European Commission comments - ICANN Auction Rules in the new gTLD program
- To: <comments-new-gtld-auction-rules-16dec13@xxxxxxxxx>
- Subject: European Commission comments - ICANN Auction Rules in the new gTLD program
- From: <Linda.Corugedo-Steneberg@xxxxxxxxxxxx>
- Date: Tue, 4 Feb 2014 14:58:41 +0000
The European Commission appreciates the opportunity to comment on the recently
updated ICANN’s New gTLD Auction Rules and welcomes ICANN's interest in the
community views expressed in Buenos Aires, including at the GAC and Public
Please find below our comments.
Linda CORUGEDO STENEBERG
Communications networks, Content and Technologies Directorate-General, DG
Cooperation, Directorate D
EU GAC representative
BU 25 06/24
Public Comment on new gTLD Auction Rules
1. General comments
We are deeply concerned about the implications that the Auction Rules in the
gTLD program may have for the protection of public policy interests,
competition, openness and innovation. As a general principle, ICANN should
implement Auction Rules that are consistent with its Bylaws, its non-for profit
status, the objectives of the new gTLD Program and the Applicant Guidebook to
promote competition, diversity, innovation and consumer choice. As expressed in
several comments already submitted during the comment period, the current
Auction Rules are advantageous for portfolio applicants rather than for small,
innovative and community applicants, which is at odds with the “diversity and
innovation” policy that ICANN seeks to promote. It would be desirable to give
these applicants a more even playing field when they come up against larger
portfolio holders in the contention process. Also, ICANN's auction rules has
not yet proven convincing to the community and deserves being revisited in
light of the input received.
2. Relevant GAC advice
The European Commission regards positively the explicit mention in the Auction
Rules of the need to "resolve any applicable GAC advice" prior to the
participation in the auction process, as part of the applicant's "eligibility"
criteria, but regrets the lack of reference to "community applications" or
applications with community support, despite the reiterated GAC advise. In this
regard the European Commission seizes this opportunity to recall the following
passages of recent GAC advice:
* "The GAC advises the board that in those cases where a community, which
is clearly impacted by a set of new gTLD applications in contention, has
expressed a collective and clear opinion on those applications, such opinion
should be duly taken into account, together with all other relevant
information." (Beijing Communique)
* "The GAC reiterates its advice from the Beijing Communiqué regarding
preferential treatment for all applications which have demonstrable community
support, while noting community concerns over the high costs for pursuing a
Community Objection process as well as over the high threshold for passing
Community Priority Evaluation". (Durban Communique)
* "The GAC requests a briefing on the public policy implications of holding
auctions to resolve string contention (including community applications)."
(Buenos Aires Communique).
It is essential that the outcome of the briefing on the public policy
implications of holding auctions requested in the Buenos Aires GAC Communique
and the reflections of the GAC on this particular issue are fully taken into
account when defining the Auction Rules. Particularly, the auction process
should not be initiated until the GAC's briefing request is duly addressed by
the ICANN Board.
3. ALAC – Community applications statement
It is important to make a specific reference to the At-Large Community (ALAC)
statement of 9.08.2013 on preferential treatment for community applications in
string contention; ALAC stressed that some of the new gTLD applications that
are intended for communities and have wide public support were not submitted as
community applications; those applications are currently in contention with
others not designed for the benefit of specific communities and driven purely
by commercial considerations. In this regard the European Commission
(consistent with its position in the GAC) fully endorses the GAC view that
community applications and applications with community support should be given
preferential treatment in the new gTLD string contention resolution process,
and remind the clear above mentioned GAC Beijing and Durban Communiques.
4. Security and consumer protection
Security and consumer protection are fundamental public policy objectives.
Therefore we endorse those comments proposing that the winning applicant is
contractually required to ensure that all security related gTLDs adopt
technologies that improve the level of trust of Internet users. A "secure" gTLD
implies that the resources offered are truly secure and operating under
specific policies that warrant a dedicated level of security to end users. It
is therefore contrary to this public policy interest that the winning applicant
is decided through an auction process that may simply favour deep pocket
Therefore we will repeat again our concern about the negative impact that
auctions may have for the preservation and enhancement of the operational
stability, reliability, security and global interoperability of the Internet,
as expressed during the Buenos Aires GAC meeting: "The European Commission
believes that in the new gTLD program, ICANN should aim not just to maintain,
but also enhance the level of consumer protection and confidence in gTLDs.
ICANN should therefore take this social and community responsibility into
account in their implementation plan. It is our understanding that trusted
domains such as .safe, .secure and .security risks being awarded to applicants
based only upon the price they are willing to pay in an auction. We therefore
urge ICANN, in the interest of fostering innovative solutions that enhance
global security, not to allow purely commercial interests to prevail in the
delegation of these domains.
5. Negotiations between applicants prior to the Auction process
Over and above, there seems not to be any incentive for financially strong
applicants to solve the contention “through voluntary agreement among the
involved applicants”. This solution places an unnecessary burden on applicants
and departs from the artificial assumption that parties are eager to negotiate.
6. Destination (use) of Auction funds
We also note the lack of clarity as regards the destination of the significant
funds that ICANN will receive as a result of these auctions; it is therefore
highly recommended that ICANN begins a consultation process with the community
to determine the allocation of the funds gathered through this process, with a
focus on its use for community support, capacity building and engagement of
stakeholders in least developed nations.
7. Unilateral powers to modify Auction Rules
ICANN shall not be entitled in its sole discretion to amend these Auction Rules
"for any auction at any time and for any reason prior to the deposit deadline
for that auction". The abovementioned unilateral power to change the rules
currently under negotiation only contributes to increase applicants'
uncertainty. The European Commission fully supports that "Any proposed changes,
at a minimum, should be announced publicly at least 30 days in advance of any
auction, and should be for good cause based on exigent circumstances".
We are confident that community input received will allow ICANN to amend the
current draft Auction Rules (version 2013.12.12) in a manner consistent with
ICANN's objectives and fully rooted in the principle of fairness.