ICANN Freezes Hundreds of New gTLD Applications, Citing GAC Concerns, Finalizes New Registry Agreement

This week’s resolutions from the committee, which has ICANN board powers but which excludes those directors with conflicts of interest, mark the final section of GAC advice the committee planned to address before ICANN’s July 14 meeting in Durban, South Africa. The GAC issued its Beijing Communique in April to broad criticism from applicants concerned the advice would delay the new gTLD program (WID April 12 p1), and the NGPC has met weekly throughout June to address the GAC’s concerns, said ICANN CEO Fadi Chehade last month (WID June 17 p8). ICANN can now begin the contracting process for the program, said Cyrus Namazi, ICANN vice president-DNS industry engagement, in a Wednesday blog post (http://bit.ly/12dUveS).

The GAC’s ‘Category 1’ advice said strings related to regulated or professional sectors “should operate in a way that is consistent with applicable laws.” It asked for ICANN to obligate registry operators to ensure registrants: Comply with privacy, data collection, consumer protection and financial disclosure laws in any country in which they operate; secure any health or financial data they collect; and keep Whois data up to date. In the advice, the GAC also asked registry operators to establish a relationship with the relevant regulatory bodies to mitigate the risk of fraudulent activities. It asked that those requirements apply to strings that apply to certain industries, like .bank, .lawyer and .dentist, and also to strings like .play, .eco, .care and .weather.

The NGPC agreed to discuss the issue further with the GAC in Durban, to “clarify the scope of the requirements provided” in the advice, noting that in comments, applicants said the advice is “untimely, ill-conceived, overbroad, and too vague to implement.” In the meantime, the NGPC directed staff to freeze those applications listed in the advice. Since the GAC itself said its list of relevant strings is “non-exhaustive,” any upcoming decisions about the regulation of the listed strings could have implications for other strings as well.

It’s important to note that ICANN hasn’t rejected any of the listed strings outright, said Nao Matsukata, CEO of the domain consulting firm FairWinds Partners. “Yes, they didn’t give them a green light, but they didn’t reject them. What ICANN is saying here is that ‘We want to see these strings delegated,'” he said. “'However, we, ICANN, also realize that the GAC and governments have some serious issues around the jurisdiction, competition, regulation around some of these things. We want to keep talking to the GAC to see how we can find a way to delegate these.’ It’s important to note that ICANN did not say, ‘We're going to reject these terms,’ it said ‘We want to keep working to delegate these.'” ICANN did not comment.

The NGPC also accepted the new registry agreement (RA) to which all new TLD applicants will eventually be subject if their TLDs are delegated (http://bit.ly/14qvz7T). Major changes to the contract, including ICANN’s right to amend it and changes to fee schedules, were outlined in May, when the proposal was put forth for public comment (WID May 2 p1). Since then, ICANN has also added the Public Interest Commitments it said it would add last week, which would require registries to hold registrars accountable for certain security and intellectual property issues on their domains (WID July 1 p7). ICANN also said it will work with brand applicants to develop provisions relevant to their closed registries, so the current RA may still change.

ICANN heralded the approval of the new RA, saying it had “cleared one of the last hurdles” for approved gTLD applicants. “New gTLDs are now on the home stretch,” said NGPC member Chris Disspain in a news release (http://bit.ly/120wzjC). Akram Atallah, president of ICANN’s Generic Domains Division, said the program had reached the point “where new gTLD applicants can see the finish line.” He called the RA a “dramatic improvement,” saying “this isn’t just a gradual step forward. This is a major move that translates to far greater security protections.” Namazi called the approval a major milestone. “I sense an added level of energy and a tinge of jubilation in our community,” he said. “It’s as though the summit is finally coming into view, after a long and at times exhausting voyage.”

But ICANN’s security provisions are just “paying lip service” to the GAC advice so ICANN can move forward quickly with string delegation, said Amy Mushahwar, a Ballard Spahr lawyer who represents large industry clients. “I'm just greatly concerned that people will look at the RA, look at a casual mention of security and intellectual property concerns, and think that that casual mention of security is enough. That’s just not the case.” Many members of the GAC don’t have the technological background to understand that ICANN hasn’t adequately addressed security and intellectual property concerns in this document, she said. Just two paragraphs of the RA speak to copyright and security concerns, and “that’s not nearly enough to operationalize the advice the GAC gave,” she said. “What they say is very vague and general,” said Dan Jaffe, Association of National Advertisers group executive vice president-government relations. “We don’t think that’s the right way to be writing these crucial functions. You need to be a little more specific and hold people to a higher standard.”

"ICANN and many of ICANN’s actors are desperate to delegate,” Mushahwar said. “That desperation is causing people to act rashly when we need them to act rationally.” Releasing a 93-page contract just 12 days before the ICANN meeting in Durban is “very concerning” behavior, she said. “This is an awfully heavy lift one week before stakeholders are trying to clear their desk to be able to attend in Durban,” she said. “By releasing this in such a hasty fashion, it almost appears as a dictate instead of a conversation with the stakeholder community that ICANN is beholden to. Procedurally this just isn’t right, either."

This week’s resolutions raise new questions about the new gTLD program at the same time they attempt to answer them, Matsukata said. “ICANN may believe this is what they have as the final RA, but I'm not sure the community is satisfied with that notion,” he said. “Yes, ICANN pushed through this RA and said go start negotiating, but I still think there’s still some very serious questions they've opened up as a result of trying to put more clarity into it.” Matsukata said ICANN will still have to address who will enforce the public interest commitments and the language that will apply to applicants of branded terms. Jaffe agreed. “Even if the RA was perfect, and we don’t think it is, there’s a lot of other outstanding issues,” he said. “Instead of beating one’s chest, I think they still have a lot of work to do to be ready. I hope they continue to take steps [to address the issues], and really listen hard to comments” in Durban.

"Overall it’s a good outcome and another step toward delegation of new gTLDs,” said Jon Nevett, executive vice president of Donuts, the largest new gTLD applicant. “Most of what the board approved we believe, on balance, is good for registries and end users.” But Nevett also said the resolutions left some questions. “There’s an outstanding issue on enforcement, but that’s being worked on now by the applicants and registries so we hope it will be resolved quickly.” Donuts, which has applied for several now-frozen Category 1 strings, declined to comment on ICANN’s decision to freeze those applications.