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Barriers to Entry

  • To: raa-consultation@xxxxxxxxx
  • Subject: Barriers to Entry
  • From: Danny Younger <dannyyounger@xxxxxxxxx>
  • Date: Mon, 10 Sep 2007 07:03:34 -0700 (PDT)

Now that ICANN has an economist on staff, it would be
appropriate to determine whether current registrar
accreditation financial requirements are posing a
barrier to entry for registrars in the developing

Currently registrars must pay:

1.  Accreditation application filing fee -- $US2500
2.  A per registrar fixed fee of US$4,000, plus a
per-registrar variable fee totalling US$3.8 million
divided among all registrars.
3.  For the cost of a US$500,000 commercial general
liability insurance policy 

Registars must also show US$70,000 of liquid capital 
at the commencement of the accreditation period
although a lesser amount will be accepted upon a
showing that under the circumstances it will provide
adequate working capital.

As ICANN reviews the accreditation process, perhaps an
economist can determine if a GDP-based cost model
based on a registrar's ability to pay in view of it's
country location (as prescribed by standard UN
development classifications) is warranted to reduce
potential barriers to entry.

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