In reconsideration request 00-9, the International Air Transportation Association (IATA) requests that the ICANN Board reconsider its November 16, 2000, decision on new TLDs, which did not include the IATA's application among the seven registry proposals selected.
CONTEXT OF RECONSIDERATION DECISIONS
[Because of their direct relevance to this reconsideration request, we repeat these observations about the new TLD process from RC 00-8.]
The Reconsideration Committee has received a number of reconsideration requests relating to the new TLD selection process of last year. Because all of these reconsideration requests relate to the same Board decision, the Committee concluded that it would be most efficient to preface its recommendations in that area with a general introductory statement.
There has been no large introduction of generic TLDs into the DNS for 15 years. Obviously, the Internet has changed dramatically during that period, and has become a critical resource for communication and commerce. Therefore, from the very beginning of the process of considering the introduction of new TLDs, the objective has been to go slowly and carefully to ensure that such introduction did not cause disruption or instability in the DNS or the Internet.
We note that this "walk-before-you-run" objective was the result of an exhaustive consensus development process, endorsed by a wide range of ICANN's stakeholders. Most notably, it was the stated recommendation of the two ICANN Supporting Organizations the Domain Name Supporting Organization (DNSO) and the Protocol Supporting Organization (PSO) that developed recommendations on new TLDs. In particular, we note that the DNSO recommendation was developed through the deliberations of an open working group over a period of nearly a year, with extensive input from the members of the various DNSO constituencies and the broader Internet community.
Given this objective, when the ICANN Board called for proposals for new TLDs, the clearly stated purpose was to find a limited number of diverse proposals which, taken in the aggregate, could safely be introduced and would likely produce enough information to enable ICANN and the community to make educated decisions about the speed and type of future TLD introductions. Since this was a unique process, both for ICANN and the community, the decisions and standards set for reaching this objective were inherently experimental. Thus, the only way to effectively measure the success of the effort is with its conclusion: Did it produce a "limited number" of sufficiently diverse proposals that the experience gained from their introduction will allow more educated decisions about possible future introductions.
This context is critical in determining the proper role of the reconsideration process here, and in the criteria that should be applied to reconsideration petitions, like this one, that assert that different selection decisions should have been made. Given the large number of submitted proposals, compared to the small number to be included in this proof of concept, it was inevitable that many proposals would not be selected. Likewise, given the experimental nature of this unique process, and the inherent subjectivity of many of the criteria established for the evaluation of proposals, it was inevitable that reasonable people could conclude that some different collection of proposals would be as well (or even better) suited for this proof of concept than those chosen. But the reconsideration process is neither intended nor suited for re-arguments on the merits, nor is useful to assert that different subjective judgements could have been made. The only real question is whether the process was fair, and whether the conclusion reached was rational, given the objective of the exercise.
We believe the process was eminently fair. All those proposing new TLDs had equal opportunities to provide information and to react to the evaluation team's report. All proposals were subject to public review and comment on an equal basis. The Board decision process was conducted in public, and resulted in a limited number (seven) of diverse proposals being selected for this initial proof of concept effort. Since it was clear from the beginning that only a limited number would be selected, no applicant could have had any reason to believe that its application would definitely have been selected, and thus no one can reasonably claim that they were misled in any way by the process -- which was in every respect fully open and transparent.
We also believe that the conclusion reached was rational. This is not to say that this particular collection of proposals was the only possible rational collection, nor that it was the "best" in some purely objective way. But it does reflect an appropriate number of proposals, providing a diversity of business models, registration policies, geographic connections and focuses, as well as sufficient technical and financial capacity to serve, in the aggregate, as an effective proof of concept.
Because we conclude the process was fair, and resulted in a rational conclusion that met the objectives of the exercise as announced at the beginning, there is no basis for reconsidering the Board's selections. Even if, for the purposes of argument, there were factual errors made, or there was confusion about various elements of a proposal, or each member of the Board did not fully understand all the details of some of the proposals, this would still not provide a compelling basis for reconsideration of the Board's conclusion. Given the uniqueness of this process, the inherent subjectivity of certain of the criteria involved, the inevitable difficulty of reaching consensus on a fact-intensive evaluation of many times the number of proposals that could possibly have been selected, and the limited objective of finding a small number of acceptable proposals for this initial proof of concept, it would not serve the interests of the community to essentially allow these decisions to be reargued on grounds over which, at best, reasonable people could differ. Given ICANN's stated goal in this process, which we believe has been met, there is no compelling reason to reconsider the Board's selections.
We want to comment specifically on two particular points.
First, the selection process provided for rigorous review of each proposal, while at the same time remaining open and transparent at every stage. Forty-seven applications were submitted by the deadline established; three of those were withdrawn for various reasons, and the remaining forty-four were published on ICANN's website and open to public comments. More than 4,000 public comments were received. The applications and the public comments were carefully reviewed by technical, financial, and legal advisors, who applied the criteria set forth in the various materials previously published by ICANN. The result of that extensive evaluation was a 326-page report, which summarized both the public comments and the analysis of the evaluation team. The evaluation team's report was posted on the ICANN website for public comment and review by ICANN's Board of Directors. More than 1,000 additional public comments were received on the staff report. The Board had access to the applications and the public comments as they were filed. Thus, the Board's decision on new TLDs was the product of many inputs from many sources. The sources of information the Board had at its disposal while making the decision on new TLDs were, among other things, the applications themselves, the comments posted on the on-line public comment forum, the independent expert evaluations of the applications, the applicants' responses to the expert evaluations, the public presentations, and a number of other reports and analyses such as those from ICANN constituencies and outside groups. The Board took into account these many different and sometimes competing information sources in seeking to achieve a reasonable proof of concept for the new TLD program.
Second, it should be clear that no applications were rejected; the object was not to pick winners and losers, but to select a limited number of appropriate proposals for a proof of concept. All of the proposals not selected remain pending, and those submitting them will certainly have the option to have them considered if and when additional TLD selections are made.
While the above analysis could, in and of itself, justify a recommendation by this Committee to deny each of the reconsideration requests dealing with the new TLD process, we have chosen to also deal with each of the specific factual and procedural issues raised in those requests.
ANALYSIS OF REQUEST
The specific reasons for reconsideration set forth in the IATA reconsideration request are discussed below.
The IATA request argues that ICANN failed to comply with the United States Administrative Procedure Act ("APA"), 5 U.S.C. 553 et seq., in reaching its new TLD selections. In support of this argument, the IATA asserts that ICANN is subject to the requirements of the APA because ICANN: (1) was created at the request of the U.S. Government; (2) serves at the pleasure of the U.S. Government; and (3) is performing a government policy-making function. The IATA's argument is based on an improper application of the APA that stems from a fundamental misunderstanding of ICANN's history and current operations.
ICANN is a non-profit private sector organization with a 19-member international volunteer Board of Directors drawn from a set of specialized technical and policy advisory groups, and from an online voting process of Internet users worldwide. Through a series of Supporting Organizations, Advisory Committees and Working Groups, it functions as a consensus development body for certain technical and administrative management issues related to the name and address functions of the Internet.
Several years ago, the United States government was confronted with the fact that its agency assignments for the coordination of its Internet activities were seriously lagging the rate at which the Internet was growing, especially in areas related to commercial use. In the face of this very real problem, the United States government sought to extract itself from a role it concluded was no longer appropriate for the United States government. ICANN is the end result of an extensive policy development process, both within the United States Government and within the global Internet community, to solve that problem. During 1997 and 1998, a framework for private sector management of the Internet's domain name and address systems was developed and put into writing in the form of a policy document known as the White Paper.
The White Paper, which was issued in June 1998, proposed that the private sector undertake management of these functions through the formation of a private, non-profit corporation, and it outlined the substantive responsibilities of the new organization and a number of guiding principles for its work. Several months of public meetings and dialogue followed in the summer of 1998, during which the White Paper framework was turned into a specific charter and set of Bylaws. ICANN was incorporated in September of that year by private individuals, with no government charter or funding. Following its incorporation, ICANN entered into a Memorandum of Understanding/Joint Project Agreement with the US Department of Commerce. The MOU has subsequently been amended twice and currently has a term expiring on September 30, 2001.
The White Paper identified four principal areas of responsibility for the new private sector consensus organization: coordination of the Internet Domain Name System; overseeing operation of the authoritative root server system; coordination of the Internet Protocol (IP) Address space; and coordinating the assignment of Internet technical parameters. As recognized in the White Paper, these four functions were broadly seen by the global Internet community as requiring coordinated action to assure the smooth and reliable operation of the Internet. The MOU represents the United States government's recognition of the efforts by ICANN to undertake these responsibilities, and its willingness to support that effort.
Thus, the IATA request is inaccurate in its assertions that ICANN was created at the request of, and to serve at the pleasure of, the United States government to perform a United States government policy-making function. Rather, ICANN is a unique private-sector entity that is undertaking a variety of functions, some of which were previously undertaken by United States government contractors and some of which were purely voluntary efforts by private citizens around the world. Its role is not to perform policy-making functions of the United States government but to serve as a private sector consensus development organization with the purpose of assuring the stability of the Domain Name System and the Internet for the benefit of the global Internet community.
The cases the IATA cites demonstrate a misunderstanding of the applicability of the APA to ICANN. In Lebron v. National Rail Passenger Corp, 513 U.S. 374 (1995), the U.S. Supreme Court held that entities qualify as instrumentalities of the government only if (1) the entity was created by special law, (2) the entity was created for the purpose of pursuing governmental objectives, and (3) the government controls the entity. See Lebron, 513 U.S. at 400. None of these are true of ICANN. The White Paper stresses the importance of transitioning DNS management from government control to the private sector: "[T]he U.S. [government] continues to believe, as do most commenters, that neither national governments acting as sovereigns nor intergovernmental organizations acting as representatives of governments should participate in management of Internet names and addresses. Of course, national governments now have, and will continue to have, authority to manage or establish policy for their own ccTLDs. See White Paper, at 4 ("Creation of the new Corporation and Management of the DNS.")
Nor is Independent Bankers Ass'n v. National Credit Union Administration, 936 F. Supp. 605, 615 (W.D. Wis. 1996), to the contrary. Like credit unions in that case, which are cooperatives run by their members acting through their board of directors and not the federal government, ICANN does not "act with the sanction of the government." Independent Bankers, 936 F. Supp. at 614.
Finally, the IATA's suggestion that ICANN is subject to the APA because it has been "delegated substantial decision-making authority in the exercise of specific functions" is without merit. Unlike the Federal Reserve Bank that was the subject of Lee Construction Co. v. Federal Reserve Bank of Richmond, 558 F. Supp. 165, 179 (D. Md. 1982), ICANN neither has nor has been delegated a substantial amount of any United States government entity's decision-making authority. ICANN's only "authority" derives from the voluntary cooperation of members of the Internet community, or from private contracts voluntarily entered into with other private entities. By definition, this is not "governmental" authority.
IATA argues that even if the APA does not apply, ICANN's Bylaws and the MOU require that ICANN operate "in an open and transparent manner and consistent with procedures designed to ensure fairness." That is an accurate statement. As discussed further below, we believe that ICANN's process for selecting TLD applications for the "proof of concept" phase was both designed to and did in fact comply with the requirements of openness, transparency, and fairness outlined in ICANN's Bylaws and MOU.
The IATA request contends that because "[n]either the Staff Report nor the Board deliberations reflect any disagreement" with the IATA's supplemental outline of the manner in which the IATA application satisfied the nine criteria announced on August 15, 2000, "one can only conclude" that "the nine announced criteria were simply ignored." The Committee finds no merit in this objection.
First, IATA's argument incorrectly suggests that it would have been possible for the IATA application, or any other application, to fully "satisfy" the nine criteria used for evaluation. In fact, full "satisfaction" of the criteria is not a meaningful concept because, as written, certain of the criteria necessarily had to be applied to an aggregate evaluation of all the applications taken together. For example, criterion 6 considered "the extent to which the proposal would enhance the diversity of the DNS and of registration services generally." It would not make sense to describe this criteria as fully "satisfied" by any one application; rather the "extent to which" this criterion could be achieved by a particular application required a continuing review of the various other proposals under consideration at any given time. Likewise, criterion 2 considered "the extent to which selection of the proposal would lead to an effective 'proof of concept' concerning the introduction of top-level domains in the future." This criterion, too, was to be used as a guideline when considering all the applications together so that ICANN could select a limited number of applications that, taken in the aggregate, would satisfy the evaluation objectives of the proof of concept phase.
Second, this objection amounts to an effort to substitute IATA's judgment for that of the Board. IATA and other private entities were invited to participate in the new TLD process if they chose to do so -- and those who did choose to participate did so voluntarily, knowing that the odds of being selected were not high, and that the criteria for being included in the "proof of concept" experiment were in some measure subjective. Of course, when many more applications were received than could be prudently introduced at this stage, some evaluation was necessary to attempt to identify those applications that might best fit the experimental parameters. Importantly, this was never a process in which the absolute or relative merit of a particular application was determinative. Therefore, "satisfaction" of all nine criteria (if that were possible) could not, as IATA argues, require that they be included in the proof of concept. Indeed, as IATA and all other applicants acknowledged in writing at the outset, ICANN had the right to not accept any and all applications in its sole discretion.
The IATA request argues that "a hitherto unspecified tenth criterion, 'representativeness,' was applied . . . ." IATA is simply mistaken in its assertion that "representativeness" was not an announced criterion.
Representativeness, or the ability of the applicant to demonstrate that it would include participation of all segments of the communities that would be most affected by the TLD, was a significant criterion in the evaluation process, particularly for sponsored TLD proposals. The importance of representativeness to the evaluation process for sponsored TLDs was not only announced at the very beginning of this process, but reiterated several times in the months preceding and during the application process. For example, the point was made in the ICANN-staff-prepared document entitled "ICANN Yokohama Meeting Topic: Introduction of New Top-Level Domains," which was posted June 13, 2000:
Proponents of limited-purpose TLDs have advocated a "sponsorship" paradigm, in which policy-formulation responsibility for the TLD would be delegated to an organization that allows participation of the affected segments of the relevant communities. The sponsoring organization would have authority to make decisions regarding policies applicable to the TLD, provided they are within the scope of the TLD's charter and comport with requirements concerning interoperability, availability of registration data, and the like intended to ensure that the interests of the overall Internet are served. For example, the TLD .museum might be sponsored by an association of museums and the .union TLD might be sponsored by a group of labor unions. In many respects, the sponsorship paradigm is a generalization of the concepts underlying appointment of managers for ccTLDs under existing ccTLD delegation policy. [Emphasis added.]
The same point was a basic component of Criterion 7 of the "Criteria for Assessing TLD Proposals," posted August 15, 2000:
The Domain Name System is a hierarchical system that facilitates delegation of policy-formulation authority for particular TLDs. In the context of unsponsored TLDs, this can appropriately be accomplished for many operational matters by giving the registry operator flexibility in the registry contract. For restricted TLDs, some have suggested a "sponsorship" model, in which policy-formulation responsibility for the TLD would be delegated to a sponsoring organization that allows participation of the affected segments of the relevant communities. Proposals will be analyzed to determine whether they offer the opportunity for meaningful, real-world evaluation of various structures for appropriate delegation of policy-formulation responsibilities, as well as evaluation of various allocations of policy-formulation responsibilities between ICANN and sponsoring organizations. [Emphasis added.]
Thus, ensuring "representativeness" from the industry affected by the application for a sponsored TLD was not only an announced criteria for the evaluation process, but a criterion that was intended to receive great emphasis for applications for sponsored TLDs, including the IATA <.travel> application. IATA was asked to provide ICANN with information about representativeness, and it did. The contention that representativeness was an unanticipated criterion is entirely without merit and does not warrant reconsideration.
The IATA request ultimately argues that even if representativeness was a proper consideration for the Board, the Board should have either concluded that the proposed TLD was representative, or concluded that a lack of representativeness was dispositive. Neither of these arguments suggests a procedural failure of process justifying reconsideration. The Board members had many sources of information at their disposal from which informed conclusions could be drawn about the representativeness of a particular proposal. And, as stated above, representativeness was an important criterion for all sponsored TLD applications.
The IATA request states that the staff report "perfunctorily rejected the IATA application." This objection does not justify reconsideration. In the Committee's view, "perfunctory" does not aptly describe the manner in which the staff or the Board evaluated the new TLD proposals. While the staff report discussion of the IATA application's perceived lack of representativeness was succinct, it would be improper to conclude on that basis that the staff or Board evaluations were "perfunctory." Indeed, the extensive report the ICANN staff and technical consultants prepared was the result of a detailed review of the applications and public comments by technical, financial, and legal advisors. The 326-page staff report summarized both the public comments and the staff evaluation. A great deal of time and effort was spent evaluating the applications for new TLDs.
The IATA request states that the APA calls for government agencies to refrain from engaging in ex parte communications with interested parties and, that one Board member, by stating that he had "received substantial negative email about this application, and no positive email," inappropriately took into account ex parte information.
As explained above, ICANN is not a United States government agency and the APA does not apply to ICANN. Nonetheless, the Committee shares the IATA's concern that all communications regarding new TLD applications be public. One of ICANN's core principles is bottom-up consensus development that is the result of open and transparent interactions with the full range of private-sector organizations. To this end, ICANN goes to great lengths to ensure that the vast bulk of ICANN's work is transparent to the public, with very rare exception (such as matters dealing with personnel issues).
A large number of public comments, both positive and negative, were received regarding the <.travel> TLD application. In addition, as is unavoidable, Board members received some unsolicited email pertaining to the .travel application and others. Significantly, the email comments received by individual Board members regarding the .travel application did not reflect new, or unique, concerns not also expressed via the public comment forum. As there is no indication that any Board member relied on private email communications to the exclusion of public comments that were of the same tenor, this objection does not warrant reconsideration of the <.travel> application.
The IATA complains that it was subject to different treatment than other "similarly situated" applicants. Specifically, the IATA first complains that another application, .museum, received negative comments about lack of unanimous endorsement of the museum community but it was nonetheless selected. The IATA's argument suggests an inappropriate comparison of apples and oranges; the .museum and .travel applications contain significant differences. For example, the proposed .museum TLD would serve a comparatively small number of registrants (approximately 10,000) in relation to the proposed <.travel> TLD (approximately 675,000 to 759,000). In addition, the .museum application received a total of 25 comments whereas the .travel TLD received 5 or 6 times that number and the comments reflected a much wider variety of positive and negative reaction to the proposal. The state of the record on the IATA application included significant concerns about whether it would in fact be appropriately representative of the portion of the community that it wished to represent. Given the uncertainties created by that record, it was appropriate for the Board to look elsewhere for the "limited number" of proposals needed for this initial proof of concept.
The IATA also complains that another "restricted commercial" category applicant, ".pro" was selected despite no showing of representativeness of the targeted community. This objection is also a comparison of apples to oranges; unlike the .travel TLD application, the .pro application was not for a sponsored TLD.
The IATA argues that the classification of its application in the "restricted commercial" category was "unexplained, arbitrary, and erroneous" and "prejudicial to its fair consideration." The classifications at issue were merely a device used by the staff evaluation report to help structure discussions and comparisons among the numerous applications. The placement of the IATA application in the "restricted commercial" category was not arbitrary; rather, useful considerations such as the number of registrants that would be served were taken into account when the various categories were created. Even assuming that the IATA .travel application might better have been placed in a different category, it does not follow that classification in the "restricted commercial" category harmed its chances of being approved by the Board. On the contrary, each application was considered on its own merits, regardless of its categorization in the staff evaluation report.
The IATA request also argues that ICANN should supply applicants with "reasoned rationale" for the Board's decision whether to accept a given new TLD proposal. The new TLD application selection process was designed to give a full and fair opportunity to each applicant to present its new TLD application and have it evaluated by the individual Board members, with input from the ICANN staff, independent experts, and the general public. As discussed above, IATA voluntarily chose to participate in the new TLD application process knowing that the odds of being selected were not high and that the criteria for being included in the "proof of concept" experiment were in some measure subjective. It is certainly conceivable that some different subset of the applications the Board had before it would have met the "proof of concept" objective as well as those chosen, but the real question is whether the applications selected were reasonable, and whether the process was fair. We believe it was.
The IATA's final complaint is that the three-minute presentations by the forty-four TLD applicants at the Public Forum on November 15, 2000 "did not allow sufficient time for applicants to make a proper presentation to the Board to enable it to reach a principled decision on the proposals. To remedy this, the Board should, upon reconsideration, hold a hearing at which a more reasonable amount of time is allotted." Oral presentations at the public forum were never intended to be a primary source of information for the Board, and the Committee does not believe this objection justifies reconsideration.
On the contrary, the new TLD proposal process was designed to encourage applicants to submit all supporting information on the record, in public, with adequate opportunity for the rest of the community to review and respond to it. Voluminous applications (with many hundreds of pages) were filed by each applicant; many of the applicants received and answered clarifying questions from the staff; and many of the applicants provided additional information by filing material on the ICANN public comment page (every one of the 5,000 plus comments was read by ICANN staff). The Board had access to the applications and to the staff evaluations well ahead of the public Board meeting at which the applications were reviewed.
The opportunity to make a presentation at the public forum was simply the final step in an extensive process, available so that any last-minute questions could be asked or points made. Since there were forty-four applicants, nearly all of whom wished to speak, and since the time available for the applicants (given the other parts of the community who also wished to be heard) was limited to about two hours, three minutes was simply all the time available.
Since this reconsideration request was submitted by the United States Travel Agent Registry (USTAR), signed by a number of individuals in the travel industry. That comment was posted on the ICANN website, and IATA was invited to respond. The IATA response was followed by a "Point of Order" from Bruce Bishins of USTAR, which generated an IATA response, which was in turn followed by a USTAR rebuttal. Most of the arguments raised in this set of point/counterpoint correspondence arise from meetings and events that have occurred after the Board's November 2000 meetings at which the first set of new TLD registries were selected; the remaining points essentially re-argue to the underlying question of whether IATA is an appropriate sponsor for a restricted travel-focused TLD. None of the arguments raised by USTAR or IATA in this subsequent correspondence alters the Reconsideration Committee's conclusions.
The Reconsideration Committee finds in this request no basis for reconsideration of the Board's November 16 new TLD decision. We recommend that the Board take no action in response to this request.
[NOTE: Director Abril i Abril did not participate in the committee's consideration of Reconsideration Request 00-9.]
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