BUTERA & ANDREWS

Attorneys at Law

1301 Pennsylvania Avenue, N.W.

Washington, D.C. 20004-1701

202-347-6875

Philip S. Corwin, Partner

[email protected]

 

 

By E-Mail     

 

               December 15, 2008    

 

Board of Directors

Internet Corporation for Assigned Names and Numbers (ICANN)

4676 Admiralty Way, Suite 330
Marina del Rey, CA 90292-6601

 

Re: New gTLD Draft Applicant Guidebook

 

Dear Members of the ICANN Board:

 

This comment letter is submitted by the Internet Commerce Association (ICA) in regard to ICANN’s October 23rd notice establishing a forty-five day period for public comments on ICANN’s Draft Applicant Guidebook for new generic Top Level Domains. On December 3rd ICANN published additional materials relating to the Guidebook and extended the English language comment period by a week.

 

ICA is a not-for-profit trade association representing the direct search industry. Its membership is composed of domain name registrants that invest in domain names (DNs) and develop the associated websites, as well as the companies that serve them. Professional domain name registrants are a major source of the fees that support registrars, registries, and ICANN itself. The ICA is an International Member of ICANN’s Commercial and Business Constituency and presently has more than 120 members located in the United States and thirteen other nations.

 

Executive Summary

 

·         ICANN must proceed cautiously in its consideration of new gTLD applications and should announce in advance a prioritization system to assure orderly and comprehensive review.

·         ICANN has not provided sufficient time for review of and comment upon the draft gTLD Applicant Guidebook and should provide a comment period of no less than sixty days following publication of the next revision, and should also consider a third comment period if considerable controversy or questions persist.

·         The new gTLD process must not be used to resurrect much less validate the concept of differential pricing by registries; any exceptions to this policy must only be for a carefully circumscribed group of “closed” registries subject to strict numerical registration limits. Likewise, ICANN should continue adhering to vertical separation of registries and registrars and to enforcing equal access policies for registrars, with any exceptions limited to a narrow category of single organization gTLDs.

·         ICANN should reverse its adoption of the GAC position relating to prior approval for any geo-gTLD and revert to the GNSO position providing governmental entities with standard objection rights. Any suggestion that governments have any ability to object to second level geo-domains on any grounds outside the scope of the UDRP should be rejected outright.

·         Strong, cost-effective, and readily implemented protections for rights holders should be established but they must be limited to enforcing their rights under existing law and not be premised upon the creation of broader rights by ICANN fiat. It is for this reason that we object to creation of a reserve list of trademark names as this would provide rights protections beyond the geographic and relevant marketplace limitations of trademark law. We also object to the imposition of any new rights or procedures that would supplant or supplement the UDRP absent extensive consideration of such proposals in a process that ensures that registrant concerns about current UDRP enforcement trends are heard.

·         We oppose permitting law and public morality objections to new gTLDs unless narrow and clearly articulated criteria for such objections can be established, because if they are not then the DNS could become a censorship regime grounded in the whims and personal views of individual jurists.

 

 

General Overview and Procedural Considerations

 

There are currently twenty-one gTLDs, both sponsored and unsponsored. ICANN has now initiated a process by which the number of gTLDs may, by ICANN’s own estimate, be expanded more than twenty-fold in a single initial application and approval round. At the same time, the application fees received from an estimated 500 applicants will, at the current stated fee of $185,000, produce an additional cash flow of $92.5 million, representing a one hundred and fifty percent increase in ICANN’s operating revenues – and following approval, contract administration duties in regard to these new registry operators will substantially add to ICANN’s overall workload. While ICANN’s management and staff are of high caliber, this is a tremendous amount of rapid and exponential change that any organization would find a challenge to successfully manage. Therefore, given that the rapid introduction of potentially hundreds of new gTLDs will be the most momentous change to the domain name system (DNS) since the establishment of ICANN, and that the success or lack thereof will have tremendous implications for all present participants in the DNS as well as ICANN itself, it would appear that a cautious and exceedingly well thought out approach to the proposed opening of the gTLD space would be the preferred course of action.

 

Unfortunately, we do not believe the approach taken by ICANN to date meets that advisable standard. Given the magnitude of the change contemplated and the stakes involved, as well as the length and complexity of the Guidebook and the fact that key issues and details have yet to be provided, two comment rounds of forty-five days each are entirely insufficient. We therefore urge that the second comment period contemplated by ICANN be for a minimum of sixty and preferably ninety days, and that a third comment round be scheduled if key issues and details remain absent or incomplete in the second version of the Draft Guidebook after considering all first round comments, or if such issues and details are provided in the second version but result in considerable continuing controversy or disagreement within the community.

 

We also find it difficult to believe that ICANN can give adequate consideration to the volume of application it expects to receive in the first round – even if one-third of the anticipated 500 applications were delayed due to objections raised against them, that would still require ICANN staff to review and approve an application nearly every day of the first year of the program’s operation, including weekends and holidays, if the first round decks are to be cleared before the contemplated initiation of the second application round approximately one year later. Such a torrid pace is unlikely to afford adequate consideration of applicant qualifications and capabilities or of the soundness of their proposals, and is likely to either result in inordinate delays or future failures and scandals that will be destabilizing to the DNS and negatively impact the ICANN community and ICANN itself. Therefore, we believe that ICANN should adopt and state, in advance of accepting applications, a prioritization regime that will allow it to process all first round applications in a thorough and orderly fashion.

 

Adding to the need for such clearly articulated prioritization policies is the fact that 2009 will also bring with it two major events that will have substantial additional impact on the attention and processing capabilities of both ICANN and the overall community. The first is implementation of GNSO reform; our recent participation in meetings in Cairo made clear that the functional success of this exercise is far from assured and that the ability of ICANN’s primary policymaking body to meaningfully participate in upcoming decisions is questionable. The second is the September 2009 Joint Project Agreement (JPA) decision point for continuation or termination of U.S. oversight of ICANN, along with associated concerns regarding ICANN’s potential plans to evolve its organizational form and legal status -- as well as its ability to withstand capture attempts by the International Telecommunications Union or similar entities that would in turn lead to increased politicization and bureaucratization of ICANN’s activities. In short, ICANN will have other major challenges and issues competing for its attention next year in addition to a massive expansion of the domain name space.

 

ICA members are competitive entrepreneurs and we therefore have no objection to the general concept of a further expansion of the gTLD space and a proliferation of new registry business models. Indeed, some ICA members may well be applicants, while others hope to offer backend services to new registries, and still others may perceive investment and development opportunities in some of the new gTLDs. But this rollout must be carefully managed. Overall, it is much more important that the application and approval process for new gTLDs be done right than be done fast.

 

Finally, in regard to both this and other ICANN proposals put out for community comment, we find it lamentable and inexcusable that ICANN continues to afford inadequate time for analysis and feedback. ICANN staff and Board should have clearly heard at the June Paris meeting a chorus of calls for longer comment periods generally, as well as great concern over ICANN’s pattern of deluging the community with new proposals and documents immediately before one of its general meetings. Despite these clear expressions of concern, ICANN once again released multiple complex proposals and reports in the week prior to the Cairo meeting (many of which have had their own comment deadlines over the past few weeks), and provided a thoroughly inadequate first round forty-five (now lengthened to fifty-two) day comment period on a draft applicant guidebook that, with supporting memorandum, exceeds 300 pages in length. Similarly, in regard to the CRA International report, “Revisiting Vertical Separation of Registries and Registrars”-- upon which we comment in this letter due to its direct relationship to overall gTLD pricing policies-- ICANN’s December 9th announcement that it would conduct a public consultation on this document in Washington, DC a scant 48 hours later constituted thoroughly inadequate notice and was indeed insulting to the community and made a mockery of the public consultation process. Even though we are located in Washington we found it impossible to attend this meeting due to prior commitments, and we imagine that the situation was even more difficult for interested parties located outside of Washington. We believe that the Washington meeting should be rescheduled to provide an opportunity for meaningful and fully informed participation and that, in the future, any ICANN announcement of a public meeting or consultation should provide a minimum of two weeks’ notice so that interested parties can make arrangements to attend and prepare themselves thoroughly for such event.

 

gTLD Pricing Regime

 

The draft contract for new registries lacks any pricing controls and thereby introduces the possibility that all new gTLDs, including those that are open to unrestricted classes of registrants, may impose tiered pricing. Proceeding without such controls would allow incumbent registry operators – including those for the four most successful incumbent gTLDs, .com, .net, .org, and .info, which collectively constitute 97 percent of all gTLD registration – to argue that provisions in their present registry contracts permit them to likewise institute tiered pricing. This result is thoroughly unacceptable. The issue of tiered pricing has been extensively debated in the context of the recent renewals of incumbent gTLD registry contracts and was rejected after substantial negative input from the community. This issue should not be reopened through the backdoor of these new registry contracts, and it is extremely disturbing that ICANN has done so.

 

ICA’s position on this matter has been clearly stated in the past – we believe that the award of a gTLD registry contract creates a natural monopoly requiring substantial oversight and controls from ICANN to prevent pricing abuse; that is, a particular domain name constitutes an Internet address that has specific value that cannot be readily transferred to another gTLD in the face of unreasonable renewal pricing demands. To the extent that a gTLD registry is or becomes successful that success is due to the efforts and expenditures of the registrants who have populated it with compelling domains, and not of the registry operator which fulfills its operational role of maintaining a secure and accurate registration database. Absent evidence to the contrary, the cost to the registrar of maintaining the registration of a particular second level name is constant regardless of the number of visits to associated web pages or the commercial success of any associated business activity. It is also clear, given the fact that .com registrations constitute 74 percent of all gTLD registrations and that sixteen of the 21 existing gTLDs collectively constitute a scant 1 percent of same, that certain gTLDs have substantially more value to registrants and the public and that migration of a second level name to another gTLD (assuming such name was available) would not be an acceptable alternative in reaction to the extortionate pricing policies that could be instituted under a tiered pricing regime. In short, registration fees should be just that -- flat fees for a ministerial service -- and any allowance of tiered pricing would permit gTLDs to institute a thoroughly undeserved and objectionable tax on the most successful websites and Internet business models.

 

We recognize that certain “closed” gTLDs may be proposed in the upcoming round of gTLD applications and that tiered pricing may be acceptable in that very limited context, For example, an organization might propose to establish a gTLD solely for its members and to impose a lesser registration fee on individuals than on business entity registrants. However, even allowing this limited exception would only be acceptable if ICANN can provide adequate documented assurance to the community that such allowance would not permit incumbent gTLD registries to argue that such action gives them a contractual green light to implement tiered pricing. In any event, tiered pricing on new gTLDs open to the general public, broadly defined, should be absolutely prohibited, and should be accompanied by establishment of a threshold limit (e.g., 50,000 domain names) beyond which even a supposedly closed gTLD will be subject to strict pricing controls. In addition, within the extremely limited universe of new closed gTLDs that are permitted to establish variable registration pricing of any kind, such registries should be required to publicly announce their pricing policies in advance of any final application approval and should be bound to such policies for the entire ten year term of initial approval with a limited exception made for those registries that can demonstrate that an alteration in pricing policies is required for their financial survival – and then only if ICANN makes such request public and permits adequate time for community input.

 

Directly related to registry pricing policies is the matter of registry-registrar relations. Section 2.8 of the draft registry agreement fails to adequately address this issue, stating only “TBD-See paper to be posted on ICANN website discussing registrar marketplace issues.” We have indeed thoroughly reviewed that report, “Revisiting Vertical Separation of Registries and Registrars” by CRA International. While it is a well reasoned, comprehensively, and adequately documented analysis we must demur from the thrust of its recommendations.

 

Vigorous competition between ICANN-accredited registrars in the pricing and range of their registrant services is one of the great successes of the ICANN experiment and should not be abandoned. We continue to believe that the position taken by the Department of Commerce in its June 1998 White Paper – “where possible, market mechanisms that support competition and consumer choice should drive the management of the Internet because they will lower costs, promote innovation, encourage diversity, and enhance user choice and satisfaction” – remains valid a decade later and should be a guiding principle for ICANN decisions.

 

We completely agree with CRA’s observation that there are various incentives for a registry to discriminate among registrars in a manner that harms consumers/registrants, that such discrimination could take on multiple forms, and that these incentives are especially clear and strong when a registry is operating under a binding price cap; and that vertical separation (of registry and registrar) and equal access (of registrars)  are useful tools for limiting the possibility of harmful discrimination. As previously stated in this and prior comment letters, we believe that award of a gTLD registry creates a natural monopoly and that fixed maximum pricing caps and prohibition of differential pricing are required to protect registrants from extortionate registry pricing actions constituting the imposition of a tax on the success that individual registrants have created.

 

Therefore, we have strong qualms regarding CRA’s recommendation that ICANN take steps toward relaxing the vertical separation and equal access requirements. We recognize that consideration of limited relaxation of such requirements may be appropriate for new and innovative single-organization gTLDs where the registry and registrants are one and the same, particularly since there may be little or any impetus for third party registrars to serve them and also recognizing there also may be valid security concerns associated with third party registrar services in this limited context. However, we agree with CRA that defining such gTLDs may not be a straightforward matter and therefore we would urge extreme caution in creating such exceptions lest they swallow the rule.

 

As for the other possibility for relaxation cited by CRA, the “hybrid model” in which a registry has a controlling stake in a registrar so long as it does not serve that particular registry, we have even greater concerns. As noted, there is already tremendous competition in pricing and services at the registrar level so we are not considering this matter in a context of inadequacy of providers where new entrants must be encouraged. We have little doubt that a registry permitted to directly own a registrar will, at some point after initial approval, present arguments to ICANN that it should be permitted to offer registration services for its own registry and that such permission can be conditioned on various safeguards to protect registrants. Therefore, we view the hybrid model suggestion as a camel’s nose under the tent of ending vertical separation of registries and registrars generally. In addition, incumbent registries might well use the CRA report to justify another attempt at removing price caps, arguing somewhat disingenuously that such action would reduce the discrimination dangers that might otherwise accompany an easing of vertical separation.

 

CRA notes that easing of vertical separation would require more vigorous enforcement of equal access requirements by ICANN, and we question whether ICANN is up to the task especially given the new administrative and contract enforcement burdens it will face in conjunction with the massive contemplated rollout of new gTLDs. Therefore, we see little to gain and much at risk and oppose ICANN approval of such hybrids.

 

Summing up, we agree with CRA’s recommendation that ICANN move slowly toward permitting integration of registry and registrar services. But we dissent from its apparent goal of using experimentation with single-organization and hybrid registries as a prelude to relaxing vertical separation and equal access requirements for a broader pool of gTLDs, as we doubt that any such relaxation could be contained to exclude the dominant incumbent registries.

 

Geographic Names

 

All recognized governments and a variety of international organizations already have been assigned their own country code TLDs (ccTLDs). The ccTLDs have been quite successful in attracting registrations, with a total of about 49 million registered domain names as of February 2008, about one-half of the approximately 100 million gTLD registrations in effect contemporaneously. In some regions, such as the European Union (EU), ccTLD commercial registrations are more popular than those on gTLDs. At the same time developed geographic domains are among the most successful websites, and the principle has become well-established that national governments and other governmental entities have no valid claim against such geo-domains. Internet users have repeatedly demonstrated that many of their Internet informational searches relate directly to a specific geographic locale, and geo-domains developed by the private sector have served the informational and commercial needs of these users very well.

 

In short, the countries of the world have been given their own registries and many have been quite successful in developing them. These nations and lower echelon regional, state, county and city authorities should not now be given the opportunity to extend their authority over new gTLDs proposed by entrepreneurial individuals and organizations by requiring such applicants to receive advance endorsement or at least non-objection of the nation or other governmental authority associated with a proposed geo-gTLD name (and, even then, such applications could still be subject to community objections). Such a requirement is a prescription for the awarding of geo-gTLD contracts on the basis of lobbying prowess and political connections at best and outright corruption at worst. It will impair the best potential development of new geo-gTLDs to the detriment of Internet users and will also abet censorship and other forms of information control. This proposed requirement is completely at odds with the GNSO principles adopted by the ICANN Board and instead acquiesces to the unreasonable overreaching on this matter of ICANN’s Government Advisory Committee (GAC).

 

It is indeed outrageous that ICANN staff has unilaterally rejected the Board-adopted recommendation of its primary policymaking body, the GNSO, and acquiesced in part to the advisory recommendations of the GAC. In this matter, as well as in regard to several others that we address in this letter, we quote with approval the statements made by outgoing ICANN Board member Susan Crawford during the Board meeting held in Cairo on November 7th. She stated:

 

>>SUSAN CRAWFORD:   Thank you, Kurt.
When I began my service on the ICANN board, the first thing I wanted to push for was new gTLDs.  And I am very anxious to see this go forward.  And we've heard so many comments from people saying they want it to go forward.
That being said, I am concerned -- and I hope the board in the future will be concerned -- about some quite breathtaking elements of the applicant guidebook that exists.  And some of these issues you have raised in your summary, for which I thank you.
The four -- I'm just going to pick the four most outrageous elements that I want to bring forward in my last half hour on the board.
The first is the morality and public order element that we've talked about in the past.  As presented in the applicant guidebook and in the explanatory memoranda accompanying it, there would be no limit to who could bring a morality and public order claim and no constraint on the subject of that claim, essentially, nothing.  Anybody could complain about something, and three panelists who keep their decision completely secret could decide that it offended morality and public order.
And then the decision of those panelist is not even final.  It just becomes another element that then may get bounced back to the ICANN board.
So you've got complete discretion, plus no finality.  I'm not sure what we're gaining through this.
So if I were king, I would suggest that we find some way of very narrowly tailoring the limits on expression that are properly the subject of objections and constrain jurists making those decisions.
Of course, the judges will say they want complete discretion.  That's their job.  They want to have the ability to make wide-ranging decisions.  It's not ICANN's job to serve as a gatekeeper in this fashion, handing over, at least temporarily, this authority to a panel.
So that's my brief summary of the problems, as I see them, with morality and public order as it's been implemented in the draft.
And please correct me if I've gotten this wrong.
The second outrageous element of this, in my view, is the suggestion in one of the explanatory memoranda that auctions appear to be the best means of resolving contention among competing applications.
Governments auction spectrum because a government can be said to stand for its citizens and to have the right to collect monies on their behalf and deposit those monies into the treasury for the good of that bounded group of citizenry.
I cannot imagine on what basis ICANN would say that it has the right to auction off domains, top-level domains.  And even if somehow it does have that right, the mischief created by trying to figure out how to allocate that money is staggering.  You'd have to create a second ICANN to deal with the deployment of funds.
So you and I have discussed this in the past.  But I want to say it again, I really think it is potentially destabilizing to assert the authority to hold an auction in this context.  And I'm not persuaded by the argument that merely flipping a coin would be illegal.  These applicants will have gone through a lot of process before they get to the contention stage.
So forget auctions.

 
 The third outrageous element, in my view, is --
 [ Applause ]      

SUSAN CRAWFORD:   Oh, thank you.

 -- geographic names.  Geographic names.  The GNSO fought over this for a long time and made a policy recommendation that objections based -- coming from communities, or let's put it the other way, that if an application seems to be targeting a community, it can be objected to.  They're very clear that opposition must be objection-based, that the burden of going forward must be on the objector.  That's the policy as stated by the GNSO.  And the policy, frankly, that the board approved.

 The guidebook flips the burden around and suggests that the applicant has the burden of coming forward with documents of support or nonobjection from the relevant government.

 And I don't understand how this could have happened.  The board approved the GNSO policy.

 I hope there will be further discussion about that.

 Possibly the most outrageous element of this entire package has not yet been explored by the board at all.  And that's the base contract that would be provided to registries.

 Now, these guys are willing to sign a napkin.  They've been waiting for these applications to be opened for such a long time.  They have zero leverage.  In this context, ICANN is a monopoly, handing out a contract that is essentially nonnegotiable.  It is up to the board and management and staff to restrain ourselves in making this contract.

 Here's what happened.  The whole point of ICANN is that it's made up of private parties signing agreements with each other, a private registry signing a private agreement with ICANN.

 These private parties have agreed that, in the future, if the community comes up with a mandatory consensus policy, they will change their activity, they will be bound by future consensus policies.

 An important element of this is that ICANN has an obligation to treat equally -- to treat parties equally.

 ICANN is abusing its power in this draft contract.  We're apparently frustrated with the consensus policy model, so it's blown up in two different ways.

 One is that the proposed draft contract really has a belt and suspenders approach.  First, it allows ICANN to amend the contract for any reason, subject to a veto of the registries, and on any topic.

 So the whole bounded nature of consensus policies is gone.

 Second, just in case anybody tries to invoke the consensus policy structure, it dramatically expands the scope of what it understands consensus policies to be.  Everything is included.

 So the contract can be unilaterally amended by ICANN on any topic unless the registries as a body vote to overturn.

 It's quite -- it's actually completely inconsistent with the Board Governance Committee's GNSO Working Group report of February 2008 that made very clear how this structure is supposed to work.

 So I really find that a destabilizing change.  I'm not sure where ICANN gets the authority to do that.  It's apparent that registries will sign this, because they will really have no choice if they want to go forward.  And it eliminates the essential bargain that was the basis of ICANN's creation.

 So otherwise, it's great, Kurt.  But I just wanted to get all of that on the record.

 Thank you very much.

 [ Applause ]

 >>PETER DENGATE THRUSH:   Other than that, Mrs. Lincoln, what did you think of the play?

 Thanks, Susan.

ICANN Board Chairman Peter Dengate Thrush chimed in with support of most of Ms. Crawford’s statements, including those pertaining to geographic names:

 

PETER DENGATE THRUSH:   Anyone else?
I would like to associate and agree with Susan's points, except that concerning auctions.  I don't use the same -- perhaps quite the same tone as Susan.  But I share the same concerns, particularly about public order and morality, on which the board has spent a considerable amount of time trying to get clear what the proper scope in relation to those issues were under the headings, particularly, of standing and standards.  And we have tended to seek to limit either one or both of those so that there was clear boundaries for everybody in relation to those disputes.
So I am going to certainly come back to those with some interest.
Similarly with geographic names, I'm concerned about the substance of that, the concept of that being a basis for a reservation or objection.  And, of course, I'm concerned about the reversal of the onus that results from adopting the way it's been put there.
And I also share the concern about possibly fundamental changes to the basic principle of ICANN's core management processes.  And as we've said before, the genius of the policy development process seems to be put at risk by this approach.  So I will be coming back carefully to look at those as well.
 
In our view, national and other governmental authorities should be restricted to the same objection rights as other parties in regard to new gTLDs. ICANN’s staff has already conceded far too much to the GAC, and yet the GAC remains unsatisfied. An October 2nd letter from ICANN CEO & President Paul Twomey to GAC Chairman Janis Karlkins notes that, while ICANN staff had acquiesced in regard to GAC Paragraph 2.2 as regards advance agreement or non-objection from the relevant government or public authority, the GAC still was pushing for acceptance of Paragraph 2.7, which would require applicant registries for new gTLDs to adopt procedures for the blocking, at no cost and upon demand of governments, public authorities, on Intergovernmental organizations (IGOs), any second level name of geographic or national significance, and further ensure procedures to allow the same entities to challenge “abuses” of such names at the second level. The notion that national governments and other entities should be awarded a cost-free method of blocking second level geo- and “national significance” (whatever that broad and undefined term might mean) names that have not secured their blessing, and that they further be permitted to harass such registrants for alleged “abuses” that fall far outside the present scope of the UDRP, is a complete outrage and a threat to free expression and enterprise. Further, the notion expressed in the letter that such second level restrictions might be inappropriate for “multi-national companies” and “brand name holders” implies that they might be acceptable vis-à-vis individual and small business entrepreneurs, a notion that we find offensive insofar as it would establish one favorable rule for large corporations and another far more stringent rule for small businesses.  
It is ICA’s position that the final application process for new gTLDs must revert to the GNSO position regarding the rights of nations and other geo-based entities and organizations and that ICANN staff’s acquiescence to the GAC in this regard is unacceptable. In particular, objections by governments and similar entities to second level geo-names must remain limited to the scope of the UDRP, as any deviation from that principle threatens dangerous and unjustified policy blowback for valuable geo-names registered at incumbent gTLDs. 
Protection of the Rights of Others
 
The ICA strongly supports the protection of intellectual property (IP) rights, including trademark rights.  We have adopted a Code of Conduct that prohibits intentional trademark infringement. And we have supported adoption of policies by individual registries, and the adoption of new pricing regimes by ICANN, that appear to be successfully eradicating that abuse of the Add/Grace Period (AGP) known as domain tasting which is sometimes associated with deliberate cybersquatting on the trademark rights of others.
 
For these reasons ICA strongly supports the adoption of policies in conjunction with new gTLDs to support IP rights. We believe that the proposed procedures accomplish this by affording IP owners the right to bring objections against any proposed string that they believe would infringe their rights. As ICANN has noted in its memorandum on this issue, “it is not unusual for more than one entity to have a trademark in the same word or phrase either for different products or services or registered in different jurisdictions”. The Internet and trademark rights coexist uneasily, as the former is a global data transmission system while the latter is restricted by relevant marketplace  as well as geographic considerations. It is for that reason that we oppose the suggestion of some IP interests that ICANN establish a master list of trademark terms  that will be either off-limits to or extremely difficult to establish as a new gTLD; vast tracts of generic dictionary words, in multiple languages, would inevitably wind up on such a list. To cite one example, the word dove is trademarked as the name of a soap bar as well as of an expensive line of ice cream, but the dove is also the universal symbol of peace – and if a non-profit peace advocacy group wishes to apply for .dove as a registry devoted solely to its activities and goals it should not be subject to blockage or objection from either of the cited business entities. 
It is critically important that IP rights protections adopted in conjunction with the gTLD process be limited to protecting existing rights conferred by relevant law and do not create newly expanded rights beyond the scope of current law. Therefore, we have some concern that the criteria for resolving objections is being developed by IP experts, as such individuals may try to utilize this process to exactly such an expansionist end, seeking from ICANN what they have been unable to persuade legislatures to confer. In any event, until these criteria are fully developed and published for public review it is impossible to render an informed judgment upon them. Our concern regarding the present vagueness of these criteria stems from our observation, which we have articulated to ICANN on numerous occasions, that the Uniform Dispute Resolution Process (UDRP) is becoming less and less uniform and predictable and that a presumptive burden is being imposed upon registrants that is contrary to the clear language of the UDRP.  Any extralegal expansion of IP rights resulting from the gTLD process has the potential to find its way into and further bias the UDRP against good faith registrants. This concern is particularly acute given that the World Intellectual Property Organization, which is inherently biased in favor of IP rights and their expansion and also serves as a leading arbiter of UDRP cases, is the only designated provider of dispute resolution services for legal rights objections and that such disputes will be decided by a single panelist.
 
Notwithstanding that caution, we support requiring gTLD applicants to adopt strong best practices to protect IP rights and, if the method chosen is a sunrise period, we would urge that trademark owners be charged only a reasonable minimum fee to register their protected names at the second level on the new gTLD. And, of course, we have no objection to the requirement that all second level registrations be subject to the UDRP – so long as it is implemented in a uniform fashion in keeping with its clearly stated requirement that a party alleging infringement carry the burden of proving the three required elements for a finding against the registrant. However, we strongly object to suggestions that ICANN establish a near-term requirement for cost-free takedown procedures for domains alleged to be established in bad faith for both new and existing gTLDs, as establishment of bad faith registration is already one of the key elements of the UDRP – it should remain one of three elements in a balanced proceeding, and not become the single determinative element in a biased proceeding. Any alteration or supplementation of the UDRP should not be implemented as a footnote to new gTLD implementation but only after presentation to and consideration by the community -- and such process must take into consideration and redress concerns with the present UDRP voiced by registrants and not simply react to the complaints of trademark interests. 
We believe that the concerns of many trademark holders will be alleviated when the reality of new gTLD applications begins. The impending situation should in no way be analogous to current abuses, in which a cybersquatter can seek to monetize a clear typographical variation of a famous trademark on .com for less than $10 per year, and can hide his identity through a proxy service. New gTLDs applicants will put at risk a full $185,000 application fee, will require several $hundred thousand more in the bank, and will entail establishing one’s bona fides as a legitimate organization with ICANN. Given these realities, we would be surprised to see any extensive infringement attempted through new registry applications. As for the second level, various infringement scams may be difficult to implement due to a scarcity of type-in traffic at most new gTLDs and their low placement in search engine results. In any event, the UDRP remains available for use against bad faith registrations.  In addition, we strongly urge ICANN and all registries to increase their commitment to finding means of taking down domains that are used to facilitate criminal activity such as phishing scams and stand ready to offer whatever assistance the domain investment community can provide in that effort. 
Morality and Public Order Objections
 
The ICA does not want to see new gTLDs utilizing names related or dedicated to the advocacy of racism, discrimination, violence, terrorism, genocide, or other harms and evils. At the same time, we cannot support the DNS being used as a censorship regime or as a means of curtailing speech to a far greater degree than is permitted in various national jurisdictions – including our base of operations, the United States, where the First Amendment provides broad protections for speech and expression. One of the major reasons we previously objected to the proposed .xxx contract was because it would have involved ICANN in the business of reviewing and rating content. 
While we are not opposed in principle to permitting objections to certain proposed gTLDs based on concerns relating to advocacy of highly offensive or criminal activities, we cannot support permitting such objections under the vague criteria proposed to date by ICANN. ICANN’s memorandum on this subject recommends that “TLD strings must not be contrary to generally accepted legal norms relating to morality and public order that are recognized under international principles of law”, yet concedes a few paragraphs later that “Extensive research has shown that it is difficult to identify existing generally accepted legal norms relating to morality and public order.” In short, ICANN is proposing that gTLDs not be contrary to norms that do not exist! 
ICANN then falls back to a position that such objections will be decided by “esteemed jurists” implementing “very broad standards” and imbued with considerable discretion, and that this should somehow mute concerns. Unfortunately, this seems to boil down to empowering jurists who “know it when they see it”, an approach that provides only the vaguest guidance to potential applicants or protection for free expression. Again, as with IP protections, one of our main concerns is that overreaching standards employed against new gTLD applicants will set new norms that will find their way into the second level and threaten existing registrants at incumbent registries. 
While we reserve judgment on this matter pending further information from ICANN, we cannot support morality and public order objections against proposed gTLDs unless and until ICANN can articulate a narrow range of specific   terms that could be subject to them. 
Conclusion
We hope that ICANN will find our comments useful as it revises the Applicant Guidebook and prepares to release a revised second version for analysis and comment. We look forward to reviewing that updated document.
Thank you for your consideration of our views in this matter.
 
Sincerely,
Philip S. Corwin
Counsel, Internet Commerce Association