[CCWG-ACCT] Lawyer's High Level Review re Proposal to Refer to 2004 ASO MOU in Mission Statement (Annex 5, Third Proposal)

Avri Doria avri at acm.org
Mon Jan 18 22:47:22 UTC 2016


I have a question. 

The current bylaws contain provisions for GNSO Operating Procedures

> X.3.4. The GNSO Council is responsible for managing the policy
> development process of the GNSO. It shall adopt such procedures (the
> "GNSO Operating Procedures") as it sees fit to carry out that
> responsibility, provided that such procedures are approved by a
> majority vote of each House. The GNSO Operating Procedures shall be
> effective upon the expiration of a twenty-one (21) day public comment
> period, and shall be subject to Board oversight and review

Understanding that this is somewhat a different case than the ASO MOU,
is it possible to do something that points to the current MOU and
includes the condition under which the referenced MOU changes?


On 18-Jan-16 15:27, Gregory, Holly wrote:
> Dear CCWG ACCT Co-Chairs, Members, Participants and ICANN Staff,  
> We are writing to raise with you a high-level concern regarding the
> proposal to reference the 2004 Address Supporting Organization MOU
> (the “MOU”) in ICANN’s Mission Statement (Bylaws Article I, Section
> 1), which was discussed on CCWG-ACCT Call #77 (January 14).
> In defining ICANN’s role in coordinating allocation and assignment at
> the top-most level of IP and AS numbers, Annex 05 from the Third
> Proposal provided as follows: “ICANN’s Mission is described in the ASO
> MoU between ICANN and RIRs.”
> /We //recommend against trying to further define ICANN’s Mission
> through cross-reference to the MOU in the Bylaws and suggest that any
> specific language that you deem of critical import to defining ICANN’s
> Mission be actually incorporated.  (We could not find a clear
> statement of the ICANN Mission in the MOU.)/
> As a general matter, referencing all or part of an external agreement
> in bylaws presents a number of problems.  For example:
> ·         The bylaws may require a different process, parties, and
> threshold for amendment than the referenced agreement, and it is
> unclear legally which rules apply.  This problem is certainly present
> here.  Although the Mission will be a fundamental bylaw, the parties
> to the MOU could amend it on their own, circumventing the fundamental
> bylaw amendment process entirely.  Alternatively, perhaps the MOU’s
> amendment provisions would be superceded by the fundamental bylaw
> amendment process.  At a minimum, if the reference remains despite our
> advice, this issue should be addressed explicitly.
> ·         Referencing an outside agreement in bylaws may have the
> legal effect of incorporating it into the bylaws, putting all its
> terms on an equal footing with the bylaws, which can create problems
> if its provisions conflict with the bylaws in any way.  This issue has
> a greater chance of arising  where an entire agreement is incorporated
> by reference, and is clearly a problem here.  For example, ICANN’s
> Bylaws are ultimately governed by California law, but the MOU provides
> that it will be governed by International Chamber of Commerce rules in
> Bermuda.  Again, if the reference remains despite our advice, the CCWG
> should decide which document governs in case of conflict (either
> generally or on a topic-by-topic basis).
> ·         Although we generally recommend against it, clients have
> insisted on incorporating an entire existing agreement in their
> governing documents, essentially freezing the agreement as
> incorporated.  It was suggested on the CCWG call that the Bylaws could
> reference the version of the MOU as of a specific date, excluding from
> the Bylaws future amendments to the MOU unless the community amended
> the Bylaws to update the reference in the Mission.  While this
> strategy partially solves one problem, it leads to others.  Assuming
> that the MOU incorporated in the Bylaws continues to evolve over time
> outside of the Bylaws, there will be two versions of the MOU -- the
> one in the Bylaws, and the one that documents the current
> understandings between the ASO and ICANN.  At a minimum, this would be
> confusing; in a worst-case scenario, it could undermine the
> enforceability of the post-reference MOU.
> ·         Any outside agreement to be referenced in bylaws must be
> carefully reviewed to assess and address the sorts of consequences
> noted above.  We have briefly reviewed a version of the MOU, and note
> that the MOU itself incorporates other documents by reference,
> including the earlier 2003 version of the ICANN Bylaws, creating a
> circularity in terms of providing legal advice on this provision in
> the future.
> While we originally thought it might be possible to work around these
> problems by inserting text from the MOU into the Bylaws describing
> this aspect of ICANN’s Mission, after our brief review of the MOU, it
> is not clear to us where or how it describes ICANN’s mission in any
> narrative text.  As we read it the MOU sets out processes and
> mechanisms for developing policies but does not itself describe
> substantive limits on ICANN or purport to define ICANN’s Mission. 
> Bylaws may of course include a process for developing a scope of
> corporate activities within the bounds of a larger mission, and the
> mission can be updated as appropriate to reflect developments that
> come out of this process, but the process itself cannot logically
> become part of the mission.
> We hope further CCWG discussion in light of our concern, regarding the
> goal that the ASO and the community seek by referencing the MOU in the
> Mission Statement, may provide a way forward without referencing the
> MOU itself in the Bylaws.
> Holly and Rosemary
> Partner and Co-Chair
> Global Corporate Governance & Executive Compensation Practice
> *Sidley Austin LLP**
> *+1 212 839 5853
> holly.gregory at sidley.com <mailto:holly.gregory at sidley.com>
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