Performance Marketing Alliance Moves to Reverse Unfair Tax Legislation Threatening New York Business Owners

Alliance Files Amicus Brief with New York State Supreme Court
NEW YORK--(Business Wire)--
The Performance Marketing Alliance (www.PerformanceMarketingAlliance.com), the
first not-for-profit trade association for the performance marketing industry,
today announced the filing of a motion seeking leave to submit an amicus brief
in support of Amazon.com`s appeal, which argues that the law requiring Amazon
and other Internet retailers to collect use taxes on sales in New York (N.Y. Tax
Law § 1101) based on their relationship with affiliate marketers is
unconstitutional under the Commerce Clause of the U.S. Constitution (U.S.
Constit., Art. I, § 8).

The PMA takes issue with the New York law`s classification of affiliates as
creating a "physical presence" in the state for online retailers like Amazon,
requiring retailers to collect use taxes on sales made through the advertising
displayed on affiliate Web sites. Affiliates are individuals and businesses who
agree to display advertisements on their Web sites for a given online merchant.
They are paid when users click on those advertisements and take an agreed-upon
action, such as a registration or a purchase.

The brief explains that affiliates provide a form of Internet-based advertising
that is closely analogous to traditional print advertisements distributed by a
catalog retailer, and do not constitute a physical presence for an ecommerce
merchant in any state. Affiliates sell no products, collect no payments from
buyers and make no deliveries. They have no further involvement in the sales and
marketing process beyond posting the advertisement.

"Since its creation, the PMA has spearheaded efforts to persuade state
legislatures not to adopt statutes like this discriminatory New York law, which
threatens the livelihood of thousands of individuals and small business owners
and has the potential to strangle ecommerce with invalid regulation," said PMA
director Rebecca Madigan.

The brief maintains that the statute harms the public interest by punishing
performance marketing, a highly efficient approach to advertising which has
allowed thousands to make a living through electronic advertising on the
Internet. Further, the revenue stream generated from performance marketing has
allowed many small businesses and individuals to accelerate the development of
their Web sites, facilitating the more rapid diffusion of free information to
the public that is the hallmark of the Internet.

According to The Performance Marketing Alliance, since it passed in 2008, the
New York statute has decimated the income of thousands of affiliate advertisers
in the state as several large Internet retailers have terminated all affiliate
agreements to avoid imposition of use tax collection responsibilities.

"I have more than 20 employees who are residents of New York, and my company
generates a significant amount of income tax for the state," said James Keating,
vice president of marketing for ShopWiki.com, a New York based affiliate.
"Unfortunately, the state won't see that revenue since its new policy has caused
out of state online retailers to discontinue using us as an advertising
vehicle."

Amazon filed its appeal on July 13, 2009, in the New York State Supreme Court
Appellate division. The state of New York is expected to file a response by
September 16, 2009.

About Performance Marketing Alliance

The Performance Marketing Alliance is the first not-for-profit, trade
association for the performance marketing industry. The Performance Marketing
Alliance was founded in 2008 by industry leaders to connect, inform and advocate
on behalf of the growing performance marketing field.

Membership is available to those interested in shaping the strategic growth of
the performance marketing industry. The membership application, and information
on the fall membership special, can be found here:
http://www.performancemarketingalliance.com/pma-membership-application/

Just Drive Media
Stacey Clarke, 813-393-9360
stacey@justdrivemedia.com

Copyright Business Wire 2009