Hi Isobel,

I, too, have signed-up for EPN, and also saw the proviso regarding US-based employees etc.
As I don't directly employ any of the staff at my hosting provider, my interpretation of Ebay's Terms is different to yours.
If your interpretation was valid, then any money earned through sites based on US hosting would be liable to US taxation. I can't see that happening any time soon, otherwise a large number of US based hosting providers would be losing a significant chunk of their market.

I have come across similar terms in other affiliate sign-up processes and my interpretation has always been that, as I have no directly employed US representatives, I have no need to pay US based taxes.

I am in the UK as well. My hosting is mostly in the US, but beyond that, I have no direct representation State-side.
I'm no lawyer or accountant, but my belief is, that as I am not a US citizen, nor have I any legal entity based in the US, my only taxation liability, is to the UK.

As I don't earn very much from any Internet based activity currently, my liability is negligible, either in the UK or the US.
Should that change, I would take the precaution of taking both legal and accountancy advice. If you are earning a significant amount from your Ebay activities, it may pay you to do the same and be sure one way or the other.
At the very least it may save you from having to hunt down alternative hosting, outside the US.
As another thought, if you found hosting say in Australia, would your earnings then be liable to Aussie taxation? I don't believe that they would.

That's my interpretation, for what it's worth.
As I stated above, the only way to be certain, would be to take legal and accountancy advice from qualified experts.

Good luck with your return to the Internet scene BTW

Kind regards

Ian