[CPWG] [GTLD-WG] Further to WT5 discussion

Sat Nov 17 09:23:49 UTC 2018

Hi Marita, all

Without being an expert here -it’s probably time for me to have a closer look at the AGB- I’m not sure whether I would call this a ‘loophole’ as the rule seems to be there intentionally there. I also would not speculate about unknown ’intentions’ or an agenda that an applicant most likely will not be transparant about.

The way I understand the below is that, as the policy currently stands, an applicant does not need a letter of support or non-objection from the relevant authority as long as it explicitly commits to not use the string to represent the city. A ‘city’ being the example here. Once the applicant receives confirmation that they can operate the gTLD this of course excludes others from doing so, including the city itself. This implies to me that the city had no interest (to gain the right) to operate the gTLD. 

If the applicant does not use the gTLD, and it seems they are waiting for others to buy from them the right to do so at an inflated price, and the city decides it does want to have the right to use the gTLD to represent its municipality, then Jonathan’s suggestion to ‘have a rule that city can only be sold it's name is for the base price’ makes sense to me. However I then think the city should have a clear privilege to buy the right, as the original applicant would otherwise sell to the highest bidder.

(I am not sure how to cover the scenario, and I do not know if the .shanghai example fits into this, where the applicant (‘legal entity’) at a profit sells all its shares, in chunks smaller than 15%, to others who intend to operate the gTLD, but for purposes _not_ related to the city)

regards
Bastiaan

> On 17 Nov 2018, at 02:46, Jonathan Zuck <JZuck at innovatorsnetwork.org> wrote:
> 
> Oh we all knew it fell within the current rules but believed there might be a better way to deal with it. For example, we could have a rule that city can only be sold it's name is for the base price.
> 
> Jonathan Zuck
> Executive Director
> Innovators Network Foundation
> www.Innovatorsnetwork.org
> 
> From: GTLD-WG <gtld-wg-bounces at atlarge-lists.icann.org> on behalf of Marita Moll <mmoll at ca.inter.net>
> Sent: Friday, November 16, 2018 6:59:58 PM
> To: CPWG
> Subject: [GTLD-WG] [CPWG] Further to WT5 discussion
>  
> Colleagues: My presentation at our last meeting suggested that we support revising the AGB wording re: applications for non-capital city names by closing the loop-hole that allows applicants who apply for city names to avoid seeking a letter of support or non-objection from the relevant authority as long as there is no intention to use the string to represent the city. I argued that the reason this wording should be changed is to prevent the owner from then selling the name for a substantial profit to the public authority (city) involved.
> 
> There was a suggestion at the time that it was an unnecessary measure as there was probably language prohibiting this kind of property "flipping" in the contract. I have posed this question to WT5 and, so far, it seems pretty clear (see thread below) that staking a claim to a geo-name with the intention of reselling it at an inflated price is entirely inside the current rules.
> 
> Do we think this kind of activity is in the interests of end-users or should we support the change?
> 
> Marita
> 
> 
> 
> -------- Forwarded Message --------
> Subject:	Re: [Gnso-newgtld-wg-wt5] applicant contractual obligations
> Date:	Fri, 16 Nov 2018 15:54:48 -0500
> From:	Marita Moll <mmoll at ca.inter.net>
> To:	gnso-newgtld-wg-wt5 at icann.org
> 
> 
> Thanks Alexander and anyone else who weights in. Sorry for my misuse of terms -- language is an issue, even for English speakers (sigh). 
> 
> But you realized what I was getting at and answered my question. And so, the suggestion that there might be contract language in place which would prevent the "flipping" (as it is known in the real estate business) of names is incorrect. Indeed, the current situation almost seems to encourage such activity.
> 
> Marita
> 
> 
> On 11/16/2018 2:12 PM, Alexander Schubert wrote:
>> Hi Marita,
>> 
>> Please clarify your question. "Domain name holder" - what is that supposed
>> to be? Sounds like a "registrant" of a 2nd level domain? But as we are only
>> discussing gTLDs on top level you probably mean the "registry operator"?
>> 
>> After the 2012 round I am very sure that EVERY SINGLE APPLICATION will be
>> applied for  by using a separate, unique legal entity: "Legal entities" can
>> be minted by the dozen in no time in most jurisdictions.
>> 
>> So in other words: You can bet that an applicant entity (and subsequently
>> registry operator) has a unique legal entity as owner of the gTLD (a legal
>> entity that is not involved in ANY other business operation but that gTLD).
>> So there is no real need to "sell the name" (I suppose you mean "the gTLD")
>> - you can simply sell the LEGAL ENTITY; or its shares! If cleverly done that
>> doesn't even need to be reported to ICANN: Only if shares of larger than 15%
>> are being sold, ICANN would look into it (not even sure if that is true
>> AFTER delegation - please if somebody knows: let us know). So you COULD in
>> theory at ANY point of time after the submission of your application "sell
>> the gTLD" (application, applicant, registry operator, whatever stage it is
>> in) to others, if it's being done in 15% share packages to 7 entities e.g. 6
>> times 15% and one time 10% each to different "owners"). Please correct me if
>> I am wrong! 
>> 
>> So if you plan to apply for ".shanghai": Just don't designate it as geo-TLD,
>> DO NOT MENTION the word "city" or "China" at all. Then you do NOT need to
>> provide a "letter of non-objection". Once you are sure you are the "winner"
>> (e.g. you where the only applicant, or you won a private auction) you can
>> now approach the biggest real estate magnate in Shanghai, or the biggest
>> media conglomerate: and sell the application by transferring ownership of 7
>> share packages! It's really THAT simple.  I am warning of this since MONTH.
>> Again: if I am mixing facts here: point it out to me. 
>> 
>> Thanks,
>> 
>> Alexander
>> 
>> 
>> 
>> 
>> 
>> -----Original Message-----
>> From: Gnso-newgtld-wg-wt5 [
>> mailto:gnso-newgtld-wg-wt5-bounces at icann.org
>> ] On
>> Behalf Of Marita Moll
>> Sent: Friday, November 16, 2018 6:35 PM
>> To: 
>> gnso-newgtld-wg-wt5 at icann.org
>> 
>> Subject: [Gnso-newgtld-wg-wt5] applicant contractual obligations
>> 
>> Hello. I am wondering whether there is anything in the contract of a domain
>> name holder that prevents that holder from selling the name to a higher
>> bidder. I am asking this as it came up in a recent conversation in our
>> community and, given our lengthy discussions here about domain name
>> parking/scalping of city or other geo-names, I have assumed that there were
>> no such restrictions. But, being fairly new here, I was unable to confirm or
>> deny this idea.
>> 
>> Thanks for any clarification
>> 
>> Marita
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