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Clearing up the “logjam”: ICANN Must Drop its Request for a Unilateral Right to Amend the Agreements

A very rare thing happened in the GNSO Council meeting this week—the ICANN community spoke with one voice. Registries, registrars, non-commercial interests, new TLD applicants, IP owners and businesses unanimously and unambiguously agreed that giving ICANN a “unilateral right to amend” the registry and registrar agreements is not compatible with ICANN’s bottom-up processes and poses a fundamental threat to the multi-stakeholder model. There is true consensus that this change should be rejected.

On February 5, 2013, ICANN surprised the community by re-introducing its demand for a unilateral right to amend the gTLD Registry Agreement. ICANN made the same change in the Registrar Accreditation Agreements. (This was posted for public comment on March 7, 2013. See: Proposed 2013 RAA Posted for Comment).

This move came without consultation, nearly five years after the new gTLD Program moved into the implementation phase, and three years after the community and ICANN, through a bottom-up process, rejected this approach and reached a compromise on similar language.

During the GNSO Council’s monthly teleconference on March 14, 2013, while discussing the recent changes to the Registrar Accreditation Agreement, Council members raised the topic of ICANN’s proposed unilateral right to amend the registry and registrar agreements. ICANN staff present on the call explained its position, saying, “the amendment clause is actually intended to be last resort for when there is agreement that something needs to be done, but there is a logjam within the processes that we have that don’t allow us to move forward.” Essentially, ICANN is asking, “what happens when everyone agrees that a particular change is needed, but the multi-stakeholder processes—or someone manipulating those processes—prevents the community from moving forward with what the community wants.”

Taken in isolation and without any other context, this is a perfectly reasonable question. If there truly were no mechanisms in the registry or registrar agreements to make necessary changes when the community demands action, then ICANN staff’s concerns would be justified. It would be a good question to ask if someone could use ICANN processes to block a change that everyone else supported. The fact is, however, that there already are a number of mechanisms ICANN can take to implement community supported changes.

First, of course, contracted-parties can agree to make a change they support. Second, there is a bottom-up Consensus Policy mechanism for critical changes that ensures that any implementation is appropriately balanced across multiple constituencies and stakeholder groups. Truly important and time-sensitive issues can be addressed via Temporary Policies that remain in place for up to a year and, during that year, can be adopted as Consensus Policies. Finally, the new gTLD agreement contains a new mechanism that gives ICANN authority to make amendments supported by a specific percentage of the registry operators effective across the entire registry group. This is the compromise that was developed through a bottom-up process in 2009-2010 when the community rejected the unilateral change provision.

ICANN agreed in 2010 that these three mechanisms gave it the necessary tools to amend the registry contract to implement changes demanded by the community. Apparently, it has had a change of heart and now wants the authority to unilaterally impose changes to the agreements. To date, ICANN’s explanation is that the introduction of new gTLDs will change things in ways that cannot be anticipated. ICANN has not responded to community requests for a concrete example of when this right would actually be needed.

Of course, the ICANN world is not unique—the future is inherently unknown, but parties enter into long-term contracts with high stakes all the time without introducing the kind of uncertainty that a unilateral amendment right would create. To borrow from the gTLD Registries comment made on February 26, 2013: “we are in the midst of dramatic change in the administration of the top-level domain name system. All businesses—whether for profit or nonprofit—require a measure of predictability, stability and certainty of contracts. Public and multi-national company applicants are subject to regulatory regimes that cannot be reconciled with the expanded unilateral authority ICANN is seeking. In deciding whether or not to utilize new gTLDs for their critical infrastructure assets, a key goal of the new gTLD program, registries cannot be subject to the whim of one private entity, even those acting under the guise of public interest, regardless of how well-intentioned that private entity purports to be.”

ICANN’s proposal for this new mechanism, however, has been met with opposition not only from the new gTLD Applicants and existing registries, but also the registrars, non-commercial interests, businesses and IP owners. In fact, every single comment on ICANN’s last minute changes to the new gTLD registry agreement called for its removal. EVERYONE is in agreement that this is a bad idea and should be withdrawn. The fact that the entire community has never been so aligned about a particular subject speaks volumes, but despite this clarity ICANN continues to insist on a unilateral right to amend the registry and registrar agreements,

Ironically, in this case ICANN itself is creating a logjam that is preventing forward movement. By walking away from the version of the legal agreement contained in the final Applicant Guidebook, ICANN is preventing the new gTLD Program from going forward. This same issue is also the logjam preventing the roll out of a new registrar accreditation agreement containing enormous changes that would benefit registrants, law enforcement, intellectual property owners and Internet users in general.

So in response to ICANN’s question about clearing logjams, we think they are asking the wrong question. ICANN should stop worrying about the theoretical logjams of the future. It’s time to take this request for extraordinary, unilateral power off the table in order to clear away today’s very real logjam. Once this request is withdrawn, the new gTLD program can move forward and the Registrar Accreditation Agreement can be finalized.

By Jeff Neuman, Founder & CEO, JJN Solutions

He has been instrumental in providing policy assistance and advice in the fields of internet governance, intellectual property protection and domain name policy since the mid-1990s. Jeff has served in key business, policy and legal roles in the domain name industry for more than 20 years. The views expressed herein reflect my own beliefs.

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What I find amusing is that the Todd Knarr  –  Mar 16, 2013 9:21 PM

What I find amusing is that the terms being objected to aren’t considered unusual or objectionable by the parties objecting to them. They’re the standard terms in every single Terms of Service of every single one of the entities objecting (or at least every one of them whose ToS I’ve seen). As an example, to quote from Dotster’s current ToS:

From section 25d: “This Agreement may not be modified or amended except by another agreement in writing executed by the parties hereto; provided, however, that these Terms of Service may be modified from time to time by Dotster in its sole discretion, which modifications will be effective when posting to Dotster’s Web site or on any subsequent date as may be set forth in any required notice provided by us in connection therewith.”

So the agreement may not be modified, except that Dotster can unilaterally modify it at any time. And “Then go somewhere else.” isn’t a viable response, because there are no other places to go that don’t have the same language in their ToS. So is it that the term itself is objectionable, or is the objectionable part merely being on the receiving end of it?

The Exception - unilateral contracts Salanieta Tamanikaiwaimaro  –  Mar 18, 2013 8:17 PM

Firstly, I do not represent anyone when I make the following statement and the comments are my own personal take on the situation. Firstly, this is a very interesting piece Jeff.

Where ICANN remains exposed to liabilities including but not necessarily limited to “potential antitrust”, it has to take measures that allow for its own protection. When ICANN is exposed, would “EVERYONE” bail it out? No, so it stands to reason to afford some sort of protection and if reserving the right to amend certain portions of the contract is part of it - then it makes legal sense.

Unless it was some kind of “entity” where it would be immune, then it makes sense for ICANN to reserve some of its rights to unilaterally amend contracts. I am not for unilateral contracts but there are instances where they need to be deployed and so in a sense are an exception. Whilst ICANN deploys a multistakeholder approach to governance issues, it does not negate the fact that as a corporation it still is exposed.

On another note, there are many commercial entities that offer unilateral contracts in the first place on the Internet if you want to access products, services or sites.

P.S I am not “EVERYONE”

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