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To: Ms Jo Lim, Secretariat, auDA Name Policy Advisory Panel

Melbourne IT response to the "Review of Policies in .au Second Level
Domains" Public Consultation Report issued on 15 November 2000.

The comments will refer to the specific recommendations in the paper, which
are restated here.

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4.1.1 Eligibility to apply for a domain name licence

  a. The proposed use of the domain name licence must fit the purpose
envisaged by the
  relevant 2LD - refer to Schedule A.

  b. There must be a declaration of a bona fide intention to use the domain
name licence for
  the purpose envisaged by the relevant 2LD.

  c. A bona fide intention to use the domain name licence for the purpose
envisaged by the
  relevant 2LD should be demonstrated in accordance with the rules
applicable in that 2LD -
  refer to Schedule A.

  d. It is not considered bona fide to license a domain name for the sole
purpose of selling
  it.

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Melbourne IT supports the first three parts of recommendation 4.1.1.  The
Registry, Registrars and resellers should not be responsible for monitoring
compliance with the purpose envisaged by a 2LD after domain name
registration, but a third party should be able to invoke a dispute
resolution process against a registrant that was in violation of this
recommendation.

With regard to 4.1.1b, the rules applicable to each 2LD will need to be
clearly defined, and should involve no subjective decisions.  Schedule A
recommends the addition of an Australian Registered Trademark as one of the
alternative
eligibility rules.  Melbourne IT strongly supports the addition of this rule
to the current rules for ".com.au".

Schedule A also recommends that a Trademark "application" be accepted as one
of the eligibility rules.  Melbourne IT is opposed to this, because it is
potentially damaging to a business to revoke a domain name if a trademark
application is not acceptable by the relevant Government body.  There would
also be an overhead in monitoring the status of the trademark application.
There are enough alternatives for eligibility that this should not unduly
inconvenience a domain name registrant.  However if the direct derivation
rule is retained, there could still be case for using the name in a
trademark application as a basis for choosing a domain name.

With regard to 4.1.1d, this rule could be removed once a suitable dispute
resolution mechanism was established.  The policy would also need to clarify
whether a domain name would need to be "in use" (e.g delegated to a website)
within a certain period of time following registration.  At present within
".com.au", there is no requirement for a name to be used.  There are again
difficulties with monitoring compliance with the rule, but a third party
could use the rule as part of an action under the dispute resolution policy.

It is unfair to create rules where compliance is not properly monitored, as
it disadvantages those that are trying to adhere to the rules.


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4.1.2 One domain name licence per entity

  The current rule of only one domain name licence per entity be removed.

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Melbourne IT strongly supports recommendation 4.1.2.  There has been strong
public demand to register multiple domain names for each business.  At
present companies are being forced to register Australian business names
solely for the purpose of registering additional domain names.  This is an
added cost for domain name registrants, and a misuse of Australian Business
Names.


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4.1.3 Direct derivation of a domain name from an entity name

  a. There must be a connection between the domain name and the domain name
licence
  holder.

  b. A connection between the domain name and the name of the domain name
licence holder
  can be demonstrated by:

     i.an exact match between the domain name and the name or trade mark of
the domain
       name licence holder; or 
    ii.a direct semantic connection between the domain name and the name of
the domain
       name licence holder.

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Melbourne IT is opposed to recommendation 4.1.3.  

>From our experience with applicants for com.au names, we have found that
most applicants do not want a domain name which is an exact match of their
commercial name. Over 40% of the rejected applications are due to the name
not being derived according to the derivation rules. Usually they want
something shorter and more "memorable". Therefore there needs to be
allowance for names other than those that are exact matches. But, as the
report highlights, with the example of banking.net.au, the current
derivation rule in place within com.au and net au allows for names to be
"derived" which do not have any relevance to the commercial name of the
applicant. The suggestion that the alternative be a direct "semantic
connection" is too subjective a ruling to be practicable, and would result
in an unreasonable burden for the domain name registry operators,
registrars, and end users.  Although semantic connection sounds good in
principle, it is unacceptable unless a clear set of guidelines can be
created that can be applied consistently.  Again new Australian business
names are registered for the sole purpose of meeting the current derivation
rule.  There is an element of shopping amongst each State that registers
Australian Business Names to gain the desired business name to meet the
existing rules.

The names policy should avoid rules that require subjective judgement, and
will result in different outcomes depending on who applies the rule.

Melbourne IT submits that, given the difficulties with designing a rule that
is both useful and capable of automation, that the rule be removed and that
a commercial entity be permitted to register any name it chooses so long as
the name is available and given that all other requirements in the policy
are met.


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4.1.4 Conflict between domain names and trade marks

  Domain name licence applicants should acknowledge at the time of
application that their
  entitlement to a domain name may be challenged by a third party with
existing trade mark
  rights in the domain name.

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Melbourne IT supports recommendation 4.1.4 that the Registration Agreement
includes a warranty that the registration of the domain name, or its use,
does not infringe on another party's rights. However this must be matched
with the introduction of a Dispute Resolution Policy similar to the one set
up by ICANN so that alleged trade mark infringements can be handled in an
orderly, cost effective manner.

Note that domain name registrants intending to use a domain name
internationally for business purposes are well advised to carry out a
trademark search in the main countries of operation before registering a
domain name, and apply for trademarks in these countries once the domain
name has been registered.  The cost of this is usually several thousand
dollars, rendering the cost of a domain name a minor expense.

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4.1.5 Renewal period for domain name licences

  All domain name licences should be subject to a specified renewal period,
and domain name
  licence holders should be required to provide evidence of continued
eligibility to hold the
  licence at the time of renewal.

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Melbourne IT supports recommendation 4.1.5 to introduce fixed licences
across all .au domains. 

Melbourne IT also proposes that licence periods should be optional on a one
to ten year basis, consistent with ".com", ".net", and ".org".  Start-up
businesses tend to register for one year to minimise the up-front cost, and
on the basis that they may not be operating after 12 months.  Established
businesses that have been in operation for over 10 years, tend to register
for a 10 year licence to ensure that there is no possibility that they may
neglect to renew their domain name and to minimise internal administration
costs.  For these businesses the up-front cost of a 10 year licence is
usually insignificant.  Thus a Registrar should be able to establish a
licence period that matches the budget and requirements of their customers.
A limit of 10 years ensures that licences are not effectively forever.  A
Registrar should however take steps to ensure that the contact details for
each domain name are updated at least every 12 months.  It may be possible
to establish eligibility criteria for companies wishing to obtain a licence
for more than 2 years (e.g based on operating a business for more than 2
years derived from the date of incorporation or business name application)
to ensure that the principles of recommendation 4.1.1 on the "bona fide"
intent to use are met.


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4.2.1 Restriction on licensing of generic, geographic or objectionable names

  Retain the current policy restricting the licensing of generic, geographic
and objectionable domain names and apply it across all open 2LDs. Adopt the
following 'reserved list' approach:

    a.clear definition of 'generic', 'geographic' and 'objectionable' will
be developed with
       reference to appropriate sources (eg. Yellow Pages Index); 
    b.domain names that have to date been rejected by the current registrars
for being
       generic, geographic or objectionable will be placed on a reserved
list; 
    c.new applications for domain names that may be considered generic,
geographic or
       objectionable may be referred to auDA; 
    d.if the domain name is determined by auDA (according to the definition)
to be generic,
       geographic or objectionable, then it will be added to the reserved
list; 
    e.applicants can challenge domain names on the reserved list, and auDA
will determine
       whether the name should remain on the reserved list or whether
changed
       circumstances mean the name can be licensed; and 
    f.restrictions in relation to the registration of generic or geographic
domain names
       should yield if the applicant seeking domain name registration can
provide evidence
       of trade mark rights in the domain name.

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Melbourne IT opposes recommendation 4.2.1 which proposes the continuation of
the restriction on generic and geographic names, based on feedback from
applicants for ".com.au" domain names.

The intention of the restriction to restrict "unfair competitive advantage
has fallen down due to the many "historic" names (names registered pre
October 1996) which are clearly generic words (eg travel.com.au,
insurance.com.au) and  Australian capital city names (eg sydney.com.au,
melbourne.com.au). This makes the continuing restriction of generic and
geographic names difficult to justify, and leads to many disputes with
domain name registrants and discredits the domain name registration
procedures. It is also doubtful whether the use of a generic name (e.g
shop.com) builds significant business advantage over a well marketed brand
name (yahoo.com).  As well, the current application of the rule to only
single words means that many phrases, which could be argued to give
"competitive advantage" as much as a single word, are acceptable. 

If there is to be a continued restriction on generic and geographic words
then there must be a set list of words which is publicly available at the
time of registration and which would need to be continually monitored given
the nature of our language. MP3 is a case in point. This "word" could now be
argued to be generic in the context of the internet but given that it was
not listed in the dictionary, and obviously not a Yellow Pages category, it
was accepted as a com.au name.  It should also not be up to a subjective
decision from a Registry operator or Registrar to identify words for
consideration by auDA for adding to the list.

The ongoing maintenance of a definitive list, and selection of appropriate
sources for generic and geographic names, could be a costly and bureaucratic
exercise.  The international trend is to reduce restrictions on registering
domains names in particular country codes (e.g see ".ca", and ".uk").


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4.2.2 Licensing of generic and/or geographic names

  Relax the current policy and enable licensing of generic and geographic
domain names using
  an appropriate licence allocation system, such as a market-based one.

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Melbourne IT strongly supports recommendation 4.2.2, that proposes to relax
the current policy for licensing generic and geographic domain names.

Melbourne IT agrees with the panel that the restriction on "objectionable"
names be continued. Within the com.au domain it is reasonable that words
that are considered unsuitable to be registered as business or company names
should also be restricted as domain names in a space designated for
commercial entities.  A definitive list of such names needs to be drawn up
by auDA, with public consultation.

Melbourne IT recommends that the auDA panel give further consideration to
methods of allocating these generic names in response to public feedback.
Proposed solutions should consider the administration overheads and costs of
implementing a complex scheme.  If there is no general acceptance of a
different approach, the first-come, first-served approach should be the
default solution as it is widely used internationally for domain name
allocation. Mechanisms can be established to ensure a fair allocation policy
in the early days following the removal of the restriction on generic and
geographic names (see the submissions for new top level domains on the ICANN
website http://www.icann.org for some examples).

As resolution of recommendation 4.2.2 is likely to take some time, Melbourne
IT recommends that recommendations that receive wide public support (e.g
4.1.2) be implemented immediately to allow end-users to gain immediate
benefits.  This will ensure that the auDA is seen to be taking some positive
steps to address end user complaints with the current names policy.


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4.3.1 Introduction of new .au 2LDs

  Introduce new 2LDs in the .au domain space, subject to the ICANN
experience of
  introducing new gTLDs.

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Melbourne IT strongly supports recommendation 4.3.1 that proposes the
introduction of new 2LDs.  

auDA could use a process similar to the process undertaken by ICANN, where
organisations can propose new 2LDs and accept the commercial risk in
establishing registries to provide these 2LDs.  This would also facilitate
competition between 2LD registries.  At present ".net.au" has a quite
specific meaning in the minds of domain name registrants, which limits its
ability to compete effectively with ".com.au".  New 2LDs such as ".biz.au"
and
".name.au" could provide domain name registrants with more choice,
particularly if the 2LDs offered different levels of service and pricing.
As with the ICANN process, a key criteria in the establishment of any new
2LD is preserving the stability and trust in the DNS.  Thus all proposals
need to provide a suitable technical solution with performance criteria to
be monitored by auDA.


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4.3.2 Introduction of a system of gateways

  Consideration be given to the introduction of a gateway structure,
following consultation,
  along the lines of one or more of the possible models.

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Melbourne IT notes recommendation 4.3.2 that proposes introducing gateways,
and suggests that it be considered in the context of recommendation 4.2.2
and recommendation 4.3.1.  In the case of generic names in ".com.au", it
would be most efficient to leave to the organisation that has registered a
generic name to decide the best use of the name.

This proposal may best be considered in the context of proposals for new
2LDs that may operate as a gateway.  It should be left up to outside
organisations to propose gateway models as part of proposals for new top
level domains, and accept the commercial risk for their operation. 


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4.4.1 Domain names that begin with a number

  Domain names that begin with a number should be allowed, however domain
name licence
  applicants should be made aware of the potential problems.

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Melbourne IT supports recommendation 4.4.1, as ".com.au" already accepts
domain names beginning with a number and there have been no significant
complaints.


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4.4.2 Country codes and gTLDs as domain names

  The prohibition on two character alpha domain names or domain names that
match existing
  or new gTLDs should be maintained.

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Melbourne IT opposes recommendation 4.4.2.

There is currently no prohibition on 2 character domain names within com.au
so to introduce one would mean many licences would have to be cancelled. As
well, gov.com.au and edu.com.au are already registered. With regard to
matching new gtlds, six of the proposed tlds have already been registered as
com.au names, museum is the only one that is not registered and that is due
to the generic rule.


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4.5.1 Retrospectivity and prospectivity

  Changes to domain name eligibility and allocation policies will not have
retrospective effect for current domain name licence holders, and will only
apply to existing domain name licences at the time of re-registration.

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Melbourne IT supports recommendation 4.5.1.


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4.5.2 Dispute resolution procedure

  a. Dispute resolution procedures should apply to:

     i.all open 2LDs; and 
    ii.closed 2LDs on an opt-in basis, with appropriate modifications if
necessary.

  b. There should be two levels of dispute resolution procedure:

     i.the first level should deal with due process - ie. where an applicant
wishes to contest the implementation of a policy within a domain by a
registrar; and 
    ii.the second level should deal with bad faith registration and/or use
of a domain name -
       ie. referral to a dispute panel for enforcement of third party
rights.

  c. At the first (due process) level:

     i.there should be a first appeal initially to the registrar; 
    ii.there should be a second appeal to an independent arbitrator; 
    iii.the arbitration should be compulsory and binding on the applicant,
the domain name
       licence holder and all registrars; 
    iv.the domain name should be frozen pending arbitration; 
    v.only an eligible applicant should have access; and 
    vi.the remedy should be restricted to registration of the domain name.

  d. At the second (bad faith) level:

     i.there should be an appeal to an independent arbitrator; 
    ii.the arbitration should be binding on the applicant, the domain name
licence holder
       and all registrars; 
    iii.it should be restricted to bad faith registration and/or use of a
domain name; 
    iv.the domain name should be frozen pending arbitration; 
    v.only eligible applicants should have access; and 
    vi.the remedy can be cancellation of the registration or transfer of the
domain name 
      to a successful applicant.

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Melbourne IT strongly supports recommendation 4.5.2 that proposes dispute
resolution procedures.  In particular, Melbourne IT recommends the adoption
of the ICANN Uniform Domain-Name Dispute-Resolution Policy (UDRP).  See
http://www.icann.org/udrp/udrp.htm.
The use of UDRP has gained wide acceptance in the international community,
and several Australian companies have successfully used it to combat
cyber-squatters in the ".com" domain space.  Melbourne IT recommends that
auDA consult the World Intellectual Property Organisation (WIPO) to
formulate an appropriate policy that takes into account Australian law.

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In general, where there is general and early consensus in the community for
particular recommendations, Melbourne IT urges auDA to consider immediate
implementation so that end-users can take advantage of these benefits
immediately.  End-users have had to wait too long for changes in the Names
Policy.  

Rather than trying to develop an ideal names policy in one attempt, auDA
should consider implementing the changes in phases, beginning with the least
controversial changes. The names policy should be regularly reviewed as a
matter of course (e.g annually to reflect consumer requirements in a
changing international environment).

Enquiries about this response may be made to:

Bruce Tonkin
Chief Technology Officer
Melbourne IT Ltd
email: bruce.tonkin§melbourneit.com.au