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<p class="MsoNormal"><span style="color:#1F497D">Thank you. Regarding Action Item 3, I thought the flow chart would also be applicable to Alternative 2. Are we saying there will only be a flow chart for Alternative 1?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">Thank you,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">Anne<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<div>
<div style="border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in">
<p class="MsoNormal"><b>From:</b> Gnso-newgtld-wg <gnso-newgtld-wg-bounces@icann.org>
<b>On Behalf Of </b>Julie Hedlund<br>
<b>Sent:</b> Monday, December 2, 2019 9:52 AM<br>
<b>To:</b> gnso-newgtld-wg@icann.org<br>
<b>Subject:</b> [Gnso-newgtld-wg] Notes and Action Items - New gTLD Subsequent Procedures PDP WG - 02 December 2019<o:p></o:p></p>
</div>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<div>
<p class="MsoNormal"><strong><span style="font-size:9.0pt;font-family:"Helvetica",sans-serif;color:black">[EXTERNAL]</span></strong><span style="font-size:9.0pt;font-family:"Helvetica",sans-serif;color:black"><o:p></o:p></span></p>
<div class="MsoNormal" align="center" style="text-align:center"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">
<hr size="2" width="100%" align="center">
</span></div>
</div>
<p class="MsoNormal"><span style="font-size:12.0pt">Dear </span>Working Group members,<o:p></o:p></p>
<p class="MsoNormal"> <o:p></o:p></p>
<p class="MsoNormal">Please see below the notes from the meeting on 02 December 2019.
<b><i>These high-level notes are designed to help WG members navigate through the content of the call and are not a substitute for the recording, transcript, or the chat,</i></b> which will be posted at:
<a href="https://community.icann.org/display/NGSPP/2019-12-02+New+gTLD+Subsequent+Procedures+PDP">
https://community.icann.org/display/NGSPP/2019-12-02+New+gTLD+Subsequent+Procedures+PDP</a>.<o:p></o:p></p>
<p class="MsoNormal"> <o:p></o:p></p>
<p class="MsoNormal">Kind regards,<o:p></o:p></p>
<p class="MsoNormal">Julie<o:p></o:p></p>
<p class="MsoNormal">Julie Hedlund, Policy Director<o:p></o:p></p>
<p class="MsoNormal"> <o:p></o:p></p>
<p class="MsoNormal"><b>Notes and Action Items:</b><o:p></o:p></p>
<p class="MsoNormal"><b> </b><o:p></o:p></p>
<p class="MsoNormal"><b>Actions:</b><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">ACTION ITEM 1: Add a third alternative.<o:p></o:p></p>
<p class="MsoNormal">ACTION ITEM 2: Add another goal (#7): “Increase efficiencies in application evaluation by way of understanding the contention set?”<o:p></o:p></p>
<p class="MsoNormal">ACTION ITEM 3: Create a flow chart with a fictional string to show how alternative 1 would work.<o:p></o:p></p>
<p class="MsoNormal">ACTION ITEM 4: Update the list of goals.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><b>Notes:</b><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">1. Review Agenda/Statements of Interest: Susan Payne was reappointed IPC Secretary for another year.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">2. String Contention Mechanisms of Last Resort: <a href="https://urldefense.proofpoint.com/v2/url?u=https-3A__docs.google.com_document_d_16qDoiK6vydQp6a0v9tMvU2l5fcypJY24hCzTIVTjKwk_edit-3Fusp-3Dsharing&d=DwMGaQ&c=FmY1u3PJp6wrcrwll3mSVzgfkbPSS6sJms7xcl4I5cM&r=adDIs0WEx_lLwFfrsdovxTYY8GkRHo5ibc8SR3Npdh8&m=CQEth_7agzL4nstv-7WTuaAuI6d1I-2inhjqcYiT46I&s=A3JYJRT5C06hqUQZ-Zi8neK99f2OkoiaMb6s-dNpcAk&e=">
https://docs.google.com/document/d/16qDoiK6vydQp6a0v9tMvU2l5fcypJY24hCzTIVTjKwk/edit?usp=sharing [docs.google.com]</a><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><i>What is the issue we are trying to address:</i><o:p></o:p></p>
<p class="MsoNormal">-- The Working Group has discussed a number of potential issues with the mechanisms of last resort used in the 2012 New gTLD Round. These issues are captured in the Supplemental Initial Report. <o:p></o:p></p>
<p class="MsoNormal">-- Although the Working Group ultimately believes that when there is string contention, an auction process should be used to select the Registry Operator invited to enter into a Registry Agreement with ICANN, the Working Group is still
discussing what forms of private resolution should be allowed (if any), the specific type of auction to be used, and the timing of such an auction. <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><i>Policy Goals / What the WG is Seeking to Accomplish:</i><o:p></o:p></p>
<p class="MsoNormal">-- The WG is largely supportive of existing Implementation Guideline F:<o:p></o:p></p>
<p class="MsoNormal"><i><u>Implementation Guideline F:</u> If there is contention for strings, applicants may:</i><o:p></o:p></p>
<p class="MsoNormal"><i>i) resolve contention between them within a pre-established timeframe</i><o:p></o:p></p>
<p class="MsoNormal"><i>ii) if there is no mutual agreement, a claim to support a community by one party will be a reason to award priority to that application. If there is no such claim, and no mutual agreement a process will be put in place to enable efficient
resolution of contention and;</i><o:p></o:p></p>
<p class="MsoNormal"><i>iii) the ICANN Board may be used to make a final decision, using advice from staff and expert panels.</i><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Other goals include:<o:p></o:p></p>
<ol style="margin-top:0in" start="1" type="1">
<li class="MsoNormal" style="mso-list:l2 level1 lfo3">Reduce the risk of “bidding wars” in which the winner ultimately overpays for the TLD.<o:p></o:p></li></ol>
<p class="MsoNormal" style="margin-left:0in;text-indent:0in;mso-list:l2 level2 lfo4">
<![if !supportLists]><span style="mso-list:Ignore">a.<span style="font:7.0pt "Times New Roman"">
</span></span><![endif]>Tentative, related goal for discussion: encourage applicants to bid their true value for a TLD.<o:p></o:p></p>
<ol style="margin-top:0in" start="1" type="1">
<li class="MsoNormal" style="mso-list:l2 level1 lfo4">Reduce collusion, profiteering, and/or speculation, especially as it relates to financial transactions external to the program (Note, while this is not an explicit goal for the mechanisms of last resort,
it has been discussed as a motivation for altering the auction mechanism).<o:p></o:p></li><li class="MsoNormal" style="mso-list:l2 level1 lfo4">Increase transparency.<o:p></o:p></li><li class="MsoNormal" style="mso-list:l2 level1 lfo4">Resolve contention more quickly.<o:p></o:p></li><li class="MsoNormal" style="mso-list:l2 level1 lfo4">Increase predictability.<o:p></o:p></li><li class="MsoNormal" style="mso-list:l2 level1 lfo4">Encourage new entrants into the field.<o:p></o:p></li></ol>
<p class="MsoNormal" style="margin-left:0in;text-indent:0in;mso-list:l2 level2 lfo6">
<![if !supportLists]><span style="mso-list:Ignore">a.<span style="font:7.0pt "Times New Roman"">
</span></span><![endif]>Which could include, making it easier to implement “multipliers” for certain types of applicants, such as those eligible for Applicant Support.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">-- Note that some of the terminology may need to be further defined if the above goals are adopted. In order to ensure that recommendations align with goals, it is important for the Working Group to agree on specific objectives.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><u>Discussion:</u><o:p></o:p></p>
<p class="MsoNormal">-- Do we still need iii)? An alternative may be, "The ICANN Board may use expert panels to make Community Priority Evaluation determinations." This may also be dependent on recommendations on the new appeals mechanism.<o:p></o:p></p>
<p class="MsoNormal">-- ICANN Board says it does not make policy. Its decision would be subject to RFR and IRP - very messy so it may be better to stick with what we developed earlier.<o:p></o:p></p>
<p class="MsoNormal">-- This isn’t about the Board making policy, but making it clear that it’s an auction process rather than the Board making a decision.<o:p></o:p></p>
<p class="MsoNormal">-- There should be a reference instead to Auction of last resort.<o:p></o:p></p>
<p class="MsoNormal">-- Agree they are good goals so suggest removing possible description<o:p></o:p></p>
<p class="MsoNormal"><i>What are we Proposing?</i><b><o:p></o:p></b></p>
<p class="MsoNormal">-- The Working Group is leaning towards recommending a sealed-bid auction as the ultimate form of auction used as a mechanism to resolve string contention. When a sealed-bid auction is held where bids are submitted without knowing the bid
of others in the auction (e.g., prior to evaluating any of the applications) it is also called a Vickrey Auction. A sealed-bid auction can also be used as a mechanism of last resort and at the end of the process. <o:p></o:p></p>
<p class="MsoNormal">-- With a sealed-bid auction, each applicant submits a sealed bid, stating the amount that they are willing to pay for the TLD. The ultimate “winner” pays the amount submitted by the second-highest bidder..<o:p></o:p></p>
<p class="MsoNormal">-- Regardless of when the sealed bid auction is held, if there are one or more Community-based Applications, that/those application(s) would need to be processed first through Community Priority Evaluation before looking at the auction
bids.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Alternative 1 - Vickrey Auction (No Private Resolution)<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">-- Addresses goals 1, 2, 4, and 6.<o:p></o:p></p>
<p class="MsoNormal">-- The principle pro here is the seemingly near elimination of private resolution. However, the principle con is the substantial complications this approach introduces (see Additional Considerations, Mostly For Alternative 1 below). Other
cons are that other forms of private resolution might be impacted (e.g., joint ventures, string change, etc.) in seeking to eliminate private resolution for financial benefit and that bids are submitted with no contextual information.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Alternative 2 - Sealed-Bid Auction allowing Private Resolution <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">-- It seems to be supportive of, or at least not impede, 1, 2, and 6, but in a less pronounced manner as it relates to Alternative 1; the maker of this Alternative has acknowledged that it does not fully address concerns around potential
collusion and profiteering on application withdrawals. <o:p></o:p></p>
<p class="MsoNormal">-- However, some benefits are likely derived by obtaining sealed bids (which can reduce the incentive for all parties to agree to private resolution, if an applicant already knows they have the highest bid). The other main pro here is simplicity
- most other processes remain unaffected.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><u>Discussion</u>:<o:p></o:p></p>
<p class="MsoNormal">-- Re: Alternative 2: First bullet point and third bullet point seem incompatible. Third bullet point: “Applicants would still have an opportunity to resolve the contention set through other means such as private auction, a joint venture
arrangement or to choose another string as was suggested for ‘brands’ of the same name.”<o:p></o:p></p>
<p class="MsoNormal">-- Assuming you stayed in only those applicants who stayed in would be revealed on reveal day. So you could still have private resolution.<o:p></o:p></p>
<p class="MsoNormal">-- For clarity, the third bullet could be swapped with the fourth bullet and add “post reveal day”. In third bullet point, after "opportunity", you would need to insert "after reveal day" or something to clarify that parties become known.<o:p></o:p></p>
<p class="MsoNormal">-- Question: Wasn’t one of the proposals to outlaw private auctions? So not sure why we are still allowing private resolution. Answer: If we went with alternative 1 we would eliminate private resolution, but not for alternative 2. So
that is one of the drawbacks with alternative 2.<o:p></o:p></p>
<p class="MsoNormal">-- Thought alternative 2 was to allow participants to know how many contention sets there are. Add as a third alternative: Alternative three could remove some of the elements about private resolution.<o:p></o:p></p>
<p class="MsoNormal">-- They may not resolve privately and should only have a limited period to resolve. If not resolved in a limited period, it should proceed to the sealed bid winner. I am not seeing the time limit in alternative 2 though. Is it there?<o:p></o:p></p>
<p class="MsoNormal">-- Question: How would the timing work with a string contention objection process?<o:p></o:p></p>
<p class="MsoNormal">-- How could private auctions be prevented?<o:p></o:p></p>
<p class="MsoNormal">-- Objections should not be triggered until a winner (or a private resolution winner) is identified.<o:p></o:p></p>
<p class="MsoNormal">-- Re: Alternative 2 there should be a limited time for private resolution.<o:p></o:p></p>
<p class="MsoNormal">-- Helpful to put these alternatives out for public comment and indicate whether the WG has a preference.<o:p></o:p></p>
<p class="MsoNormal">-- Re: Alternative 2 -- Question: For string confusion objections those would have to be heard right away.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Additional Considerations:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><i>Public Comment: Comments from the public are solicited on all applications regardless of where they are placed in the queue. To do it otherwise would mean opening up separate public comment periods depending on whether there is a need
to go to the second bidder, and that would be impossible to monitor.</i> <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><u>Discussion</u>:<o:p></o:p></p>
<p class="MsoNormal">-- Strongly support 1 public comment period, for the exact same length of time for all.<o:p></o:p></p>
<p class="MsoNormal">-- Impractical to have multiple public comments.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><i>String Similarity Evaluation:</i><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><u>Discussion:</u><o:p></o:p></p>
<p class="MsoNormal">-- Don’t see how this fits with the notion of closed bids and timing. You have a scenario where you have some who know who they are bidding against and everyone else doesn’t. <o:p></o:p></p>
<p class="MsoNormal">-- In the scenario where the result of a string similarity evaluation is that some would have insight into who is in the set -- this is an unfair result.<o:p></o:p></p>
<p class="MsoNormal">-- Which is why getting every applicant to submit a bid at the point of application is something to consider, even though it may be cumbersome for many.<o:p></o:p></p>
<p class="MsoNormal">-- What if this fact situation should default to sealed bid only?<o:p></o:p></p>
<p class="MsoNormal">-- Why would they not be all announced at the same time?<o:p></o:p></p>
<p class="MsoNormal">-- So we are proposing to treat some applicants differently from others? That does not seem to be in line with the Bylaws.<o:p></o:p></p>
<p class="MsoNormal">-- Wouldn’t alternative 1 solve this issue?<o:p></o:p></p>
<p class="MsoNormal">-- What about plurals?<o:p></o:p></p>
<p class="MsoNormal">-- There was only one case in 2012 that was found to be similar (unicorn/unicom). <o:p></o:p></p>
<p class="MsoNormal">-- Why string similarity evaluation after reveal day? Why not make it before reveal day? That is a possibility.<o:p></o:p></p>
<p class="MsoNormal">-- is string similarity not subject to accountability mechanisms and appeals?<span style="font-family:"MS Gothic"">
</span>would that not “reveal” it in some manner?<o:p></o:p></p>
<p class="MsoNormal">-- Agree with that suggestion re string similarity evaluation occurring first and before reveal day. bids would have to be in before appeal.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Objections:<b> </b><i>Objections on the highest bidder’s application must be filed within the objection period. With respect to objections to the other applications, ICANN would create a system for the filing of “an intent to file an objection.” </i><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><u>Discussion:</u><o:p></o:p></p>
<p class="MsoNormal">-- Question: What happens when someone indicates that they are filing a community objection and they are filing it against all of the applicants for a string. Answer: All applicants should have a chance to respond. Add text to relay your
comment on "can indicate that an objection will apply to all applications for same string"?<span style="font-family:"MS Gothic"">
</span> <o:p></o:p></p>
<p class="MsoNormal">-- Objections should not come into full proceedings unless and until there is a winner - it's a huge waste of time and money if it does proceed but private parties need to know what the value of the string may be.<o:p></o:p></p>
<p class="MsoNormal">-- Some concern about not having to submit the objections on a standard timeline, although support not engaging fees or panels until the objection is necessary, based on bidder ordering<span style="font-family:"MS Gothic"">
</span>.<o:p></o:p></p>
<p class="MsoNormal">-- “time” may benefit some as they build their case. Or could the “intent to file” require some key points that will be included in the objection filing?<o:p></o:p></p>
<p class="MsoNormal">-- Question: We are agreeing on the principle that the intent to object is a good idea, but when would that happen? Would one party have to state the type of objection and the grounds? Could it just be a party filing very general intent
to objection concerning a risk associated with that application. Would there be a panel for an intent to object process? Answer: Proposal was that the objection would be “bare bones”. There would be no panel if it was just an intent to object to one application,
but if for all applications (to the string) then one could request a panel. You file your objection against the applicant first in the queue and an intent to file against the others in the queue. Or, you could say I have the same objection to all of the
applicants/string.<o:p></o:p></p>
<p class="MsoNormal">-- Important for private parties in resolution to know that there is an intent to object (but that doesn’t pertain to alternative 1 as there is no private resolution).<o:p></o:p></p>
<p class="MsoNormal">-- The objection should be submitted within a certain time period.<o:p></o:p></p>
<p class="MsoNormal">-- The nature of the applicant is important. It's not just the existence of the string. It depends on who is operating it and what the purpose of the tld as stated in the application in Question 18 answers and services to be provided
in answer to Question 23. There should be an intent to object process prior to determining the order of the queue with no panel convened.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><i>Other complications:</i><o:p></o:p></p>
<p class="MsoNormal"><i>Objections if there is more than one Community Application</i><o:p></o:p></p>
<p class="MsoNormal"><i>String Confusion Objection Results in the Creation of a New Contention Set or Adds to an Existing Contention Set</i><o:p></o:p></p>
<p class="MsoNormal"><i>Appeals/Accountability Mechanisms</i><o:p></o:p></p>
<p class="MsoNormal"><i>Applicant Support Program</i><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><u>Discussion</u>:<o:p></o:p></p>
<p class="MsoNormal">-- Seems that these are all related to the attempt to gain efficiencies to know the order of the contention sets. If you don’t need to know the order then you could leave the program untouched. If you go back to the goals knowing the
order of the contention sets goes to goals 3, 4, and 5.<o:p></o:p></p>
<p class="MsoNormal">-- Add a goal: “Increase efficiencies in application evaluation by way of understanding the contention set?”<o:p></o:p></p>
<p class="MsoNormal">-- Note that alternative 1 would eliminate the goal to allow contention resolution.
<i>“If there is contention for strings, applicants may: i) resolve contention between them within a pre-established timeframe”</i><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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