[gnso-gac-closed-generics] Closed Generics Updates - 14 April 2023

Wed Apr 19 05:41:05 UTC 2023

All,

Jeff has proposed the following:

In other words, it would not be for ICANN to determine what is
“anti-competitive”, but rather such determinations would be made by courts
of national jurisdiction.  If they found a violation of law, then ICANN
would have to ensure the registry takes remedial actions.  ICANN Compliance
should never be in the position of having to determine whether an action is
”anti-competitive” in any jurisdiction.

Philippe wrote something similar:

As I observed during our last call, I think asking the applicant “to
commit” is the right thing to do, and I don’t think this can call for more
than ticking a box or a “Yes we commit.” sort of response: I don’t expect a
panel/committee or even compliance to be in a position to determine whether
a particular behaviour is anticompetitive or not, as authority on the
matter lies with national/regional competition authorities/agencies.

I’m not saying that a closed generics may not lead to an anticompetitive
behaviour (I don’t know) but from a practical standpoint, I can only expect
“ICANN” to rely on those authorities to decide/rule on whether that is the
case, and act accordingly in the event, based on the fact that the
applicant didn’t live up to their “commitment”.

This runs counter to the concept of enforceability and to the reality of
how contracts are enforced.  It is utterly common for contracts to contain
provisions that obligate a party to comply with (and/or not to violate)
specified laws, and more generally to comply with applicable law.  In my
experience and observation, a contracting party will just about always
determine for itself (through the advice of appropriate counsel) whether
the other party is breaching one of these provisions and will take
appropriate action (notice of breach, possible suspension or termination
for cause, notice and demand for "cure"/remediation, etc. -- including
"softer" or more nuanced approaches).  If the parties cannot resolve the
issue between themselves, they may end up in court, but that is only a
small percentage of the time.  Even then, it is much more common for the
parties to settle rather than litigate to a verdict.

The only times I have observed a party wait until there's a court verdict
or regulatory finding is when the contract provision specifically and
expressly states that that is the threshold for breach.

To state the obvious, courts (in most jurisdictions) cannot initiate a case
on their own initiative -- there must be a plaintiff (either a private
party (in civil litigation) or the state (which can be civil or criminal))
who initiates the case (by filing a complaint or other similar action).

These proposals would utterly tie the hands of ICANN in contract compliance
and enforcement.  ICANN, like any other party to a contract, must be free
to determine for itself when a contract is being breached and to take
appropriate action.  It would be far too extreme to require ICANN to go
straight to a lawsuit when it believes that a contractual obligation to
comply with laws is being violated.  It would be even more extreme to
prohibit ICANN from taking any action and require it to wait for a third
party to bring a case or a government to bring a case or initiate an
investigation and secure a verdict or make a regulatory determination
before ICANN can take appropriate action.  That would take us massively
backward on concepts of contractual compliance and enforcement that have
gradually improved over time.

Of course, there could be times when cases are brought and verdicts are
secured that find behavior that violates contracts with ICANN, and ICANN
will of course be able to react and take appropriate enforcement action
regarding contracts.  But those times frankly are edge cases. That cannot
be our standard for any type of contractual commitment, including (but not
limited to), commitments relating to closed generics.

Best regards,

Greg

On Tue, Apr 18, 2023 at 4:37 PM <philippe.fouquart at orange.com> wrote:

> Thanks John. Your suggestion works for me too for the reasons given in my
> previous post.
> Best,
> Philippe
>
>
> Le 18 avr. 2023 22:04, John McElwaine <john.mcelwaine at nelsonmullins.com>
> a écrit :
>
> Jeff,
>
>
>
> That was my intent.
>
>
>
> John
>
>
>
> *From:* Jeff Neuman <jeff at jjnsolutions.com>
> *Sent:* Tuesday, April 18, 2023 4:02 PM
> *To:* John McElwaine <john.mcelwaine at nelsonmullins.com>; Melissa Peters
> Allgood <melissa.allgood at icann.org>; gnso-gac-closed-generics at icann.org
> *Subject:* RE: [gnso-gac-closed-generics] Closed Generics Updates - 14
> April 2023
>
>
>
> Thanks John.  I can live with your number 2 *If* all of those acts are
> predicated in violation of national laws.
>
>
>
> In other words, if I were to rewrite your #2 as I am ok with it being
> interpreted, it would be:
>
>
>
> .            For “non anti-competitive behaviour”, applicants must commit
> that its use of this closed generic gTLD will not be used to violate
> applicable national laws prohibiting unfair methods of competition.  This
> includes, but is not limited to, , such as collusion, restraints of trade
> that prohibit third parties from supplying or offering to supply goods or
> services, or otherwise monopolistically controlling, limiting, or
> restricting the supply of goods or services.
>
>
>
> In other words, it would not be for ICANN to determine what is
> “anti-competitive”, but rather such determinations would be made by courts
> of national jurisdiction.  If they found a violation of law, then ICANN
> would have to ensure the registry takes remedial actions.  ICANN Compliance
> should never be in the position of having to determine whether an action is
> ”anti-competitive” in any jurisdiction.
>
>
>
> Hopefully this is what you meant John.  If so, I can support.  If not, it
> is a red line for me to have ICANN compliance act as a substitute for
> regulator of national laws.
>
>
>
> Sincerely,
>
>
>
> Jeff
>
>
>
>
>
>
>
> Jeffrey J. Neuman
>
> Founder & CEO
>
> JJN Solutions, LLC
>
> p: +1.202.549.5079
>
> E: jeff at jjnsolutions.com
>
> http://jjnsolutions.com
> <https://urldefense.proofpoint.com/v2/url?u=http-3A__jjnsolutions.com&d=DwMGaQ&c=qmi9WrYRGQEDDOxOwKrAjW7mWovpzN_EKyRbeK_zbP0&r=Kepk-9GEB6JgOj0vUGl8c0hdrRM7FW-8Is-VAQU1VAm5U0rBXiZs3BfB3GfKU2uR&m=MeoIhLexdpwao9NQLMENEawFWz_0kTVclFlB0Xk_SAtHPNGbTYinOoLoeRir7-ho&s=ez0rB5lxV3bl0kZ1GOvz_DjYm-vAme9Rusom0REQMCk&e=>
>
>
>
>
>
> *From:* gnso-gac-closed-generics <
> gnso-gac-closed-generics-bounces at icann.org> *On Behalf Of *John McElwaine
> *Sent:* Tuesday, April 18, 2023 11:59 AM
> *To:* Melissa Peters Allgood <melissa.allgood at icann.org>;
> gnso-gac-closed-generics at icann.org
> *Subject:* Re: [gnso-gac-closed-generics] Closed Generics Updates - 14
> April 2023
>
>
>
> With respect “representativeness”, I must respectfully state that the
> following is a redline for me:
>
>
>
>    1. *For “representativeness”, applicants must demonstrate that the
>    applicant represents all or a significant part of the businesses (or has
>    their agreement) in the industry or grouping related to the closed generic
>    term.*
>
>
>
> The revisions would *only* allow for a closed generic applicant that was
> an international trade association of businesses.  This is far afield from
> what we have discussed and would fall into the category of an impermissible
> Policy determination.
>
>
>
> I agree with the concept of  “Non Anti-Competitiveness” as a part of the
> Framework process as a part of the delegation section, which is Section
> IV.  However, we are discussing this mostly in a double-negative way.
> Moreover, this is an area of law that I fear we are trying to define and
> which is outside of our knowledge.  I prefer something like Proposed
> Alternative #1, which I would suggest is revised as follows:
>
>
>
> 2.            For “non anti-competitive behaviour”, applicants must commit
> that its use of this closed generic gTLD will not be used to violate
> national laws prohibiting unfair methods of competition, such as collusion,
> restraints of trade that prohibit third parties from supplying or offering
> to supply goods or services, or otherwise monopolistically controlling,
> limiting, or restricting the supply of goods or services
>
>
>
> Thanks,
>
>
>
> John
>
>
>
>
>
>
>
> *From:* gnso-gac-closed-generics <
> gnso-gac-closed-generics-bounces at icann.org> *On Behalf Of *Melissa Peters
> Allgood
> *Sent:* Friday, April 14, 2023 2:34 PM
> *To:* gnso-gac-closed-generics at icann.org
> *Subject:* [gnso-gac-closed-generics] Closed Generics Updates - 14 April
> 2023
>
>
>
> *◄External Email►* - From: gnso-gac-closed-generics-bounces at icann.org
>
>
>
> Hi all –
>
>
>
> I want to share a bit of the work that staff has done to support your
> efforts and provide more detail about the approach to our upcoming calls.
>
>
>
> *Discussion Draft v2.1
> <https://urldefense.proofpoint.com/v2/url?u=https-3A__docs.google.com_document_d_1wtLVcyWhyrCaYl1iqlAncaIyrqpS-2D-2D0aPCTjpwMue7I_edit&d=DwMGaQ&c=qmi9WrYRGQEDDOxOwKrAjW7mWovpzN_EKyRbeK_zbP0&r=Kepk-9GEB6JgOj0vUGl8c0hdrRM7FW-8Is-VAQU1VAm5U0rBXiZs3BfB3GfKU2uR&m=ODO8endu2yFS9Q7WIZvDyDo1jWyvQo0fVRf64r8ZyBJHmS1kTm2DEU42C8rV4FGM&s=n6Zv8I5X6-mQu2qIZs8CpuYTk5kqq3ZsvNMfiqiSDUM&e=>*
>
> We will continue to work our way through all your inputs into this
> document. It has been cleaned up slightly, hence the v2.1, but nothing of
> substance has been altered. We will move through this document in the
> following manner:
>
>    - Section III.  Applying for a Closed Generic gTLD
>    - Section IV. Evaluating a Closed Generic gTLD Application
>    - Section V. Contracting & Post-Delegation Review
>    - Definitions
>    - Policy questions and possible implementation questions based on
>    group discussions to date
>       - I don’t anticipate getting into the substance of these and will
>       simply ask if the areas detailed properly encapsulate other conversations
>       had by this group
>
>
>
> In comments, staff have identified possible areas of duplication in
> upcoming points under discussion. When such areas arise, I will ask for the
> temperature of the room on the duplication issue before possibly moving
> onto the substance of the framework element.
>
>
>
> *Closed Generics Framework v3
> <https://urldefense.proofpoint.com/v2/url?u=https-3A__docs.google.com_document_d_1u0Nb9-5FCJ-2D6R-5FZF4bt9wbkzxLhMKu64aKY-5FvzS3QixgQ_edit&d=DwMGaQ&c=qmi9WrYRGQEDDOxOwKrAjW7mWovpzN_EKyRbeK_zbP0&r=Kepk-9GEB6JgOj0vUGl8c0hdrRM7FW-8Is-VAQU1VAm5U0rBXiZs3BfB3GfKU2uR&m=ODO8endu2yFS9Q7WIZvDyDo1jWyvQo0fVRf64r8ZyBJHmS1kTm2DEU42C8rV4FGM&s=k27Asp9yNGvBNSgyJY2Pi8f1F7M5gBtFQCRbjkgfgm0&e=>*
>
> This is a clean copy of framework elements from Discussion Draft v2.1
> where the group has demonstrated broad agreement. This document will
> continue to evolve as you work through the remaining sections of Discussion
> Draft v2.1. *Please keep this document clean*. We will consider this
> document as a whole after we complete the remaining work found in
> Discussion Draft v2.1.
>
>
>
> *Proposed Edits to Representativeness or Non Anti-Competitiveness*
>
> Sophie has shared proposed edits to this element on the mailing list.
> Please respond on the mailing list if:
>
>    1. You disagree *and* this a red line for you
>    2. You wish to state a preference between the options presented
>
> Staff will incorporate your feedback on this element into Discussion Draft
> v2.1.
>
>
>
> *Upcoming Discussions*
>
> As we continue to work through Discussion Draft v2.1, I’d remind you that
> this is *not *the time to rehash previous positions. We all understand
> that many elements under discussion may not be the preference of a given
> individual while also not rising to the level of personal red line.
> Accordingly, *I ask you limit interventions to clarifying questions
> and/or indications that the text under discussion is a personal red line.*
>
>
>
> Finally, at this point in the work I ask you focus your energy on the
> spirit and intention of each framework element under discussion rather than
> details of the text. I recognize this is far easier said than done, but I
> ask we all try.
>
>
>
> As always, my sincere thanks for your continued hard work. We are getting
> there!
>
>
>
> Wishing you all a lovely weekend,
>
> Melissa
>
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-- 
*Greg Shatan*
*Chair, NARALO*
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