

US Government: You're Scaring Web Businesses Into Moving Out Of The US - pavel_lishin
http://www.techdirt.com/articles/20120216/17154217785/congrats-us-government-youre-scaring-web-businesses-into-moving-out-us.shtml

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aytekin
When I saw the title I first thought they saw this forum thread about how a
Canadian business has switched away from using JotForm and how they are
considering to stop purchasing from all US based online companies:
[http://www.jotform.com/answers/77171-Recent-Domain-
Suspensio...](http://www.jotform.com/answers/77171-Recent-Domain-Suspension)

By the way, Techdirt's Mike is such a great guy. He has been very supportive
and he even introduced us to some lawyers.

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praxeologist
What does "Get corporate membership with EFF" mean?

Anyhow, I totally agree that the gov't is out of control. It isn't just with
this copyright stuff either.

I sell electronic cigarettes and have an innovation to improve adoption with
smokers. My product will undoubtedly be proven many times safer than smoking
and more effective in helping people quit, but we face seizures and the threat
of regulations which will shutter small businesses like mine.

I'm doing #4, "Migrate yourself to a non-US controlled country." as soon as I
can afford to.

~~~
joering2
serious question: were you aware who you trying to compete with (or step on a
toe) before going into this business? I cannot imagine being successful in
such a field competing with tobacoo brands who have such a strong lobbying
representation.

~~~
praxeologist
Big Tobacco doesn't sell ecigs, yet anyhow. The more open opposition is from
Big Pharma and those who make their living pushing "quit or die" vs. harm
reduction.

I just found a way to better serve consumers what they wanted.. pretty
standard entrepreneurial story. If everyone let the 90%+ fail rate of
businesses scare them from trying, the world would seriously suck.

Part of what I need to do to succeed is recognizing the threat of legislation
and finding a better place to do business. My point was that the
ridiculousness of SOPA and such isn't new and hurts other parts of the economy
too. (and I am genuinely curious what #0 means)

~~~
nextparadigms
> Big Tobacco doesn't sell ecigs, yet anyhow

That makes you even more dangerous than if you sold regular cigarettes,
because e-cigs have the potential to change the game - to change their entire
industry. And big companies hate it when the industry has to radically change
from a model that worked for decades.

~~~
joering2
was about to say the same. he really didnt see that his successful business
could kill 200 yrs old competitor with billions of never-ending [habit]
profits?

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alan_cx
I see a time in the not to distant future where people in other countries
start copying well used and know US sites and hosting them in say China. OK,
China is scary, but what about, say, Poland? A kinda of whole website piracy.
It might work because they can simply market the safe as being safe from the
US government.

I'm thinking of sites like that forms site that suddenly got taken down
wrecking the day of, what, millions of customers? How many of them might
changed to an identical site that guarantees no US gov interference? Such
people might not even realise its not the same people.

~~~
SkyMarshal
Good point. Basically all user-generated content sites could leave the US for
countries that continue to respect safe harbor provisions.

[http://en.wikipedia.org/wiki/Digital_Millennium_Copyright_Ac...](http://en.wikipedia.org/wiki/Digital_Millennium_Copyright_Act#Title_II:_Online_Copyright_Infringement_Liability_Limitation_Act)

~~~
rmc
Do other sites have "safe harbour" laws like that part of the DMCA? I'm not
sure any do...

~~~
rmc
Sorry, not "sites", "countries". Do other countries have safe harbour laws
like USA?

~~~
jmilkbal
Most countries IP laws are not as obnoxious as ours so they don't have to give
minor concessions to pretend to care.

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asto
You're also scaring web consumers to pick non-US businesses. Do I want to
purchase a service that can be shut down by the US govt with no notice
whatsoever? No.

~~~
MichaelApproved
Which country would you move to? No government of any country gives prior
notice before shutting down a website.

~~~
nextparadigms
This wasn't possible in USA when they passed the Pro IP Act, just like they
wanted to pass SOPA now. But people weren't aware of it, so it did pass. I'm
afraid takedowns like these will continue until the Pro IP Act is repealed.

This is why it's so important citizens are aware of what goes on in
Washington, and move to stop a bill if it's too dangerous. Because if it does
pass, it will probably be a decade or more before people even start thinking
about repealing a bad law. What's worse is by then, a few more bills will pass
to enforce that one.

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wes-exp
The US is still a great place for business, IMO, but sometimes I feel like I
should be wearing one of those t-shirts that says "I'm with stupid", with an
arrow pointing to DC.

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rmc
A lot of this is due to the current US control of the .com namespace.

I wonder what'll happen when/if the US shuts down some non-US business's .com,
and that business starts getting court orders to force local ISPs to resolve
that. It would either lead to a split in the .com namespace, or international
diplomatic agreements on DNS (like how there is international maritime law
about what happens in international waters). This would make the USA no longer
have control over it.

~~~
pchivers
The U.S. government has already shut down non-U.S. .com domains (PokerStars,
Fult Tilt Poker, Cereus).

<http://en.wikipedia.org/wiki/United_States_v._Scheinberg>

~~~
rmc
Things only get Interesting™ when the non-US companies start kicking up a
fuss, and succeeding in kicking up a fuss, in other countries.

------
backrecord
The reason we have not submitted an application for YCombinator is actually
simply that we perceive the US to be a bad place to be incorporated. Not just
for the reason stated in this article of course, hacker news is frequently
littered with other reasons as well. My understanding is the requirement to
incorporate as a Delaware company is fairly strict requirement for YC
companies. Can someone verify this? (we're already incorporated in Singapore).

~~~
jandrewrogers
There are good reasons to incorporate in US states like Delaware, it is not
coincidence that so many (non-YC) tech companies are incorporated there. Note
that you incorporate in US states, not in "the US", and states offer very
different jurisdictions. Here is a quick explanation of why selection of
corporate jurisdiction is important:

1) You want to select a jurisdiction that has clean, flexible, and stable set
of corporate laws that have already been through judicial review. This
provides a robust foundation for corporate structure with few legal unknowns
or political risks.

2) Important for investors, the corporate laws must be fair to all parties
involved. For example, a jurisdiction with corporate laws that allow a
minority shareholder or employee to screw the majority shareholders or hold
the company hostage is bad and greatly increases investor risk. There are many
jurisdictions that are like this, even in the US. It is one of the reasons you
never see tech companies incorporated in California, for example, even though
Silicon Valley is there.

3) A jurisdiction that operates under English Common Law is convenient because
it is the common basis of contract law used in business, particularly if it
involves parties in multiple jurisdictions. Delaware is a nice example of such
a jurisdiction with a long, sane, and mature judicial history.

Jurisdictions like Delaware are among the very best in the world for everyone
involved if you are building an investor-backed business. Startups that are
not incorporated there often have to reincorporate in a place like Delaware as
a condition of investment. It is all about having a stable, scalable, and fair
set of legal rules on which to build the company.

The average startup faces much more risk from being in a poor jurisdiction
than whatever risk you perceive from being incorporated in the US. Investors
know this and proper jurisdiction selection is an inexpensive way of reducing
the total risk to startup success.

~~~
backrecord
Lots of very very good reasons for Delaware, yes. It totally makes sense for
yc to have this as a rigid rule.. Still I'm interested to know if they have
ever made an exception for anyone, and if so who and why.

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daenz
Consider rewording the title, it makes it sound like the US Govt is saying
that.

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Yaggo
> 3\. Migrate DNS, web serving and other critical services to non-US based
> servers.

What non-US alternatives there exist e.g. for Amazon?

~~~
sokoloff
AWS has regions in Ireland, Singapore and Brazil at least.

AWS is still a US company, but they offer services from non-US DCs.

~~~
Yaggo
> AWS is still a US company [...]

That's the very problem (i.e. US legislation), not the physical locations of
DCs.

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sarcasmatron
At this point, use of GoDaddy at any point should be noted in any Due
Diligence process by investors.

If the founders are unable to identify using GoDaddy as an unacceptable risk
and are unable to quickly find an alternative, then one might justifiably come
to the conclusion that said founders don't know what they're doing.

If an investor is unable to recognize the risk, then one might justifiably
come to the conclusion that they don't know what they're doing, and should
stick to Real Estate Development and Direct Mail advertising.

Personally, I like gandi.net for domain registration and hosting. They're not
the cheapest, but they're not in the US.

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Natsu
Is it just me, or have a fair number of HN comments or references thereof been
showing up in stories lately?

This is what, the third one or something in about a week?

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yason
The better the services and environment for doing business, the more
extortionist tactics you can apply and still keep the majority of the
business.

