[Ws2-jurisdiction] issues on applicable law
Raphaël BEAUREGARD-LACROIX
raphael.beauregardlacroix at sciencespo.fr
Sun Sep 10 19:03:16 UTC 2017
Dear Jorge,
Let me now comment on a few elements of your proposal
*"This creates great legal uncertainty and a potential issue as regards the
jurisdiction given that it would be the prerogative of the arbitrators or
the judges having jurisdiction -who could come from a US Court- (...) "*
- I had a second look at the registry agreement and my understanding is
that there is no way a court would entertain litigation over it, despite
the ambiguous wording of the very last sentence of 5.2. I understand this
last sentence as giving competence to LA courts for litigation over the
arbitration agreement itself (which makes sense if the arbitration is
seated in LA,) although I recognise that this is not very well drafted. The
alternative, which is that you could also litigate over the RA in general
in courts, defeats the whole purpose of the arbitration agreement.
- Hence, to me, it is not open for a litigant to sue ICANN in a
"standard" court except if this suit is precisely targeted at the
arbitration agreement contained within the RA.
*"Following the principles of the institutions typical to the Common Law
provided for in the Registry Agreement poses issues of compatibility with
other legal orders and suggests that Californian law would -a priori- apply
to the Registry Agreement."*
- Yes, that is also one of my points; to the extent that the agreements
are drafted with American/Californian law in mind, it seems to me it would
make little sense to even attempt to make them fit into another legal
system. Square pegs in round holes, in a way.
*"The applicable law should be determined on the basis of the legitimate
expectations which the parties may have in terms of applicable law. It is
understandable and appropriate that the fundamental provisions or duties
contained in the Registry Agreement should apply equally to all registries
around the world and be therefore interpreted in a uniform way."*
- The legitimate expectations of the parties are a priori contrary, to
the extent we can assume each party wants its domestic law to apply.
- As for uniform interpretation of these legitimate expectations, yes,
but where from? If you want such an interpretation to be binding, better
put it in the contract or invent a new dispute settlement body for ICANN
contractual disputes and put that interpretation in its statute...
*"Beyond a few provisions and duties which are absolutely fundamental, it
would be judicious and consistent with a legitimate expectation that the
contractual relationship between ICANN and a registry be subject to the
national law of the latter. The foregoing is all the more reasonable given
that the manager of a generic domain (TLD) is delegated broad powers, as it
is within its scope to establish the purpose of the domain, the
eligibility, or the terms of the assignment of domain names, not to mention
that it has great freedom as to the way in which a domain is actually
managed."*
- I could agree with your arguments, however we then come back to the
square pegs in round holes problem. I do believe (but this is my very
personal take on the matter) that the issue is more one of the venue than
the governing law. In any case, if you need to find an attorney who knows
1) arbitration and 2) domain names industry, my bet is that this attorney
will be somewhat conversant in California law, wherever this person may be
situated.
*"There already exist special provisions for registries that are
IGO/Governmental entities (section 7.16 registry agreement): if
international law is at stake, there is a procedure (mediation and
arbitration ex 5.2.) to resolve disputes between the registry and ICANN –
this special provision could be extended:*
*- To other registries that are not IGOs/Public authorities*
*- To cover not only “international law obligations” but also
national law obligations"*
- I do not see the point of this insert (7.16) in the RA at all
actually. A registry may be a public (state-related) entity that falls
under administrative law rather than private (companies) law, but how would
public international law ever be applicable to such an entity? PIL is for
state-state relations. Registries, whatever their form, would never be
empowered to conclude treaties, much less be expected to respect
international customary law and the like...
- However, building carve-outs for national laws of the parties into the
contract is, I believe, not such a good idea. The governing law governs the
contract. Any form of niche and carve-outs where other laws may apply is
calling for endless interpretative complexity. Who says more complexity
says more power to the powerful (read: ICANN) and less for the less
powerful party, the registry. Confusion, complexity, niches and legalese
can only serve the powerful and certainly do not increase accountability,
in my opinion.
*"With regard to territorial jurisdiction, the arbitration clause (section
5.2 of the Registry Agreement entitled "Arbitration text for
intergovernmental organizations or governmental entities") has allowed the
".swiss" registry to submit itself to the arbitration of the International
Court of Arbitration of the International Chamber of Commerce in Geneva,
Switzerland. This provision also provides for some flexibilities restricted
to IGOs or governmental entities as regards the competent court.*
*However these flexibilities are not open to all registry operators.*
*Possible solutions:*
*It would be wise in our opinion:*
*- to also allow private registries to decide on the choice of their
arbitration/competent court;*
*- to broaden the possibilities of choice for all registries (by principle,
to choose an arbitration recognized in each country.)"*
- Yes, I do agree that they could add more options in terms of location
for the arbitration, to be more in favour of the registries. In that sense,
I would pick up Becky's idea but limit it to choice of venue; the RA could
contain a slight amount of flexibility by allowing the registry to choose
(at the moment the RA is concluded) between arbitration in let us say, LA,
Geneva, and maybe Singapore, and we could also think of locations in
countries such as Brazil, Mexico, Chile, UAE, South Africa, etc. Maybe that
would already solve some issues even if the governing law were to remain
California? That being said, the idea of choosing the governing law based
on regional blocks is not a bad one either (and is certainly less
fragmenting than the law of registry's location) but we are still stuck
with the square pegs-round holes issue.
Best,
2017-09-06 22:19 GMT+02:00 <Jorge.Cancio at bakom.admin.ch>:
> Dear all,
>
>
>
> Here are, for your convenience, the two issues I have tried to briefly
> explain during today’s conference call, for your consideration.
>
>
>
> As said, the main thought is to reduce uncertainty, and clarify that the
> parties to the registry agreements have an effective freedom to choose the
> applicable law and to apply a principle of subsidiarity that may reduce
> potential conflicts with the national laws where they are based.
>
>
>
> ==
>
>
>
> 1. *Issue: *The law applicable to the Registry Agreement has been
> identified as being the main issue:
>
>
>
> The Registry Agreement contains no provision relative to the choice of
> jurisdiction, the applicable law consequently not being defined by the
> Agreement.
>
> This creates great legal uncertainty and a potential issue as regards the
> jurisdiction given that it would be the prerogative of the arbitrators or
> the judges having jurisdiction -who could come from a US Court- to
> determine what law governs the relationship between ICANN and the registry.
>
> Pursuant to the current business practice, the applicable law is that of
> the party that provides the service in question, i.e. ICANN, a priori. A
> registry should therefore expect the potentially applicable law to be the
> law of the State of California.
>
> The applicable law further determines the faculty of ICANN to claim
> punitive or exemplary damages (i.e. under US law, damages highly surpassing
> the damage actually suffered, in order to punish a behavior), in the event
> the registry were to breach the contract in a deliberate and repeated
> manner (section 5.2 of the Registry Agreement.) This well-established
> institution of Common Law is non-existent under Swiss law, which follows
> the principle of compensation (damages are used to repair the damage but
> cannot enrich the claimant,) and should be considered to be contrary to
> public order. Were the Swiss law to apply to the Agreement, such damages
> would not be granted. Following the principles of the institutions typical
> to the Common Law provided for in the Registry Agreement poses issues of
> compatibility with other legal orders and suggests that Californian law
> would -a priori- apply to the Registry Agreement.
>
>
>
> *Possible solutions:*
>
>
>
> The applicable law should be determined on the basis of the legitimate
> expectations which the parties may have in terms of applicable law. It is
> understandable and appropriate that the fundamental provisions or duties
> contained in the Registry Agreement should apply equally to all registries
> around the world and be therefore interpreted in a uniform way.
>
>
>
> Beyond a few provisions and duties which are absolutely fundamental, it
> would be judicious and consistent with a legitimate expectation that the
> contractual relationship between ICANN and a registry be subject to the
> national law of the latter. The foregoing is all the more reasonable given
> that the manager of a generic domain (TLD) is delegated broad powers, as it
> is within its scope to establish the purpose of the domain, the
> eligibility, or the terms of the assignment of domain names, not to mention
> that it has great freedom as to the way in which a domain is actually
> managed.
>
>
>
> There already exist special provisions for registries that are
> IGO/Governmental entities (section 7.16 registry agreement): if
> international law is at stake, there is a procedure (mediation and
> arbitration ex 5.2.) to resolve disputes between the registry and ICANN –
> this special provision could be extended:
>
> - To other registries that are not IGOs/Public authorities
>
> - To cover not only “international law obligations” but also
> national law obligations
>
>
>
>
>
> 2. *Issue: **arbitration clause*
>
>
>
> With regard to territorial jurisdiction, the arbitration clause (section
> 5.2 of the Registry Agreement entitled "Arbitration text for
> intergovernmental organizations or governmental entities") has allowed the
> ".swiss" registry to submit itself to the arbitration of the International
> Court of Arbitration of the International Chamber of Commerce in Geneva,
> Switzerland. This provision also provides for some flexibilities restricted
> to IGOs or governmental entities as regards the competent court.
>
>
>
> However these flexibilities are not open to all registry operators.
>
>
>
> *Possible solutions:*
>
>
>
> It would be wise in our opinion:
>
> - to also allow private registries to decide on the choice of their
> arbitration/competent court;
>
> - to broaden the possibilities of choice for all registries (by principle,
> to choose an arbitration recognized in each country.)
>
>
>
>
>
> ==
>
>
>
> Hope this may be considered.
>
>
>
> Regards
>
>
>
> Jorge
>
>
>
>
>
>
>
>
>
> *Jorge Cancio *
>
>
>
> International Relations
>
> Federal Department of the Environment,
> Transport, Energy and Communications DETEC
>
> Federal Office of Communications OFCOM
>
> Zukunftstrasse 44, CH 2501 Biel
>
> Tel. +41 58 460 54 58 (direct)
>
> Tel. +41 32 327 55 11 (office)
>
> Fax +41 58 460 54 66
>
> mailto: jorge.cancio at bakom.admin.ch
>
> www.bakom.admin.ch
>
>
>
> [image: cid:image001.png at 01D2F585.7A604270]
>
>
>
> Igf2017.swiss <https://igf2017.swiss/>
>
> info at igf2017.swiss
>
>
>
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--
Raphaël Beauregard-Lacroix
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<https://www.linkedin.com/in/rapha%C3%ABl-beauregard-lacroix-88733786/> -
@rbl0012 <https://twitter.com/rbl0112> - M: +33 7 86 39 18 15
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