Atlanteknology - Technology News for Atlantic Canada

Holy Flying Cow

The Supreme Court of Nova Scotia gave Flying Cow (a newsletter distributed in, among other places, restaurants and coffee shops) a slap on the wrist recently, handing down a $239,000 fine and a finding that Flying Cow infringed on the copyright of a national publisher. Justice Richard (the judge who heard the case) held that Flying Cow's activities clearly infringed the copyright of The Coffee News of Manitoba and that Flying Cow had acted in an effort to confuse advertisers. The trial was held over five days in November, 2005 in Halifax.  

The Coffee News is trade-marked and published in about 50 countries and operates on a franchise basis with each of the publications having the same format, colour and style. 

From my perspective neither the finding nor the appeal (the owner of flying cow has indicated in a press release that he would appeal the decision) are particularly relevant except to point out to business owners that you have to be careful in what you do and the names you choose to use in your business. It also shows the power of actually registering your copyright and trade-marks with the Canadian Intellectual Property Office. Doing so can give you a head start in any disputes which arise with other companies.

The only other point I would like to make with respect to the case is that, if you are involved in a franchised business, you should be extremely careful if you decide that you want to strike out on your own and open up a competing business which may use business methods, proprietary information, or other property of the franchisor.

Websites and the collection of GST/HST

Let me preface what I am about to write by saying that I am neither a tax lawyer nor an accountant. However, this case is interesting and you may wish to bring it to the attention of your tax lawyer or accountant if you sell services on your website and charge GST/HST to non-residents.

In the case of Dawn's Place Ltd.  v. Canada, a  November 10, 2005 decision of the Tax Court of Canada, the issue was an assessment made under Part IX of the Excise Tax Act against the appellant. The court found that the appellant was not required to pay seven per cent Excise Tax on the membership fees paid to access the adult content website, as the information contained on the website was intellectual property, and the supply of intellectual property to non-residents of Canada is zero-rated -- Excise Tax Act, ss.10 and 123.

The matter is worth investigating, even if the services/products you are selling on your website are not adult content.

Oppurtunities for IT service providers?

Here is an interesting article.

According to a recent Gartner study, laws on corporate governance and compliance, such as the U.S.A. Sarbanes-Oxley Act, may force businesses to spend more on information technology in the future. The report predicts increases in IT budgets from 10 to 15 percent in 2006, up from roughly 5 percent in 2004. The survey included 326 audit, finance, and IT professionals in North America and Western Europe. Gartner recommended solutions that can support multiple regulations across a business to maximize effectiveness on spending for compliance.

NSP as ISP? Internet over power lines revisited

A while back I discussed the possibility of getting internet access via power lines. A great idea, especially for those in rural areas. I saw an article a few weeks ago which discussed such a plan for the State of Texas.

The utility TXU Corp. of Texas will offer high-speed Internet service over power lines to several million Texans as part of a $150 million (US) project aimed at improving the utility's ability to monitor the power grid. The "smart grid", once completed, will enable what would be the largest broadband-over-power line Internet rollout in the USA.

The internet portion of the project is secondary to the primary purpose - to improve the delivery of power to customers but it is still significant.

Capital Pool Companies

The TSX Venture Exchange has a programme (implemented in Nova Scotia in March 2005) called the Capital Pool Company Programme  which will be of interest to entrepreneurs, angel investors and businesses, who have considerable business experience. The initial public offering for a capital pool company will generally raise between 200,000 and 1.9 million dollars.

Capital pool companies  were the most popular method for joining the TSXV in 2004, with 87 being launched.

In a nutshell, the Capital Pool Company Programme is designed as a corporate finance vehicle to provide businesses with an opportunity to obtain financing earlier in their development than might otherwise be possible through a normal IPO. The programme permits an IPO to be conducted and a TSXV listing to be achieved by a newly created capital pool company which has no assets other than cash and which has not commenced commercial operations. The capital pool company uses the pool of funds obtained through the IPO to identify and evaluate assets or businesses which, when acquired, qualify the capital pool company for listing as a regular tier 1 or tier 2 issuer on the TSXV.

There is considerable information on the web about the programme. I just thought I would make mention of it.