[ALAC] Closed generic statement [Suggested edits]

[Alan Greenberg]

Sala, do I understand correctly that what you 
were proposing is to take the statement as is, but add those two sections?

Alan

At 01/03/2013 07:29 AM, Salanieta T. Tamanikaiwaimaro wrote:
>Dear ALAC,
>
>*The suggested changes is in BLUE.** *
>
>*Suggested Changes to the Draft Statement*
>
>In considering the matter of closed generic Top Level Domains (gTLDs),
>ICANN is guided by The Affirmation of Commitments (AoC) between the United
>States Department of Commerce (DOC) and ICANN clearly specify the promotion
>of competition, consumer trust and consumer
>choice.[1]<https://community.icann.org/pages/viewpage.action?pageId=40927847&focusedCommentId=40931544&#_ftn1>It
>is also worth noting that there are several issues that surface with
>closed gTLDs and these include but are not limited to the following:
>
>    1. Would the endorsement of “Closed Generic” Applications create a
>    situation or a series of situations whether now or in the future that will
>    restrict competition?
>    2.  Would the endorsement of “Closed Generic” Applications create a
>    situation where there is a dominant position within the market?
>    3. Would the endorsement of the “Closed Generic” Applications create a
>    restraint in trade of a particular market?
>    4. Would ICANN be immune from anti-trust liability?
>
>On 4th August 2012, a precedent was established in the *Manwin Licensing
>International S.A.R.L., et al. v. ICM Registry, LLC, et al  *where
>the* *Honorable
>Philip S. Gutierrez, United States District Judge ruled that antitrust
>claims could be filed over .xxx.  Under the *Sherman Act § 2, 15 U.S.C. § 2*
>*[2]*<https://community.icann.org/pages/viewpage.action?pageId=40927847&focusedCommentId=40931544&#_ftn2>monopolizing
>trade is a felony. Under the circumstances where this trade
>involves foreign nations such as generic TLD applications that have been
>made by countries outside the US, then *Sherman Act § 7 (Foreign Trade
>Antitrust Improvements Act of 1982), 15 U.S.C. § 6a* will apply in relation
>to conduct involving trade or commerce with foreign nations.
>
>On the whole, the ALAC does not believe that unrestricted closed generics
>provide public benefit and would prefer that TLDs -- especially for strings
>representing categories -- were not allocated in a way that would lock out
>broad access to sub-domains. Some members of At-Large believe, on
>principle, that all closed generics are harmful to the public good. Others
>believe that, while not necessarily being beneficial to end users, closed
>gTLDs should be allowed as simply being consistent with existing practise
>for lower-level domains.
>
>Traditionally, the prohibition and control provisions laid out in
>competition rules basically aims to prevent cartelization and
>monopolization in markets for goods and services. Such developments in
>markets inevitably harm consumer welfare which competition rules aim to
>protect. On the same token, there are instances where some agreement may
>limit competition to allow for social and economic benefits to pass to the
>other. In order to ensure that such agreements with a net effect of
>increasing competition can be made, an exemption regime is regulated in
>competition law and agreements between undertakings in the same level
>(horizontal) and different levels (vertical) of the market may be left
>exempt from the prohibition of the competition rules under an exemption
>system, provided they are not cartel agreements which are, by nature, out
>of the scope of exemption.
>
>However, in developing this response to the Board's request, the ALAC found
>the issue to be far more nuanced than the above hard positions would
>suggest. There may be innovative business models that might allow a closed
>TLD to be in the public interest. An example might be a registry that makes
>2nd level names available at no cost to anyone, but retains legal control
>over them. This is similar to the model used by Facebook and many blog
>hosting sites. Allowance should be made for applicants interested in
>widespread sub-domain distribution that do not require domain-name sales as
>a source of revenue, or for other forms of sub-domain allocation.
>
>Whether a generic-word string is used with its generic meaning or in some
>other context may also be relevant. The fictitious but famous computer
>manufacturer, Orange Computers Inc. using the TLD ".orange" might be
>acceptable, while the same string used as a closed TLD by a California
>Orange Growers Cooperative (and not allowing access to orange producers
>from Florida or Mediterranean and South American countries) might well be
>considered unacceptable.
>
>Allowing this nuanced approach would likely involve a case by case review
>of how a TLD will be used and how its sub-domains will be allocated.
>Moreover, it would require a contractual commitment to not change that
>model once the TLD is delegated.
>
>In summary, the ALAC believes that completely uncontrolled use of generic
>words as TLDs is not something that ICANN should be supporting. However,
>some instances of generic word TLDs could be both reasonable and have very
>strong benefits of just the sort that ICANN was seeking when the TLD space
>was opened. Such uses should not be excluded *a*s long as it can be
>established that they serve the public interest.
>
>------------------------------
>
>[1]<https://community.icann.org/pages/viewpage.action?pageId=40927847&focusedCommentId=40931544&#_ftnref1>Clauses
>3 and 9.3 of the Affirmation of Commitment between the United
>States Department of Commerce and the Internet Corporation for Assigned
>Names and Numbers
>
>
>
>
>
>Kind Regards,
>Sala
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