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NIKE, Inc. Public Policy Position Highlights

Tax and Intellectual Property

Taxation. As a multinational company, we are subject to income tax and a variety of other taxes in the U.S. and numerous foreign jurisdictions. As a result, we closely monitor proposed changes in tax laws and, where appropriate, advocate on these proposals to ensure they do not expose us to double-taxation or unfairly and adversely affect our profitability, especially when compared to our competitors in other countries.

We recognize that we must comply with all tax laws and regulations. However, we are proactive where we believe that legislation or practice unfairly impacts NIKE, Inc.

As such, we seek to support efforts to create an efficient tax system by identifying and securing tax legislation that allows Nike to be competitive in the global marketplace. Part of this effort includes analyzing and utilizing incentive-based or other programs. We understand that taxes on corporations such as Nike ultimately fall as a burden on working families in the form of higher prices of our products. Our objective is to minimize these costs and, as a result, benefit our consumers, employees and shareholders.

In all of our efforts to promote tax efficiency, we prefer to work in broad coalitions with other businesses and through trade associations where our views are aligned. Some recent examples of such efforts include work with Retail Industry Leaders Association (RILA), Oregon Business Association, Smart Growth Coalition, and American Chamber of Commerce (AmCham) in the Netherlands.

Intellectual Property (IP). Intellectual Property Rights (IPR) is one of the most vital assets any business owns. IP encompasses a wide range of rights and responsibilities, designed to protect business investment in creativity, research and development, and innovation. It is also the intellectual capital and future for many companies. Trademarks, patents and design are all examples of essential IPR.

Businesses make significant investments in brand equity and brand promotion, the value of brands, and the trust consumers place in branded products and services. Nike and other brands account for millions of jobs in today's global economy and are the catalyst for the creation and health of upstream and downstream industries, from manufacturing to advertising, communications and retail. The value of consumer brands is huge, estimated to be more than U.S. $2.289 trillion for the top global 500 brands (Brand Finance, 2009 report).

NIKE, Inc. believes there is a genuine need for policymakers, and other stakeholders to understand issues such as innovation and creativity, brand protection and brand building. They also need to understand how to integrate understanding of the building blocks of the brands into specific IPR and more general public policy decision making.

Our four specific policy objectives on IPR are:
  • Contribute to greater awareness and understanding of IPR and brand issues, and their significant contribution to the global economy
  • Work toward more coherent, consistent and "joined up" IP policy at national, regional and global levels. Nike believes there is a strong need for policymakers to take a broader, holistic view of IP, brands and their overall socioeconomic significance, and contribution to economic growth and innovation
  • Recognize IPR as a cornerstone of the knowledge-based economy. IP protection is one the core enabling conditions for creativity, innovation and development of the information society and digital economy. To this end, we have partnered with Creative Commons to develop the GreenXchange, a platform for sharing IP for innovation
  • Support policymakers' efforts to create a supportive, consistent global legislative framework to fight counterfeiting and piracy across the globe. The economic and social impacts of counterfeiting and piracy have taken on a phenomenal global dimension in the past decade. Trade in counterfeit and pirated goods now represents an estimated 7 percent of world trade

NIKE, Inc. has constructively worked with many policymakers, governmental IPR authorities and enforcement bodies, coalition partners and industry leaders to contribute to policy development and support responsible IP legislative change around the globe.

For example, in the U.S., NIKE, Inc. was a vocal supporter of the passage of the Pro-IP Act signed into law in 2008. In addition to increasing penalties for certain forms of IP infringement, this Act will increase resources for the U.S. Department of Justice to enforce federal criminal laws protecting IP and seek to promote better coordination among various federal and state agencies in combating counterfeiting and piracy. The law also mandates that the President appoint the first Intellectual Property Enforcement Coordinator, informally known as the Copyright Czar.

In the European Union, NIKE, Inc. is a member of the multi-stakeholder Observatory on Counterfeiting, established after agreement by EU member states in early 2009. We are contributing to the Observatory's work program, in particular on future directions for IP policy and legislation, data collection and raising consumer awareness.

Through our membership of FESI (EU Sporting Goods Association), Nike has also been engaging with a number of national EU governments on national IPR legislative initiatives and improved IP enforcement, particularly in France, Italy, U.K. and the Czech Republic. In 2008, FESI hosted the first meeting between the sporting goods sector and representatives from EU and Turkey to help launch the start of a formal IPR dialogue with the goal of IPR legislative alignment and improved mutual cooperation.

In China NIKE, Inc. is a founding member of the Quality Brands Protection Committee (QBPC), a brand-owners' coalition with more than 180 company members. QBPC was founded in 2000 and has since worked effectively and cooperatively with the Chinese government, and multinational and domestic companies in the fields of IPR and brand protection. Through this platform, Nike has strengthened its position and status by participating with QBPC in the revision of various Chinese IPR laws and regulations, and speaking at IPR-related seminars and forums. In 2008 NIKE, Inc. received an award for success in IPR enforcement from QBPC.

NIKE, Inc. is also an active member of the International Anti-Counterfeiting Coalition (IACC), whose mission is to combat counterfeiting and piracy by promoting laws, regulations and directives designed to render the theft of intellectual property undesirable and unprofitable. The IACC serves as an umbrella organization, offering anti-counterfeiting programs designed to increase protection for patents, trademarks, copyrights, service marks, trade dress and trade secrets. NIKE, Inc.'s Director of Corporate Security is chair of the IACC board and takes the industry lead working with key global stakeholder on enforcement matters and works closely with Nike on global legislative and policy issues.