In the interest of compromise and in hopes of not reverting to the 2012 rules and thereby ignoring the Board’s request that we make a recommendation on this issue, please consider this proposal to allow contention resolution via creative means as well as auctions, with guardrails and tweaks made to the well-received hybrid proposal.

It is a blend of many of the compromise solutions proposed. It also accommodates those who do not want ICANN to end up with all auction proceeds but at the same time minimizes the entire pool of money committed, thereby not disadvantaging single applicants.

Objective:
Increase transparency and accountability in contention resolution to improve the perception of ICANN and the new gTLD program.

Proposed process:

• String Similarity evaluation completed
• On Reveal Day, all contention sets are announced (number and entities are revealed)
• A 90-day Resolution Period begins
• Members of a contention set may
• Form a JV
• Withdraw
• Find a creative private resolution
• Fail to resolve
• Members of a contention set may NOT
• Participate in a private auction or auction like mechanism.
• No later than the close of the 90-day Resolution Period, remaining contention sets will be required to provide ICANN with their decision on how to resolve the contention. They will have decided to:
• Agree to create a partnership or other form of joint venture that would allow two or more applicants within a contention set to jointly run and/or operate the applied for string.  Application Change Request requirements will apply, including public comment period.
• Agree to participate in a sealed bid “3^rd Party Auction” which is overseen by ICANN.  Proceeds are distributed amongst the losing applicants in the contention set.
• Agree to participate in an ICANN Auction of Last Resort using the sealed bids.  Proceeds go to ICANN Auctions Proceeds fund.
• Auctions of Last Resort and 3^rd Party Auctions will take place immediately after the 90 day Private Resolution Period 
• For 3^rd Party Auctions
• All auctions are conducted as sealed bids by the same auction provider ICANN chooses for Last Resort auctions.  The applicant that submitted the highest sealed bid amount pays the second-highest bid amount. The auction provider must attest that the participants fully disclosed all information and followed the rules before the funds are released to the losers.
• All bids for all unresolved contention sets are due on the same date, no more than 30 days after reveal of contention sets/into the resolution period.  Auctions for contention sets involving objections, CPE or other outstanding accountability challenges may be delayed but bids are still due no more than 30 days after reveal of contention sets/into the resolution period.
• All auctions are to be conducted in an identical fashion using publicly available procedures.
• All auctions should be finalized as quickly as possible after the 90 day deadline.
• All results are disclosed on a similar timeline as ICANN auctions of last resort from 2012 round, which was usually 72 hours. All parties partaking in the auction as well as winning bidder and amount paid are disclosed.
• Auctions of Last Resort  
• All bids for all unresolved contention sets are due on the same date, no more than 30 days after reveal of contention sets/into the resolution period.  Auctions for contention sets involving objections, CPE or other outstanding accountability challenges may be delayed but bids are still due no more than 30 days after reveal of contention sets/into the resolution period.
• On the auction date, the applicant that submitted the highest sealed bid amount pays the second-highest bid amount.
• Once payment is received, the applicant may proceed to evaluation and eventually the Transition to Delegation.
• In the unlikely event that a winning bidder in either auction format does not pass evaluation (none failed in 2012), the next highest bidder is selected for evaluation.

Requirements:

• Add T&Cs warning applicants that they may not participate in any of the following activities (Prohibited Application Activities):
• They shall not submit applications largely for the purpose of financially benefiting from the resolution of contention sets
• During the 90-day Resolution Period, they will not participate in the resolution of contention sets where non-winning applicants receive financial benefit to withdraw.
• The Registry Agreement must include a mandatory Public Interest Commitment stating that the registry:
• has not submitted applications for the purpose of financially benefiting from the resolution of contention sets.
• has not participated in an auction or auction like mechanisms outside of the ICANN 3^rd party and ICANN Auction of Last Resort.
• agrees to punitive measures for violations listed above, which may include the potential loss of the registry as well as a bar on participation in any future rounds (both for the individuals as well as the entities (and their affiliates) involved.
• The auction provider must agree to fully disclose all information about the auctions
• The auction provider must assert that all rules were followed before releasing auction funds
• All contention set resolutions including creative resolutions, 3^rd Party Auction and ICANN Auctions of last resort must be submitted by ICANN to relevant competition authorities for review.

Benefits:

Full transparency, ICANN oversight and competition authority review mitigate community concerns about nefarious activity.

Unlike the 2012 round, access to data from this point forward can inform future policy making efforts in the program.

Private auctions are eliminated but applicants can still receive proceeds from a 3^rd Party Auction if all applicants in a contention set agree.

Sealed bids tend to result in lower auction prices so decreased auctions proceeds to ICANN fund.

Speeds up the process allowing more applicants to withdraw applications prior to evaluations resulting in greater refund amounts and faster processing of remaining applications.

Jim Prendergast

The Galway Strategy Group

+1 202-285-3699

From: Gnso-newgtld-wg <gnso-newgtld-wg-bounces@icann.org> On Behalf Of Steve Chan
Sent: Tuesday, June 30, 2020 8:44 PM
To: gnso-newgtld-wg@icann.org
Subject: [Gnso-newgtld-wg] Proposed Agenda - New gTLD Subsequent Procedures PDP WG - Thursday, 02 July at 03:00 UTC for 90 Minutes

Dear WG Members,

Please find below the proposed agenda for the WG meeting on Thursday, 02 July 2020 at 03:00 UTC for 90 minutes.

Proposed Agenda:

1. Review Agenda/Updates to Statements of Interest
2. Complete review of "Can't Live With" comments on Work Track 5 – see attached document.
3. Continue to review Private Resolutions: Hybrid Proposal 2+ and Proposal 4: https://docs.google.com/document/d/1X8F8zHkgMzQg2WqGHpuoEP78rhpDkFOjD2qKrZZzjHw/edit?usp=sharing
4. Review the updated Predictability Framework, see: https://docs.google.com/document/d/1vBckhFQCCQ-zyvfGGcDB3NWQhodVsffdqbyb6kTwXL4/edit?usp=sharing. Also attached, please find the updated concerns/mitigation document and process flow.
5. AOB

If you need a dial out or would like to submit an apology, please email gnso-secs@icann.org.

Best,

Steve

Steven Chan


Policy Director, GNSO Support

Internet Corporation for Assigned Names and Numbers (ICANN) 

12025 Waterfront Drive, Suite 300

Los Angeles, CA 90094-2536


Email: steve.chan@icann.org

Skype: steve.chan55

Mobile: +1.310.339.4410

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Transcripts and recordings of GNSO Working Group and Council events are located on the GNSO Master Calendar