RE: [gnso-vi-feb10] Re: cross-ownership definition

[Jeff Eckhaus <eckhaus@xxxxxxxxxxxxxxx>]

I understand your point that even in minority position CO, there is still 
"ownership" but have always thought of in this case that CO referred to a 
Controlling Interest.

For example many Registrars own shares in Afilias, but I would not consider it 
Cross Ownership, I think of it as a Minority Interest.

So how about we call it Minority Interest  ?

Thoughts? 





-----Original Message-----
From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Avri Doria
Sent: Monday, February 08, 2010 2:05 PM
To: Gnso-vi-feb10@xxxxxxxxx
Subject: [gnso-vi-feb10] Re: cross-ownership definition


Hi,

I was not thinking that what was allowed and what wasn't was necessarily 
elevant to the definition.  Some CO is ok and some isn't.

To ask the question another was, what should we call te situation where a 
registry owns a minority share in a registrar or vice versa.

i would think we were talking a majority CO and minority CO but still talking 
abut CO in either case.

It is not that a big a thing to me, it just bothers me the restrict the 
definition that way when I don't what the term is for the other case. What is 
minority CO if not CO?

a.


On 8 Feb 2010, at 21:11, Jeff Eckhaus wrote:

> Finally catching up through these emails so hopefully I am not too far behind 
> on the CO definition issue.
> 
> I believe Milton is correct in his definition since minority ownership is 
> currently allowed so the term Controlling (over 50%) needs to be in there. 
> 
> 
> Jeff
> -----Original Message-----
> From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
> Behalf Of Milton L Mueller
> Sent: Sunday, February 07, 2010 5:19 AM
> To: Avri Doria; Gnso-vi-feb10@xxxxxxxxx
> Subject: [gnso-vi-feb10] cross-ownership definition
> 
> 
>>> Don't we also need a definition of cross-ownership, just to avoid
>> further confusion about that?
>>> 
>>> Here's a stab at that:
>>> "Cross ownership" is defined as the ownership of a controlling share of
>> a registry by a registrar, or vice-versa, while maintaining the
>> contractual and functional separation and equal access arrangements
>> required by ICANN policies and contracts. As long as equal access
>> arrangements are in place, cross-ownership that permits the registrar to
>> sell the names of the cross-owned  TLD registry shall not be considered a
>> form of vertical integration.
>> 
>> 
>> While I agree with what the end result would be, i am somewhat troubled by
>> bundling Recommendation 19 into the definition of CO.
> 
> ?? I don't see any mention of Rec 19 there. Can you explain?
> 
>> I also do not know
>> if controlling share is a necessary part of the definition.
> 
> Ok, it doesn't have to be. My reason for putting it in was that I was under 
> the impression that minority ownership is already allowed by current policy. 
> So the purpose of the definition is to make it clear that the WG will be 
> concerned only with CO issues that involve acquisition of a controlling 
> share. With a controlling share, CO moves somewhat closer on the spectrum 
> towards VI, which makes it a concern of this PDP.
> 
>> And I think
>> there has to be some notion of verifying that in those cases were cross-
>> ownership is allowed, the fair and equal access can be verified.
> 
> Here I think you are getting away from definitions and into specifying 
> policy. One of the chief policy debates about cross ownership has to do with 
> the verifiability of equal access/nondiscrimination. The registries have 
> argued that unless there is a ban on selling a cross-owned TLD, we cannot 
> enforce nondiscrimination. The registrars have argued that such a ban is not 
> needed. By including the word "verifiable" in there you may be viewed as 
> pre-judging that issue.
> 
> The definition of CO I proposed above was meant to define the type of CO this 
> WG will consider as in scope, and to distinguish it from pure VI. It was not 
> intended to specify the appropriate policy for allowing or not allowing CO, 
> nor is it appropriate for a DT charter to do that. 
> 
> I think the issue of verifiability should be left to the WG as a policy 
> issue, and left out of the definition. If you like, we can explicitly mention 
> it in the description of the WG scope or objectives. 
> 
>> What would we call a relation where a registrar owns a strong minority
>> share of a registry and they have concluded a marketing deal that gives
>> priority to that registrar in selling the names of that Registry's new
>> gTLD.  It seems that we would have a cross-ownership situation with a
>> question of VI and degree.
> 
> Sure, there is a gradation here but again I am under the impression that 
> current contractual arrangements already allow minority shares. Perhaps the 
> registrars and registries on this list can clear up that factual issue. 
> 
> If we decide to remove the "controlling share" language from the CO 
> definition, then the easy solution is to specify a threshold (say, 30%); 
> above that we consider the share large enough to be considered "cross 
> ownership" below that we don't. Advantage: the definition is clearer. 
> Disadvantage: the threshold is somewhat arbitrary. 
> 
> --MM
> 
>