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Overstock Threatens to Terminate Colorado Affiliates Over Pending Legislation
In a high stakes game of chicken with state legislators, Overstock is once again using the threat of affiliate terminations as leverage in a preemptive move, this time with Colorado state bill HB 1193 (pdf), as the target. The bill, introduced on January 22nd, 2010 attempts to establish responsibility for collection of sales tax for out‐of‐state retailers if those out‐of‐state retailers use Colorado‐based affiliate relationships as a method of advertising. The bill is set for a hearing in front of the House Appropriations Committee for on Wednesday, January 27, 2010 at 8:30AM.
Sponsored by Colorado State Representative John “Jack” Pommer, who is also Chair of the Appropriations Committee, and Senator Rollie Heath, HB 1193 is comprised of the same DNA as the so-called Amazon Tax that was passed by New York State in 2008 and which is currently making its way through a series of legal challenges lead by Amazon. In its current incarnation Colorado’s version of the bill does not stipulate a minimum amount of revenue for nexus and mistakenly treats affiliates as a sales force rather than as publishers engaging in a method of advertising.
While I don’t condone the way Overstock President Jonathan E. Johnson III callously uses affiliates as bargaining chips, this type of tactic worked quite effectively in California with AB 178 which was ultimately led to a veto by California Governor Arnold Schwarzenegger. Schwarzenegger even mentioned and appealed to Overstock directly in his reasoning prior to the veto.
In an effort to display small business solidarity and put a face to those in the affiliate industry who would be hurt by Colorado HB 1193, Brian Fox, Senior Director of Business Development at Adperio, has organized a meeting at the Legislative Service Building, located on corner of East 14th Avenue and Sherman St., which is directly across the street from the Capital Building. You can find more about the group on Facebook here.
To find out more about HB 1193 visit either the Performance Marketing Association here, or Affiliate Advocacy here. Both are great resources.
If you wish to contact Rep. Jack Pommer you may do so through the following: email: jack.pommer.house@state.co.us; phone: 303-866‐2780.
If you wish to contact Senator Rollie Heath you may do so through the following: email: rollie.heath.senate@state.co.us; phone: 303-866-4872.
Important Affiliate Tax Issues in Colorado, Virginia, New Mexico #advertisingtax…
IMPORTANT INFO!
Overstock.com announced they will Terminate Colorado Affiliates.
Use this info to your advantage as it helped to cause the Gov of CA to veto the bill.
Schwarzenegger even mentione……
Great post Angel I hope this helped today during the CO hearing.
Actually, Stephanie, I owe you a direct thank you for the story. Was about to turn off my computer for the evening when I saw your email on Facebook citing the letter from Travis Hopkins that prompted me to write the article to try to get the word out. Wouldn’t have seen it until the morning otherwise. Thank you for helping us and the industry spread information on such an important announcement.
Glad I could help by sending the message. I just saw the turnout of over 100 CO affiliates at the hearing. This is great news that affiliates are getting involved. The 6-5 vote is close so they can definitely still beat it like in CA. Keep it up CO affiliates!
[...] Also see this post from ReveNews: Overstock Threatens to Terminate Colorado Affiliates Over Pending Legislation. [...]
Want to make your voice heard? Want to hear why THEY want to pass this bill? Hear from the man himself coming up in June. We just got it confirmed from their office that Colorado State Representative John “Jack” Pommer, who is also Chair of the Appropriations Committee…will be present and sit on a panel at Denver’s Affcon2010.com
I’m stoked about this. This really gives the community the chance to speak directly to our lawmakes at one of our conferences to try and help educate them and to hopefully in the long run, make a difference.
Hi Daron,
Good to see you on ReveNews. Just a small tip, if you want to be taken seriously when you promote an event you need to be current on industry news. HB 1193 is no longer a “bill”, it was signed into law on February 25 by Governor Bill Ritter.
Now John “Jack” Pommer who was the sponsor of the bill is a great guest to have. It will be interesting to hear his take on the fallout now that Amazon and others have terminated Colorado affiliates.
Angel
Agreed!
! Saw it come across my desk today and knew this would be good for affiliates.
We’ve wanted to be proactive within our trade shows regarding the ever changing laws that affect affiliates.
So this should be a good panel nonetheless, and you can bet there will be no punches pulled with this crowd.