The term “technical fees” means payments of any kind to any person, other than to an employee of the person making the payments, in consideration for any service of a technical, managerial or consultancy nature.
Services are of a technical nature when special skills or knowledge related to a technical field are required for the provision of such services. For example, engineering services would be of a technical nature but not the services of a psychologist. The fact that technology is used in providing the service or that the service relies on the internet for delivery does not make it a technical service. For example, online gambling relies on the internet for its provision or delivery but that does not make it a technical service.
It is crucial to determine at what point the special skill or knowledge is used. Special skill or knowledge may be used in developing or creating inputs to a service business but the fee for the provision of such a service will not be a technical fee unless that special skill or knowledge is required when the service is provided to the customer.
Many categories of e-commerce transactions involve the provision or the use of access to data and software. The service of making such data and software or the functionality thereof available for a fee is not, however, a service of a technical nature.
Services of a managerial nature are services rendered in performing the functions of management. Therefore, such services would involve functions related to how a business is run as opposed to functions involved in carrying on that business. For example, the functions involved in recruiting, training and managing sales representatives would relate to management but the functions performed by the sales reps would not.
Consultancy services refer to services such as the provision of advice by experts or professionals such as accountants or lawyers who have special skills and qualifications allowing them to offer such services. However, there is an overlap in this area as technical and managerial services could also be provided by a consultant.