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A recent ICANNfocus article discussed the magnitude of ICANN’s legal fees. Specifically, ICANNfocus questioned whether the extent of ICANN’s legal fees, about 20% of their total revenues, was related to the organization functioning as a regulator instead of simply as a technical manager of the internet.

In an article in the National Journal’s “Technology Daily,” ICANN’s General Counsel discusses the organization’s legal costs. The ICANN official is quoted as responding to questions about the organization’s legal expenses by stating that internet is built on interconnected contracts and that, “[l]egal expenditures are necessary to both construct these legal relationships and to resolve disputes that may arise as these relationships mature.”

ICANN’s statement appears to bolster the theory that the significant size of their legal bills is due to: 1) the organization’s regulatory activities; and 2) the closed nature of their regulatory development and enforcement processes. An example of how ICANN’s regulatory actions increase their legal bills may be found in the Explanatory Notes to their Request for Proposal for new sponsored Top Level Domains (sTLD).

The ICANN RFP explains that, following an evaluator’s recommendations regarding an application for a new sTLD, “ICANN staff will proceed with contract negotiations and develop an agreement reflecting the commercial and technical terms to be agreed, although such terms may be subject to further amendment, as appropriate.”

What ICANN does not explain is why they are developing such “commercial and technical terms,” along with “further amendment” on a closed, case-by-case basis in the first place. It appears that ICANN’s legal bills for contract development and resolution could be sharply reduced if they were to offer a simple, standardized legal agreement open to any party meeting necessary basic criteria.

Use of basic standardized legal agreements would likely reduce ICANN’s legal costs while substantially enhancing the organization’s transparency and reducing their discretion. Thus, use of simple, open legal agreements could help return ICANN to the path of being a technical manager, rather than regulator, of the internet.

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John P.  –  Jun 3, 2004 5:39 AM

I am new to this forum, yet am extremely glad that I found it.  This particular article I am commenting on, I am reminded of the Praetorian guard barracks in old Rome: “Who guards the guardians?”  At every point of control and “absolute” power - one must ask, where is the impetus to create a true benefit for the whole, versus a single-minded focus for the one or the organization.  Yes, I am that rarest of beasts - a flaming conservative from the early 70’s - a person that firmly believes in fiscal responsibility and conservative behavior (I’m made two ex-wives rich) while insisting on focus on the premise of why the body is in place at all, and an ultimate advocate of personal freedom.  ICANN has always struck me as a body with too much power that has no proper oversight, thus can make decisions that make no coherent sense for society as a whole.  I am not about to criticize all the hard work they have done, I don’t think anyone envisioned the explosion of the net nor the recent re-explosion after it seemed it had ?calmed down? (60,000,000 plus domains registered and active in one year!).  I have seen over the years insane decisions made by ICANN.  At the same time, I’ve seen them struggle with the unanticipated growth of this monster called The Net.  Who guards this guardian?  What forum exists to openly question and challenge?  Yep, I’m a radical.  Will always be.  Yet I totally respect authority that is derived from the whole and respects it (I guess that’s called a democracy).  What can I do as a gadfly, an anarchist, a change agent, a strategist, or a supporter?

Be well,

John P.

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