RE: [gnso-vi-feb10] request -- documenting BRU2 - minority opinion

["Neuman, Jeff" <Jeff.Neuman@xxxxxxxxxx>]

Last e-mail notwithstanding, I do support the notion of including all of the 
compliance/disclosure requirements we discussed as that WAS part of the core 
proposal that was developed.

Jeffrey J. Neuman
Neustar, Inc. / Vice President, Law & Policy

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From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Drazek, Keith
Sent: Tuesday, July 13, 2010 9:18 AM
To: Kathy Kleiman; Mike O'Connor; Gnso-vi-feb10@xxxxxxxxx
Subject: RE: [gnso-vi-feb10] request -- documenting BRU2 - minority opinion

Thanks Kathy. You're correct that the detailed compliance and enforcement 
section was part of the majority/consensus position from that group. It was 
included in the original summary I sent to the list while still in Brussels. 
Thanks for reviewing and correctly adding it back in.  Regards, Keith

From: Kathy Kleiman [mailto:kKleiman@xxxxxxx]<mailto:[mailto:kKleiman@xxxxxxx]>
Sent: Tuesday, July 13, 2010 8:32 AM
To: Drazek, Keith; Mike O'Connor; Gnso-vi-feb10@xxxxxxxxx
Subject: RE: [gnso-vi-feb10] request -- documenting BRU2 - minority opinion

Hi All,
After yesterday's call, I am not sure whether and in what form the Brussels 
work will be going forward.  But in the interest of completeness, I wrote up 
the minority voice (me) in the Brussels 2  group (BRU2). In particular, we 
developed a long list of compliance, detection and monitoring requirements (as 
part of the majority BRU2, I had thought. I see it in our notes, but not in the 
write-up).

The minority opinion is attached, and it could be inserted after "6. Compliance 
and Enforcement," and before the Questions section.  Tx to Keith for writing up 
the main position.

Best,

Kathy Kleiman
Director of Policy
.ORG The Public Interest Registry
Direct: +1 703 889-5756  Mobile: +1 703 371-6846

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From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Drazek, Keith
Sent: Thursday, July 08, 2010 1:55 PM
To: Mike O'Connor; Gnso-vi-feb10@xxxxxxxxx
Subject: RE: [gnso-vi-feb10] request -- documenting the current state of 
"Brussels proposals"


Mikey, per your request, here's the recap from Brussels Option #2 (BRU2) and 
responses to the questions you posed. Other members of the BRU2 sub-group 
should review and edit as needed. I'm submitting this in my personal capacity 
as note-taker for the group, not as an advocate. Questions/comments/edits 
welcome. Thanks, Keith



1. LIMITS DO NOT APPLY ACROSS TLDS

A registry operator or registry services provider that does not distribute its 
own TLD should not be restricted from acting as a registrar in other TLDs. An 
existing registrar should not be prohibited from becoming a new TLD registry 
just because it sells other TLDs. The potential harms of registry sharing data 
with an affiliated reseller or friendly registrar can be addressed via contract 
and ICANN compliance and enforcement mechanisms, provided resources and 
commitment are present. The benefit of new entrants, including existing 
registrars, outweighs the potential harms from cross-ownership if no 
self-distribution is permitted.



2. CONTROL/OWNERSHIP

Cross-ownership up to 100% is permitted provided there is no distribution of 
own TLD. An existing registrar should be permitted to become a new TLD registry 
and own up to 100% provided they don't act as their own registrar. Separation 
of functionality and no self-distribution make restrictions on cross-ownership 
unnecessary provided ICANN enforces contracts.



3. OWNERSHIP LIMITS

No ownership limit if cross-owned entity doesn't distribute its own TLD. De 
minimus limit (5%) if cross-owned entity distributes own TLD.



4. EXCEPTIONS

Exceptions should be allowed for single-registrant/single user, orphaned TLDs, 
and possibly others TBD. A procedure should be established for applicants to 
request exceptions based on business model and to ensure ability to take TLD to 
market if no other registrars agree to offer and/or market the TLD.



5. REGISTRY SERVICE PROVIDERS

Registry Service Providers should have the same restrictions as Registry 
Operators.



6. COMPLIANCE AND ENFORCEMENT

We spent a significant portion of our time discussing compliance, audit, and 
enforcement procedures. Our group felt that a "serious" structure would be 
required, but would be capable of deterring bad actors with significant but 
tiered penalties.


Questions:

What is the best way to prevent gaming in a cross-owned entity -- percentage 
ownership caps, restrictions on control, both or something else?


*         BRU2 maintains and strictly enforces functional separation of 
registries and registrars and equal access requirements.

*         BRU2 prevents cross-owned entities from selling registrations in 
their own TLD, except in SRSU and orphaned TLD cases.

*         BRU2 prohibits a registry from owning or controlling more than a de 
minimus share (5%) of a registrar distributing its own TLD.

*         BRU2 allows 100% cross-ownership provided there is no 
self-distribution.

*         BRU2 recognizes the need for an effective compliance and enforcement 
regime, including severe penalties for violators.

Do the benefits of increased competition (registrars becoming registries or 
back-end service providers) outweigh the potential risks of gaming from a 
cross-owned entity, or vice-versa?


*         BRU2 considers the benefits of increased competition, specifically 
allowing registrars to become registries, as more valuable than the potential 
risks of gaming from a cross-owned entity if that cross-owned entity was also 
prohibited from self-distribution.

*         BRU2 recognizes the need for an effective compliance and enforcement 
regime, including severe penalties for violators, and that such a regime would 
adequately address the risks of gaming and data-sharing.


Common ownership

Should a registry be able to own a registrar, and vice versa, provided it 
doesn't distribute its own TLD?


*         Yes, BRU2 says 100% cross-ownership is allowable if self-distribution 
is prohibited..

What is an acceptable level of cross-ownership (0 - 100%) if self-distribution 
is permitted?


*         BRU2 says de minimus (5%) is allowable when self-distribution is 
permitted.

What is an acceptable level of cross-ownership (0 - 100%) if self-distribution 
is prohibited?


*         BRU2 says 100% cross-ownership is allowable if self-distribution is 
prohibited.

Control

Should a registry be able to control a registrar, and vice versa, provided it 
doesn't distribute its own TLD?


*         BRU2 says yes, 100% cross-ownership and control is allowed with no 
self-distribution.

Absent an arbitrary restriction on percentage of cross-ownership, what 
constitutes control?


*         BRU2 did not address the definition of control.

What restrictions should be put in place to prevent control?  Do these vary if 
self-distribution is prohibited?


*         BRU2 did not address restrictions on control.

Enforcement and compliance

Is ICANN capable of enforcing contract compliance to prevent gaming in a 
cross-owned entity?


*         BRU2 assumes that ICANN is capable of enforcing contract compliance, 
provided the rules and restrictions are clearly defined.

Scope

Should the scope of ICANN contracts be increased?


*         BRU2 identified the need for expanded/enhanced contractual language 
to prevent gaming and data-sharing.

Specifically, should Registry Service Providers be required to enter into 
contracts with ICANN?


*         BRU2 said cross-ownership and self-distribution restrictions should 
be extended to Registry Service Providers, but did not recommend new contracts 
with ICANN for those entities.

Should other entities (eg Resellers) also be required to enter into contracts 
with ICANN?


*         BRU2 did not consider or recommend reseller contracts with ICANN.

Exceptions to cross-ownership and self-distribution restrictions

Permitted for Single-Registrant, Single-User (SRSU) TLDs?


*         BRU2 allows an exception for SRSU TLDs.

Permitted for "orphaned" TLDs that can't get registrar distribution?


*         BRU2 allows an exception for orphaned TLDs.

Permitted for "community" TLDs?


*         BRU did not address a specific exception for "community" TLDs.

Should there be numeric caps for any or all of these?


*         BRU2 did not address specific numerical caps for exceptions.

Interim solution

Should the results of this first-phase VI-WG PDP be limited to the first round 
of new TLDs only?


*         BRU considers the first phase of the VI-WG PDP as applying only to 
the first round of new TLDs.



From: owner-gnso-vi-feb10@xxxxxxxxx [mailto:owner-gnso-vi-feb10@xxxxxxxxx] On 
Behalf Of Mike O'Connor
Sent: Thursday, July 01, 2010 10:08 PM
To: Gnso-vi-feb10@xxxxxxxxx
Subject: [gnso-vi-feb10] request -- documenting the current state of "Brussels 
proposals"

hi all,

one of the requests that came out of our call today was for a summary of each 
of the "Brussels proposals" that we developed during the Saturday meeting (and 
then refined through lots of hallway conversation thereafter).  as i mentioned 
on the call, those summaries will have to come from the groups themselves, as 
Roberto and i were floating back and forth between the groups and wouldn't be 
able to do a good job of preparing the summaries.

could each of the groups document the current state of their views and post 
them to the list?

another request -- could the RACK+ folks do the same?  it would be nice to 
create another version of Kathy's matrix so that we can set all these side by 
side.

to aid that process, here's a series of questions that i've lifted from various 
places that you all can use to structure your summaries.  it's a blend of atoms 
and questions and the goal is to get to principles that perhaps we can rally 
around.  note the cool Capitalization so that it can be used as the basis of a 
real document.  please try to structure your summary around these if you can.

thanks,

mikey

- - - - - -

Questions:

What is the best way to prevent gaming in a cross-owned entity -- percentage 
ownership caps, restrictions on control, both or something else?

Do the benefits of increased competition (registrars becoming registries or 
back-end service providers) outweigh the potential risks of gaming from a 
cross-owned entity, or vice-versa?

Common ownership

Should a registry be able to own a registrar, and vice versa, provided it 
doesn't distribute its own TLD?

What is an acceptable level of cross-ownership (0 - 100%) if self-distribution 
is permitted?

What is an acceptable level of cross-ownership (0 - 100%) if self-distribution 
is prohibited?

Control

Should a registry be able to control a registrar, and vice versa, provided it 
doesn't distribute its own TLD?

Absent an arbitrary restriction on percentage of cross-ownership, what 
constitutes control?

What restrictions should be put in place to prevent control?  Do these vary if 
self-distribution is prohibited?

Enforcement and compliance

Is ICANN capable of enforcing contract compliance to prevent gaming in a 
cross-owned entity?

If the answer is "no," what steps would ICANN need to take to overcome this 
problem?

If the answer is "no," what steps would ICANN need to take to demonstrate an 
ongoing commitment to fulfilling this role?

Scope

Should the scope of ICANN contracts be increased?

Specifically, should Registry Service Providers be required to enter into 
contracts with ICANN?

Should other entities (eg Resellers) also be required to enter into contracts 
with ICANN?

Exceptions to cross-ownership and self-distribution restrictions

Permitted for Single-Registrant, Single-User (SRSU) TLDs?

Permitted for "orphaned" TLDs that can't get registrar distribution?

Permitted for "community" TLDs?

Should there be numeric caps for any or all of these

Interim solution

Should the results of this first-phase VI-WG PDP be limited to the first round 
of new TLDs only?

- - - - - - - - -
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