Intellectual Property: The ECJ Extends the Use of Trade Marks to Goods and Services

The European Court of Justice (“ECJ”) ruled in Praktiker Bau- und Heimwerkermärkte (C 418/02) that a trade mark that is now in use by a company on its goods can be extended to cover the services provided by this company.

A DIY retailer Praktiker Märkte, filed for registration with the Deutsches Patent und Markenamt (the German Patent and Trade Mark Office) of the mark PRAKTIKER in respect of the slogan ‘retail trade in building, home improvement and gardening goods for the do-it-yourself sector.’ However the German Patent Office refused registration of this slogan on the grounds that the concept of ‘retail trade’ did not denote independent services having autonomous economic significance.

Praktiker Märkte brought an appeal before the Bundespatentgericht (Federal Patents Court) against the rejection of its application. The company argued that the economic trend towards a service society necessitated a re-appraisal of retail trade as a service. The consumer’s purchasing decision would increasingly be influenced not only by the availability and price of a product, but also by other aspects such as the variety and assortment of goods, their presentation, the service provided by staff, advertising, image and the location of the store, etc. Such services provided in connection with retail trade enabled retailers to be distinguishable from their competitors. They further argued that such services ought to be eligible for protection by service marks.

The case was referred to the ECJ who concluded that:-

Retail services should be registered as trade marks if the services differ from the goods under which the trade mark is sold; and
The contents of the services provided by the retailer must be specified so as to enable consumers to know in concrete terms (1) what the service consists of (expressions such as “retail trading” or “retail services” are not explicit enough) and (2) what goods or types of goods the services relates to.

Additive Manufacturing application in consumer goods can meet customization demand
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The Relevance of Implementing Value Added Tax Or VAT on Goods and Services

Economists in the government had come up with a good way of funding the biggest deficit in the history of United States, and that is through value added tax, shortened to VAT, which is also called national sales tax.

Advocates assert that this system gets rid of the complicated income tax system of the United States, thinking that the value added tax is quite more efficient in bringing in more revenue, something that could be of great help to the economy. This is said to be a solution to the issue about lost online sales taxes, which occurred as a result of commerce being taken online and, in doing so, evaded policies mandated by the government on taxation of sales. With value added tax system, all sales have become taxed. So goods either sold at a brick and mortar shops or sold online are taxed. Most business transactions are now levied, and by business transactions we mean services and goods offered or vended. However, insurance services, some types of training and education, and loans are not covered by the VAT system.

This system provides extra income to pull down shortfall and to finance vital programs of the government for American citizens.

Nevertheless, levying on goods and supply sales can have negative effects, just so you thought that everything is good about it. There is always the other side of the coin. The system can be extensively regressive which means that when you put taxes on sold goods and services, you make them a bit more expensive than they actually are. And this creates a problem among people with less income because they are hit most negatively by higher prices of products.

Businesses find computations of value added tax terribly cumbersome and they do cost significantly. Since products have different prices, calculations must be done for each product. Business owners, of course, pass VAT and all the costs it incurs onto buyers.

All businesses are required by law to collect sales tax, so if you sell goods, products, or services, you are to impose taxes on them. Where consumers shoulder this tax, you are obliged to remit it to the government. The imposing of value added tax on goods and services is not a matter of your own discretion that you may or may not collect this tax, because this is your legal obligation. You can face litigation by not abiding by what was mandated. You are collecting value added tax and you are doing it on behalf of the state and you are obliged to turn the money in to the state on time.

For your information, nonetheless, not all states of the US charge sales tax. We are talking about New Hampshire, Alaska, Oregon, Delaware, and Montana.

Today, there are a lot of companies that sell items and advertise services online, and the problem with online business transactions is that the two parties, the seller and the buyer, may be in different locations, states, or even countries with different tax rules. The government has been sorting out this issue, but there is still no definite ruling regarding the matter, and different states have different legislation regarding sales tax collection of online products and services.

Value added tax is a convoluted matter and because of that you may opt for assistance to help you out with transactions involving sales tax. There are companies out there that help you ensure you do not encounter legal problems by elucidating which transactions are excepted from value added tax and which ones are charged. Expert advice from servicing firms is even more important during instances of large purchases. The complexity of sales tax rules becomes more relevant when making major business transactions such as purchasing real estate.

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The Benefits of Bartering Goods and Services Between Private Individuals

Bartering is not a new concept. It’s been around probably for as long as man has walked the earth. In fact, long before money existed people traded goods for services or services for other services. That’s how commerce took place.

Today, bartering is as popular as it has ever been, particularly among small businesses that are often strapped for cash. The internet features hundreds, perhaps even thousands, of barter exchange websites that have been set up to help small, struggling businesses survive and even thrive by providing a way for them to access needed goods or services they might not otherwise be able to afford.

The owner of a shoe store may trade a pair of loafers to the dentist for a check-up and a teeth whitening treatment if both are members of the same barter exchange and have access to one another. An interior decorator may barter her professional service for a pair of stylish earrings and the transaction, without the exchange of any money, will be helpful to both businesses.

But bartering is not exclusive to small businesses. It is also commonplace today among ordinary consumers – private citizens. That’s because the depressed economic climate has left many people short of funds, without employment or facing other hardships. Many regular folks just don’t have the money needed to buy the goods or services they want or need. But, they often have something they can trade.

Barter exchange websites exist for consumers, too. And every day more and more people with access to computers are joining these websites and taking full advantage of the opportunities that exist on them. In fact, online communities like Craigslist and Swap Thing provide environments that encourage members to trade goods and services without any movement of money. Not a single dime changes hands.

These websites are adding members daily … lots of them. Just recently, Craigslist had a whopping 142,000 postings offering everything for exchange except the kitchen sink. And it’s actually possible that was available, as well.

Swap Thing is even more engaged. It generally has up to a phenomenal 35 million listings of everything from school clothes to school books … vacations to home rentals … labor for merchandise … and on and on and on.

Does it really work for people who commit themselves to the idea? The answer is a resounding yes, particularly in these economically-depressed times when money problems are common in many households.

Consider the case of a woman I will call Rachel (not her real name). She and her husband Ted (not his real name, either) live in a Midwestern city and have always dreamed of vacationing in Cape Cod. For Rachel, in particular, it’s been a lifelong dream. And Rachel and Ted were finally going to realize that dream … until they found out that decent lodging in the area would cost about $200 a night, somewhat beyond their vacation budget. In most cases, that shortness of available cash would absolutely squelch any chance of the vacation becoming a reality.

However, given the current proliferation of barter exchange websites for consumers, Rachel seized upon an idea. She advertised her husband Ted’s professional accounting services in exchange for lodging for 3 or 4 nights in a Cape Cod hotel, motel or similar kind of lodging. The posting appeared on Craigslist and, as a result, Rachel and Ted will be able to enjoy their Cape Cod vacation – cost-free.

There are, of course, thousands of other examples of successful swaps or barter exchanges between consumers in which each party to the exchange ended up a winner. In fact, each year, as summer ends and fall arrives – along with the beginning of a new school year — many hard-pressed moms are able to trade a coveted service for school uniforms for their school-age kids. That, of course, saves a costly trip to the clothing store. Parents and older kids, especially those already in college, enjoy trading for school textbooks which any advanced student knows tends to be alarmingly expensive.

Clearly, barter works as well for individual consumers as it does for small businesses. And, as is true for small businesses, the consumer who engages in bartering meets many new friends (businesspeople meet and get many new customers) … enjoys a transaction in which he or she almost always wins … and develops a pastime (or habit) that often turns into a compelling passion.

There is more for ordinary consumers to like about bartering, as well. It provides a real opportunity to move and rid yourself of old, dust-collecting items (just as would happen if you conducted a yard sale) … enjoy the true fun that comes from trading (you’ll be like a “kid in a candy store”) … and, of course, when you trade or barter, you save money. That is particularly meaningful now, in these difficult economic times.

What’s more, you may also be able to acquire goods that you’ve always wanted, but could never afford (such as expensive, if slightly-used, luxury items, including clothing and jewelry, exotic vacations or great electronic merchandise for your home)… or services, including health or cosmetic care and treatment … or professional services, such as accounting, tax returns, even legal advice just because you’re a member of a website exchange community=2 0and you’re willing to give up something to get something in return – with absolutely no exchange of cash.

So now you need to ask yourself: is bartering something that I can enjoy and profit from? If you’re like millions of other people, the answer is probably yes. And even if you are someone who stands apart from the crowd, the answer is still likely to be yes. Bartering is a social experience … and generally quite enjoyable for those who participate in it. In all likelihood, it is something you will enjoy for its social aspects and profit from, as well, because it will enable you to acquire needed goods and services without the use of your hard-earned money.

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Australian Goods and Service Tax Basics

Goods and Services Tax is part of a taxation system governed by the Australian Tax Office (ATO). The tax applies to all product and service purchases at a rate of 10% including those take place between suppliers, manufacturers and retailers. Businesses are able to claim credits on their own payments and on any other business purchases. Only the end consumer pays Goods and Service Tax without being able to reclaim any of the payments that they have made.

Registering for Goods and Services Tax

In Australia, businesses have to meet the following criteria before they can register for Goods and Services Tax:

The business must act as an enterprise and have a turnover in excess of $75,000 in each financial year (or $150,000 if the business is a non-profit organisation)
The business must act as an enterprise and project a turnover of $75,000 or more in the forthcoming financial year (or $150,000 if the business is a non-profit organisation)
The business must act as an enterprise and provide taxi travel as part of its services

GST registrations must be made through the Australian Tax Office. This can be done independently or by using a third-party service provider.

Making Payments

Business activity in Australia is recorded on Business Activity Statements (BAS) and for Goods and Services Tax purposes, these are returned to the Australian Tax Office on a quarterly basis unless the business turns over more than $200,000 in a financial year, in which case the statements are submitted on an annual basis.

Businesses must pay the full amount of tax at the time of any business purchase but registration allows them to claim back credits on any payments that have been made. Business Activity Statements highlight the amount of Goods and Services Tax paid on transactions and the amount being claimed back as tax credits.

Keeping Records

Record keeping is an integral part of managing Goods and Services Tax payments. To claim back tax credits successfully, you will need to present a valid tax invoice from your suppliers. Tax exemptions are applied to any individual products or services that cost less than $75. A valid tax invoice will contain the name of the supplier, their Australian Business Number and the price of the product or service including any Goods and Services Tax paid.

Invoices should be kept on record for five years after the date each Business activity Statement is lodged. The same invoices must be kept for five years for income tax return purposes. Understanding the basics of the tax can help businesses keep a tighter control on spending and ensure that they claim the credits they are entitled to.

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Economic and Social Implications of Goods and Services Tax

The overwhelming majority of product and service transactions in Australia are subjected to a 10% value-added tax called Goods and Services Tax (GST). Introduced by the Australian Howard Government in July 2000, the tax has effectively replaced the former Federal Wholesale Tax System and has phased out a number of state and territory levies including stamp duty and highly unpopular banking taxes.

Despite the success of the Goods and Services Tax, observers still believe that the 10% charge applied on business and customer transactions has a series of economic and social implications. In particular, these concerns are levelled towards the end consumer who ultimately picks up the cost of Australian GST payments.

While business that are Goods and Services Tax registered can claim credits that see them reimbursed for any payments made, it is the everyday citizen who is already paying income tax on their earnings who continues to be penalised. Indeed, it could be easily argued that GST is simply a regressive tax that potentially targets low income earners and that the Australian Government is now consuming more of their earnings than ever.

Peter Costello, the former Treasurer of the Australian Government, certainly seems to believe that Goods and Services Tax is anything but regressive. During his tenure, which ran from 1996 to 2007, Costello argued that the abolition of state and territory taxes and their subsequent replacement had left consumers no better off or worse off than they originally were.

Consumer behaviour spiked dramatically in the months preceding the introduction of Goods and Service Tax, with many end users rushing out to purchase high-end consumer products that would become much more expensive as soon as the new tax system began. It is significant to note that Australian consumer spending and economic performance spiralled into negative growth during the first GST fiscal year.

Small businesses have also felt the impact of the new taxation system. Unlike consumers, a business that is registered for Goods and Services Tax can claim refunds from the Government in the shape of GST credits for any payments made under the new regime. Even so, small business owners claim that the increased cost of administration and continuous interaction with the Australian Tax Office is little more than the result of bureaucratic red tape.

Goods and Services Tax also had a negative impact on the Australian property market. The tax itself led to an increase of 8% in the price of new homes while demand fell by over 12%. Although the market recovered by 2004, arguments continue to rage over economic and social implications of the new tax and to a certain extent, this is largely justified by the fact that it is the consumer who has to shoulder the bill.

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