[gnso-vi-feb10] RE: GAC Comments on new GTLDs and DAGv4

[Eric Brunner-Williams <ebw@xxxxxxxxxxxxxxxxxxxx>]

All,

The GAC Comment of the 23rd contains a reference to registry registrar 
separation, at pages 3 and 4:
Begin quote:

Registry-registrar separation

The GAC notes the significant work being done within the ICANN 
community to resolve the difficult issue of registry-registrar 
separation. The GAC looks forward to further discussion of this 
important issue.
The GAC notes that CANN has incorporated strict rules in version 4 of 
the DAG under which registrars are not able to provide registry 
services or to operate a new gTLD. Governments generally support 
restrictions on vertical integration and cross-ownership as important 
devices for promoting competition, preventing market dominance and 
averting market distortions. The GAC notes in this regard the Salop
and Wright report and recognizes that vertical separation may be 
warranted where a market participant wields, or may in the future 
wield, market power.
However, the GAC also recognises that if market power is not an issue, 
the ability of registrars with valuable technical, commercial and 
relevant local expertise and experience to enter the domain names 
market could likely lead to benefits in terms of enhancing competition 
and promoting innovation.
An important additional benefit which the GAC expects would flow from 
such an exemption would be that community-based TLD applicants would 
be able to cast their net more widely in securing partners with the 
necessary expertise and experience in the local market to undertake 
what would be relatively small scale registry functions.
The GAC therefore urges ICANN to resolve the current debate about 
registry-registrar separation with a solution that fosters competition 
and innovation in the DNS market by allowing exemptions, subject to 
some form of regulatory probity that ensures a
level playing field, for certain registrars as potentially valuable 
newcomers to the registry market. ICANN may find it useful to consider 
the experience of competition regulators around the world in 
addressing this issue.
End quote.

Eric