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Exclusive: Tiny island sues to take control of lucrative .nu

Kevin Murphy, November 28, 2018, Domain Registries

The tiny Pacific island of Niue has sued the Swedish ccTLD registry to gain control of its own ccTLD, .nu, DI has learned.

The lawsuit, filed this week in Stockholm, claims that the Internet Foundation In Sweden (IIS) acted illegally when it essentially took control of .nu in 2013, paying its American owner millions of dollars a year for the privilege.

Niue wants the whole ccTLD registry transferred to its control at IIS’s expense, along with all the profits IIS has made from .nu since 2013 — many millions of dollars.

It also plans to file a lawsuit in Niue, and to formally request a redelegation from IANA.

While .nu is the code assigned to Niue, it has always been marketed in northern Europe, particularly Sweden, in countries where the string means “now”.

It currently has just shy of 400,000 domains under management, according to IIS’s web site, having seen a 50,000-name slump just a couple weeks ago.

It was expected to be worth a additional roughly $5 million a year for the registry’s top line, according to IIS documents dated 2012, a time when it only had about 240,000 domains.

For comparison, Niue’s entire GDP has been estimated at a mere $10 million, according to the CIA World Factbook. The island has about 1,800 inhabitants and relies heavily on tourism and handouts from New Zealand.

According to documents detailing its 2013 takeover, IIS agreed to pay a minimum of $14.7 million over 15 years for the right to run the ccTLD, with a potential few million more in performance-related bonuses.

The Niue end of the lawsuit is being handled by Par Brumark, a Swedish national living in Denmark, who has been appointed by the Niuean government to act on its behalf on ICANN’s Governmental Advisory Committee, where he is currently a vice-chair.

Brumark told DI that IIS acted illegally when it took over .nu from previous registry, Massachusetts-based WorldNames, which had been running the ccTLD without the consent of Niue’s government since 1997.

The deal was characterized by WorldNames in 2013 as a back-end deal, with IIS taking over administrative and technical operations.

But IIS documents from 2012 reveal that it is actually more like a licensing deal, with IIS paying WorldNames the aforementioned minimum of $14.7 million over 15 years for the rights to manage, and profit from, the TLD.

The crux of the lawsuit appears to be the question of whether .nu can be considered a “Swedish national domain”.

IIS is a “foundation”, which under Swedish law has to stick to the purpose outlined in its founding charter.

That charter says, per IIS’s own translation, that the IIS “must particularly promote the development of the handling of domain names under the top-level domain .se and other national domains pertaining to Sweden.”

Brumark believes that .nu is not a national domain pertaining to Sweden, because it’s Niue’s national ccTLD.

One of his strongest pieces of evidence is that the Swedish telecoms regulator, PTS, refuses to regulate .nu because it’s not Swedish. PTS is expected to be called as a witness.

But documents show that the Stockholm County Administrative Board, which regulates Foundations, gave permission in 2012 for IIS to run “additional top-level domains”.

Via Google Translate, the Board said: “The County Administrative Board finds that the Foundation’s proposed management measures to administer, managing and running additional top-level domains is acceptable.”

Brumark thinks this opinion was only supposed to apply to geographic gTLDs such as .stockholm, and not to ccTLD strings assigned by ISO to other nations.

The Stockholm Board did not mention .nu or make a distinction between ccTLD and gTLDs in its letter to IIS, but the letter was in response to a statement from an IIS lawyer that .nu, with 70% of its registrations in Sweden, could be considered a Swedish national domain under the IIS charter.

Brumark points to public statements made by IIS CEO Danny Aerts to the effect that IIS is limited to Swedish national domains. Here, for example, he says that IIS could not run .wales.

IIS did not respond to my requests for comment by close of business in Sweden today.

Niue claims that if .nu isn’t Swedish, IIS has no rights under its founding charter to run it, and that it should be transferred to a Niuean entity, the Niue Information Technology Committee.

That’s a governmental entity created by an act of the local parliament 18 years ago, when Niue first started its campaign to get control of .nu.

The history of .nu is a controversial one, previously characterized as “colonialism” by some.

The ccTLD was claimed by Boston-based WorldNames founder Bill Semich and an American resident of the island, in 1997. That’s pre-ICANN, when the IANA database was still being managed by Jon Postel.

At the time, governments had basically no say in how their ccTLDs were delegated. It’s not even clear if Niue was aware its TLD had gone live at the time.

The official sponsor of .nu, according to the IANA record, is the IUSN Foundation, which is controlled by WorldNames.

Under ICANN/IANA policy, the consent of the incumbent sponsor is required in order for a redelegation to occur, and WorldNames has been understandably reluctant to give up its cash cow, despite Niue trying to take control for the better part of two decades.

The 2000 act of parliament declared that NITC was the only true sponsor for .nu, but even Niuean law has so far not proved persuasive.

So the lawsuit against IIS is huge twist in the tale.

If Niue were to win, IIS would presumably be obliged to hand over all of its registry and customer data to Niue’s choice of back-end provider.

Both Afilias and Danish registrar One.com have previously expressed an interest in running .nu, providing a share of the revenue to Niue, according to court documents.

Brumark said that a settlement might also be possible, but that it would be very costly to IIS.

Readers might also be interested in my 2011 article about Niue, which was once widely referred to as the “WiFi Nation”.

ROTD conducts first new gTLD auction as One.com wins .one

Kevin Murphy, February 25, 2014, Domain Sales

Danish registrar One.com has won the .one contention set in the first private auction carried out by new gTLD consultancy Right Of The Dot.

One.com beat Radix, the United Arab Emirates-based portfolio applicant, to the string. Radix withdrew its application last week. The price has not been disclosed.

ROTD, Mike Berkens and Monte Cahn-managed company, has been competing with Applicant Auction for contention set resolution services and this is its first win.

The .one auction was carried out using a “single sealed bid second price” methodology, in which all participants privately submit a single bid and the winner pays the second-highest losing bid.

In this case, One.com will have paid Radix whatever bid Radix had put forward, with ROTD and escrow partner Escrow.com taking their fees from the winning bid.

Applicant Auction uses an “ascending clock” method, where bids are set in increments by the auctioneer over the space of several rounds, with bidders choosing to stay in or drop out in each round.

Cahn said in a press release: “Our Single Sealed Bid Second Price auction method protects the participants from ‘auction fever,’ which often causes over-bidding as people get emotionally tied to the process of winning at any cost due to time committed and sometimes throw their budgets out the window.”

Registrar banned from Swedish namespace

Kevin Murphy, September 14, 2010, Domain Registrars

A Danish registrar has been banned from selling .se domain names for 30 days after it registered a “large number” of names on behalf of customers but without their permission.

The Internet Infrastructure Foundation, which runs .se, had this to say (translated from Swedish):

One.com has registered during the summer a large number of domain names without having a mandate from customers. In several cases, inaccurate customer data has been used. This means that today there may be customers who are not aware that domain names are registered on their behalf.

One.com reportedly defended itself by saying it merely renewed names on its customers’ behalf, to prevent them losing their domains.

The company needs to rectify the situation within the month, or it faces a permanent ban.

UPDATE: One.com has released a statement explaining its side of the story.

It seems the company made its unauthorized renewals following a little customer confusion over recent billing changes made at the registry end. Here’s a PDF explaining its position. (thanks @findub)