Addresses Changing Regulations for Selling Digital Goods in the European Union
MINNEAPOLIS, May 29, 2003 --Digital River®, Inc. (NASDAQ: DRIV), a global leader in e-commerce outsourcing, today announced that it has expanded the Value-Added-Tax (VAT) capabilities of its e-commerce platform. The VAT enhancements are designed to comply with the new European Union (EU) directives, requiring EU and non-EU sellers to collect VAT on the online sales of digital products and services to European customers. The new rules are scheduled to go into effect July 1, 2003.
"In an e-commerce environment, companies of all sizes find the automation of sales tax and VAT challenging," said Joel Ronning, Digital River`s CEO. "With the upcoming regulation changes, managing this portion of an e-commerce operation has just gotten magnitudes more complicated and risky. As an e-commerce outsourcer, one of the important value-added services that we can provide on behalf of our clients is the ability to handle the intricacies associated with calculating, charging and remitting VAT as well as the costly and complex country-by-country registration process. We have a significant vested interest in making certain that VAT requirements are successfully met and will continue to provide VAT services for our clients under the new legislative model."
"By leveraging Digital River`s international e-commerce expertise, we`ve been able to reduce the risks and resources required to successfully expand our business into European markets," said Anuja Parikh, Trend Micro`s global web marketing manager. "While we focus on growing our online consumer business, Digital River ensures that all our global stores are running smoothly and meeting everything from customer expectations to changing e-commerce regulations. It`s an outsourcing model that works because it is backed by a solid technology platform, a shared revenue model and a demonstrated history of e-commerce best practices."
Digital River`s enhanced VAT capabilities include:
• Collection, reporting and remittance of VAT for all digitally delivered products and services into EU countries, including support for complex orders containing both physical and digital products;
• Delivery of all EU downloads via data center operations physically located in the EU;
• Special VAT treatment on all business-to-business orders; and
• Country registration for cases when certain country-specific sales thresholds are met.
"Because many e-commerce vendors have little or sometimes no VAT expertise, they leave the management, costs and risks associated with VAT in the hands of their clients," said Ronning. "That`s why it`s particularly important for companies that are selling digital products and services through international online channels to determine what their tax exposure is and whether their organizations or e-commerce partners are adequately prepared to comply with the changing e-commerce regulations. If not properly handled, penalties can result."
Digital River`s international e-commerce capabilities extend complete support for the online purchasing process, from site development and e-marketing to transaction processing, order fulfillment and fraud prevention. Today, Digital River hosted e-commerce sites can transact in more than 15 currencies, display in any language or currency, and offer customer service in ten languages, including English, German, French, Portuguese, Dutch, Spanish, Swedish, Italian, Japanese and Chinese. In the near future, the company plans to extend customer service support for the Korean language.
About Digital River, Inc.
Digital River, Inc., a global leader in e-commerce outsourcing, builds and manages profitable online businesses for nearly 34,000 companies worldwide. Its comprehensive e-commerce solution and world-class infrastructure are designed to help companies of all sizes quickly maximize online revenues as well as cut the costs and reduce the risks associated with running an e-commerce operation. Digital River`s international e-commerce services include site development and hosting, order management, fraud prevention, site merchandising, reporting and analytics, product fulfillment, e-marketing and multi-lingual customer service. Digital River`s clients include 3M, ACT!, Autodesk, H&R Block, Major League Baseball Advanced Media, Motorola, Novell, Staples.com and Symantec.
Founded in 1994, Digital River is headquartered in Minneapolis with offices throughout the United States and in Europe. For more details about Digital River, visit the corporate Web site at www.digitalriver.com or call 952-253-1234.
Digital River is a registered trademark of Digital River, Inc. All other company and product names are trademarks, registrations or copyrights of their respective owners.
Back...
