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Spies, intellectual property and tax dodges

News items that caught our attention this week

Spies could activate iPhone cameras and microphones if FBI forces us, says Apple

Governments could demand access to iPhone cameras and microphones to spy on civilians if Apple loses its high-profile battle with the FBI, one of the company’s most senior executives has said.

Eddy Cue, Apple’s head of internet software and services, said if the security service wins its court battle over the unlocking of a terrorist’s iPhone, it could lead to a slippery slope in which governments ask for even-greater access.

“When they can get us to create a new system to do new things, where will it stop?” he said in a Spanish-language interview to US television channel Univision. “One day they might want us to open your phone’s camera, microphone. Those are things we can’t do now.”

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IT directors must protect intellectual property

Many IT directors and CIOs are not fully aware of the importance of protecting commissioned websites and software.

“If an IT director commissions a website or a piece of software without being entirely sure that their business will own the finished project, they are taking a huge risk.

“If a business has software or a website created for it by a third party and does not discuss ownership rights prior to signing a contract, the completed product will belong to the creator rather than the commissioner of the work.

“One possible consequence of this is that the business could lose the rights to sell on any commissioned software, making it an expensive investment that will not bring in any revenue.”

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UBS and Deutsche Bank lose 'Houdini' bonus tax dodge case

Investment banks UBS and Deutsche Bank must cough up taxes they attempted to dodge in 2004 when paying bonuses to staff, the Supreme Court has ruled.

The banks had each tried to pay more than £91m of bonuses in the form of shares in an offshore company, established solely for the purpose of paying the awards. Through a combination of conditions attached to the shares plus a waiting period of two years, the banks hoped to cut the tax bill on the bonuses to 10pc, thus avoiding paying income tax and national insurance.

But the banks' efforts to cut their bills were “the most sophisticated attempts of the Houdini taxpayer to escape from the manacles of tax”, Justice of the Supreme Court Lord Reed said.

The complex arrangements “were no more than disguised or artificially contrived methods of paying cash to employees”, the ruling stated, and so should be treated as cash payments.

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