IGOs plead for special new gTLD protections

Twenty-eight intergovernmental organizations, including the UN, ITU and WIPO, have asked ICANN for special protection for their acronyms in the new top-level domains program.
A letter sent to ICANN earlier this week and obtained by DI, reads:

we formally request ICANN to make provision for a targeted exclusion of third party registrations of the names and acronyms of IGOs both at the top and second level, at least during ICANN’s first application round and until further appropriate policy could be developed.

It goes on to claim that fighting abusive domain registrations and enforcing rights diverts funds from causes such as famine relief, scientific research and children’s rights.
For the sake of brevity, this is the list of the letter’s signatories in acronym form only: AfDB, EBRD, ESO, CERN, ESA, IADB, IAEA, IFAD, ILO, IMO, IMF, IOM, ITU, NIB, NATO, OECD, OPCW, UN, UNESCO, UNIDO, UPU, WB, WHO, WIPO, WMO, UNWTO, and WTO.
The letter justifies its request by citing the rights given to IGO names under the Paris Convention for the Protection of Industrial Property.
It’s a pretty flimsy argument. The Paris convention does not give IGOs exclusive rights to strings. It may protect the World Bank abbreviation WB, for example, but not to the extent that Warner Brothers can’t also use it to market movies.
The letter also cites ICANN’s Governmental Advisory Committee, which called for IGOs to be protected in its March 2007 GAC Principles regarding New gTLDs advice.
The Principles, however, talk about IGOs in the same breath as regular trademark owners, which is exactly how the new gTLD Applicant Guidebook treats them today.
There is some ICANN precedent for giving in to this kind of special pleading, however.
The latest Guidebook makes several dozen trademarks relating to the Red Cross, Red Crescent and Olympic movements “ineligible for delegation” as gTLDs, but offers them no second-level protection.
It was noted at the time the decision was made – at the behest of the GAC – that giving the Olympics special treatment would create a slippery slope to a full-blown Globally Protected Marks List, a concept ICANN has already rejected.
The UN et al only really have a shot at getting what they want if they can get the GAC on side, and several influential GAC members have already stated that the Olympic/Red Cross case was unique.
I think the response from ICANN will be a letter from president Rod Beckstrom politely declining the request and inviting its signatories to participate in the ICANN community.

Will ICANN approve cheap gTLDs for poor applicants?

One of the big questions at ICANN’s 42nd public meeting in Dakar next week is whether the board of directors plans to approve subsidized new gTLD application fees for worthy applicants.
A volunteer working group known as JAS came up with a set of recommendations last month that would lower the $185,000 fee for applicants from developing nations with public benefit missions.
It was a wide-ranging set of proposals that would stretch beyond the scope of the $1 million to $2 million ICANN approved for applicant support initiatives at its last meeting in June.
Chiefly, JAS wants the application fee reduced to $45,000 for qualified developing-world applicants, meaning ICANN would have to find the funds to cover the $140,000 shortfall elsewhere.
In addition, JAS wants ICANN to set up a fund to loan money to these same applicants. It also wants these applicants to be able to pay fees on a staggered schedule.
Whether it was deliberate or not (I suspect it was semi-deliberate), the JAS wish-list seems to me to go above and beyond the support the ICANN board said it was prepared to offer in June.
I don’t think the board will grant those wishes when it meets next Friday, and here’s a few reasons why.
First, CEO Rod Beckstrom has already basically ruled out blanket fee reductions, even for poorer applicants, and he did so after the board had already discussed them.
At an ICANN panel on new gTLDs in London last month, Beckstrom was asked by an audience member if the application fee could be reduced before January.

At roughly 32 minutes into the embedded video, this is what he said:

There’s no plans to reduce the fee and I could not contemplate that happening before the program opens. The fees have been determined and there’s no process to review them, and there would be no basis at the present time because the costing estimates in the program appear to be reasonably accurate.

He went on to say that economies of scale may lead to a reduction in fees in future rounds, but did not mention the JAS recommendations at all.
As I was also on the panel, I called him on the omission later in the discussion, roughly 45 minutes into the video above. He said:

The board of directors did make a directional indication in Singapore to set aside up to a million to two million dollars for financial support for applicants…
However, it’s not a repricing of the fees, it would be some type of support for those applicants. A reduction in the application fee or effectively subsidizing the application fee is one possible concept, but what I can tell you as the CEO and as a board member is that board’s indication is one to two million dollars, not an unlimited number, so can do math and figure out what might be possible and what might not.
We’re not going to change the program fees, it just means there might be some benefit to or some support for some applicants, but it may not come in the form of that subsidy for the fee.

What we have here is JAS asking for a fundamental restructuring of the application fee in certain circumstances, and ICANN’s CEO saying that’s not likely to happen.
At that time, the JAS report had not been formally submitted to the board, but it had nevertheless been seen and discussed by the board at its two-day retreat in mid-September.
The GNSO, which had been frustrated with the cross-constituency structure of the JAS for some time, didn’t even formally approve the report before forwarding it to the board, due to time constraints.
Another indication of the board’s thinking on the JAS recommendations comes from the minutes of its Finance Committee meeting, September 15. Here’s an extract:

Staff has initiated efforts to be ready for implementation if and when approved. Establishment of a fund – a short-term mechanism for earmarking funds for applicant support, and a long-term formal mechanism for several purposes. Meeting community expectations: Board had approved US $2mm, while the JAS/GAC-ALAC recommendations would be more costly. Four tasks: developing criteria based on the JAS report plus practical concerns, developing procedures, entity for considering applications, and mechanism for holding the funds. Discussed the need to stay within the mission and purpose of ICANN and the ability to set-up special funds.

There’s no mention of application fees, but there is an acknowledgment that the JAS recommendations would be more expensive to implement than just the $2 million ICANN has already set aside.
There’s also talk of “practical concerns” and the “need to stay within the mission and purpose of ICANN”, all of which says to me that there’s a worry JAS asked for too much.
We’ll have to wait until next Friday to find out for sure, but my guess is that the board will likely side with ICANN’s bean-counters and that the JAS will not get much of what it asked for.

There’s a new new gTLDs Applicant Guidebook and it’s quite boring

ICANN has released the eighth version of the Applicant Guidebook for the new generic top-level domains program as promised, and as expected it’s rather dull.
Here it is.
By far the most important change appears to be the firm inclusion of a new deadline: March 29, 2012.
If you’re a new gTLD applicant, and you have not registered with ICANN’s TLD Application System by 2359 UTC, March 29, 2012, you’re done – your application fails at the starting blocks.
Apart from that, there does not appear to be much to get excited about.
The long gap since the program was approved by the ICANN board on June 20 had some people scratching their heads, wondering whether major changes were in store.
But what’s been published tonight appears to differ very little from the draft published in May, and most of the edits are those specifically envisaged by the June resolution.
It has, for example, been updated to reflect some of the Governmental Advisory Committee’s requests that ICANN’s board of directors acceded to in Singapore.
There’s no longer a requirement for the GAC to reach consensus in a transparent way when it deliberates about new gTLD objections.
There’s also almost 40 new strings – variants of the Olympic, Olympiad, Red Cross and Red Crescent trademarks – that are now explicitly banned from the first round of gTLD applications. These are being called “Strings Ineligible for Delegation”, rather than “Reserved” strings.
(As an aside, while it’s easy to understand the GAC’s rationale for this, does it strike anyone else as a completely pointless move? The gTLD .olympic may be now banned, but the far better and more obvious squat, .olympics, is not.)
No redline version of the Guidebook – in which all the edits are highlighted – has yet been published, but ICANN has released a non-exhaustive document summarizing the changes here.
Not included in that summary is ICANN president Rod Beckstrom’s new introduction, which addresses the latest batch of criticisms leveled at the program (such as the perceived lack of publicity since June and the unfinished applicant support policy).
It also drops the “Dear Prospective Applicant” salutation found in previous versions of the Guidebook, which probably doesn’t mean anything.
The disclaimer that the Guidebook has not been approved has also disappeared. While the document could be considered a production copy, it by no means presents a full picture of the program
Some of the items of unfinished business I outlined in this article last month remain unfinished.
The aforementioned applicant support program, for example, is not likely to be approved until the ICANN board’s meeting in Dakar, October 28.
The new Guidebook explicitly punts this, now saying it will be handled “through a process independent of this Guidebook”.
The Singapore promise that ICANN would continue discussing the US and EU government concerns about cross ownership between registrars and registries does not appear to have led to any edits either, but that does not necessarily mean it’s settled law.
Also, the process the GAC will use internally to decide whether to raise objections to gTLD applications is still not known.
In summary, it appears that we have an Applicant Guidebook that is “approved”, but is unlikely to be the “final” version.

What Europe’s demands mean for new gTLDs

The European Commission wants stronger government powers over ICANN’s new top-level domain approval process, according to leaked documents.
Six “informal background papers” obtained and published by .nxt yesterday indicate that the EC, perceiving snubs over the last six months, plans to take a hard line with ICANN.
The documents cover a lot of ground, including a discussion of the various mechanisms by which governments would be able to force ICANN to reject new gTLD applications.
This article covers just the bases related to new gTLDs.
As things currently stand, ICANN’s Applicant Guidebook gives governments three ways to register their objections to any given gTLD application. The EC wants two of them strengthened.
GAC Early Warning
The Governmental Advisory Committee may formally put an applicant on notice that one or more governments have a problem with their bid.
Any government can initiate an Early Warning “for any reason”, at any point during the 60-day public comment period that is currently scheduled to begin April 27.
The mechanism is designed to give applicants a chance to get out with their cash before a more formal objection is filed by the GAC or an individual government.
Applicants in receipt of such a warning can choose to withdraw at that point, receiving a partial refund of their fees, but it’s entirely voluntary.
Under the EC’s new proposals, a GAC Early Warning would trigger an additional requirement by the applicant to show the support of “the relevant internet community”.
Because there’s little chance of getting this provision into the Guidebook now, the EC wants this provision baked into ICANN’s IANA contract with the US Department of Commerce.
The IANA contract is currently the biggest stick governments have to beat ICANN with. It’s up for renewal before March, and it’s the US that decides what goes into the contract.
The European Commission paper on new gTLDs says:

The IANA contract should include a provision requiring applicants to positively demonstrate the support of the relevant Internet community in advance of formal consultation of the GAC (and other supporting organisations and advisory committees), in cases where there are prima facie grounds to believe that the application may raise a public policy concern.

The paper explains: “in other words, if the GAC issues an early warning, the applicant would be automatically required to demonstrate the support of the relevant Internet community”.
In the Guidebook today, only applicants that have self-designated as “community” applications have to show this level of support, using a strict scoring process.
The EC’s proposal could, hypothetically, force non-community applicants to show a similar level of support if a single government initiates an Early Warning in the GAC.
If there was a vanilla, non-community application for .gay, for example, an Early Warning spurred (anonymously) by Saudi Arabia, say, could force the applicant to provide evidence of community support.
How this evidence would be evaluated is unclear. It would depend on what final language the Department of Commerce puts into the IANA contract.
At a guess, it could be a matter for the ICANN board to decide, with the Damoclean sword of IANA non-compliance hanging over its decision.
Formal GAC Advice
The Guidebook today allows for over six months, from April 27 to November 12, for the GAC to formally object to any gTLD application.
The way the GAC will create this formal “GAC Advice on New gTLDs” is a black box. We probably won’t even be told which governments objected, or what level of support they received.
ICANN had tried to enforce certain transparency and procedural requirements on this mechanism, but the GAC told it to take a hike and ICANN bent over in the interests of expediency.
But any such Advice will nevertheless “create a strong presumption for ICANN that the application should not be approved”.
The ICANN board will technically still be able to overrule one of these objections, but it practice it seems unlikely. At the very least it’s not predictable.
Under the European Commission’s new proposals, this fail-safe would be weakened further:

The ICANN by-laws should be amended to ensure that consensus GAC advice is accepted as reflecting the global public interest, and should ICANN wish to reject such advice, it would bear the burden of demonstrating that the GAC advice would conflict with ICANN’s legal obligations or create problems for the stability or security of the Domain name System.

In other words, the bar for an ICANN board decision to overrule the GAC would be raised to only include cases where there was a legal or technical reason not to comply.
The GAC would have an effective veto on every decision ICANN is asked to make. The term “multi-stakeholder” would be subverted in almost textbook Orwellian fashion.
To have this proposal implemented, the EC suggests that ICANN and the GAC enter talks. There’s no talk of running to the US government to have it unilaterally imposed.
Reserved Words
Currently, all new gTLD registries will be forced to reserve strings such as country names from their spaces, and deal with individual governments to open them up.
The EC wants the list expanding to include basically any word that governments ask for, and it wants the US government to make this a condition of IANA contract renewal:

In relation to reserved and blocked names at the second level, the IANA contract should require the contractor to develop appropriate policies to allow governments and public administrations to identify names to be included in a reference list to be respected by all new gTLD operators.

This request appears to have been inspired by ICM Registry’s offer to block “culturally sensitive” strings from .xxx at the request of governments.
Yet again, we find global internet policy being driven by sex. What is it with these politicians?
Domain Name Takedown
Incredibly, the EC also wants the IANA contract to include a provision that would allow any government to ask any gTLD registry to turn off any domain:

The contractor [ICANN] should also be required to ensure that governments and public administrations can raise concerns about particular names after their registration if a serious public order concern is involved, and with a view to the registry “taking down” the name concerned.

This clearly hasn’t been thought through.
Facebook.com and Twitter.com have both been blamed recently for raising “serious public order concerns” in everything from the Egyptian revolution to the London riots.
The new powers the EC is discussing would have given the despotic former government of Egypt a legal basis for having Twitter shut down, in other words.
Cross-Ownership
Finally, the EC is still concerned, on competition grounds, about ICANN’s decision to drop the vertical separation rules that apply to registries and registrars.
It suggests that the IANA contract should create a new oversight body with an “extra-judicial review” function over ICANN, enabling its decisions to be challenged.
This would enable antitrust authorities in Europe or elsewhere to challenge the vertical integration decision without having to resort to the US courts.
Anyway
Overall, the proposals seem to represent a depressingly authoritarian ambition by the European Commission, as well as a disdain for the idea of the ICANN multi-stakeholder model and a shocking lack of respect for the rights of internet users.
While the documents are “informal background papers”, they do seem to give an indication of what certain elements within the EC think would make reasonable policy.
Whether the positions outlined in the papers became a reality would largely depend on whether the EC’s requests, if they were made, were compatible with US public policy.
As usual, the Department of Commerce still holds all the cards.

Final gTLD Applicant Guidebook expected this week

It’s been over a month since ICANN approved its new top-level domains program, but we still don’t have a final-final version of the Applicant Guidebook.
The resolution approving the program ICANN passed in Singapore called for a number of amendments to be made to the 352-page tome.
The current draft was published May 30, and so far ICANN has not said when the next version – likely to be the version used in the first round of applications – will be released.
I inquired, and now word has come from on high that ICANN’s new gTLD team hopes to have the English version of the new Guidebook published by the end of July – this coming weekend.
The Singapore resolution called for changes to the government Early Warning and Advice processes, added protection for Olympic and Red Cross trademarks, and a modification of the Uniform Rapid Suspension cybersquatting policy.
One has to wonder if the changes outlined in the resolution are the only changes that we’ll see – a month seems like a long time to make just a few fairly minor edits.
The resolution said the board “authorizes staff to make further updates and changes to the Applicant Guidebook as necessary and appropriate”.
The first round of new gTLD applications is set to open January 12.

Olympics make more new gTLD demands

The International Olympic Committee, fresh from its big win at ICANN Singapore, is pushing for more special protections in the new top-level domains program.
ICANN only approved the new gTLD program last month with the proviso that Olympic and Red Cross strings – .redcross and .olympic for example – would be banned as gTLDs in the first round.
The decision was a pretty obvious piece of political bone-throwing to the Governmental Advisory Committee, which had backed the IOC’s cause.
Now the IOC wants to ensure ICANN will ban .olympic and .olympiad in eight additional languages, including four non-Latin scripts, as well as “confusingly similar” strings such as .olympics.
I expect ICANN will probably grant this concession, even though the idea that somebody other than the IOC could successfully apply for .olympics under existing rules has always been ludicrous.
The IOC has probably already spent just as much money lobbying for these changes as it would have cost to file a slam-dunk legal rights objection, as already allowed by the Guidebook.
And that would only have been necessary, of course, in the vanishingly improbable scenario where somebody was stupid enough to pay $185,000 to apply for .olympics in the first place.
But the IOC now also wants all of its brands banned at the second level in all new gTLDs. This seems like a bigger ask, given that ICANN resolved to protect the Olympic marks “for the top level only”.
In a July 1 letter to ICANN (pdf), published today, an IOC lawyer includes suggested text for the Applicant Guidebook, to be included in the default registry agreement, stating:

In recognition of legislative and treaty protection for the Olympic designations, the labels “OLYMPIC” and “OLYMPIAD” shall be initially reserved at the second level. The reservation of an Olympic designation label string shall be released to the extent Registry Operator reaches agreement with the International Olympic Committee.

This would give the Olympic brand as much protection as country names at the second level.
The problem with this, of course, is that it sets the precedent for a specially protected marks list, which ICANN has resisted and which the GAC specifically has not asked for.
It’s a problem ICANN has arguably brought on itself, of course, given that it already specially protects “icann”, “iana” and a number of other strings on spurious technical stability grounds.

New gTLD program approved — full resolution

ICANN’s board of directors has approved its new generic top-level domains program and will start accepting applications from companies in January next year.
The vote this morning at the Raffles City Convention Center in Singapore, was 13 in favor, with George Sadowsky voting against.
Bruce Tonkin of registrar Melbourne IT abstained on conflict-of-interest grounds, and Mike Silber abstained because, while generally in favor of the program, he did not believe it was ready yet.
Here’s the resolution in full. I’ll provide commentary later in the day.

Approval of the New gTLD Program

Whereas, on 28 November 2005, the GNSO Council voted unanimously to initiate a policy development process on the introduction of new gTLDs.
Whereas, the GNSO Committee on the Introduction of New gTLDs addressed a range of difficult technical, operational, legal, economic, and policy questions, and facilitated widespread participation and public comment throughout the policy development process.
Whereas, on 6 September 2007, the GNSO Council approved by a supermajority vote a motion supporting the 19 recommendations, as a whole, as set out in the Final Report of the ICANN Generic Names Supporting Organisation on the Introduction of New Generic Top-Level Domains going forward to the ICANN Board (http://gnso.icann.org/issues/new-gtlds/pdp-dec05-fr-parta-08aug07.htm).
Whereas, the Board instructed staff to review the GNSO recommendations and determine whether they were capable of implementation, and staff engaged international technical, operational and legal expertise to support the implementation of the policy recommendations and developed implementation plans for the GNSO’s policy recommendations.
Whereas, on 26 June 2008, the Board adopted the GNSO policy recommendations for the introduction of new gTLDs and directed staff to further develop and complete its detailed implementation plan, continue communication with the community on such work, and provide the Board with a final version of the implementation proposals for the board and community to approve before the launching of the new gTLD application process (http://www.icann.org/en/minutes/resolutions-26jun08.htm#_Toc76113171).
Whereas, staff has made implementation details publicly available in the form of drafts of the gTLD Applicant Guidebook and supporting materials for public discussion and comment.
Whereas, the first draft of the Applicant Guidebook was published on 23 October 2008 , and the Guidebook has undergone continued substantial revisions based on stakeholder input on multiple drafts.
Whereas, the Board has conducted intensive consultations with the Governmental Advisory Committee (including in Brussels in February 2011, in San Francisco in March 2011, by telephone in May 2011, and in Singapore on 19 June 2011), resulting in substantial agreement on a wide range of issues noted by the GAC, and the Board has directed revisions to the Applicant Guidebook to reflect such agreement.
Whereas, ICANN received letters from the United States Department of Commerce and the European Commission addressing the issue of registry-registrar cross-ownership, and the Board considered the concerns expressed therein. The Board agrees that the potential abuse of significant market power is a serious concern, and discussions with competition authorities will continue.
Whereas, ICANN has consulted with the GAC to find mutually acceptable solutions on areas where the implementation of policy is not consistent with GAC advice, and where necessary has identified its reasons for not incorporating the advice in particular areas, as required by the Bylaws; see .
Whereas, the ICANN community has dedicated countless hours to the review and consideration of numerous implementation issues, by the submission of public comments, participation in working groups, and other consultations.
Whereas, the Board has listened to the input that has been provided by the community, including the supporting organizations and advisory committees, throughout the implementation process.
Whereas, careful analysis of the obligations under the Affirmation of Commitments and the steps taken throughout the implementation process indicates that ICANN has fulfilled the commitments detailed in the Affirmation (http://www.icann.org/en/documents/affirmation-of-commitments-30sep09-en.htm).
Whereas, the Applicant Guidebook posted on 30 May 2011 (http://www.icann.org/en/topics/new-gtlds/comments-7-en.htm) includes updates resulting from public comment and from recent GAC advice.
Whereas, the draft New gTLDs Communications Plan forms the basis of the global outreach and education activities that will be conducted leading up to and during the execution of the program in each of the ICANN geographic regions.
Whereas, the Draft FY12 Operating Plan and Budget (http://www.icann.org/en/announcements/announcement-17may11-en.htm) includes a New gTLD Program Launch Scenario, and the Board is prepared to approve the expenditures included in Section 7 of the Draft FY12 Operating Plan and Budget.
Whereas, the Board considers an applicant support program important to ensuring an inclusive and diverse program, and will direct work to implement a model for providing support to potential applicants from developing countries.
Whereas, the Board’s Risk Committee has reviewed a comprehensive risk assessment associated with implementing the New gTLD Program, has reviewed the defined strategies for mitigating the identified risks, and will review contingencies as the program moves toward launch.
Whereas, the Board has reviewed the current status and plans for operational readiness and program management within ICANN.
Resolved (2011.06.20.01), the Board authorizes the President and CEO to implement the new gTLD program which includes the following elements:
1. the 30 May 2011 version of the Applicant Guidebook (http://www.icann.org/en/topics/new-gtlds/comments-7-en.htm), subject to the revisions agreed to with the GAC on 19 June 2011, including: (a) deletion of text in Module 3 concerning GAC advice to remove references indicating that future Early Warnings or Advice must contain particular information or take specified forms; (b) incorporation of text concerning protection for specific requested Red Cross and IOC names for the top level only during the initial application round, until the GNSO and GAC develop policy advice based on the global public interest, and (c) modification of the “loser pays” provision in the URS to apply to complaints involving 15 (instead of 26) or more domain names with the same registrant; the Board authorizes staff to make further updates and changes to the Applicant Guidebook as necessary and appropriate, including as the possible result of new technical standards, reference documents, or policies that might be adopted during the course of the application process, and to prominently publish notice of such changes;
2. the Draft New gTLDs Communications Plan as posted at (http://www.icann.org/en/topics/new-gtlds/new-gtlds-communications-plan-30may11-en.pdf), as may be revised and elaborated as necessary and appropriate;
3. operational readiness activities to enable the opening of the application process;
4. a program to ensure support for applicants from developing countries, with a form, structure and processes to be determined by the Board in consultation with stakeholders including: (a) consideration of the GAC recommendation for a fee waiver corresponding to 76 percent of the $185,000 USD evaluation fee, (b) consideration of recommendations of the ALAC and GNSO as chartering organizations of the Joint Applicant Support (JAS) Working Group, (c) designation of a budget of up to $2 million USD for seed funding, and creating opportunities for other parties to provide matching funds, and (d) the review of additional community feedback, advice from ALAC, and recommendations from the GNSO following their receipt of a Final Report from the JAS Working Group (requested in time to allow staff to develop an implementation plan for the Board’s consideration at its October 2011 meeting in Dakar, Senegal), with the goal of having a sustainable applicant support system in place before the opening of the application window;
5. a process for handling requests for removal of cross-ownership restrictions on operators of existing gTLDs who want to participate in the new gTLD program, based on the “Process for Handling Requests for Removal of Cross-Ownership Restrictions for Existing gTLDs” (http://www.icann.org/en/announcements/announcement-02may11-en.htm), as modified in response to comments ; consideration of modification of existing agreements to allow cross-ownership with respect to the operation of existing gTLDs is deferred pending further discussions including with competition authorities;
6. the expenditures related to the New gTLD Program as detailed in section 7 of the Draft FY12 Operating Plan and Budget http://www.icann.org/en/announcements/announcement-17may11-en.htm); and
7. the timetable as set forth in the attached graphic , elements of which include the New gTLD application window opening on 12 January 2012 and closing on 12 April 2012, with the New gTLD Communications Plan beginning immediately.
Resolved (2011.06.20.02), the Board and the GAC have completed good faith consultations in a timely and efficient manner under the ICANN Bylaws, Article XI, Section 2.j. As the Board and the GAC were not able to reach a mutually acceptable solution on a few remaining issues, pursuant to ICANN Bylaws, Article XI, Section 2.k, the Board incorporates and adopts as set forth in the document describing the remaining areas of difference between ICANN’s Board and the GAC the reasons why the GAC advice was not followed. The Board’s statement is without prejudice to the rights or obligations of GAC members with regard to public policy issues falling within their responsibilities.
Resolved (2011.06.20.03), the Board wishes to express its deep appreciation to the ICANN community, including the members of the GAC, for the extraordinary work it has invested in crafting the New gTLD Program in furtherance of ICANN’s mission and core values, and counts on the community’s ongoing support in executing and reviewing the program.

GAC gives ICANN final warning on new TLDs

As ICANN’s 41st meeting begins in Singapore, the Governmental Advisory Committee is sticking to its guns on a number of its outstanding demands on new top-level domains.
GAC chair Heather Dryden said in a Saturday letter to the ICANN board (pdf) that its concerns relating to controversial string objections, trademark protection, and vertical integration have not been satisfactorily addressed.
She also said that the Applicant Guidebook should be amended to protect the trademarks of the Red Cross, Red Crescent and Olympics movements, and that developing countries should get support.

The GAC would advise the Board that these issues involve important public policy objectives and, until resolved, also risk gTLD applications being made that conflict with applicable law.
…
To this end, and notwithstanding the GAC’s wish to avoid any further delay in the new gTLD process, the GAC would advise the Board to ensure that all remaining public policy concerns are properly addressed and adequately respected before the new gTLD application procedure is finalised.

The GAC and board will meet this afternoon in Singapore to discuss these remaining issues.
The ICANN board is due to meet tomorrow morning to consider approving the Applicant Guidebook and the new gTLD program.

Governments back Olympic domain bans

ICANN’s Governmental Advisory Committee has called for a ban on domain names containing terms relating to the Red Cross and Olympics movements.
Both organizations have for some time been calling for their trademarks to be added to the list of specially reserved strings that nobody will be able to register under new top-level domains.
The GAC “strongly supports” these demands.
In a piece of uncharacteristically straightforward advice (expect much more of this in the wake of the .xxx decision), GAC chair Heather Dryden wrote to ICANN:

The GAC advises the ICANN Board to approve these requests and to direct staff to reflect the Board’s approval in the May 30, 2011 version of the Applicant Guidebook.

It’s special pleading, of course, but there’s plenty of precedent for the Olympics, Red Cross and Red Crescent being given special protection under national laws, as Dryden notes in her letter.
I’d guess that this is a bone ICANN may be willing to throw, given that it has more important unresolved issues still to discuss with the GAC, some of which could delay the new gTLD program.
The Applicant Guidebook’s current list of reserved names includes the names of ICANN and related organizations, several terms used in networking, and country names.

What happened to ICANN’s .net millions?

Questions have been raised about how ICANN accounts for the millions of dollars it receives in fees from .net domain name registrations.
The current .net registry agreement between ICANN and VeriSign was signed in June 2005. It’s currently up for renewal.
Both the 2005 and 2011 versions of the deal call for VeriSign to pay ICANN $0.75 for every .net registration, renewal and transfer.
Unlike .com and other TLDs, the .net contract specifies three special uses for these fees (with my emphasis):

ICANN intends to apply this fee to purposes including:
(a) a special restricted fund for developing country Internet communities to enable further participation in the ICANN mission by developing country stakeholders,
(b) a special restricted fund to enhance and facilitate the security and stability of the DNS, and
(c) general operating funds to support ICANN’s mission to ensure the stable and secure operation of the DNS.

However, almost six years after the agreement was executed, it seems that these two “special restricted funds” have never actually been created.
ICANN’s senior vice president of stakeholder relations Kurt Pritz said:

To set up distinctive organizations or accounting schemes to track this would have been expensive, complex and would have served no real value. Rather — it was intended that the ICANN budget always include spending on these important areas — which it clearly does.

He said that ICANN has spent money on, for example, its Fellowships Program, which pays to fly in delegates from developing nations to its thrice-yearly policy meetings.
He added that ICANN has also paid out for security-related projects such as “signing the root zone and implementing DNSSEC, participating in cross-industry security exercises, growing the SSR organization, conducting studies for new gTLDs”.
These initiatives combined tally up to an expenditure “in excess of the amounts received” from .net, he said.
It seems that while ICANN has in fact been spending plenty of cash on the projects called for by these “special restricted funds”, the money has not been accounted for in that way.
Interestingly, when the .net contract was signed in 2005, ICANN seemed to anticipate that the developing world fund would not be used to pay for internal ICANN activities.
ICANN’s 2005-2006 budget, which was approved a month after the .net deal, reads, with my emphasis:

A portion of the fees paid by the operator of the .NET registry will become part of a special restricted fund for developing country Internet communities to enable further participation in the ICANN mission by developing country stakeholders. These monies are intended to fund outside entities as opposed to ICANN staff efforts.

That budget allocated $1.1 million to this “Developing Country Internet Community Project”, but the line item had disappeared by time the following year’s budget was prepared.
Phil Corwin from the Internet Commerce Association estimates that the $0.75 fees added up to $6.8 million in 2010 alone, and he’s wondering how the money was spent.
“We believe that ICANN should disclose to the community through a transparent accounting exactly how these restricted funds have actually been utilized in the past several years,” Corwin wrote.
He points out that the contract seems to clearly separate the two special projects from “general operating funds”, which strongly suggests they would be accounted for separately.
Given that .net fees have been lumped in with general working capital for the last six years, it seems strange that the current proposed .net registry agreement still calls for the two special restricted funds.
The oddity has come to the attention of the ICA and others recently because the new proposed .net contract would allow VeriSign for the first time to offer differential pricing to registrars in the developing world.
The agreement allows VeriSign to “provide training, technical support, marketing or incentive programs based on the unique needs of registrars located in such geographies to such registrars”, and specifically waives pricing controls for such programs.
It seems probable that this amendment was made possible due to the .net contract’s existing references to developing world projects.
Corwin said ICA has nothing against such programs, but is wary that existing .net registrants may wind up subsidizing registrants in the developing world.