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This section is designed to explain the ideas and terms relevant to offshore e-commerce which occur on the site and may not be immediately understandable to a non-expert.


ADSL:

Asymmetric Digital Subscriber Line, a technology that allows high speed use of the Internet down normal telephone wire; however it works satisfactorily only within relatively short distances from an exchange.

Bandwidth: Put simply this is the rate at which information that can travel along a given communications link, for instance down the medium (twisted copper pair, cable, wireless frequency etc) used to connect to the Internet. See Mbps, Gbps, Tbps.
Broadband: A generic name for methods of delivering electronic data which are fast enough (have enough bandwidth/have large anough pipes) to be used to deliver motion-picture quality images. Cable can deliver broadband; telephone lines cannot (at present).
Carnivore: A program used by the FBI in the US which can 'sniff-out' suspicious content in protected messages and data-bases and take copies; may eventually be judged unconstitutional in its present form.
Certification: Authentication that a signature or document or transaction on the Internet is what it says it is; certification is supplied by Trusted Third Parties or Certification Authorities who use advanced security features to ensure that data accompanied by a Certificate cannot be tampered with.
CFC: Controlled Foreign Corporation; most high-tax countries have legislation which compels the repatriation (or equivalent taxation) of the profits of companies in offshore jurisdictions if they are substantially owned by shareholders in the high-tax jurisdiction.
CIF: Catalogue Interchange Format.
Co-location: Placing a virtual server, dedicated to one client (one customer-base), on the same server as is used by the ISP or Internet host who is providing that client with Internet access.
Cybercash: Electronic money, provided in a secure way by a bank to a customer, which can then be used electronically to buy products or services.
Electronic products, or digital products: Any product or service that can be delivered electronically, and specifically over the Internet. For example, computer software can be downloaded from server to client; or legal advice can be given in the form of e-mails and electronic files.
E-Shop: A company's retail presence on the Internet, including its catalogue, selling tools and payment processing tools.
FATF: The Financial Action Task Force, an action group set up by the OECD (qv) to attack money-laundering, and which issued a list of 6 offshore jurisdictions which it said lacked effective controls on money-laundering.
Front-End: those parts of a commercial operation that face and deal with the customer.
FSF: The Financial Stability Forum, an action group set up by the G7 (top nations club) to prevent a recurrence of the 1998 Asian melt-down, and which issued a list of 15 (mostly offshore) jurisdictions which it said represented a threat to global financial stability.
Gbps: Gigabytes per second (one billion bytes per second) - a measure of Bandwidth, ie the capacity of a connection.
GUI: Graphical User Interface. This is the name for the screens that people will see when browsing a web site.
Host: An Internet Service Provider (ISP - see below) who also offers hosting of Internet domains. Many do, but not all.
IBC: International Business Company. A type of company offered by many offshore jurisdictions which gives tax exemption for international trading companies.
IOFC: International Offshore Financial Centre. Another name for an offshore financial jurisdiction, or what used to be called a tax haven.
IP: Intellectual Property. 
IP: Internet Protocol. The standardised format used to send packets of information on the Internet.
ISDN: Integrated Services Digital Network. An ISDN line will give you a much faster connection to the Internet; it may come to be replaced by ADSL technology.
ISP: Internet Service Provider. A company which offers connection to the Internet to its clients; it may or may not offer more complex service.
Napster: A 'peer-to-peer' program that allows two or more computer users to exchange data securely over the Internet; used by music buffs for free copying until attacked by the record companies.
OECD: The Organisation for Economic Co-operation and Development - a Paris-based club of 27 rich countries which sets informal but widely-adopted economic standards and which has attacked 35 offshore jurisdictions for what it calls 'unfair' tax competition.
Offshore: In the context of e-commerce offshore means that a site is situated on a server that is physically located in an IOFC.
Pipes: The channels (wires, transmission links, cables, or whatever, that connect two parts of a network).
Mbps: Mega bits per second (one million bytes per second). A measure of bandwidth i.e. the volume of bits of data that can be transferred per second over a given link.
Mp3: The protocol (data format) used to allow music to be sent over the Internet.
Nexus: Presence in (for instance) a US state, giving rise to a liability for sales tax.
Open: As in 'open standards'; software which has general applicability on the Internet and can be used in any application, as opposed to:
Proprietary: Software tied to a particular provider, and not necessarily compatible with any particular other piece of software.
PSN: Public Switched Network - the existing telecommunications system in a country which routes calls between users.
Resellers: Much Internet software and many services are provided by resellers who buy or license programs or packages from originators and sell them on.
RIP: Regulation of Investigatory Powers Act; a contentious piece of UK legislation which can be used to compel ISPs to provide decoded copies of encrypted communications to the Government and which may restrict the growth of the UK e-commerce.
SDMI: Secure Music Downloading Initiative. The 'corporate' alternative to Mp3, being developed by the big recording companies.
Server: The computer that will host a web site, usually on the premises of an ISP or Web Host; it 'serves' visitors to the site with pages on request.
Server Farm: Sometimes called Internet Hotel - a facility which houses e-commerce or e-business servers belonging to users in a controlled environment and acts as a communications hub for them.
Secure server: a server that is equipped to handle sensitive details such as credit card information; thus it must have the ability to send and receive encrypted information through the SSL and/or SET protocols.
Shopping Cart/Trolley: A part of the software in an electronic shop that allows customers to pick up goods as if they were on a shelf and take them all together to the check-out
SSL/SET: Secure Socket Layer and Secure Electronic Transaction respectively. These two protocols allow encryption between browser and server, facilitating secure transfer of sensitive data.
SSTP: Streamlined Sales Tax Project; an attempt by about 40 US states to develop a harmonised sales tax regime in preparation for imposing effective sales taxes on the Internet.
Taxable Presence (UK)/ Permanent Establishment (US): This relates to the law regarding taxation of business profits. For a country to tax a company's profits it must usually be first established that the company is carrying on business in that jurisdiction. This is done by showing that the company has a 'taxable presence' in the UK or a 'permanent establishment' in the US.
Tbps: Terabytes per second (One thousand billion bytes per second) - a measure of Bandwidth, ie the volume of data that can be transmitted over a given connection.
Telco: Telecommunications Company. The companies that supplied basic telecommunications services; very often, the national PTTs. The distinction between telcos and other telecommunications providers is becoming blurred.
Terabyte: Another level of data volume, 1,000 times greater than gigabyte, which is in turn 1,000 times greater than a megabyte (one million bytes), which is in turn 1,000 times greater than a kilobyte (one thousand bytes).
VAT: Value Added Tax. A tax that applies throughout the value-chain in the EU and some other jurisdictions, whereas sales tax jurisdictions (eg the US) apply tax only at the final stage when a consumer buys a product.
Withholding Tax: Most countries levy a tax on various types of payment leaving their jurisdiction, including interest, royalties, license payments, and dividends. These payments are 'withheld', hence, 'withholding taxes'.
XML: Extensible Markup Language: XML is an extended form of HTML allowing extra features to be integrated to web pages.


 

STRATEGIC PARTNERS
  Lowtax.net
  Tax-News.com
  Expat Briefing
  LawAndTax-News.com
  OffshoreTrustsGuide.com
  TreatyPro.com
  Global Incorpoation Guide [GIG]

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