ICA's commentary posted at http://www.internetcommerce.org/Congress_to_Beckstrom Philip S. Corwin Partner Butera & Andrews 1301 Pennsylvania Ave., NW Suite 500 Washington, DC 20004 202-347-6875 (office) 202-347-6876 (fax) 202-255-6172 (cell) "Luck is the residue of design." -- Branch Rickey ________________________________________ From: owner-bc-gnso@icann.org [owner-bc-gnso@icann.org] On Behalf Of Philip Sheppard [philip.sheppard@aim.be] Sent: Friday, September 18, 2009 3:22 AM To: 'BC gnso' Subject: [bc-gnso] Letter from members of the US House Committee on the Judiciary to ICANN For information - re new gTLDs Letter from members of the USA House Committee of the Judiciary. From: http://www.icann.org/correspondence/smith-coble-to-beckstrom-15sep09-en.pdf Dear Mr Beckstrom, Congratulations on your recent appointment as President and Chief Executive Officer of the Internet Corporation for Assigned Names and Numbers (ICANN). You assume responsibility of the principle private sector organization charged with maintaining the security and stability of the global Internet at a critical juncture. The contemporaneous consideration of the rollout of an unrestricted number of generic top level domains (gTLDS) in conjunction with the scheduled expiration of the Joint Project Agreement (JPA) presents historic challenges and turning points in Internet Governance. As senior leaders of the House Committee on the Judiciary, which has jurisdiction over matters that relate to criminal justice, competition and intellectual property rights, we have a longstanding interest in matters that affect the domain name system (DNS). In this capacity, we would like to share with you our concerns regarding the proposed new generic domain name expansion and the expiration of the JPA. It has come to our attention that the proposed unlimited expansion of gTLDS will likely result in serious negative consequences for U.S. businesses and consumers, As new gTLDs are created, many businesses fear being forced to defensively register trademarks and variations of their marks to block cybersquatters from illegitimately trading on their good will and to protect consumers from increased incidences of fraud. We note that the absence of price caps in the new registry agreements could mean that legitimate businesses with an established consumer base and Internet presence may be discriminated against and compelled to pay a premium for each new domain name they register or renew. We also note that the record concerning the impact this proposed expansion will have on competition is woefully inadequate. To our knowledge, the only economic justification put forth thus far has been an ICANN-commissioned report that has been widely criticized for failing to include empirical data or analysis in support of its conclusion that the unrestricted expansion of gTLDs will result in net consumer benefits. We are aware that ICANN has taken some steps to respond to the concerns of intellectual property owners by establishing an Implementation Recommendation team (IRT) charged with developing specific proposals to protect intellectual property interests. However, we note with disappointment that serious consideration of these interests did not occur in the normal course of ICANN's policy development process, and the IRT was formed only after considerable public outcry arose from the business and intellectual property communities. We further note that decisions regarding the execution of the IRT's recommendations have not been publicly announced as well as our concern that it appears such disclosures are not intended to be made available to the public prior to the scheduled expiration of the JPA. This apparent time-line reinforces the perception that ICANN decision-making processes lack critical transparency and accountability. Given the late consideration of intellectual property concerns, the lack of a credible independent analysis on competition issues in the context of proposals to expand gTLD's, as well as ICANN's less-than-stellar track record on a variety of other issues (enforcement of registrar obligations, accuracy of publicly available Whois data), we have serious misgivings about the prospect of terminating the formal relationship between the U.S. Government and ICANN that is currently represented by the JPA. In the interests of better understanding ICANN's position on these and related matters, we will appreciate your providing the Committee with answers to the following questions: 1. Which of the recommendations of the IRT does ICANN plan to implement? What is the justification for not publicly announcing such decisions prior to the September 30, 2009 scheduled expiration of the JPA and instead deferring such public notice and review until publication of the new version of the Draft Applicant Guidebook? If implemented, how will the recommendations put forth by the IRT serve to reduce or eliminate the need for defensive registrations? Will any of recommendations prevent price gouging by registries and registrars? 2. Does ICANN intend to carry out a comprehensive, empirical economic study to examine the impact on competition that additional gTLDs may have? If not, what confidence can the public have that the expansion of gTLDs will improve rather than hinder, competition? Assuming the rollout goes forward, what steps will ICANN take to monitor the impact on competition in the future? 3. Do you recognize a need for and support the establishment of a permanent instrument that memorializes the relationship between ICANN and the U.S. Government? If not, what are your current thoughts on an extension of the JPA prior to its expiration on September 30, 2009? What key elements do you think should be incorporated into such as permanent or temporary agreement? What assurances do citizens of the United States have that ICANN will effectively meet the goals set out in the JPA if it or a successor agreement is not formally extended? As a final matter, we wish to associate ourselves with many of the concerns articulated by the ICANN's Government Advisory Committee in their letter of August 18, 2009 (copy enclosed) to the Chairman of ICANN's Board. We would appreciate your assessment and response to the matter detailed in that letter, particularly as they relate to the stability of the Internet and the absence of clear evidence that the introduction of new gTLDs will provide net benefits to consumers. The effects of policies adopted by ICANN transcends the narrow technical operation of the global Internet. The policy choices made and the manner they are implemented affect the rights, property and security of consumers, companies, non-governmental organizations and governments worldwide. With this enormous impact, ICANN has an obligation to ensure there are inclusive, transparent, and accountable processes that consider fully the perspectives of ALL stakeholders, before rendering significant decisions or implementing substantial policy changes. We urge you to weigh carefully the concerns expressed by us, the GAC, and other parties before finalizing a course of action and we look forward to receiving your written response by Tuesday, September 22, 2009. Sincerely, Lamar Smith, Ranking Member, House Committee on the Judiciary Howard Coble, Ranking Member, Subcommittee on Courts and Competition, House Committee on the Judiciary