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Internet Corporation for Assigned Names and Numbers

Introduction

At its meeting on 20 February 2003, the GNSO Council voted unanimously to accept the Final Report of the GNSO Transfers Task Force and to forward it to the ICANN Board as a consensus-policy recommendation. The report will be discussed at the ICANN Public Forum session to be held on Wednesday, 26 March 2003, and will be considered by the ICANN Board at its meeting on Thursday, 27 March 2003. Both the Public Forum and the Board meeting will be held in Rio de Janeiro, Brazil.

This paper summarizes the history that led to completion of the task force's Final Report and the issues for discussion at the Public Forum and consideration by the Board.

Written comments are invited. They should be submitted no later than Monday, 24 March 2003 by sending an e-mail to <transfers-comments@icann.org>.

I. Procedural Background

A. The Current Framework

The shared registry system implemented for the .com, .net, and .org top-level domains (TLDs) in 1999 (and extended to the other new TLDs as they were introduced in 2001) creates a competitive environment among accredited registrars. To permit effective competition, registrants not only may choose among registrars at the time of their initial registration, but also may choose to transfer their registrations between registrars during the term of their registration. To initiate a transfer, the registrant contacts the registrar to which the registration is to be transferred (the "gaining registrar"). That registrar then sends a transfer request to the registry operator, which contacts the existing registrar (the "losing registrar") to determine whether there is any objection to the transfer. Unless the losing registrar makes an objection, the transfer by the registry operator is made after five days. When the transfer is made, the registration is extended by one year, with the gaining registrar paying the registry operator a transfer fee equal to the fee for a one-year renewal.

For the unsponsored TLDs (.biz, .com, .info, .name, .net, .org, and .pro), the procedure for transfers of registrations between registrars is described in each registrar's agreement with each registry operator. They are all essentially identical. For sponsored TLDs (.aero, .coop, and .museum), the procedures for transfers between registrars are set by the top-level domain's sponsor.

B. The Problem

In early 2001, several registrars began expressing concerns regarding allegedly inappropriate denials of requested transfers, including substantial delays, confusing processes, and a lack of coordination from losing registrars. Other registrars expressed concern regarding transfer requests that had allegedly been initiated by gaining registrars without adequate registrant authorization.

These differing concerns led to disputes under the Registry-Registrar Agreements. Specifically, some registrars sought to address their concerns over unauthorized transfer requests by seeking to independently verify that each transfer request initiated by another registrar had in fact been authorized by the registrant. If these losing registrars did not receive confirmation confirmation from the registrants, they objected to the request, resulting in the transfer being cancelled. Upon receiving complaints from various registrars regarding this practice, VeriSign Registrar asked for ICANN's guidance. In response, on 27 August 2001 ICANN's General Counsel advised VeriSign Global Registry Services (then the operator of .com, .net, and .org) that:

1. The responsibility for ensuring that a Registered Name Holder authorizes the transfer lies with the gaining registrar, not the losing registrar.

2. This allocation of responsibility should not prevent the losing registrar, as an additional measure, from seeking to inform Registered Name Holders of impending transfers and affording them an opportunity to express their objection.

3. The losing registrar may not deny a transfer request that the gaining registrar has verified merely because the losing registrar has not verified it. Thus, a losing registrar should not deny a transfer request simply because it has notified the Registered Name Holder of the request and has not received a response.

4. The losing registrar may, however, deny the transfer request where it has an adequate reason for believing that the Registered Name Holder has not authorized the transfer.

The topic of registrar-transfer rules was extensively discussed by the DNSO registrars constituency in July-September 2001. After extensive drafting and discussion, a final document with extensive guidance on practices concerning transfers was produced, and endorsed by a majority of the registrars. However, there was not complete acceptance among registrars, and different practices were followed by various registrars.

Shortly before the September 2001 ICANN Meeting in Montevideo, Uruguay, the issues concerning inter-registrar transfers came to the attention of other constituencies. These other constituencies felt that their members were affected by the issues and had an interest in achieving an appropriate solution. Accordingly, the issue was discussed by the DNSO Names Council at its meeting on 11 October 2001. At that meeting, the Names Council created a task force to analyze the issues and recommend solutions.

C. Task Force Actions

The Task Force engaged in extensive outreach to the impacted communities over fourteen months, including 8 open teleconferences, 3 in-person open meetings, 8 conferences and briefings involving the Registrars Constituency, and 3 Names Council or cross-constituency meetings. Following these extensive consultations, the Task Force published a report in advance of the ICANN Meetings in Shanghai in October 2002. Comments were received from the public from 16 October 2002 through 12 November 2002.

D. Task Force Report

The first version of the Transfers Task Force Final Report was posted on 30 November 2002. It built on previous reports and proposed various changes in the manner by which registrars handle transfer requests. It described high-level principles to guide policy, provided extensive policy recommendations, and described where consensus existed and where it did not. Finally, it established some areas where unresolved work items existed. The report was posted for public comment from 30 November 2002 through 8 December 2002. On 12 December 2002, the report was revised to include the public comments received, and was presented for action by the DNSO Names Council.

E. Names Council Action – 14 December 2002

At its Amsterdam Meeting on 14 December 2002, the DNSO Names Council accepted the policy recommendations that were set forth in the Transfers Task Force Report of 30 November. The Names Council further approved the formation of an implementation analysis committee to review the impact and implementation issues implied by the Task Force's report.

F. Transfers Implementation Committee

The Transfers Implementation Committee consisted of representatives of registrars, registry operators, and the task force, and was chartered to evaluate the manner in which the policy recommendations approved by the DNSO Names Council could be implemented and to prepare a statement of the costs and impacts of implementation, taking into account significant implementation or operational concerns. The committee analyzed each of the report's twenty-nine specific recommendations, and analyzed potential obstacles to the implementation of the recommendations and any undue burden or unintended consequences that may occur as a result of the implementation on registrants, registrars and gTLD registries.

On 30 January 2003, the Transfers Implementation Committee filed its final report with the GNSO Council. The Transfers Task Force consulted with the Implementation Committee, and incorporated its suggestions into the Task Force Report.

G. Final Task Force Report

On 12 February 2003, the Transfers Task Force Final Report on Gaining and Losing Registrars was updated to include feedback from the Transfers Implementation Committee.

H. GNSO Council Action on 20 February 2003

The GNSO Council (which replaced the DNSO Names Council when the New Bylaws became effective on 15 December 2002) considered the Final Report of the Transfers Task Force, with its analysis of implementation methods and impacts as well as the additional public and registrars constituency comments, at its teleconference on 20 February 2003. At that meeting, the GNSO Council unanimously accepted the Final Report and forwarded the report to the ICANN Board as a consensus policy recommendation.

II. Board Consideration

Under the ICANN Bylaws, the GNSO is responsible for developing and recommending to the ICANN Board substantive policies relating to gTLDs. The GNSO is intended to follow the Policy Development Process (GNSO-PDP) that appears as Annex A to the New Bylaws that became effective on 15 December 2002, but the transition to that process is still underway. Because consideration of the transfers issue occurred in large part before 15 December 2002, those procedures were not available during most of the task force's work. Indeed, the Transfers Task Force report was originally accepted by the Names Council on 14 December 2002, the day before the transition to the GNSO began.

A. Requirements of the GNSO-PDP

Nonetheless, the basic requirements of item 11 of GNSO-PDP can be applied to GNSO Council Reports to the Board recommending adoption of policies. GNSO-PDP item 11 lists the following report elements:

a. A clear statement of any Supermajority Vote recommendation of the Council;

b. If a Supermajority Vote was not reached, a clear statement of all positions held by Council members. Each statement should clearly indicate (i) the reasons underlying each position and (ii) the constituency(ies) that held the position;

c. An analysis of how the issue would affect each constituency, including any financial impact on the constituency;

d. An analysis of the period of time that would likely be necessary to implement the policy;

e. The advice of any outside advisors relied upon, which should be accompanied by a detailed statement of the advisor's (i) qualifications and relevant experience; and (ii) potential conflicts of interest;

f. The Final Report submitted to the Council; and

g. A copy of the minutes of the Council deliberation on the policy issue, including the all opinions expressed during such deliberation, accompanied by a description of who expressed such opinions.

B. Compliance with the GNSO-PDP Requirements

The GNSO Council Report contains the following elements in line with item 11 of the GNSO-PDP:

a. The recommendations of the Transfers Task Force Final Report on Gaining and Losing Registrars were approved by a 14-0 vote of the GNSO Council. This meets the GNSO-PDP's definition of a Supermajority Vote.

b. Since the report was approved unanimously, item 11(b) (a statement of all council member positions) is not applicable.

c. The Transfers Task Force's Final Report provides a detailed section entitled "Impact, Cost, and Risk Analysis" that analyzes the impacts of the recommendations on registrants, registrars, and registry operators. Each constituency is being invited to provide its own analysis of the expected impact for consideration by the ICANN Board and community in advance of the ICANN meetings in Rio de Janeiro.

d. The Transfers Task Force and the Implementation Committee considered the question of implementation time periods in the course of their discussions. The participants estimated that technical changes needed to bring registries and registrars into compliance with the proposed new transfers framework would take three to six months. Policy and legal implementation details and timelines will be discussed in a forthcoming staff report to the Board.

e. No outside advisors were relied on in preparing the comments are provided in the Final Report with details of advisor's qualifications and potential conflicts of interest

f. The Transfers Task Force Final Report on Gaining and Losing Registrars approved by the GNSO Council on 20 February 2003 is posted at <http://www.icann.org/gnso/transfers-tf/report-12feb03.htm>, and

g. The minutes of the GNSO Council's deliberation prior to unanimously approving the Transfers Task Force Final Report are available at <http://www.dnso.org/dnso/notes/20030220.GNSOteleconf-minutes.html>.

III. Board Actions

The task force's Final Report contains "Consensus Policy Recommendations" in twenty-nine numbered paragraphs. Since these recommendations were supported by a Supermajority Vote of the GNSO Council, the provisions of item 13 of the GNSO-PDP provide that "the Board shall adopt the recommendation unless more than sixty-six (66%) percent of the Board determines that such policy is not in the interests of the ICANN community or ICANN." In the event that the Board rejects the recommendations, it must return to the GNSO Council a "Board Statement" articulating the reasons for its determination. The GNSO-PDP then establishes a process for consultation between the Board and GNSO Council to resolve any differences.

In the event that the recommendations are adopted by the Board, the Board will give the ICANN staff appropriate direction for implementation.

IV. Public Comment Invited

Comments are invited from all concerned on the Final Report and Recommendations of the GNSO Council's Transfers Task Force Final Report, on the GNSO Council's recommendations, and on the actions that the Board should take. Comments may be submitted electronically until Monday, 24 March 2003, by sending them to <transfers-comments@icann.org>. Submissions will be archived at <http://forum.icann.org/transfers-comments/>.

Commentary is particularly sought concerning the costs and benefits to various groups of implementation of the recommendations and on the time reasonably required for their implementation.

In addition, a portion of the ICANN Public Forum on Wednesday, 26 March 2003, in Rio de Janeiro, Brazil, will be devoted to public discussion of the transfers issue.