Colombia has successfully defended itself against a $350 million lawsuit filed by U.S. company Vercara, formerly known as Neustar, in a legal battle over the management of the “.co” internet domain. The International Center for the Settlement of Investment Disputes (ICSID), part of the World Bank, ruled in favor of the Colombian government, sparing the country from paying the hefty claim.

Contract renewal dispute: Vercara, responsible for the development and security of the “.co” domain, filed the lawsuit in 2019, claiming that Colombia had breached the terms of their contract. The dispute stemmed from a 2009 agreement in which Neustar was contracted to manage the “.co” domain for ten years, with expectations of a renewal. However, as the contract neared its end in 2019, Colombia launched a public tender for the domain’s management, which Vercara argued was biased against them. Though Vercara ultimately retained the contract, they claimed significant financial losses and reduced terms.

In his 2019 article, Kieren McCarthy observed that the Colombian government’s tender process “seemed to have been specially constructed so that only Afilias, then Neustar’s fiercest rival and now part of Identity Digital, could win.” He added that the technical requirements set in the government’s RFP appeared “naive and arbitrary at best and dodgy at worst,” reflecting concerns about fairness and transparency. This suspicion of bias formed the core of Vercara’s claims, which ultimately led to the lawsuit.

Claims dismissed: Vercara alleged that the Colombian government violated the U.S.-Colombia Trade Promotion Agreement by not meeting standards of fairness and transparency during the contract renewal process. However, the ICSID court dismissed all of Vercara’s claims, both on the merits of the case and on jurisdictional grounds.