Per Regulation 1684, The Daily Truffle has been asked to make clear to it’s readers our agreement to comply with the Annual Certification of No Solicitation. Below is our agreement with one of our affiliates Net-A-Porter which contains the signed affidavit.
BOE-232 FRONT (9-12) STATE OF CALIFORNIA ANNUAL CERTIFICATION BOARD OF EQUALIZATION REGARDING SOLICITATION ACTIVITIES AFFILIATE NEXUS INFORMATION
A “retailer engaged in business in this state” as defined in Revenue and Taxation Code (RTC) section 6203 is required to register with the Board of Equalization (BOE) to collect and remit use tax on sales of tangible personal
property to California customers.
RTC section 6203, subdivision (c)(5) includes an “affiliate nexus provision.” Under the provision, a retailer is engaged in business in this state and is required to register to collect California use tax if the retailer enters into “an
agreement or agreements under which a person or persons in this state, for a commission or other consideration, directly or indirectly refers potential purchasers of tangible personal property to the retailer, whether by an Internetbased link or an Internet website, or otherwise, provided that” the retailer’s sales exceed two specific sales thresholds.
Sales and Use Tax Regulation 1684, Collection of Use Tax by Retailers, explains that the affiliate nexus provision does not apply if a retailer can demonstrate that all of the persons with whom the retailer has agreements described in the affiliate nexus provision did not directly or indirectly solicit potential customers for the retailer in California. In addition, Regulation 1684 provides that a retailer can demonstrate that an agreement is not an agreement subject to the affiliate nexus provision if:
1. The retailer’s agreement prohibits persons operating under the agreement from engaging in any solicitation activities in California that refer potential customers to the retailer including, but not limited to, distributing flyers, coupons, newsletters and other printed promotional materials or electronic equivalents, verbal soliciting (for example, in-person referrals), initiating telephone calls, and sending emails;
2. The person or persons operating under the agreement in California certify annually, under penalty of perjury, that they have not engaged in any prohibited solicitation activities in California at any time during the previous year; and
3. The retailer accepts the certification or certifications in good faith, and the retailer does not know or have reason to know that the certification or certifications are false or fraudulent.
Regulation 1684 further provides that a retailer can demonstrate that an agreement with an organization, such as a club or non-profit group, is not subject to the affiliate nexus provision if, in addition to the above requirements,
1) the agreement provides that the organization will maintain information on its website alerting its members to the prohibition against each of the solicitation activities described above, and
2) the retailer obtains an annual certification from the organization under penalty of perjury that includes a statement certifying that its website
includes information directed at its members alerting them to the prohibition against the solicitation activities described above.
Instructions for Annual Certification
A person may complete the Annual Certification of No Solicitation section on the next page, or any document that satisfies the requirements of Regulation 1684, to annually certify under penalty of perjury that the person has not
engaged in any prohibited solicitation activities in California at any time during the previous year.
An organization may complete the Additional Statement from Organization section on the next page, or any document that satisfies the requirements of Regulation 1684, to annually certify under penalty of perjury that its website includes information directed at its members alerting them to the prohibition against the solicitation activities described above. The BOE recommends you retain this form or any other document that satisfies the annual certification requirements of Regulation 1684 for a minimum of eight years.