Affiliates please take the time to participate in this fight that threatens our industry and your livelihood. No matter what size your affiliate business is your voice is needed and does make a difference. An advertising tax bill has been proposed in Maryland, and a hearing has been scheduled for March 17th. If this tax passes, we estimate over 100 advertisers will terminate their affiliate programs with Maryland publishers.

The Performance Marketing Association is the central hub of all of our initiatives and is leading our industries charge to fight this unfair and ill-conceived tax.

“Our effectiveness in fighting legislation that directly harms the income of affiliates will depend on your support. The PMA will be coordinating a targeted grassroots campaign, and we need help from all Maryland affiliate marketers.”

You can learn more about this issue here:

http://www.performancemarketingassociation.com/blog/category/state-legislation/maryland/

You can register your support on the PMA site:

http://performancemarketingassociation.com/advocateform.html

You can also join a group formed for Maryland affiliates: http://groups.google.com/group/pma-md/

Our strength is in our numbers!

If you Twitter please use #NoAdTax to help spread the word in your tweets and Tweet this post ASAP
You can also reach out to the PMA

Rebecca Madigan
Executive Director | Performance Marketing Association
o: 805.445.9700 (PST)

Notice that the panel description does slant towards the favor of the merchant and places most of the responsibility on the affiliate’s shoulders. This is a position that I will be countering as we have seen merchants equally participating in using the same tactics on thier landing pages. Affiliate networks are also responsible  in making sure both the affiliate publisher and advertiser are compliant. We have experienced affiliates asking how they can make sure the merchant on the other side is compliant as well as the advertisers. Our position is that we are all in this together and need to collaborate to proactively get ahead of these issues and help set the regulation frame work . Rather than waiting in the grey area for regulation to to be dictated to our industry from regulators who dont understand online marketing and disrupt our industry.

I am very pleased to see a well-rounded panel and good affiliate industry representation at the SES show. I hope to get a chance to connect with everyone at the show. Here is more info on the panel:

The Oprah Winfrey Litigation: What Affiliate Marketers MUST Know
In August, Oprah Winfrey’s production company brought a lawsuit against over fifty Internet marketers and their affiliates alleging numerous intellectual property rights violations against the marketers and the affiliates. Because many of the merchants used affiliate networks, these merchants were being sued regarding actions by affiliates that the merchants did not know or pay. Because many of the affiliates disappeared the moment that they were sued and because many merchant/network contracts preclude indemnification, the merchants may be liable for significant damages.

Using the context of the Oprah case, the panelists on this session will discuss whether the merchant/affiliate network model needs to be changed and how the risk can be mitigated. While the industry is unlikely to ever be risk-free, it is possible to manage risk by:

• Understanding how techniques like behavioral and contextual targeting affect consumers, affiliates and merchants
• Understanding the legal and regulatory environment
• Understating risks involved with prospective marketing partners
• Using and maintaining proper contracts that allocate risk and provide appropriate indemnifications, and
• Keeping informed about the changes in technology, marketing practices and the regulatory environment.

Attendees will learn how to identify these issues and develop policies and procedures to keep informed about the current technology, marketing strategies and regulatory compliance. The ultimate goal of this knowledge is to help insulate merchants from liability and protect their brands and reputation.

Moderator:

Kristopher Jones, President & CEO, Pepperjam

Speakers:
Mark Rosenberg, Of Counsel, Sills Cummis & Gross P.C.
David Adler, Partner, Adler Law Group
Grant Crowell, Senior Media Analyst, ReelSEO.com
Peter Bordes, Founder CEO and Chairman of the Board, MediaTrust

Your Family Members,

MediaTrust

_______________________
Minnesota –Multiple Taxes: Omnibus Public Finance Bill Passes Legislature

An omnibus public finance bill that would make numerous changes to corporate
income, personal income, sales and use, property, and other taxes has been
passed by the Minnesota Senate, and has been repassed by the House of
Representatives as amended by the Senate, on May 12, 2009. The provisions
were amended to H.F. 1298 by the conference committee for H.F. 2323, which
as previously reported, passed the House of Representative on April 25,
2009, and the Senate on April 28, 2009. (TAXDAY, 2009/04/28, S.12)

Sales and Use Taxes
The bill does not contain the provision, previously passed by the House and
the Senate (TAXDAY, 2009/04/28, S.12), that would have created a rebuttable
presumption, similar to New York’s so-called Amazon law, that a retailer is
presumed to have a solicitor in Minnesota if the retailer enters into an
agreement with a resident under which the resident, for a commission or
other consideration, directly or indirectly refers potential customers to
the retailer by a link on an Internet Web site or by other means.
H.F. 1298, as passed by the Legislature on May 12, 2009.
______________________

The Performance Marketing Alliance has an all hands on deck alert for networks, merchants, service providers and affiliates to get involved in fighting the Advertising Tax in Hawaii.  As you may well know, the status of the affiliate marketing sales tax legislation in Hawaii has reached a critical point. The bill, HB 1405, has been sent to the Governor’s desk. We need everyone in the industry to help and most importantly, we the help of Hawaiian affiliates. We need to reach out to Governor Linda Lingle and ask her to veto the bill. Hawaii affiliates need to email or send a letter to the Governor as soon as possible.

Below are two sample emails networks, merchants and affiliates can send and info and contact information for the Gov. This strategy has proven to be easy, yet effective.

NETWORKS, MERCHANTS email letter to get your affiliates active BELOW
—————————————-
Dear Hawaiian Affiliate:

The Hawaiian legislature has sent an anti-affiliate bill, HB 1405, to
the desk of your Governor, the honorable Linda Lingle. This
legislation could force out-of-state merchants to shut down their
affiliate programs.

How would that impact your business?

If you live in Hawaii, it is critical that you send an email of
opposition to the Governor as soon as possible! It is our hope that
the bill will be vetoed by the Governor. With your letters of
opposition, she will hear your opinions voiced and increase the
chances of a veto.

So please contact Governor Linda Lingle as soon as possible, even over
the weekend. Because your businesses are under threat, it is
imperative that your messages are heard.

More background information can be found here on the PMA website.
www.performancemarketingalliance.com

Below is an e-mail template to use and the contact information for the
Governor. Please send an e-mail; it will only take a few minutes of
your time.

Email Template – copy and paste. Don’t forget to personalize the bracketed sections. Sometimes it is easy to overlook them in a hurry.

Thank you.

(e-mail: governor.lingle@hawaii.gov )
_____________________________________________________________________________

AFFILIATE EMAIL TEMPLATE TO SEND TO THE GOV ASAP
[letterhead]

[Date]

Her Excellency, the Honorable Linda Lingle
Governor, State of Hawai`i
Executive Chambers
State Capitol
Honolulu, Hawai`i  96813

Subject: Opposition to HB 1405

Dear Honorable Governor:

I am a small business owner with a website, and I am in strong
opposition to HB1405, which would require retailers that advertise and
receive direct or indirect referrals from advertising on websites,
such as mine, to collect sales tax in Hawai?i.

I am opposed to this bill because it would substantially harm my small
business, by reducing a large source of revenue that I rely on to
survive. This revenue results from providing advertising on my website
on behalf of out-of-state retailers.

[Describe your type of business, the % of income dependent on
out-of-state advertisers, number of employees you may have, and what
you contribute to the local economy.]

If retailers believe that doing business with me will result in their
having to collect sales tax on all Hawai?i sales, they likely will
sever ties with me, putting the viability of my business at risk. Such
was the case in the state of New York, where Overstock dismantled its
performance advertising program and hundreds of other business
followed Overstock?s example. This left thousands of small- and
medium-sized business owners with a major loss of income.

For these reasons, I respectfully oppose this legislation.

Sincerely,

This is part of the FTC’s advertising-practices divisions effort to “update guidelines that are 30 years old.”

The FTC commissioners will be voting on the new proposed guidelines later in the summer. This is part of the new regulation-minded administration in Washington that wants to set better standards, definitions and best practices in the online marketing industry.The administration will be formalizing many areas of our business’s framework from paying taxes to outlawing unethical business practices.

The online marketing industry is still very young and has been allowed to have too much undefined grey area for marketers and consumers. This effort will cause some initial pain and awkwardness for some of our online marketing community, but in the long run our industry will greatly benefit. This will create a more solid foundation and greater credibility for growth – especially in the the performance marketing segment of our markets.

We will be launching a compliance resource center in our platform for our advertising and affiliate publisher partners. The center will be updated with all the new policies and procedures plus other hosted compliance solutions. We are looking forward to our industry’s next evolution in becoming a more mature and vibrant business. Stay tuned and also make sure to reach out to us if you need any help understanding the many moving parts of compliance and our markets.

The grass roots approach part of the Internet marketing coalition led by the the PMA Performance Marketing Alliance had a very meaningful impact. The grass roots effort mobilized affiliates, merchants and networks to send in letters, call and set up meetings with legislators in Maryland protesting the Bill and its negative impact on their business and the industry.

Big thank you to all who participated and we ask everyone to stay involved in the states that are working on passing this Bill.

CA is a very important state the coalition is fighting. The bill is up for adoption April 27th. Please make sure to send in letters, call or set up meetings with your legislators. All the tools and information for affiliates to fax letters and set up meetings can be found on the PMA CA Tax section.

Changing the FTC Rules on Endorsements & Testimonials: Why You Should Care!
April 16, 2009 – 2:30 p.m. EDT

Since 1980, the FTC guides on testimonials and endorsements have constituted the framework within which the advertising community has operated.  The FTC’s proposed changes would mean a sea change for the way marketers use testimonials.

What will become of the “results not typical” disclaimer?

How can marketers comply with the new requirements?

How will the FTC’s requirements for “new media” affect marketing in the 21st century?

What is the status of the proposal?

Speaker: Ed Glynn, Partner, Venable LLP

ERA members: FREE
Non-members: $99

Minnesota :: URGENT AFFILIATE COMMUNITY ACTION NEEDED

There was lobbying intelligence that indicated this bill would disappear, but it has not. A senate hearing is scheduled for this Thursday, April 16th. Affiliates desperately need to take action tomorrow, Wednesday the 15th, by emailing their state senators. More information can be found in this post.

Connecticut  :: URGENT AFFILIATE COMMUNITY ACTION NEEDED

This is a very challenging state. The bill has already passed out of committee and is expected to be fast-tracked through both the house and the senate. If you live in Connecticut and haven’t emailed your legislators, please do so now. More information can be found in this post.

Hawaii

This bill has just risen from the dead. Last week nexus language was stricken from a digital goods bill by the senate. This week, when the bill went back to the house, they added the nexus language back in. One of the lobbyists we’re working with is getting more information on what happened, and who should be contacted next. If you live in Hawaii, we’ll be reaching out to you soon.

California  :: URGENT ATTENTION April 27 deadline

This fight is ongoing.  We have learned there are 3 committee members are wavering in their support: Beals, Ma and Coto. We are working on a targeted effort to have affiliates in their district outreach directly to these influential people. Brad Waller is coordinating district visits and another lobby day in Sacramento. If interested, email: lobby_day@performancemarketingalliance.com. Several people, including Brook Schaaf, Karen Garcia and Lisa Picarille, are also organizing editorial visits with mainstream press.

Maryland

This bill was successfully shot down in the committee, due in large part, to the efforts of Maryland affiliates who reached out to their legislators. We were told they were very surprised to the opposition to the bill. However, we fully expect this bill will be reintroduced next year when their legislative session opens. This will be an ongoing problem with every state – it will continue to show up every year.

Illinois

There still isn’t a bill number. One lobbyist was in Springfield today and said that to pass a rule change like this, the office of Revenue would need to formally propose a rule change, and then a joint legislative committee would have 120 days to review it, and determine if they want to overturn it.  We are keeping an eye on this but there doesn’t appear to be a need to act just yet.

Florida, North Carolina and Tennessee

Still rumors of discussions in the halls, but no activity or buzz over the past week. The situations could change quickly, so we’ll let you know as soon as we know more.

Internet Marketing Industry Unite! Fight the Internet Advertising Tax

The entire ecosystem of online marketing is being attacked state by state with the rollout of the internet advertising tax that affects affiliates, publishers, merchants, affiliate networks, service providers and more.

The state tax attack started last year in New York: “OverStock Files Lawsuit w/ Supreme Court to Fight New York Tax Law” and has now started to spread rapidly in many other states like CA, CT, FL, MN, IL ( to name a few). This ill conceived tax that has been called unconstitutional my Amazon and other companies fighting it. The tax bill started directly attacking the affiliate marketing industry by creating a nexus, meaning that affiliate programs would be charged state taxes for transactions generated and treated as if they were physical store fronts.

Instead of creating more revenue, it has done the opposite as internet retailers in these states have been shutting down their programs. In New York State over 100 programs were shut down affecting approximately 3,400 affiliate marketers. The Tax is now threatening to rapidly spread to other states and cause the same negative effect hurting many affiliates and small businesses. One of the key issues is that state legislators do not understand the ecosystem of affiliate marketing and how this current tax structure causes a much larger negative ripple effect across the entire industry.

There is no way for people outside the industry to get a clear picture or understanding of the tax’s impact because there is little data or rese about affiliate marketing’s intricate complexity. this led to the recent formation of the Performance Marketing Alliance and the Affiliate Voice Association.

It is very important that our community understand the reach and gravity of this tax as it can literally wipe out hundreds of millions of dollars in industry revenue and even affect shareholder value of public internet media & marketing companies. In it’s current form it does more harm than good, and in fact, appears to create less tax revenue and instead sucks more income out of our already ailing economy. It is hard to get a clear picture as there has not been any total impact study done by state or federal government.

THESE STATE TAXES MUST BE STOPPED NOW

There is an industry-wide call to action. The entire online marketing community is coming together to fight the internet advertising tax at state and federal levels. It is very important that we all participate in this ground swell and collaborate before it’s too late. No matter who you are, you can make a difference by letting your voice be heard in your state.hThe affiliate marketing segment can help make the most impact as states are very concerned about not hurting small businesses. On an aggregate basis the affiliate marketing channel is estimated to be $10 billion in revenue.

The Performance Marketing Alliance is now at the center of a grass roots movement working on behalf of the affiliate marketing industry. The PMA has real-time information and tools you can use in each s tate to make a difference such as individual and group form letters, legislators information and more.

This coalition is being coordinated by Google’s state policy counsel, and includes ActOnline, Amazon, AOL, Comcast, DLA Piper, eBay, Microsoft, TechAmerica, and Yahoo. The intent is to pool resources and intelligence from all these companies’ lobbying efforts, to make sure we all have up-to-date information, and the most effective coverage.  Sometimes house reps need to be targeted, sometimes Senators, other times it is certain committee members, and their guidance will help us direct our efforts.

Make sure to follow the PMA and also push this information out into your community through your blogs, Twitter, Facebook forums etc. We will be posting coverage and sending targeted messaging to our MediaTrust partners who are in the states that are in need of affiliate letters, calls and meetings with local legislators. When Twittering information out make sure to use #advertisingtax

Here is a list of resources to follow and people who are actively working together to fight and make a difference

PMA Performance Marketing Alliance Association Blog :: Twitter :: Facebook

Affiliate Voice Association Site :: Twitter

NY Affiliate Voice :: Blog

5 Star Affiliate programs blog

Revenews Blog

Affiliate Tip Blog :: Twitter

missyward.com Blog :: Twitter

Jangro.com Blog :: Twitter

lisapicarille.com Blog :: Twitter

stephanielichtenstein.com Blog :: Twitter

Fight Against the #AdvertisingTax :: Facebook Group