Information Technology Reference
In-Depth Information
the profits generated by them will be taxed in the country where the components
are located. From a comparative perspective, many countries (i.e. the United States,
France, Italy, Spain, etc) follow this principle, with the notable exception of the
United Kingdom (where servers are not considered to be permanent establishments)
(Parrilli 2008).
From the practical perspective, this risk can be mitigated through a careful tax
planning policy regarding the location of Grid/Cloud components. Technology
providers basically have two alternatives: (i) centralise the Grid or the Cloud in one
country, so that no issues related to multiple taxation of the same profits and/or right
assessment of profits among the components arise; or (ii) locate the Grid/Cloud
components in countries where servers are not deemed to be permanent establish-
ments of the technology provider.
The above described tax planning may also be linked to the tax-effective loca-
tion of the headquarters of the Grid/Cloud provider. If and when the Grid/Cloud
components can be remotely managed, the technology supplier can decide to be
established (i.e. to locate the central place of management of the company) in a
low-tax country while the Grid or the Grid components operate in countries that are
attractive from the tax point of view and that have good network connections (the
same applies to Cloud computing).
7.5 Conclusions
The main message coming out from the previous pages is that legal issues should
not be perceived as barriers to invest in Grid and Cloud computing and to start up
a successful business. The law, in a very broad sense, does not prevent Grid/Cloud
computing from showing all its potential and proving to be innovative technologies
able to create new business opportunities, reduce the costs and maximise the profits
of the users. It is nevertheless true that in some circumstances the legal sources
are not fully able to encompass all existing scenarios, included in possible Grid/
Cloud-based business opportunities. For instance, in previous sections, we saw that
the criteria of the provision of the service, set forth by Art. 5(1)(b) of Regulation
44/2001, cannot operate in a Grid or Cloud environment. The use of dispersed
resources and the possibility to enjoy and use the services supplied by the tech-
nology provider anywhere and everywhere in the world, e.g. through a web portal,
makes many legal principles and criteria simply not applicable. In a typical Grid
and Cloud scenario, in particular, the volatility of the traditional concept of space
is evident. The development of appropriate laws is by definition slow, definitely
slower than the development of technology, but this is a natural consequence of the
(more or less) democratic process that should guide their creation: discussions take
time.
Maybe the future will be a world without laws, or, on the contrary, a world with
a huge quantity of laws regulating every aspect of citizens' and businesses' life
(and probably this will be the case: if industrial production is declining at global
level, lawmakers may be prompted to produce more and more laws). In any case,
