding that the Internet will allow many types of commercial activity to be carried out offshore which were previously anchored physically in their destination (high-tax) market-places.

Broadly speaking, e-commerce development offshore has so far been limited to existing offshore specialities such as banking, with so far perhaps only the betting and gaming sector having given a demonstration of how easy it is for an entire industry to up sticks and leave if domestic legal and tax regimes are too restrictive.

There is widespread acknowledgement that, sooner or later, there will be a mass exodus from high-tax jurisdictions of many other types of company which no longer need sales-forces, manufacturing plants or distribution systems on the ground, but some surprise that it hasn't happened yet to any large extent. This is reasonably understandable given that e-commerce still represents only a tiny fraction of sales in most sectors, and that customers are still reluctant (rightly or wrongly) to trust the new medium for transactions involving money. Firms therefore don't feel that they can risk burning their bridges by giving up their legacy systems and installations - and the move offshore is not one that can be carried out on a trial basis. In order to get the tax benefits, there has to be a clear split with the old existence.

For an offshore jurisdiction hoping to develop into the location of choice when the flood does begin, there can't be any waiting around though: it's necessary to demonstrate now that one is bulging with connectivity, support staff and server space, because there are a dozen or more competing jurisdictions doing the same thing. It can also be argued that the lack of established, proven facilities offshore is one of the contributory factors to the slowness with which mainstream businesses are making the move. Other factors, apart from buyer reluctance, include the uncertain corporation tax environment pending a final report from the OECD's Technical Action Group on permanent establishments, and the emerging split on sales tax practice between the US with its moratorium on e-commerce taxation and the EU's keenness to extend VAT as quickly as possible to digital downloads.

In this survey we are going to take a look at the degree of e-readiness of the main competing offshore jurisdictions from the perspective of physical facilities and the availability of technical support. Without specifically aiming to describe the regulatory background, we will need to mention the telecommunications regime in particular - it is more difficult for a jurisdiction to offer competitive facilities if it is still operating under a telecoms monopoly, although our first jurisdiction, Dubai, offers some limited reassurance in this direction.

The Jurisdictions: Part I

Dubai

Gibraltar

Dubai

Government support programmes and legislation

In February 2000 Dubai ruler Sheikh Maktoum bin Rashid al-Maktoum issued a decree setting up a free-trade zone for electronic commerce and technology, to be known as Dubai Internet City. The decree established an independent body, the free zone authority headed by Crown Prince Sheikh Mohammed bin Rashid al-Maktoum. "Among the objectives of the free zone, as outlined by the law, is to draft strategies and policies to make Dubai a centre for technology and electronic commerce,' said the announcement. The Dubai government planned to invest $200 million in setting up the zone; by September 2000 more than a hundred information technology companies had been granted licences to operate in the City and total committed investment in the DIC was said to be $700m.

The free zone authority oversees the establishment of the necessary infrastructure at the zone, licenses companies wishing to set up shop there and leases land and property to them for up to 50 years. The authority also runs the zone, and levies fees for its services.

Companies are allowed 100 per cent foreign ownership in the zone. Goods imported to the zone and products for export are exempt from custom duties and companies are exempt from taxes, including income tax.

The physical location of the Internet City is on Sheikh Zayed Road, next to the American University. This area overlooks the Emirates hills golf course development. The City opened for business in late 2000, by when more than 350 companies were either already licensed or had applications pending.

Telecommunications infrastructure

The DIC aims to offer world class technical infrastructure with high bandwidth availability, low cost telecom infrastructure and secure, high speed support infrastructure.

In July 2000 Siemens Business Services (SBS) was awarded a major contract to provide the City's technical infrastructure, using leading edge technology from Cisco Systems International and Sun Microsystems.

Mr. Mohammed Al Gergawi, Director General, Technology, E-commerce and Media Free Zone Authority and Chairman of Dubai Internet City, said: " The three companies will provide the information and communications infrastructure for the City. The contract requires them to design, build and operate state of the art systems in four key aspects of DIC's operational structure. They include the data centre, telecommunications and network infrastructure, internet connectivity and ISP (Internet Service Provider) infrastructure, and billing solutions.

Telecommunications in Dubai are provided by monopoloy supplier Etisalat, which has been accused of over-charging and slowness in introducing new services. The authorities have made it clear that the monopoly will not be allowed to stand in the way of the development of DIC. Most likely, this is just a negotiating ploy, and Etisalat will be sufficiently worried about threatened liberalisation to reach acceptable agreements with DIC over service levels and pricing.

Connectivity/Bandwidth Availability

Availability of bandwidth has been one of the first questions asked as potential tenants contemplate DIC. The UAE's monopoly telecoms provider, Etisalat, has long been criticised for moving too slowly towards delivery of broadband services, and companies looking at DIC want competing providers that will race each other and accelerate delivery of services. At the same time, competition is seen as a driving force behind lower and lower prices. "Internet City has to have better rates for telecommunications. Without this, it will fail. The minimum next step is better telecommunications," argues Ali Ferling, general manager for Hewlett-Packard Middle East.

"The telecommunications infrastructure will be of a globally competitive standard," promised Adel Ahmed Lootah, a senior executive for Dubai Internet City.

If that means breaking Etisalat's telco monopoly in the UAE, it will be broken, claim officials. DIC's Web site actually states that when it comes to communications, "We cannot operate on a monopolistic basis."

Etisalat knows that the writing is on the wall in terms of its monopoly status. In a recent event to launch Emirates Internet and Multimedia, an autonomous division of Etisalat delivering Internet services, Ali Salim Al Owais, president and CEO of Etisalat, was philosophical about competition. "If [competition] comes, it comes" he said.

While liberalisation remains a popular subject of debate, Etisalat is predictably doing everything it can to avoid it by bringing on new services and forming alliances.

It has launched ADSL capability in Dubai, although delivery remains very patchy; many customers say they are plagued with outages and broken service promises.

In 2001 Etisalat was able to point to an alliance with Astrolink, which opened its regional headquarters in the Dubai Airport Free Zone. The official opening was jointly performed by His Highness Sheikh Ahmed bin Saeed Al Maktoum and the General Manager Dubai Region, Etisalat, Mr. Obaid Bin Mes-Har. "We are pleased to welcome the opening of Astrolink's Representative Office in the Dubai Airport Free Zone. The selection of Dubai by this important and innovative satellite company underlines the importance of UAE's telecom infrastructure and Etisalat's achievements in this vital sector with its highly advanced telecommunications network," said Mr. Mes-Har.

Astrolink works alongside telecommunications operators such as Etisalat throughout the world to enable their clients with ultra-high speeds for virtual private networks (VPN) and the Internet. Astrolink is building a global constellation of Ka-band satellites to deliver ultra-high-speed Internet access to businesses on a world-wide basis. With the system launch scheduled for 2003, giving two-way access 'to the desktop' at speeds of up to 226 Mbits/s (compared to today's ISDN access speeds of 128 kbp/s), Astrolink will enable service providers to offer VPN and Internet services globally.

"Etisalat has a firm commitment to working with a range of world-leading companies in building advanced telecommunications and Internet capabilities for customers," said Mr. Mes-Har. "We believe that Astrolink is building a very important global resource for the future and we look forward to further extending our relationship with the company."

Internet Service Providers

Etisalat is not only the monopoly telco in Dubai, but also the monopoly Internet Service Provider, although it works through variously branded outlets such as Emirates Internet.

Beginning in 1995, with basic 64K and 128K circuits, Etisalat offered ISDN lines from 1996, dedicated circuits with 2Mb from 1997. ADSL was offered from last year, when it also launched its co-operation with Emirates Airlines in Emirates Internet, known as EIM.

Subscribers have risen from 2,500 in 1995 to more than 210,000 by the end of 2000.

EIM says that its future plans include the launch of applications such as TV based Video on Demand, Online Distance Learning and Education, Online Travel, Business News and Financial Information Center, Internet Kiosks, Internet Executive Workstations, Web Design Centers, Online Games and Entertainment and Internet Home Banking.

However there remains constant pressure from users for lower prices and better service and in May 2000 EIM reduced its rates to Dhs 1.80/hr peak and Dhs 1/hr off-peak.

EIM's ADSL service is offered at Dhs 250 per month, comparatively expensive by world standards.

Local commentators say that despite Etisalat's best efforts, the lack of cheap, flexible Internet access has severely damaged Dubai's chances of becoming a regional e-commerce power-house. But it's fair to add that Dubai is scarcely alone in failing to liberalise telecommunications fast enough - the UK's supposedly liberalised environment for example has totally failed to deliver ADSL even to the business community.

It is an ironic comment on the local situation that the website for Dubai Internet City is hosted in the USA and designed in India.

Hosting Services and Facilities

In pursuit of its policy of alliances with major international providers, in May 2001 Dubai Internet City signed a major ten-year agreement with IBM to build two Internet Data Centers (IDCs) offering "a full set of solutions, services and technologies to enable comprehensive e-business hosting capabilities."

The two new centres are located within the DIC and their services include managing and operating customer servers, hosting websites and building new network-based customer applications. In addition they provide a full range of network services, such as managed bandwidth, Internet connectivity and IP (Internet Protocol) transit under service level agreements. A joint technical and marketing team has been set up jointly by DIC and IBM to develop, manage and market the new centres, which are expected to generate more than US$75m in revenues.

IBM is providing the blueprint for building the two IDC's, based on the company's state-of-the-art hosting farm architecture. Ahmad Bin Byat, Chief Executive Officer of DIC, commented: 'We will also be able to connect from DIC to IBM hosting/trading centers around the world, giving us access to the very latest tools and technological solutions.' The data centers will offer a full portfolio of next generation e-business network and hosting services, and DIC claims that they will be the first in the region to offer true management of servers up to the application level.

Mohammad Al Gergarwi, Director General of Dubai Technology, Electronic Commerce and Media Free Zone Authority and Chairman of DIC, said of the collaboration with IBM: 'Our aim is simple - to offer the best possible e-business facilities to all organisations, both public and private sector, operating in this region. Our partnership with IBM is designed to deliver just that, namely a secure, reliable and scalable hosting facility that is world class. Speed to market is vital in this space as is access to the best technology and skills. The partnership with IBM will deliver all of these requirements.'

The first managed data center is being based out of DIC’s existing co-location hosting facility, giving DIC a first to market advantage in the region.

At the other end of the hosting spectrum, local company Cyber Gear recently announced the launch of a range of standard and customised interactive web-enabled kiosks. These kiosks can be installed at airports, shopping malls, government departments, exhibitions and at the reception of hotels and other hospitality and healthcare institutions.

Cyber Gear with its experience in developing internet based applications will develop tailormade presentations using state-of-the-art multimedia tools which support touch screen technology. According to Sharad Agarwal, CEO of Cyber Gear, "Internet kiosks offer an opportunity for organizations in the region to promote their business online through an interactive user experience. We are offering a range of basic and high end networked kiosks to suit all requirements. The advanced models support information transfer, keyboards with track ball, receipt printing, credit and smart card processing, video conferencing, proximity sensors, ticket dispensing and e-commerce applications".

The internet kiosks are equipped with high resolution screens and virtual keyboards. The shell housing structure can be customized with the look and feel of the surrounding environment in a desktop, wall mounted or standalone models. Complete visitors log reports and remote diagnostic software is a standard feature with all kiosks.

Cyber Gear's headline product is the design and maintenance of portals for retail e-commerce operations.

Presence of International Providers (eg Sun, IBM, Cisco etc)

According to Killen & Associates, spending on information technology products and services in the Middle East region is growing twice as fast as the world average and is forecast to grow from 1999's US $17.8 billion to US $35 billion by 2002. Spending for software and related services is forecast to grow to US $11 billion by 2002. And whatever the pros and cons of Etisalat's monopoly, Dubai has certainly been successful in attracting major international names in the IT sector:

• In June 2001 India’s leading IT company, Wipro Infotech, a division of the $660 million Wipro Ltd. Corporation, which offers high value corporate information technology products, solutions and services, launched its Middle Eastern operation at Dubai Internet City (DIC). Wipro Ltd has operations in North America, Europe, Japan and India and is the only Indian company to be listed among the Fortune 500. "We chose DIC as our regional headquarters because of the synergy of missions between the two organisations. We are both intent on building an exhilarating environment where we will thrive on rapid learning, continuous innovation and speed of execution," said Suresh Vaswani, President, Wipro Infotech. The NYSE-listed Wipro Infotech, the first software services company in India to achieve ISO 14001 certification, offers comprehensive IT and Communication solutions to its customers through its suite of infrastructure products, business solutions, professional services and communication services.
  
  
• Also in June, Logica, the global IT solutions provider inaugurated its regional mobile networks support center within the company’s new Middle East headquarters at the Dubai Internet City (DIC). Christopher McDermott, Logica’s Supervisory Managing Director for the Middle East, Far East, and Australia, and a member of Logica’s executive committee, traveled to the region to officially open the company’s new premises. The center provides round-the-clock support to Logica’s key telecommunications clients, including Batelco in Bahrain, MTCG and CICG in Kuwait, FTML and LibanCell in Lebanon, and STC and Saudi GlobalStar in the Kingdom of Saudi Arabia. Telecoms providers in the Central African Republic, South Africa and Zambia also receive assistance, bringing to 24 the total number of Logica clients supported by the new Dubai-based center. “The Middle East represents a vibrant and expanding market for Logica – not only in the telecoms sector, but in financial services, energy, government, utilities, and a host of industries that are critical to the region’s economy,” commented McDermott.

Among the many international names already having a presence in the DIC are IBM and Microsoft.

Human Skill-set Availability; Training Programmes

Like other offshore jurisdictions, Dubai faces the difficulty of needing to create an affordable body of skilled technicians without having to rely on flightly and expensive expatriates, who have the additional disadvantage of being culturally divisive and can often inflame local opinion.

Dubai is taking steps to improve domestic education and training programmes, but relies considerably on the transfer of skills and knowledge to local citizens from the foreign companies that implant themselves in Dubai. When announcing IBM's contract to build data centers in DIC, CEO Ahmed Bin Byat, emphasized that a key element would be skills and knowledge transfer to local UAE nationals. “ With the enormous changes in the uses of Computer and Communication technology the growing demand for IT services is staggering” says Mike Lawrie, General Manager IBM Europe Middle East and Africa.

Technical Support Facilities (Hardware & Software)

Organisations with IT skills are in as much demand as individuals. Many incoming companies, regardless of size, are looking for experienced IT partners who can help develop and host their new e-business infrastructure and applications in a secure and scalable environment, backed by top-notch services support.

As with telecommunications and Internet infrastructure, Dubai is attracting IT companies and partners who will help to build a local support industry in depth.

• In June 2001 UAE-based Cadd Emirates, a system integrator and IT solutions company, announced the launch of its wireless ASP model to deliver web-enabled enterprise applications to mobile devices utilising the LPG CMS (corporate mobile suite) wireless application suite from its partner LPG Innovations Oy, Finland. According to Sathya Moorthy, director of Cadd Emirates, the two companies will roll out the functional business model from their secure servers hosted at the data centre in Dubai Internet City to address the business needs of mobile-enabling existing corporate applications like messaging, ERP, CRM and others. Cadd W-ASP is a hybrid approach and allows companies to deploy wireless applications within the enterprise and access an external wireless application gateway that manages all of the back-end connectivity and device support that poses the most significant burden for IT resources.
  
  
• Instingo, a leading German e-consultancy specialising in e-government, e-learning and e-tourism, recently announced that it is to set up a number of offices in the Middle East in order to meet the growing need for e-services in the region. The company has appointed Jamil Ezzo as Managing Director - Middle East. Based in Dubai Internet City (DIC) he will be responsible for establishing, managing and operating Instingo's expansion into the region.
  "We are steadfastly ramping up our team and operations in the region in order to be able to convert the enquiries we have into orders and build on initial project successes in places such as Cairo. At the same time it is our intention to set the pace for e-business consulting for both public and private sectors in the Gulf, Egypt and Lebanon," says Anas Chbib, Instingo's Chief Executive Officer. "We intend to take successes of e-government and e-business in Germany, where we have our head office, and transfer them to the Middle East. However these will all be tailored to specific requirements such as infrastructure, regulations and competencies."
  
  
• In May 2001 ELC New Media, a part of the UK-based ELC International group, launched ELCdesigns.com, the first off-the-net web design service, from its Dubai Internet City (DIC) headquarters. The new service allows customers to browse the web site’s eclectic collection of PhotoShop and Flash web designs and purchase a readymade design. ELC New Media’s team of ten designers, based at Dubai Internet City, have created an on-line library with in excess of 1000 templates in under seven months making it the largest of its kind. ELC New Media was one of the first companies to set up operations at DIC. "Dubai Internet City prides itself on its ability to attract technology leaders that will partner our drive to ensure Dubai’s pre-eminence as the regional new economy hub. It is extremely rewarding to see that the seeds sown not so long ago are already coming to fruition," said Mr Ahmad Bin Byat, CEO, DIC.

In a positive comment on DIC's e-readiness, Girish Chandra, Joint Managing Director, ELC International, said: "Being able to work in an environment such as DIC has been fantastic. The infrastructure, facilities and support of the DIC staff have allowed us to develop and deploy the ELCdesigns.com portal in a remarkably short time."

• Malaysia's Multimedia Development Corp (MDC) has signed a memorandum of understanding with Dubai Internet City (DIC) to pave the way for collaboration between the two. The signing of the agreement at DIC last month was witnessed by Prime Minister Datuk Seri Dr Mahathir Mohamad, while on a two-day working visit to the Gulf state. MDC chairman Tan Sri Dr Othman Yeop Abdullah said the landmark agreement would enable the corporation to explore opportunities for Malaysian IT-based companies in the fast growing Middle East market. "This is a great possibility for Malaysian IT-based companies to explore synergic cooperation with over 200 international companies which have set up operations in DIC. They can also take advantage of various incentives provided by DIC like tax-free status, financial backing, access to capital and funding, and networking among identified incubators,'' added Othman.

BACK TO JURISDICTIONS

Gibraltar

Government support programmes and legislation

The new Gibraltar Government, elected early in 2000, was quick to make its intentions clear as regards e-commerce.

'The Government of Gibraltar believes there are significant opportunities for e-commerce businesses operating from the Rock. The Internet allows access to customers located in every corner of the globe and we should be well placed to serve this international clientele.'

The Minister for Trade, Industry and Telecommunications, with responsibility for the Rock's burgeoning financial services sector, is the Hon. Keith Azopardi, who said:

"I am very pleased to take over the helm at the Department of Trade, Industry and Telecommunications at a time when Gibraltar is prioritising e-commerce and, after a consultative process, will introduce Electronic Commerce legislation. This benchmark piece of legislation, which incorporates the provisions of the relevant EU directives, will provide the legal framework to launch Gibraltar as a high-tech platform for e-commerce."

In February, 2001, Darion Figueredo was appointed E-business Development Officer at the Ministry of Trade, Industry and Telecommunications in Gibraltar. Darion graduated with a first-class honours degree in Information Design in 1995 from the University of Westminster (BA Hons, E-commerce Concepts Analyst). He is a member of the Chartered Society of Designers and Institute of Management and has been involved with internet, multi-media, information architecture and interactive design and development since 1991.

The Electronic Commerce Ordinance was passed on March 5, 2001 by the Gibraltar parliament, the House of Assembly, and is viewed as an important step in Gibraltar's development as an e-commerce hub to rival its nearest competitors, such as Guernsey, Malta and the Isle of Man.

The legislation facilitates the use of electronic means for transmitting and storing information and affords legal recognition to transactions effected electronically. It also provides a framework for the accreditation of electronic signatures and determines the activities and liability of service providers.

A press release from the Gibraltar government said it 'will seek to continue to provide e-commerce operations within a fiscally attractive environment. The treaty exemption from VAT enjoyed by Gibraltar is likely to gain importance, especially in the provision of services and other non-physical products.'

As part of the EU, Gibraltar is of course subject to the developing body of EU law that impacts on e-commerce. There is already a fair amount of this, but the most important parts are the Electronic Signatures Directive and the 'E-Europe' Directive to establish a coherent legal framework for e-commerce development within the Single Market. The Electronic Signatures Directive 1999/93/EC on a Community framework for electronic signatures was approved on 13th December 1999. The E-Europe Directive was finally approved on 4th May 2000. In both cases, member states have 18 months to transpose the provisions of the Directives into national law.

The Government describes its Bill as follows: 'The legislation is aimed at "facilitating the use of electronic means for transmitting and storing information" and affords legal recognition to transactions effected electronically. It also provides a framework for the accreditation of electronic signatures and determines the activities and liability of service providers.'

The labour/liberal opposition says that it is "totally committed" to the development of e-commerce and notes it voted in favour of the e-commerce bill when it went through the House of Assembly last March, but it says that Gibraltar needs "action, not words" on e-commerce, and has accused the government of "gimmicks and empty media sound-bites." It describes recent government announcements on e-commerce as consisting "almost entirely of meaningless jargon and a repetition of things that have been said before."

Gibraltar's main achievements in e-commerce so far have been in the betting and financial derivatives sectors, where a number of British companies have re-located to take advantage of high-quality telecommunications and Internet support from the local operators.

Telecommunications infrastructure

In October 2000, the Gibraltar House of Assembly passed the Telecommunications Ordinance 2000, which transposes into Gibraltar law the relevant telecommunications-related EU directives. Since then various sets of Regulations have been issued under the Ordinance, including one which sets up a Gibraltar Telecommunications Regulatory Authority; this Authority, together with the relevant minister, will have a statutory duty to ensure "fair and effective competition" in the commercial operation of telecommunications networks and the provision of telecom services in, from or through Gibraltar. The Authority acquires its powers as from June 2001; as of July it has yet to make any public announcements.

The Telecommunications Ordinance does away with the Rock's existing telecommunications monopoly. The local telephony service used to be operated by Nynex under a government licence (the government owns half the company) and the international link, via the UK by satellite, was run by GibTel which is a joint venture between the Gibraltar government and British Telecom plc. In mid-2000, Nynex sold its 50 per cent share to BT so now both telecommunications companies are 50/50 joint ventures between BT and the Gibraltar government.

Since late 2000, plans have been afoot to merge the two telecoms operations, as a defence against incoming competition after liberalisation takes effect in 2001. It is thought that Financial Secretary Tim Bristow will head the merged company when he ends his term of office as Financial Secretary in the summer.

Sources said that the aim is to circumvent a choice between the two existing telco bosses, but, says the source: "This would start off by making the proposed combined company more expensive". It's also thought that there are conflicts brewing behind the scenes about staff remuneration, given that people on the old telephone department were given pay initiatives to encourage their move to Nynex when first created, and enjoy pay advantages over those at Gibtel in certain areas of employment.

All this is bound to increase costs further, at a time when telephone users complain of the high costs of the Gibraltar telephone service even as it stands today.

Of course, hanging over the future of Gibraltar telecommunications is the Spanish intransigence over freeing up additional phone numbers. While Gibraltar has been saying for some time that this did not affect capacity as such in terms of bandwidth, and thus might not matter to an operator whose interest was in Gibraltar as an international hub, it surely must compromise the attractiveness of the Rock as a base for call centres or other intensive telecommunications users.

The two main Gibraltar telcos have been offering a range of Internet services for some time, and there are a number of smaller companies offering various types of support service for site development.

Both telecommunications companies operate a digital telephone system which is becoming increasingly fibre optic, and they provide ISDN and leased lines from at least 64kb with sufficiently large bandwidth for international users.

British Telecom's attitude towards its Gibraltar telecoms holdings has to be understood in the context of its Spanish interests. In 1997, BT and MCI of America announced an alliance with Telefonica of Spain, in a move that was deemed to have had dramatic effect on the balance of power in the world telecom sector. A year later BT said it was planning to end its relationship with Telefonica, but would instead compete head-on with Telefonica by applying for fixed-line and mobile licences in Spain, later announcing that, together with Vodafone, it was acquiring joint control of Airtel, the Spanish mobile group. BT also acquired Spanish internet service provider Arrakis and in January this year it said it was forming a joint venture with Banco Popular to launch an internet-based shopping mall in Spain. BT's spending plans amount to £600million in Spain over the next 10 years - at least before its recent travails put much of its international expansion under the cosh.

What is now open to question is whether it can realistically maintain both its Spanish and its Gibraltarian interests in the light of Spanish hostility towards Gibraltar. It can reasonably be assumed that delays in sorting out the new telecoms regime in Gibraltar are due at least in part to BT's financial problems and the attitude of the Spanish, most recently reflected in Spain's blocking of the OECD's June report.

Internet Service Providers

GibNet, as well as being the administrators of the Top Level Domain .gi, offer a range of hosting solutions:

• Basic shared hosting: In shared hosting a web-site resides on the same server as other web-sites. It shares all the resources associated with that server such as disk space, memory, processor cycles and bandwidth. On the whole shared hosting is not particularly well suited to more advanced e-commerce applications. GibNet charges £15 per month or £150 per year for 5MB and £1 per extra MB. The package is designed for the typical ‘company web presence’. This is UNIX based hosting; GibNet do not currently offer shared NT hosting although they are planning to offer larger ‘blocks’ both on UNIX and NT in the future.
  
  
• Managed servers: This is a server which hosts only one client's content. GibNet performs essential maintenance and daily routine tasks such as backing up the contents of the server to a tape as part of the ‘rental’ fee. This is by far the best option for a client not planning to maintain a presence in Gibraltar as GibNet will perform all necessary routines to ensure the smooth running of the server, whilst performance of the site is not being compromised by the popularity of any other sites hosted alongside. GibNet use Netscape Enterprise Server on Unix and Apache on their Linux servers. Presently GibNet caters for Perl and CGi. They will "shortly be catering for all others, ASP, Cold Fusion, SQL and multi media streaming".
  
  
• Co-Location: This entails owning your own server and all the software installed on it. The burden of installation, maintenance, upgrade, routine tasks, etc. is upon the owner. GibNet offer server co-location in their new offices, which have secure, climate controlled rooms. Access to these rooms possible 24 hours a day via recordable entry points, using swipe cards or an equivalent system.

GibNet say that they can provide any customer with as much bandwidth as is required.

GibNynex offer some comparable options:

• Shared hosting: Offered under the name WebWorks Package is unlimited Internet access, domain hosting, 25Mg web space (with a domain URL), on-line web statistics and tracking, 10 emails (with a domain extension). The price for this package is £25.00 set up fee, and £25.00 per month.
  
  
• Co-location: Co-locate third party servers are offered with support contracts (preferably LINUX). Co-located services are provided in very secure premises in a purpose built data centre. Owner access must normally be pre-arranged at least 24 hours in advance.

GibNynex say that there is no limitation to bandwidth requirements; under 2Mg is a quick deployment (within 2 weeks) and anything greater will take approximately 12 weeks to put in place.

Inotech have been set up as an ISP more recently than Gibnet and Nynex, and offer a standard range of web hosting services. They originated as a hardware supplier, and have developed particular expertise in networks.

Web Services Limited is perhaps the more ‘design’ oriented of Gibraltar's Internet providers. It evolved from a purely web-design background as opposed to being part of an ISP's range of services, although it does now offer these. Web Services Limited is wholly owned by the partners of Deloitte & Touche's Gibraltar office.

Hosting Services and Facilities

Apart from the hosting facilities available as above from Gibraltar's ISPs, an Israeli-led group are investing $78 m in a major data centre at Gibraltar through qualifying company Ecom Limited.

The company, described as a specialist in complex web-hosting facilities, is building "one of the world's most secure and robust hosting infrastructures" in a disused military area known as Lathbury Barracks. Ecom holds a teleport facility licence and has taken as its main partner New York-based Computer Associates International Inc, a leading business solutions provider.

Ecom has assembled "a set of strategic partnerships with the world's top corporations in the different market segments used for the engineering of its platforms'" said a statement by the Gibraltar government, which entered into a memorandum of understanding with the company.
The government statement adds that Ecom's " network will be built utilising ecom's own infrastructure and communications expertise, Computer Associates' management solution (Unicenter TNG) and industry-leading security product suite (eTrust), as well as Sun Microsystems servers."

The data centre is being built on land leased from the Gibraltar government, which has also offered the company a special concessionary package which includes tax incentives, and a waiver of import duties for the equipment, which will include up to 10,000 servers.

The data-centre is expected to be operational by the by the end of 2001. The web-hosting facility will employ about 75 IT specialists backed by around 25 administrative and maintenance staff. Targeting the top end of the market, the company is hopeful of attracting between 500 and 700 large companies. It is not a set-up for small start-up operations.

Announcing the venture in October 2000, a Government statement said that the web-hosting business, currently worth about £2 billion a year, was expected to grow to about £10 billion by 2003. "I am very pleased that we have successfully concluded our discussions with Ecom and that they will be setting up a major web-hosting network in Gibraltar," said trade, industry and telecommunications minister Keith Azopardi. The government is very eager to capture a slice of this market, one of a number of specialist telecommunications and ebusiness areas where the government hopes to attract new investment to Gibraltar.

Human Skill-set Availability; Training Programmes

The Gibraltar government, like most 'offshore' administrations, is keenly aware of the need to create a body of skilled e-workers to underpin its e-commerce ambitions, and has a number of policies designed to achieve this goal.

Foreign investors who open Gibraltar offices and staff them with expatriates are a key means of providing training for Gibraltarians. Although there is freedom of movement and labour for EEA citizens, expatriate work permits often come with a requirement to hire a Gibraltarian 'shadow' or understudy who will be trained in the skills brought in by the expat.

The EU is also a major source of funding for training programmes. Gibraltar's allocation of objective 3 funding for the period 2000-2006 is approximately £650,000 a year up to 2006. Objective 3 is funded by the European Social Fund and is primarily meant for the development of training packages targeted at specific needs

The 5 priority areas for this programme of funding (as set by the Commission) are to:

• develop active labour market policies;
• promote social inclusion and equal opportunities;
• develop education and training systems as part of a lifelong learning policy;
• improve systems to create a skilled, trained and adaptable workforce; and
• improve the position of women in the labour market and reduce labour market segregation by gender.

The new Objective 3 programme has a much broader scope than was previously the case It incorporates for the first time training for persons in employment and skills development for the existing workforce as well as additional business and economic development training activities A further welcome feature is a longer programming period which offers opportunities for continuity and better advanced planning.

In launching this new tranche of EU Funding, DTI Minister, Keith Azopardi, said:

"The way the new programme is structured will allow Government to work with the private sector to target the training needs of Gibraltar's employment market and will provide a good opportunity for strategic planning to take place aimed at injecting new skills into the workforce. It is important to provide opportunities to obtain new skills given the trends for the greater use of E-business, information technology and telecommunications. We need to channel these funds in a way that will ensure that we transform our workforce into a more flexible, highly skilled body. This will allow employers and employees to be better prepared for future needs as set by changing economic trends. Work is starting immediately on planning the use of these funds."

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