WIPO Internet Domain Name Process

Transcript - part 4: Brussels regional consultation

Swissôtel
September 29, 1998

(Mr. Philip Sheppard, Manager Branding Affairs, AIM European Brands Association): Thank you. For today, I would like to talk mostly about the principles behind our discussions really, rather than the specific detail, as AIM will be submitting some written detail to this process later. And in particular, I would like to talk about what is behind intellectual property protection. And it can be summed up in one word and that word to us is, trust. My organization AIM, the European Brands Association, groups over 1600 companies who are selling daily consumer goods. And many of these companies have what we know as famous names. They all succeed ultimately, because there is trust by the consumer in their brand names. And that trust is hard-earned, because consumers see benefits in buying their brands. There is trust in the reliability of the brand, there is trust in the quality of the brand, their is trust in the maker of the brand. And many of these brands are today available not just in the corner shop or in the super market, but on the Internet. And we believe that the level of trust that we should have on the Internet should be no less than the level of trust upon buying at the corner shop or the supermarket.

So, what does this mean in relation to domain names? Well, I think the conclusion is quite simple. Consumers who are now Internet users should be able to trust the search engine to lead them to the site of their choice and not to someone else’s. I think the comments that we had earlier today, for example as to the Delta site etc., are precisely the sort of thing we want to see more of. And it also means that cyberpiracy, the bad faith snapping up of someone else's well known brand name, destroys trust and therefore that is why it should be prevented. So, in relation to the WIPO domain name process itself, I think that means that we are less concerned what happens today or what I think can be described as a historical monopoly of .com, because tomorrow we could see hundreds of top-level domain names, regardless of our own individual opinions today. And those hundreds of names will be suitable for individuals, for businesses, for groups and for governments. And I think the first examples of that we heard from the last speaker of the developments happening there. I believe that it is in that context in which the domain name process should be taking place. Such an expansion will allow much more coexistence than is possible at the moment in .com and solves a multitude of problems that have resulted because of that monopoly. And it is only in order to maintain trust that there is a need for dispute resolutions procedure to be in place before the creation of any new top-level domain names. I think it is very important, as we heard earlier from speakers like Keith Gymer, that creation of top-level domain names must have differentiation. Because there is no differentiation whatsoever in the earlier proposals we had for a handful of domain names all of which, like .firm or .shop, have no serious differentiation in the existing monopoly of .com. Moving from monopoly to oligopoly is not as we see it, a healthy business competition. More new top-level domain names means increased exposure of consumers to deception. Such an increase should not expose consumers to more deception, and so we believe that to maintain trust there has to be special consideration for famous names. But, I think I must disagree with the concept that has been heard earlier, and we also see in the e-mail, the consultation process, that a list of famous names is not the answer. A list works for some of the names of course. Names like Coke etc, are all names that have been there for a long time and we foresee that they will continue to be around for a long time. But many other names surf the waves of fashion, if you like. They may be very important and very famous one Christmas as a gift, but two years later they are not famous by any sense or definition. So, we see this as no solution. But the solution is one that WIPO has been working on for a long time, because it has an existing process looking at famous names. Indeed AIM is a regular member of the expert panels for that process and we would like to see a link from their conclusions to this process here.

I think we would also agree strongly with the comments made earlier by Paul Waterschoot and John Wood, that it is absolutely essential that we all lobby for recognition of this process to the process taking place in the United States. Because there is no sense whatsoever in us coming to some sensible conclusions here for the future structure of the process, unless we also convince other voices on the other side of the Atlantic that these are serious proposals and must be taken into account. Some of you may have read the ICC, International Chamber of Commerce, Paper on principles for an Electronic Commerce Friendly Domain Name System. If not, I would urge you to do so. It sets out I think extremely well many of the ideas that I have been making and more besides. The Internet must not be allowed to become the place of the forger, the cheat or the pirate. But if we get it right, it will be simultaneously a place for free speech and for trustworthy trade. Thank you very much.

(Mr. Francis Gurry): Thank you Mr. Sheppard. Are there any observations?

(Mr. Constantinos Popotas): Related to your concern for consumer protection, would you recognize a form of collective action to challenge non-bona fide registration or even individual action by consumers? Thank you.

(Mr. Philip Sheppard): I think any bad faith registration should be challenged by whoever wishes to challenge it. I mean, there is no need for rules if bad faith is seen - somebody could try and prevent bad faith happening. And indeed, it should be open to anybody to complain and that is an important part of the process we are discussing, in terms of where a complaint can end up, not necessarily who is making it.

(Mr. Francis Gurry): Thank you. Other observations please? None? Then I suggest that we adjourn for lunch and thank you very much Mr. Sheppard. The first two speakers that we have on the list immediately after lunch are Dr. Willie Black and Madame Isabelle Leroux. We will resume at 2.15.

(lunch)

(Mr. Francis Gurry): Ladies and gentlemen perhaps we could start the afternoon's proceedings. So, ladies and gentlemen we are about to hear from Dr. Willie Black. May I ask if Madame Leroux is in the room? I believe she has not come today and that the gentleman from Rouse & Co. also is not here. So, I think that the situation now is that we have Dr. Willie Black as the last formal speaker, unless anyone else would like to perform that role. Then, what I would suggest to you is that after the presentation of Willie Black, I would like to go through the RFC, not every single question, but the main questions to see to what extent and to see to what extent the non-binding informal views of those present favor or do not favor particular positions in relation to issues that are treated in the RFC. Now, Dr. Willie Black, as you all know, is the managing Director of Nominet and I will now hand over to him. Thank you.

(Dr. Willie Black, Managing Director, Nominet & gTLD-MoU Policy Oversight Committee (POC): Thank you very much. I apologize for the folk in the audience who may have heard this talk or bits of it before, because I really don't have much new to say that I haven't said in other fora. But maybe some people will not know. I am the Director of Nominet U.K., which is the country code manager for .uk. We currently have a register of about a 170,000 domain names. I think we are the second to Germany within Europe and probably one of the biggest in the world apart from NSI. I am also here because I was asked to come by the Policy Oversight Committee, which Amadeu referred to, as the people who are going to have an oversight over the seven gTLDs that we know and love from some of the discussions. I was invited onto that by John Postel in order to bring to it the experience of a real register, real registry I think is the right terminology, I will try to use registry when I mean Nominet. We have members who would be the registrars. I am going to speak with both hats on, and I am going to first of all deal with a little bit about what domain names are. Because quite often I have discovered that people in the audience who are debating legal topics or trademark topics actually don't know what the domain name system was all about, and what it was intended to do. And then I want to give a couple of the examples of the problems, most of which you already may be aware of. And I could tell you lots of examples from the U.K. experience, because we deal with about 10 disputes every month, maybe 200 or so in all. Some of which are cybersquatting, some of which are innocent clashes. Then I have a few messages for WIPO that I think would come really from the POC and from the registries’ perspective.

So, first of all, a domain name is not an e-mail address and it isn't a URL. People often think that domain names and URLs are the same. The universal results locator is there to principally access web resources and a domain name can also be used for e-mail, but it is neither of the two (referring to screen). I have underlined the domain name part there and you can see that the extra bits are what make it into an e-mail address and what make it into URL. The domain name part is that little common registered part. Domain names can be used therefore without being associated with any goods or services for sale. If I merely use my domain name for people to send e-mail to me to find out how well I am and to discuss things of national interest, I am certainly not associating that name with any goods or services. The point I am going to try and get across is that a domain name and a trademark are not the same things. In simple terms a domain name is a mapping function. That may not be simple to a non-mathematician, but it simply means that you give me a name and I will tell you where to find out more about the Internet services associated with that name. Be it, an e-mail box, be it a web site, be it even the ability to log-in interactively using the Telnet protocol to a remote site. So, it says "here is a name and I will give you the number." It is not necessarily offering goods for sale or commercial services. I keep emphasizing that because I think it is one of my main points. I think people put more emphasis on domain names than they should do, but I think the importance will reduce. Because of search engines for example. The other day my wife wanted me to find something on the Internet about Cambridge English and criticism because she is studying an English course, and I looked up Alta Vista search engine and I found several references and I clicked on several pointers and I went to sites all over the world. I didn't care a fig what the domain name was or where that site was. I didn't care if it was in the U.K. or Italy or the U.S., I didn't even look at the domain names because I looked at the title of the document and I clicked on it. Now, as it happens I probably did catch several of them because I was professionally interested. My wife certainly wouldn't have appreciated at all what the URL that was quoted in the Alta Vista report was saying. So, I think search engines are going to suppress the importance of domain names from a marketing perspective. Also for e-mail, people would bookmark these things and use a press book and so in your browser you will certainly bookmark all the common sites. And if you bookmark something like Alta Vista, it does not say alta vista.digital.com. It says "Alta Vista search homepage" or something like that in your bookmark. So, again, when you look at the bookmark file you don't see the domain name. So, I think people in business, if I may say so, are slightly over-emphasizing the importance of having to have that particular name for their particular business. And I am not trying to belittle it. There is a problem there, but I think the problem is going to be reduced by the use of directories and search engines in the future. The basic function, just to recap, is to take a domain name and map it to a number. The Internet routes things on the basis of these numbers. Thirty-two bit numbers at the present time, they are organized a bit like that and if you plug in to this very big distributed look-up system there are computers all around the world that are able to resolve that name and give you that number back. It is a very robust system, if one machine is not available there are other machines that take its place. But the basic function is simply to do that, and it was never meant to be more than that technically.

As to the significance of registration. There is no statutory power behind registration. We don't have the equivalent of a Company's Act as we have in the U.K. that governs company names, and how you make new companies. Though we have Trademark Acts, we don't have the equivalent of domain names. We can't rely on these two for the process of registering a domain name. So, a registration of a domain name is basically a contract under the law of contract. A contract principally between the applicant for a domain name, who becomes the registrant in our terminology, and the registry who keeps the registration. Part of the terms of this contract involve the applicant warranty, in the U.K. anyway, that they have the right to that domain name, and they know of nobody with a superior right that they would be infringing. They also indemnify the registry if it happens to cost the registry some money because of a lawsuit. When the applicant pays, it is obviously the consideration in the contract. The registry in turn records the registration and there are certain terms of the contract that are important. Principally, as to the jurisdiction of the contract, we nominate it as the laws of England. The other terms in the contract involve certain powers that are given to the registry to suspend the domain name or to cancel the domain name. And obviously we would be able to do that in case of a breach of a contract. And the contract would say you must keep the information on the registry up to date. If you give us false information then we would certainly have a breach of contract from the registrant's side. So, it is important that this contract is understood. Not all registries in the world have done this. Network Solutions have a contract that the registrants enter into presumably under the laws of Virginia. The U.K. has one and a lot of the country codes do. But many don't, and it was one of the important things that the Policy Oversight Committee and the Council of Registrars were debating when things got slightly put on hold by the Green Paper, was what exactly should the terms of the contract be. And it is important that whatever recommendations WIPO comes up with, that they are incorporated in contracts with the registries. Because we will not get statutes in every country in the world or an international treaty which would give you the statutory basis for registration. We will have to rely on contract law for a long time. So, therefore no intellectual property rights are given by the registration per say, because there is no statute that says this is intellectual property by definition. The market, however, is treating it as having some intellectual property values. People are trading in domain names. Now, what they are really doing is reassigning contracts amongst themselves, if you take the legal analysis to that level, but they are treating it a little bit like intellectual property. So, we must not forget that, and the registries are fully aware and we are not turning a blind eye to the problems of the intellectual property community. We are simply saying we have to understand the legal basis for the registration process and the fact that de facto the market is treating it as intellectual property. The registries’ role is simply to be an authority for the process of registration. We have open and fair rules that the world can see that we are applying consistently, and we certainly take the view in the U.K. that if we don't apply our rules consistently, somebody will take us to a judicial review process, and as a pseudo-public body we could be subject to judicial review like any government agency could. But we try to make sure that the rules are open and fair, and we consistently apply them to little businesses and big businesses alike, Even to individuals who register in the U.K. But what we don't do is make intellectual property judgements. We will not say that party A has more right to a name than party B. We will try to facilitate a solution, and we facilitate by mediation primarily. Although, we offer people the ability to go to a mediation provider external to Nominet. We spend a lot of time phoning both parties. If somebody complains, we talk to the registrant, we tell the registrant what the complaint is, we ask for their explanation and we feed that back to the challenging party. So, we do a lot to pass the materials back and forward, which would be a very useful first stage and most disputes are settled at that stage. Particularly, once we got some case law in the U.K., for example One-in-a-Million, which Keith Gymer referred to, was a clear case dealing with cyberpirates. And we simply will copy that judgement to the party who has been challenged and we say, look, you might like to look at this because these guys lost a lot of money trying to take these names. However, we are not going to tell you that you are wrong if you really have a case for that domain name being used. If you have some right that you are going to argue in court, we are not going to make the decision for you. Similarly, we turn to the big party and say, look, you are trying to get us to act as a court, you are trying to get us to do an interloctory hearing in private so to speak. You are trying to get us to be the undertaker and get rid of this guy's domain name. We won't do that, either because either the parties reach a commercial solution which is desirable, or the court will rule on it. The court has already ruled on a cyberpirating case and the more difficult ones are probably best dealt with by the courts anyway. Although, I have to say that an arbitration that both parties would agree to ............ (end of tape). So, we facilitate solutions, we don't make the judgement which is properly the law’s job, or just simply a commercial agreement. Again, I will say a domain name is not a trademark, nor is it a trading of company name. I live in a village called Yarlington, near Oxford. I could register Microsoft Yarlington Limited in the U.K. as a company for £20. I don't think I would get very far trying to trade with it, but I could do so. It’s easy to do and, we have lived with this for many years. Its just as easy to register a domain name. So let’s take it in that environment. Of course, in the U.K., you can actually trade without registering a company so that I could just simply trade as Microsoft Yarlington, as long as I don't claim to be a limited company. And that is just a characteristic of a common law country like England.

Anyway, a domain name is neither one of these two things. We certainly find that domain names can infringe trademarks. That is for sure I won't deny it, we have seen it happen and it can be used to pass off as a business. We have seen that happen also. But what I am trying to say is we have had these two things, trademarks and trading names, for a long time. They have interacted in the past and the law has learnt to deal with them. Trademark attorneys have learnt to deal with them. Lawyers have managed to advise clients and have to deal with them, and courts have made judgements. We have now got a third thing that interacts with both of these. It cannot be equated to either of them but it is certainly is very messy and interacts with the other two. There is a key example. There is a street in Oxford called St. Michaels. Now, you probably know that Marks & Spencers have a brand name called St. Michaels, it’s a trademark. But, there is a St. Michael’s Brasserie, which happens to be in St. Michaels Street. If they wanted st.michaels.co.uk and they were putting up a web site that was clearly a restaurant with particular kinds of menus, come and enjoy a meal with us. I have to say to myself, I don't know how I would judge and how would the court judge, whether that was an infringement of the trademark of Marks & Spencer, which is probably in the area of clothing and probably some groceries and whatever else Marks &