All, FYI. Jonathan From: Flanagan, Sharon [mailto:sflanagan@sidley.com] Sent: 14 April 2016 16:05 To: Client Committee <cwg-client@icann.org> Subject: [client com] Chuck Gomes Comments Dear All, Chuck’s comments were forwarded to us and our notes and responses are below. Best regards, Sharon
In my personal review of the Bylaws I noted the following issues that I don’t think were covered in the CWG Bylaws Review meeting today:
· There are several acronyms or terms that are used before they are defined:
SO: Observed that as well, but considering that their explanations are quite long and detail I wonder to what extent they could reorganise things. [Sidley comment: We are adding “as defined in Section ___” where defined terms are used before they have been defined.]
· Unless I missed it somewhere, as far as I can tell the ‘Decisional Participants’ are not named anywhere in the Bylaws even though they are referenced dozens of times.
SO: That seem to be attributed(defined) in Section 6.1a [Sidley comment: “Decisional Participants” is defined in Article 6, Section 6.1(a).]
· Section 8.2 on page 54 of the redlined version (page 56 overall) says that one member of the NomCom will be selected by the NCUC.
SO: While I think this is particularly within the scope of the CCWG, I don't think nomcom composition was even discussed in that group and I am quite surprised that there has been edits that exceeds just renumbering on that section.
o I have no problem with that but I do wonder if it should say NCSG instead of NCUC.
o I am pretty sure that the original version of this language was before there was a NCSG and before the NPOC existed.
SO: While my concern above still stand, the version I am looking at that compares the current bylaw with proposed version seem to indicate that it's been NCUC all along. [Sidley comment: Edits have not been made to the provision requiring one delegate of the NomCom to be “from consumer and civil society groups, selected by the Non-Commercial Users Constituency” other than to renumber that subsection (Section 8.2(g)(vi)); NomCom composition was not discussed in the CCWG Proposal.]
· Section 16.2(a) on page 86 of the redline version (page 89 overall) says: “ICANN, in its capacity as the sole Member of PTI, shall elect the directors of PTI in accordance with the articles of incorporation and bylaws of PTI and . . .”
o It is my understanding that ICANN shall elect three of the five directors, not all five.
o Shouldn’t this be corrected?
SO: Oops that's a good catch and somehow I thought I saw where the composition was indicated early now I can't seem to find it. Thanks for noting that [Sidley comment: ICANN will elect all directors of PTI in its capacity as the sole member of PTI; ICANN will be instructed in the PTI governing documents on how to vote with respect to PTI director elections (i.e., the allocation of directors on the PTI Board between independent directors and employees of ICANN or employees of PTI); any amendment of the provisions in the PTI governing documents relating to PTI Board composition could be rejected by the EC pursuant to Section 16.2(c)(vii)).]
· Section 18.7(c) on page 97 of the redline version (page 100 overall) says that the IFRT will contain two (2) representatives from the RySG. [Sidley comment: Section 18.7(c) requiring each IFRT to include two representatives appointed by the Registries Stakeholder Group is consistent with the CWG Proposal, Paragraph 283.]
o Note that it also says that there will be three ccTLD members (two from the ccNSO and one not from the ccNSO).
o Note also that Section 19.5(iii) says that the SCWG will have three (3) RySG representatives, the same number as for ccTLDs, two from the ccNSO and one not from the ccNSO. [Sidley comment: Section 19.5(a)(iii) requiring each SCWG to include three representatives appointed by the Registries Stakeholder Group is consistent with the CWG Proposal, Paragraph 393.]
o Was this just an inadvertent oversight?
o It seems to me that the IFRT should have three (3) representatives from the RySG.
SO: For IFRT, one could say that the Rysg having 2 is because Registrar stakeholder group has one which makes 3 in total and perhaps that of the SCWG needs to be updated to 2 RySG. On a sightly related note, the more I look at the compositions on the review teams the more I wonder how this skipped us during the proposal development. There are 8/9 votes (counting the NCSG and CSG) already from the SO related groups and just 4 from the AC. It's a huge imbalance that makes me still wonder what went wrong during the discussion that made us not to pay attention to that. This is the more reason why I will always be against anything with majority in it as a way of making decisions within the groups! Regards
· Section 22.4(b), IANA Budget, says: “At least 45 days prior to the commencement of each fiscal year, ICANN shall prepare and submit to the Board a proposed annual budget of ICANN for direct costs for ICANN’s IANA department, all costs for PTI, direct costs for shared resources between ICANN and PTI and support functions provided by ICANN to PTI and ICANN’s IANA department for the next fiscal year (the “IANA Budget”), which shall be posted on the Website.”
o The recommendation of DT-O regarding the IANA Budget was that it be approved prior to approval of the ICANN Budget.
o DT-O’s recommendation was made prior to any knowledge that a change to the Bylaws would be proposed to require submission of an ICANN Budget to the Board 45 days prior to the start of the applicable fiscal year.
o I support the requirement for submission of an ICANN Budget to the Board 45 days prior to the start of the applicable fiscal year but believe that there are advantages to the IANA Budget being approved earlier than the ICANN Budget; having the IANA Budget approved prior to consideration of the final ICANN Budget will: [Sidley comment: This proposed change to be discussed with ICANN once CWG signs off on the relevant provisions.]
§ Remove any dependency of IANA services funding from approval or veto of the ICANN Budget
§ Allow more time for resolution of a veto of the IANA Budget
§ Provide increased confidence that IANA services will continue without interruption.
o My personal recommendation would be that the IANA budget be submitted for Board approval with sufficient time to be approved prior to submission of the ICANN Budget for Board approval.
o Note that DT-O plans to discuss this issue in its meeting on 13 April 2016.
· Paragraph (e) in Section 3.2 (SO/AC Director removal process) on page 187 of the redline version (overall page 190) requires “a three-quarters majority of an applicable Decisional Participant as determined pursuant to the internal procedures of the Applicable Decisional Participant for the SO/AC Director Removal Petition.
o If the GNSO is the applicable Decisional Participant, the GNSO does not presently define what a ‘three-quarters majority’ is.
o Presumably, following current threshold definitions for the GNSO Council, a three-quarters majority would be defined as a three-quarters majority of each house.
o Is the addition of this definition considered to be an implementation action item for the GNSO?
[Sidley comment: Our understanding is that this will form part of implementation for the GSNO, along with other procedures to be adopted by the Decisional Participants.]
· Paragraph 1.f in Annex E, The ICANN Caretaker Budget, on page 208 of the redline version (overall page 211) says: “Notwithstanding any other principle listed above, prevents ICANN from initiating activities that are subject to community consideration (or for which that community consideration has not concluded), including without limitation, preventing implementation of the expenditures or undertaking the actions that were the subject of the ICANN Budget that was rejected by the EC and that triggered the need for the Caretaker ICANN Budget.” [Sidley comment: We defer to CWG on this since the caretaker budgets are not specified in detail in the proposals.]
o This clause seems appropriate in a case where the EC rejects the budget because it does not support funding certain actions or thinks that too many funds are allocated to those actions.
o But what about a situation in which the EC rejects the budget because it believes that insufficient funds are budgeted for certain actions? In a case like that, it might not be necessary to prevent funding of the actions while the dispute is resolved; in other words, it might be fine if the actions proceeded at the reduced funding level until a decision is made on increased funding, especially if taking the actions at the reduced funding level would not negatively impact the actions if increased funding was provided later.
o I wonder whether this clause should be reworded to accommodate such situations; if so, then a change may also need to be made in section 2.b.v, Examples of expenditures that would be excluded from a Caretaker Budget: “the proposed expenditure that was the basis for the rejection by the EC that triggered the need for the Caretaker ICANN Budget.”
· Paragraph 1.f in Annex F, IANA Caretaker Budget Principles, on page 211 of the redline version (overall page 214) says: “Notwithstanding any other principle listed above, prevents ICANN, in its responsibility to fund the operations of the IANA functions, from initiating activities that are subject to community consideration (or for which that community consultation has not concluded), including without limitation, preventing implementation of the expenditures or undertaking the actions that were the subject of the IANA Budget that was rejected by the EC and triggered the need for the Caretaker IANA Budget.” [Sidley comment: We defer to CWG on this since the caretaker budgets are not specified in detail in the proposals.]
o This clause seems appropriate in a case where the EC rejects the budget because it does not support funding certain actions or thinks that too many funds are allocated to those actions.
o But what about a situation in which the EC rejects the budget because it believes that insufficient funds are budgeted for certain actions? In a case like that, it might not be necessary to prevent funding of the actions while the dispute is resolved; in other words, it might be fine if the actions proceeded at the reduced funding level until a decision is made on increased funding, especially if taking the actions at the reduced funding level would not negatively impact the actions if increased funding was provided later.
o I wonder whether this clause should be reworded to accommodate such situations; if so, then a change may also need to be made in section 2.b.v, Examples of expenditures that would be excluded from a Caretaker Budget: “the proposed expenditure that was the basis for the rejection by the EC that triggered the need for the Caretaker ICANN Budget.” (Note that a minor edit is needed: it should say Caretaker IANA Budget, not Caretaker ICANN Budget.)
o Note that DT-O plans to discuss this issue in its meeting on 13 April 2016.
· Note that a glossary of acronyms and key terms would be a very useful aid for community members. [Sidley comment: This has been recommended to ICANN but there are concerns that there is insufficient time to develop such a list and gather feedback.]
SHARON R. FLANAGAN SIDLEY AUSTIN LLP 555 California Street Suite 2000 San Francisco, CA 94104 +1 415 772 1271 sflanagan@sidley.com <mailto:sflanagan@sidley.com> <http://www.sidley.com> www.sidley.com <http://www2.sidley.com/files/upload/signatures/SIDLEY_150-AUTOSIG.png> **************************************************************************************************** This e-mail is sent by a law firm and may contain information that is privileged or confidential. If you are not the intended recipient, please delete the e-mail and any attachments and notify us immediately. ****************************************************************************************************