Emerging Issues for Fair Trade and Taxation of Virtual Goods
The Internet as an open and level economic platform for the international trade in 'intangibles' is explored by discussing the latest trends in the trade, and taxation, of virtual goods. We will discuss the future of online commerce relying on the trade of intangibles, and how Internet policy and governance can effect such international trading.
Direct Monetization of Virtual Goods Banned
The phenomenon of trading virtual goods on the Internet, for real money, is expected to reach a worldwide market of USD$ 20 billion by 2015. The controversial trading of these intangible, non-physical objects, by international communities of users that number in the tens of millions, often employ the use of virtual currencies that are outside existing systems of money; and also outside the international system for trade in tangible goods and services. Indeed the practice of direct monetization of these 'intangibles', through Internet-based social games, has now been banned both in Japan and South Korea (bans imposed during 2012).
Value and Trade in Other Intangibles Emerging
At the same time, recent changes in the 'System of National Accounts'  appear to better reflect how the investment in developing intellectual property(IP) 'intangibles' may indeed be larger than traditional investments in tangible goods in some economies (e.g. the U.K.). Furthermore, that better measurement of the value of 'intangibles' might better inform policy making to drive economic growth. With some economies establishing IP Trading platforms (e.g. HK)  and Digital Copyright Exchanges  and several economies experimenting with new forms of Internet-aware copyright licences (e.g. Creative Commons).
Changing Nature of Money and Payment
Furthermore Internet-aware cryptographic currencies (e.g. Bitcoin) are emerging, together with open web-payment standards for the Web (e.g. Payswarm) and the global standardization work being done by W3C and others.
This high-level international discussion of the trade in virtual goods addresses four broad themes:
1. Appropriate regulatory regimes and modalities: TISA, WTO GATS, TRIPS Other
2. Micro-settlements, micro-taxation: Taxation, Laundering and Theft.
3. Intellectual Property (IP), End-User Licence Agreements: Value, Liability and Property
4. Jurisdiction and principles of territoriality: Settlement, Tariffs, and Scaling
A goal is to use this IGF session to identify emerging issues in the trade of intangibles and to bring them to the attention of the Ninth World Trade Organisation (WTO) Ministerial Conference (Bali, Indonesia, 3-6 December 2013), to help ensure that no country/stakeholder group is disadvantaged from the trade in virtual goods and the opportunities of emergent digital trading hubs.
The round-table will build on a session held at the Asia Pacific Regional IGF (APrIGF), Seoul September 3-6 September 2013 that will discuss the matters arising from last year's ban on direct virtual goods monetization in South Korea and Japan.