[members-discuss] Proposed 2012 Charging scheme, Board comments

Dear all,

I would like to update you about the RIPE NCC Executive Board
deliberations regarding the draft charging scheme for 2012.

We presented you with two draft schemes, in early summer, to gather
feedback from you. We did this as we wanted to hear your opinions on
measures we want to take which are designed to keep the RIPE NCC
financially stable and capable of serving its members as it should.

You engaged in a lively discussion on this mailing list, and even ran a
mini-survey. We followed the exchanges closely and as result asked
RIPE NCC staff to provide the board with another charging scheme option,
based on a sliding scale scheme that eliminated the membership
categories we currently use.

During the board meeting of last Friday, 23 September, we discussed the
merits as well as some of the issues of that model. Obviously a sliding
scale model as its main benefit does away with the fee jumps of the
category based model. We were pleased with the model that we developed
with the NCC staff and felt that it addressed many of the issues raised
by you, the members.

However, in consultation with our tax lawyers we have had to think
again. Because it brings a "fee-per-address" flavour to the charging
model of the RIPE NCC it fundamentally alters the tax scheme under which
we operate. The current "category" model allows us to argue that we are
a membership association with different categories  of membership. This
brings substantial tax advantages.

As you know, for a long time the RIPE NCC tax situation has been
extremely favourable, as we don't have to pay corporation tax, based on
an agreement made with the Dutch tax authorities many years ago. We are
advised that the envisaged change in the charging scheme would lead to a
re-assessment of that agreement, with the likely outcome that the
association's surplus would have to be taxed, leading to a significant
financial liability, with an obvious knock-on effect to the member fees.

In the light of this, the board members have agreed not to expose our
organisation to that risk, staying with a category based system. We have
however noted your preference for reduced "fee jumps" between
categories, and have instructed NCC staff to produce a charging scheme
model based on 10 categories, doubling the current category number.
Category divisions will be based on a count of address space held.

This revised Charging Scheme 2012 we will publish, as usual, prior to
the General Meeting in November, for approval by the members during the
General Meeting. We can advise you already that we are opening up the
voting mechanism for all resolutions to include electronic voting, so
that all members of the association have a good opportunity to take a
full part in the proceedings.

At this time, I would like to thank you all, on behalf of the RIPE NCC
Executive Board, for participating in the discussion. I look forward to
seeing as many of you as possible at the next General Meeting.

Best regards,

Nigel Titley
Chairman
RIPE NCC Executive Board