Legal Update October 13, 2015 Seven Key Topics to Track During ICANN 54 in Dublin The 54th international meeting of the Internet Corporation for Assigned Names and Numbers (ICANN) commences in earnest on Saturday, October 17, 2015, in Dublin, Ireland, with some sessions beginning on Friday, October 16, 2015. As always, several high-profile topics have emerged amidst community discussions leading up to this meeting, all of which are relevant to registry operators and new generic top-level domain (gTLD) applicants, including for .BRAND TLDs, and brand owners alike. IANA Transition & ICANN Accountability Issues IANA TRANSITION Since ICANN 53 in Buenos Aires, the ICANN community has prepared a Final IANA Transition Proposal1 comprising the three proposals submitted to the IANA Stewardship Transition Coordination Group (ICG) by the Internet protocols, numbers, and names communities respectively. A public comment period was held on the final proposal from July 31, 2015, until September 8, 2015, during which time the ICG received more than 150 comments. The ICG held a face-to-face meeting in Los Angeles, California, on September 18 and 19, 2015, where it discussed and analyzed the comments received on such key topics as: jurisdiction; the Post-Transition IANA (PTI) entity; root zone maintenance and administration; dependency on the CrossCommunity Working Group on Enhancing ICANN Accountability (CCWG-Accountability); the IANA trademark and domain name; country code TLD (ccTLD)-related issues; and measuring the final proposal against the ICG and National Telecommunication and Information Administration (NTIA) criteria. The ICG expects to integrate any changes or clarifications to the proposal by the time of the Dublin ICANN meeting. As a result, we expect a further-refined final proposal to emerge just ahead of, or during, the Dublin meeting, which will likely stimulate community discussion during ICANN 54. That said, given the generally high level of support within the community for the final proposal as a whole, we expect minimal controversy with respect to a further refined proposal. In parallel, the US Congress has been considering the Domain Openness Through Continued Oversight Matters (DOTCOM) Act of 2015,2 which prohibits the termination of the NTIA’s oversight of the IANA functions until 30 legislative days after the NTIA submits to Congress a report that contains: (i) the proposal relating to the transition of the NTIA’s stewardship of the IANA functions that was developed in a process convened by ICANN at the request of the NTIA, and (ii) the following certifications required by the Assistant Secretary (i.e., the Head of the NTIA): Such proposal supports and enhances the multistakeholder model of Internet governance, maintains the security, stability and resiliency of the Internet domain name 2 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin system, meets the needs of global customers and partners of the IANA services, maintains the openness of the Internet and does not replace the role of the NTIA with a government-led or intergovernmental organization solution; and The required changes to ICANN's bylaws contained in the final report of ICANN's Cross Community Working Group on Enhancing ICANN Accountability and the changes to ICANN's bylaws required by ICANN's IANA Stewardship Transition Coordination Group have been adopted. The US House of Representatives passed the DOTCOM Act on June 23, 2015, but the Act remains in the Senate committee with no indication of further movement since late June 2015. However, in a related effort, a group of Senators led by Ted Cruz recently submitted a letter to the Government Accountability Office (GAO) requesting a legal analysis as to whether the termination of NTIA oversight of the IANA Functions, and delegation of the root zone file to a private, multistakeholder entity (i.e., ICANN and the Post-Transition IANA), by the Executive Branch, comports with the US Constitution. ICANN ACCOUNTABILITY The CCWG-Accountability undertook extensive work during ICANN 53 in Buenos Aires. It published its Second Draft Proposal3 on August 3, 2015, after an additional face-to-face meeting in Paris in late July 2015. The public comment period on the Second Draft Proposal closed on September 12, 2015, although comments continued to be submitted through September 24, 2015. Although there is generally a high level of support for the proposed accountability mechanisms and enhancements within the community as a whole, there are a number of aspects of the proposal that remain problematic and are likely to draw additional attention during ICANN 54, including: Concerns from certain segments of the intellectual property community, primarily copyright industries, regarding the proposed bylaws change to ensure that ICANN “shall not engage in or use its powers to attempt the regulation of services that use the Internet’s unique identifiers, or the content that they carry or provide” and, more specifically, whether this proposed provision could undermine ICANN’s ability to enforce its contracts with registries and registrars; Concerns from stakeholders regarding certain limitations to the proposed Independent Review Process (IRP), including the costs, the scope of review being constrained to ICANN action that exceeds the scope of its mission, articles and bylaws and, thus, the inability to challenge other irrational ICANN decisions, and the proposed de novo standard of review rather than a more favorable abuse of discretion standard; Concerns from stakeholders that the current proposal for enhanced IRP and Request for Reconsideration processes do not require parties to have previously participated in community policy development mechanisms (e.g., public comment processes) before pursuing either of these accountability mechanisms, distorting incentives to participate in the bottom-up processes before seeking redress for ICANN decisions at a late stage; Concerns from stakeholders regarding the currently unlimited ability for the community to veto ICANN strategic plans and budgets over multiple iterations; Concerns from stakeholders regarding the potential destabilizing effects of the proposed community power to recall the entire ICANN board, and regarding the proposed minority view that any of the three Supporting Organizations could exercise the power, individually, to recall the entire ICANN board; Concerns from stakeholders regarding the lack of clear guidance on several aspects of the 3 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin voting processes for community powers, including how voting thresholds will be determined and on what basis Supporting Organizations and Advisory Committees will be allowed to split votes; Concerns from the intellectual property community and other stakeholders that the requirement that ICANN, including a PostTransition IANA entity, remain subject to jurisdiction in the United States be incorporated as a “fundamental bylaw”; and Concerns from stakeholders regarding attempts to selectively incorporate certain human rights principles into ICANN’s articles or mission at the potential exclusion of others. In addition, the board response (through its legal counsel) to the Second Draft Proposal demonstrated significant resistance to a number of the proposed accountability enhancements, including the Single Member Model, community powers (unsurprisingly the board raised concerns over the ability to remove board members or recall the entire board), and enhanced IRP and Request for Reconsideration processes. However, independent legal counsel for the CCWG has advised that the CCWG has previously considered the majority of the concerns raised by the board, and has taken into account the potential impact of its proposals on the board’s ability to comport with its fiduciary and other legal duties. The CCWG and board met face to face in Los Angeles on September 25 and 26, 2015 to discuss the Second Draft Proposal and the board’s reaction thereto, although leaders of the CCWG were careful to highlight that the meeting was not intended as a “negotiation” between the community and the board regarding the community’s accountability recommendations. Nonetheless, we anticipate that the CCWG will incorporate this feedback from the board in preparing a further revised Draft Proposal. The CCWG originally hoped to publish an updated Draft Proposal by ICANN 54, although this timeline has since been delayed given the scope of additional work that remains to be done. Nonetheless, additional advocacy on the ground in Dublin may be necessary to address these outstanding issues and ensure that appropriate changes or refinements are made to the CCWG proposals going forward. Use of Two‐Letter, Country and Territory, and Other Geographic Names at the Second and Top Level Although these issues ultimately garnered less attention during ICANN 53 than expected, we believe they will resurface as key issues during ICANN 54 in view of several recent developments. TWO‐LETTER NAMES AT THE SECOND LEVEL On August 11, 2015, ICANN published an update outlining how it will resolve requests to release two-letter names at the second level that were previously contested by governmental representatives. Their efforts will include: Outreach to governmental representatives to clarify comments; Outreach to registry operators to provide plans to mitigate possible confusion between two-letter names at the second level and corresponding two-letter country codes; Development by ICANN of approval criteria based on these governmental and registry responses; Publication of those criteria for community comment; and Finalization of the criteria for resolving current and future release requests. Although ICANN indicated that it was planning to launch the updates to this process later in August 2015, ICANN has not yet provided any further public status reports. Regardless, ICANN 54 will likely present a key opportunity to continue advocacy efforts aimed at maximizing the release of all remaining two- 4 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin letter names, and undermining government arguments that such names will cause user confusion. FULL COUNTRY AND TERRITORY NAMES AT THE SECOND LEVEL On August 14, 2015, the Governmental Advisory Committee (GAC) published an updated table indicating which countries require notification of all requests to release full country and territory names at the second level (comprising the vast majority), which countries would only require notification for requests from non- .BRAND TLDs, and which would not require any notification. To date, ICANN has received more than 30 requests for the release of full country and territory names in new gTLDs, from .BRAND, geographic and unrestricted TLDs alike. Of these, the vast majority remain in the “public comment” phase, even though the public comment periods for many such requests have closed and ICANN staff reports of public comments have been delivered.4 Thus, ICANN 54 presents a key opportunity to continue to pressure ICANN to fairly and timely evaluate these requests, and to advocate with governmental representatives to approve (or at least not object) to the use of their country or territory name at the second level in all new gTLDs, but especially .BRAND TLDs where there is very minimal likelihood of user confusion. GEOGRAPHIC NAMES AT THE TOP LEVEL Argentina Proposal Despite substantial community opposition, including within the GAC itself, the GAC Working Group on Geographic Names, spearheaded by Argentina representative Olga Cavalli, continues to push forward with the Argentina Proposal. For obvious political reasons, the Argentina Proposal was unlikely to die during ICANN 53 in Buenos Aires; however, there have been no meaningful updates to the community or further reactions from the GAC Working Group since the public comment period on the original Proposal closed on December 31, 2014, with the exception of a single GAC-led “community session” during ICANN 52 in Singapore in February 2015. We expect the Argentina Proposal to resurface at ICANN 54, with a strong possibility that a second draft proposal will be published just ahead of the meeting, or during the meeting itself, and that another ad hoc session regarding the proposal will be held. Thus, we anticipate that ICANN 54 will present a critical opportunity to reinvigorate community efforts to oppose the Proposal, including through additional pressure on the GAC, and in particular the GAC Chair, to sunset the Geographic Names Working Group for lack of support. Given the persistence of Ms. Cavalli in continuing to pursue the Proposal, it will be critical to push other members of the GAC to strongly and publicly reject continued efforts. Cross‐Community Working Group on Use of Country and Territory Names as TLDs Despite repeated clashes with the GAC Working Group on Geographic Names, the CrossCommunity Working Group on Use of Country and Territory Names as TLDs (CWG-UCTN) continues its efforts to develop a policy framework for the use of two-letter, three-letter and full country and territory names at the top level, in view of current ICANN policy prohibiting the use of such names as TLDs (as reflected in the Applicant Guidebook). The CWG-UCTN has collected initial input regarding the use of two-letter names and, just after ICANN 53 in Buenos Aires, began discussions around the use of three-letter names. Although many are familiar with twoletter country code TLDs (ccTLDs), each country and territory has also been assigned a threeletter country code, although these codes have never been activated in the DNS. Nonetheless, 5 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin ICANN prohibited applications in the 2012 new gTLD round that conflicted with any of these three-letter codes. Because this issue could have implications for future applicants, including three-letter brand owners interested in securing their own .BRAND TLD, such stakeholders may wish to provide input to the CWG-UCTN in favor of a policy whereby all three-letter names are eligible to serve as new gTLDs, subject to any string similarity rules to prevent end-user confusion. We expect the CWG-UCTN to hold a meeting during ICANN 54, and it will be important to track developments of the group and support less restrictive gTLD eligibility policy options where appropriate. Planning for Subsequent New gTLD Rounds During ICANN 53, the GNSO Council directed ICANN staff to prepare an issue report on new gTLD subsequent rounds, as a preliminary step to launching a PDP Working Group to fully examine every aspect of the 2012 round and to change, tweak, or refine policy and implementation for subsequent rounds of new gTLD applications. On August 31, 2015 ICANN published the Preliminary Issue Report on New gTLD Subsequent Procedures5 for public comment. The Report explicitly addresses a large number of issues involved in the new gTLD process, mainly drawn from the work of the New gTLD Subsequent Procedures Discussion Group, but also indicates that a subsequent rounds PDP Working Group would be free to consider any additional issues pertaining to any aspect of the new gTLD process. The issues specifically addressed in the Report include: Cancelling subsequent procedures Application submission period IGO/INGO protections Predictability Support for applicants from developing countries Closed generics Competition, Consumer Choice and Consumer Trust Different TLD types New gTLD applicant freedom of expression Community engagement Reserved names lists String similarity Applicant Guidebook Base contract Objections Clarity of application process Registrant protections Accountability mechanisms Applications assessed in rounds Compliance Community applications Accreditation programs Registrar non-discrimination Internationalized Domain Names and universal acceptance Systems TLD rollout Security and stability Application fees Second-level rights protection mechanisms Applicant reviews of technical, operation, and financial capabilities Communications Registry/registrar standardization Name collisions Application queuing Global public interest Although the public comment period on the Report was initially set to end on October 10, 2015, just prior to ICANN 54, the GNSO Council voted to extend the public comment period until 6 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin October 30, 2015, providing the community with an opportunity to further discuss the issues in the Report during the Dublin meeting before comments are due. Although the Report and Charter will scope the issues for the PDP Working Group and it will therefore be important to ensure all appropriate issues are included for consideration, it will be of greater importance to participate actively in the PDP Working Group, once constituted, to shape discussions in preparation for a future round of new gTLDs. The IPC is currently in the process of drafting its public comment on the Preliminary Issue Report, having identified a handful of areas requiring additional information, clarification, or other improvement, or, on the other hand, garnering explicit support, including: The PDP should be fluid in view of numerous dependencies of issues on other issues and on ongoing review and other datagathering processes; The Report may require reorganization to minimize confusion, and improve clarity, particularly to ensure all pertinent subjects are included, and to highlight interdependencies; The PDP should refer back to “first principles” to consider whether any fundamental policy changes are needed, including an examination of the question “What makes for a good steward of a gTLD?”; Application evaluation criteria should examine more than mere technical and financial health; A number of issues are missing, inadequately addressed, or are so distributed across the Report that they are not readily apparent to the community, including: Root zone stability; Premium names and pricing; and ICANN compliance. Enforceability of obligations at various stages of the application, contracting, and postcontracting phases is ambiguous and should be an issue examined and clarified by the PDP; Differentiating policy versus implementation is premature at this stage, but the PDP should take into consideration the procedures devised by the Policy & Implementation Working Group to guide designation of issues as “policy” or “implementation” at the appropriate stage; and The PDP should consider “chunking” issues if appropriate discrete categories are developed. Once the public comment period on the Preliminary Issue Report closes, staff will review the comments and prepare a Final Issue Report and a final charter for the PDP Working Group. We expect the Working Group to be formed by the end of the year. Privacy & Proxy Services Accreditation Issues Since the publication of its Initial Report6 in early May 2015, the Privacy & Proxy Services Accreditation Issues PDP Working Group has attracted a significant amount of attention both within the ICANN community and beyond, with reactions to the Initial Report coming in overwhelmingly in support of robust privacy protection for domain name registrants and Internet users more broadly. Since the public comment period closed in early July 2015, the Working Group has been expending significant effort in reviewing and analyzing well over 10,000 public comments, and working to incorporate public feedback into a Final Report. We expect this momentum to continue into ICANN 54, as substantial ideological debates continue to rage within the group on basic principles such as a registrant’s right to privacy and principles of applicable law and due process. While intellectual property owners—and, in 7 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin particular, representatives of copyright industries—continue to push hard for a robust accreditation scheme that would require or enable disclosures of registrant contact details on grounds of intellectual property infringement, substantial opposition remains at a fundamental level among contracted parties (including service providers themselves), as well as privacy and free speech advocates. Although the Working Group initially planned to submit a Final Report prior to ICANN 54, this has been delayed until after ICANN 54— potentially beyond the end of the year—in view of the ongoing lack of consensus within the group on fundamental issues. As such, we expect ICANN 54, including a second facilitated face-toface meeting of the PPSAI Working Group, to present a key opportunity to weigh in. Next‐Generation gTLD Registration Directory Services to Replace WHOIS Although WHOIS-related issues have commanded attention within ICANN for many years, the piecemeal approach to WHOIS improvements and reform that has been employed to date has generally proven inadequate to address key issues. As a result, in recent years, the community has pushed for a “clean slate” approach in the hopes of developing a possible “next-generation” registration directory service (RDS) to replace WHOIS. After some discussion at ICANN 53 around this issue, ICANN published a Preliminary Issue Report on Next-Generation gTLD Registration Directory Services to Replace WHOIS7 on July 13, 2015. The comment period closed on September 6, 2015, and the staff report of the comments submitted was expected to be published on September 27, 2015 although it is currently overdue. Given the importance of this undertaking for all stakeholders, we expect substantial discussion of this issue to take place during ICANN 54, with a Final Issue Report expected just after ICANN 54 and the PDP Working Group likely to be formed by the end of the year. Clearly, this PDP Working Group presents a critical forum and opportunity for the community to take a tabula rasa approach to WHOIS reform, for the first time since the original WHOIS system was developed, with the potential to correct a number of deficiencies in the current system and provide a more balanced registration directory system for all stakeholders. ICANN Contractual Compliance Issues Intellectual property stakeholders continue to raise ICANN contractual compliance as a major issue, having already flagged it as a possible topic for discussion with the ICANN board during ICANN 54. The IPC appears to be growing more frustrated with the ICANN compliance department’s continuous dismissal of its concerns regarding non-transparent and lax contractual enforcement, particularly with respect to the Public Interest Commitments under the new gTLD registry agreement8 and Section 3.18 of the 2013 Registrar Accreditation Agreement9 (RAA) (obligating registrars to investigate and respond appropriately to reports of intellectual property infringement and other abuse). In discussions in and since Buenos Aires, ICANN Compliance Head Allen Grogan has repeatedly suggested that ICANN lacks the ability to take action to enforce these provisions, and that it is up to aggrieved community members to pursue dispute resolution options such as the Public Interest Commitment Dispute Resolution Procedure (PICDRP) directly against registry operators. This has raised the ire of the IPC considerably and exacerbates fears that the community is attempting to denigrate ICANN’s contractual enforcement capabilities in other fora, particularly the CCWG-Accountability. More specifically, as noted above, the IPC and other stakeholders have flagged the proposed bylaws change to ensure that ICANN “shall not engage in or use its powers to attempt the regulation of services that use the Internet’s 8 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin unique identifiers, or the content that they carry or provide” as potentially undermining ICANN’s ability to enforce its contracts with registries and registrars, insofar as such activity could be viewed as “regulating” these service providers’ “content.” While we believe this is not the intent of this proposed Bylaw language, we expect the CCWG to provide additional clarification during ICANN 54. In view of these concerns, we expect contractual compliance to continue to be a banner issue for the IPC during ICANN 54, although ICANN appears to remain relatively unsympathetic to non-contracted party views on this subject. GNSO Elections In addition to these substantive topics, ICANN 54 will involve various changes in leadership both within the GNSO Council and within the various stakeholder groups and constituencies of the GNSO. These changes may very well affect the overall working dynamics of both the Council and the broader GNSO. Therefore, we thought it prudent to include a preliminary analysis of these upcoming changes in GNSO officers. GNSO COUNCIL CHAIR AND VICE CHAIR ELECTIONS The current Chair of the GNSO Council, Jonathan Robinson from the Registry Stakeholder Group (RySG), will see his term come to an end during ICANN 54. The Council recently approved a timeline for electing its new Chair, in alignment with the requirements GNSO Operating Procedures. Under this timeline: Each GNSO House choosing to submit a nominee must do so by September 25, 2015; Candidacy statements must be submitted by October 2, 2015; Each candidate must thereafter undergo a formal interview or similar interaction with Council; and Chair elections to be held on Thursday, October 22, 2015, during the Dublin ICANN meeting, after new GNSO Councilors have taken their seats (the final day of current GNSO Councilor terms is Wednesday, October 21, 2015). Current IPC Councilor Heather Forrest has been put forward as a nominee for Council Chair from the Non-Contracted Parties House (NCPH), with informal support having been noted both within the IPC, as well as within other groups in the NCPH. Meanwhile, Registrar Stakeholders Group (RrSG) representative James Bladel from GoDaddy Inc. has been formally nominated by the Contracted Parties House. Although the selection is sure to have some affect on the Council’s working dynamics, the Chair is required to refrain from imparting any biased constituency/stakeholder group views into his or her management of the Council. Nonetheless, the Chair certainly could subtly affect stakeholder empowerment, although the community would be quick to reprimand such behavior. A member of the IPC has never held the GNSO Council Chair position. In addition, should any current GNSO Council Vice Chair be elected Chair, an additional election would be held to replace that Vice Chair. Few additional details have emerged as to this aspect of the Chair election, although it does not appear that either of the current Vice Chairs (Volker Greimann from the RrSG and David Cake from the NCSG) are likely to run for Chair. For more information about the topics raised in this legal update, please contact any of the following lawyers. Brian Winterfeldt +1 202 263 3284 firstname.lastname@example.org Michael D. Adams +1 312 701 8713 email@example.com 9 Mayer Brown | Seven Key Topics to Track During ICANN 54 in Dublin Phillip V. Marano +1 202 263 3286 firstname.lastname@example.org Griffin M. Barnett +1 202 263 3289 email@example.com Endnotes 1 ICANN, Final IANA Transition Proposal (July 2015), available at https://www.ianacg.org/icgfiles/documents/IANA-stewardship-transition-proposalEN.pdf. 2 U.S. Congress, Domain Openness Through Continued Oversight Matters (DOTCOM) Act of 2015 (June 24, 2015), available at https://www.congress.gov/bill/114thcongress/house-bill/805/text. 3 ICANN, CCWG-Accountability Second Draft Proposal (Aug. 3, 2015), available at https://www.icann.org/en/system/files/files/ccwg-draft-2- proposal-work-stream-1-recs-03aug15-en.pdf. 4 See ICANN, Registry Service Evaluation Process (last visited Sept. 28, 2015). 5 ICANN, Preliminary Issue Report on New gTLD Subsequent Procedures (Aug. 31, 2015), available at http://gnso.icann.org/en/issues/new-gtlds/subsequentprocedures-prelim-issue-31aug15-en.pdf 6 ICANN, Privacy & Proxy Services Accreditation Issues PDP Working Group Initial Report (May 4, 2015), available at http://gnso.icann.org/en/issues/raa/ppsai-initial-05may15- en.pdf. 7 ICANN, Preliminary Issue Report on Next-Generation Registration Directory Services to Replace WHOIS (July 13, 2015), available at http://whois.icann.org/sites/default/files/files/rds-prelimissue-13jul15-en.pdf. 8 ICANN, New gTLD Registry Agreement (Jan. 9, 2014), available at http://newgtlds.icann.org/sites/default/files/agreements/a greement-approved-09jan14-en.htm. 9 ICANN, 2013 Registrar Accreditation Agreement (Sept. 17, 2013), available at https://www.icann.org/resources/pages/approved-withspecs-2013-09-17-en#raa. 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