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Asia Pacific – The Legal Challenges Of The New TLDs.

20 December, 2013

 

Legal News & Analysis – Asia Pacific

 

617 new TLDs – How to cope with the legal challenges?

 

Introduction

 

Brand holders are facing a new challenge on the internet, as a large volume of new Top Level Domains (TLDs) will arrive over the next two years. This article will focus on the legal challenges for brand holders and propose a defensive domain name strategy.

 

In 1985 the .com TLD was introduced, and since then only 21 new TLDs have seen the light of day. That is until now. In 2005 the Internet Corporation for Assigned Names and Numbers (ICANN’s) opened up for plans to liberalize the TLD space. After many years of discussions back and forth it was finally agreed to open up for new TLDs. ICANN certainly did not expect more than a couple of hundred applications given the application fee of USD 185,000 and with a tight deadline. However on 13th June 2012 a stunning total of 1,930 applications was revealed. 


The TLDs fell into the following categories: 


A. Geographic names (e.g. .berlin, .corsica) 

B. Community names (e.g. .thai, .yoga) 

C. Brands (e.g. .nike, .philips, which are closed TLDs) and 

D. Generic names (e.g. .blog, .music). 


The full list of applied for names can be viewed at ICANN’s website.

 

The Sunrise phase (Special rights period for trademark holders) have already been initiated for the first batch starting with .شبكة on 31st Oct. (meaning .web in Arab). Since then new TLDs like .guru, .bike, .diamonds and .tattoo have been launched. A handful of new TLDs will be released every week from now on until June 2015.

 

This new development leaves brand holders with a huge challenge in the matter of IP protection, and it requires that a defensive strategy is laid out. It is impossible to protect any brand right given the huge volume of TLDs, however the good news is that ICANN and one of the largest registries, Donuts Inc., have taken measures to help brand holders secure their legal rights.

 

The Launch Phases

 

Any TLD launch is divided into three phases: 


1) An initial Sunrise period of min. 30 days where trademark holders can secure their matching domain names. It is required that brand holders verify their trademarks at the Trademark Clearinghouse (TMCH). The TMCH is a centralized database of verified trademarks, which is connected to all TLD registries. This means that you only have to provide documentation once to apply for any TLD. The annual cost of a trademark verification is USD 150,-. Any registered trademark is valid for verification, whether it is nationally or regionally registered. The verification process takes 3-5 days, and until now more than 10,000 trademarks are in the database.

 

It is important to note that a verification in itself is not sufficient to stop cybersquatting (the practice of registering names, especially well-known company or brand names, as Internet domains, in the hope of reselling them at a profit). However during the first 90 days after a new TLD launch a warning notice is send to anyone planning to register a domain name matching a verified trademark. If the warning notice is ignored, then a notification is send to the brand holder. 


2) The second phase is called the Landrush phase, which is an optional phase allowing the registry to auction premium domain names. 


3) In the final phase the TLD is made accessible to the general public. Most of the new TLDs will be without any requirements at this point.

 

Which Legal Measures Do Brand Holders Have To Combat Cybersquatting?

 

There are two important tools you should consider. One is reactive and one proactive:

 

Uniform Rapid Suspension

 

As described above it is fundamental that brand holders verify their trademarks at the TMCH. The verification entitles brand holders to perform a Uniform Rapid Suspension (URS), when they experience brand infringements. Until now any domain name dispute had to be settled at The World Intellectual Property Organisation (WIPO) with a Uniform Domain Name Dispute Resolution (UDRP). It is known to be a process which is both costly, slow and sometimes with surprising decisions. With the launch of the new TLDs the URS is a much quicker and inexpensive way to take down domain names.

 

Domains Protected Marks List (DPML)

 

Donuts Inc. is one of the largest new registrars having applied for +100 TLDs. They offer a DPML block, which means that for a flat fee you can block anyone from registering your brand name for any of the TLDs they manage. You can choose just to block your brand name or variations hereof. The DPML can be ordered via your own domain registrar, and is a very economically viable solution (around 2 USD per domain name annually). If you have made the decision not to use these domain names actively, then the DPML is recommended.

 

The Brand Holder Domain Strategy

 

When it comes to planning a domain name strategy the proactive approach is always the cheapest solution in the long term. I suggest the following steps:

 

1) Verify your trademark(s) at the TMCH.

 

2) Get an overview of the TLDs: You can see all new TLDs and their expected launch dates in this infographic. Make a list of TLDs which are relevant to your industry (.e.g .diamonds or .bike). Secondly, point out the generic terms which can be damaging to your brand (e.g. .blog or .download). You should by then have a shortlist of 50-100 TLDs.

 

3) With your priority list in hand define your budget to apply for as many of the TLDs as possible. You should by now know the expected launch details, so you can make an action plan for each month. Contact your domain registrar with this action plan, as they can surely queue the domain names for you.

 

4) Apply in the Sunrise period for each of the domain names on your priority list.

 

5) React to the notifications from the TMCH, when a third party infringes your brand name, and make sure to file a URS against them to take down the domain name.

 

The introduction of the new TLDs is a welcome opportunity to go through your current domain name portfolio. There are many unanswered questions regarding the impact that the new TLDs will have, however it is quite possible that existing TLDs will lose importance over the next years. Letting certain domain names go can surely provide you with the budget to apply for more relevant domain names. 

 

For further information, please contact:

 

Christopher Hofman, European Domain Centre ApS.

christopher@europeandomaincentre.com

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