Legal update: Domain name gold rush on the horizon

by Michael Park, Senior Associate, Deacons Lawyers, AustraliaICANN recently approved draft proposals that would see the biggest ever expansion of domain name choice.Under the draft proposals anyone would be allowed to apply for a generic top level domain (gTLD), resulting in an unlimited number of gTLDs. Currently, there are a limited number of gTLDs, including .com, .net and .gov (and .com.au, .net.au and .gov.au in Australia), which are strictly controlled by ICANN and each country’s internet regulatory authority (for example, .au Domain Administration for .au domain names). ICANN has introduced several new gTLDs, such as .biz, .travel and .asia, but the draft proposals could allow gTLDs such as .ebay and .yahoo.The key points of the draft proposals are:

  • Applicants will be required to satisfy several criteria in order to set up a gTLD.
  • An initial evaluation phase will involve a comparison between the new gTLD and the existing TLD or reserved name to determine whether they are too similar or likely to cause instability.
  • The application will then face an evaluation on both business and technical criteria.
  • If the applicant passes the initial evaluation, there will be an opportunity for other parties to object to the proposed gTLD. As trade marks will not automatically be reserved, the objection period is an important mechanism for trade mark owners to protect their interests. It is proposed that an objection to an application could be made on any combination of the following grounds:

– string confusion;
– existing legal rights;
– morality and public order; and
– community objection.Decisions on objections will be made by an independent dispute resolution provider, rather than ICANN.The cost of applying for a new gTLD will depend on the number of applications, but is likely to be at least $100,000. The high price, as well as the above criteria, will tend to act as a disincentive to potential cybersquatters.The draft rules for this new gTLD system are likely to be published within the next 3 months, and will then be available for comment for several months. Once the final policy is issued by ICANN, it may be a further few months before applications can be made. It is therefore unlikely that any applications for new gTLDs could be made before mid-2009.It is worth noting, however, that a very real impediment to the introduction of any new rules will be securing industry and public support for the proposed new rules, as well as approval from each country’s internet regulatory authority. In the past, for example, an attempt to introduce .xxx as a new gTLD for the adult entertainment industry was rejected following a spirited moral debate.Finally, it is also proposed that the present domain name system be expanded from the current 37 characters to include non-Latin characters, which would potentially expand the reach of the internet to millions of users who do not recognise Latin-based languages.This article was sourced, with permission, from Deacons Lawyers’ website at www.deacons.com.au/legal-services/technology-media-telecommunications/legal-updates/legal-update.cfm?objid=6512.

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