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Showing posts with label e-residency. Show all posts
Showing posts with label e-residency. Show all posts

Saturday, September 10, 2016

e-Residency is Virtual Global Citizenship

This Tiny Country Thinks Virtual Citizens Will Make It Rich

Estonia aims to bring 10 million people to its digital shores.
July 27, 2016 by Nanette Byrnes, MIT Technology Review

With 1.3 million citizens, Estonia is one of the smallest countries in Europe, but its ambition is to become one of the largest countries in the world. Not one of the largest geographically or even by number of citizens, however. Largest in e-residents, a category of digital affiliation that it hopes will attract people, especially entrepreneurs.

Started two years ago, e-residency gives citizens of any nation the opportunity to set up Estonian bank accounts and businesses that use a verified digital signature and are operated remotely, online. The program is an outgrowth of a digitization of government services that the country launched 15 years ago in a bid to save money on the staffing of government offices. Today Estonians use their mandatory digital identity to do everything from track their medical care to pay their taxes.

Now the country is marketing e-residency as a path by which any business owner can set up and run a business in the European Union, benefiting from low business costs, digital bureaucratic infrastructure, and in certain cases, from the country’s low tax rates.

“If you want to run a fully functional company in the EU, in a good business climate, from anyplace in the world, all you need is an e-residency and a computer,” says Estonian prime minister Taavi Rõivas.

Things that don’t come with e-residency include a passport and citizenship. Nor do e-residents automatically owe taxes to the country, though digital companies that incorporate there and obtain a physical address can benefit from the country’s low tax rate. The chance to run a business out of Estonia has proven popular enough that almost 700 new businesses have been set up by the nearly 1,000 new e-residents, according to statistics from the government.

The government hopes to have 10 million e-residents by 2025, though others think that goal is a stretch.
Estonian officials describe e-residency as an early step toward a mobile future, one in which countries will compete for the best people. And they are not the only ones pursing this idea. Payment company Stripe recently launched a program called Atlas that it hopes will boost the number of companies using its services to accept payments. It helps global Internet businesses incorporate in the state of Delaware, open a bank account, and get tax and legal guidance.

Juan Pablo Vazquez Sampere, a professor at Madrid’s IE Business School, sees the Estonia program as enabling global entrepreneurs to operate in Europe at a fraction of the cost of living in the region.

Last year, Arvind Kumar, an electrical engineer who lives just outside Mumbai, left his 30-year-career in the steel industry to start Kaytek Solutions OÜ, which creates models to improve manufacturing quality and efficiency. Last September Kumar flew to Tallinn, the capital of Estonia, and spent half a day setting up a bank account and a virtual office. In addition to the price of the trip, initial setup costs were around $3,300 (€3,000), and he has ongoing expenses of about $480 (€440) a year. The Indian system of setting up a new business is “tedious” by contrast, says Kumar—time-consuming, difficult, and expensive.

Cost was also a factor for Vojkan Tasic, chairman of a high-end car service company called Limos4, in his decision to pick Estonia as a new home for the company. Started in his home country of Serbia six years ago, Limos4 has been paying credit-card processing fees of 7 percent. Limos4 operates in 20 large European cities as well as Dubai and Istanbul, and counts Saudi Arabian and Swedish royalty and U.S. and European celebrities among its clients.

After considering Delaware and Ireland, Tasic chose Estonia, where he can settle his credit-card transactions through PayPal subsidiary Braintree for 2.9 percent and where there is no tax on corporate profits so long as they remain invested in the business. Since getting his e-residency and moving the company to Estonia, profits are up 20 percent, Tasic says. Annual revenue is around $2 million.

For Estonia, the financial benefit comes from the fees e-residents pay to the government and the tax revenue local support services like accountants and law firms make.

To Tasic, who runs background checks on all his drivers, one of the best things about the e-residency is the fact that the Estonian police investigate every applicant. Since Kumar set up his company, Estonia has begun allowing e-residents to set up their bank accounts online, but there remains a level of security, because to pick up their residency card, applicants must go in person to one of Estonia’s 39 embassies around the world and prove their identity.

Some have raised concerns that the e-residence might attract shady characters who could shield themselves from prosecution and possible punishment by doing business in Estonia but residing outside of its jurisdiction. But with no serious cases of fraud or illicit activity to date, it is unclear whether this is a serious concern, says Karsten Staehr, a professor of international and public finance at Tallinn University of Technology.

As with any digital system, security is a major concern. Estonia, which sits just to the west of Russia and south of the Gulf of Finland, recently announced plans to back up much of its data, including banking credentials, birth records, and critical government information, in the United Kingdom.

In 2007 the country suffered a sustained denial-of-service cyberattack linked to Russia after moving a Soviet war memorial from Tallinn city center and has run a distributed system for some time with data centers in every embassy in the world.

“I am convinced they are doing a good job,” says Tasic, who holds a PhD in information services. “But with increased attention, the attacks will increase, so let’s see what the future is.”


Saturday, July 16, 2016

Digital Citizenship, Part of our Universal Identity

Are you Ready to Become a Digital Citizen?

Estonia, home of the international e-residency, is the current head of the D5 “group of the world’s most digitally advanced nations” and is hosted this year’s conference recently in the capital Tallinn.

The dream across the world, but maybe particularly in the D5 – which also includes the UK, South Korea, New Zealand and Israel – is that eventually all citizens will prefer using digital services to paper ones.

Not least because online services should in theory cut the time and cost of delivery.

Widely considered the leading digital democracy because it was the first country in the world to hold online elections, every Estonian aged over 15 now has to have a card linking a personal ID code to all of their online interactions with government.

As of January last year there were more than 1.2 million active cards, close to 100 percent of the population, and since the summer Estonia now offers anyone, anywhere the opportunity to register as a digital citizen so they can make use of its streamlined services.

Admittedly Estonia is working to much smaller scales than most countries, but the challenge for any digital government is how it ensures the people who need its services the most, which is disproportionately those in need, can get help when it’s required.

UK and US

Since it launched the ‘digital by default’ agenda launched back in 2012, the UK’s Government Digital Service (GDS) has absorbed some 250 different government websites and relaunched as the single GOV.UK portal.

Unique users of the site have grown from just over 2 million to 12 million visitors in the three years since the UK got serious about digital democracy, but that figure only represents just over one in six people.

GDS has also transformed 25 ‘exemplar’ transactional services, including the patenting process and voter registration, which now both have digital take-up of more than 50 percent. Indeed, more than one million people used the new online voter registration THE WEEK before the deadline closed.

The transition, however, has come with challenges. In some areas of the UK, up to 25 percent of people are unable to vote because they haven’t yet realized they need to update their details by a rather arbitrary December deadline.

The presence of a disenfranchised minority should come as little surprise to government ministers. According to the Office for National Statistics figures from March, 11 percent of UK adults, or 5.9 million people, are still yet to enjoy the pleasure of Google, Facebook and Wikipedia. Although 40 percent of those over the age of 75 have taken to silver surfing, 60 percent haven’t.

The stated aim for the government’s digital inclusion strategy outlined back in 2014, via targeting access, skills, motivation and trust, is to reduce the number of people who are offline by 25 percent by 2016, continuing this every two years until in “2020 everyone who can be digitally capable, will be.”

But, it also admitted that “just under 10 percent of the adult population may never be able to gain basic digital capabilities, because of disabilities or basic literacy skills.”

How this 10 percent will access digital government services remains unclear.

The United States likewise launched its comprehensive Digital Government Strategy back in 2012, and it has its own Digital Literacy program, but it is absent among the D5 nations.

Internet penetration is lower, around 86 percent, but 15 years of the Center for Digital Government’s Digital Cities survey shows star performers like Philadelphia are storming ahead with digitisation, at least at a city-wide level.

Perhaps its size compared to the world’s top five digital democracies, along with the interaction between state and federal legislators, simply makes it a more tricky thing to pull off?

What’s clear is that the D5, and the relevant young and hip teams in each of these countries, is working hard to ensure seamless interaction with government.

GDS’ own data dashboard enables you to really easily compare the cost-per-transaction for 800 services, demonstrating the significant cost savings being made by the most digital services compared to the least.

Estonia’s system, meanwhile, offers a personal transaction log so you can see if someone has been digging around in your folders and report them to the data ombudsman.

The Future

Up next as the UK plows ahead with its digital agenda is the rather controversial care data program. In a nutshell, this could see patient records opened up to private companies.

The UK is also set to roll out the Verify process, Estonia-style, for uniquely identifying citizens.

Verify has been in public beta for just over a year and currently has 300,000 users who can personally interact with 13 government services. It is set to go live across the UK in April next year.

This program is yet to make headlines, but it’ll no doubt be trust and security issues, similar to those that contributed to the rejection of ID cards in the UK back in 2006, along with digital literacy challenges, that will be the biggest cause for concern.

The question remains whether the world’s citizens are really ready, willing or able to give up their souls to an open, transparent, but increasingly faceless digital government machine.

What happens to my data? What happens if something goes wrong? What happens when those one million people realize they are unable to vote?

Whether or not you like it, it looks like you’re probably not going to have much of a choice in your digital future.

Edited and republished from The Next Web, article written by Kirsty Styles

Saturday, November 28, 2015

Bitnation: Decentralizes Governance and Creates Individual Sovereignty

Creating Digital Nations of Sovereign People

We no longer depend on the monarchs, church or governments as subservient citizens as corporations take control of the human in our last evolutionary stage.

Bitnation and Estonian Government Team Up

Bitnation and Estonian Government start Sovereign Personal Jurisdiction Project using the Blockchain

Bitnation, the decentralized governance project which offers blockchain IDs and Bitcoin debit cards to refugees, has done a deal with Estonia to offer a Public Notary to e-Residents.

Starting December 1 2015, the blockchain notary service will allow e-residents, regardless of where they live or do business, to notarize their marriages, birth certificates, business contracts and more, on the blockchain.

The blockchain is a public ledger distributed across hundreds of thousands of computers around the world. The distributed and immutable nature of this public notary makes it more secure than any notary currently offered by traditional nation states.

The Estonian e-Residency program is far and away the most advanced of its kind on the planet. This agreement takes that a step further into wholesale decentralization.

Bitnation is doing for identity and statehood, what Bitcoin is doing for money. Bitnation CEO and founder Susanne Templehof has said, in reference to the current refugee crisis, that the project seeks to eradicate the most criminal part of our existing legacy systems – borders.

She told IBTimes in an email: "We have made a deal with Estonia, and the ultimate goal is to gain recognition for Bitnation as a sovereign entity, thus creating a precedent for open source protocol to be considered as sovereign jurisdictions."

Bitnation, as the world's first blockchain powered virtual nation, provides "DIY governance services", and has received international attention for providing refugee emergency response and world citizenship ID on the blockchain, as well as pioneering marriage, land titles, birth certificates etc.

On the subject of marriage, Templehof points out that in many countries gay marriage, for example, is illegal: "Blockchain doesn't give a s**t about that," she said.

Estonian e-Residency is an initiative that allows anyone around the world to take advantage of the secure authenticated online identity the Estonian government already offers its 1.3 million residents.

Kaspar Korjus Estonia's e-Residency program director, said: "In Estonia we believe that people should be able to freely choose their digital/public services best fit to them, regardless of the geographical area where they were arbitrarily born. We're truly living in exciting times when nation states and virtual nations compete and collaborate with each other on an international market, to provide better governance services."

If a couple get married on the Public Notary, it doesn't mean they get married in the jurisdiction of Estonia, or in any other nation state jurisdiction. Instead, they get married in the "blockchain jurisdiction".

The technology provides a worldwide legally binding proof of existence and integrity of contractual agreements for things like banking, incorporating companies quickly and cheaply, and generally empowering entrepreneurs and citizens around the world.

Tempelhof said she believes the Estonian government understands the dynamics of the globalization era far better than any other government she can think of.

"I'm delighted to work with Estonia's e-Residency program to set a standard practice of competition of governance services on a global market, and to enable others to exercise self-determination and follow Bitnation's path to sovereignty" she said.

Re-posted from International Business Times, Written by Ian Allison, November 28, 2015

Edited by Globcal International for American English