The Freename Forum

The renewal of contracts for the administration of .com domains is turning into a legal bone of contention: three representatives of the US House of Representatives have raised the possibility that the current registry VeriSign Inc. will have to submit to a public tender.

VeriSign's right to administer .com, which has existed since 2001, currently rests on two pillars: the Registry Agreement (RA) with ICANN and the Cooperative Agreement with the National Telecommunications and Information Administration (NTIA), which is under the authority of the US Department of Commerce. In parallel, VeriSign has committed to ICANN to provide additional funding to ensure the security and stability of the Domain Name System; the payment obligation commenced on 1 January 2021, extends over five years and amounts to US$ 4 million annually. In return, VeriSign is entitled to increase the maximum price received for the annual registration or renewal of a .com domain by up to seven per cent compared to the previous year in the last four years of each six-year contract period. VeriSign has always fully utilised this right. Both the "Registry Agreement" and the "Cooperative Agreement" are currently valid until 30 November 2024; they are automatically extended unless written notification of non-renewal is submitted within 120 days prior to expiry. As this deadline approaches, there have recently been calls to reorganise the allocation of .com through a tender process and, in particular, to limit the fees; the American Economic Liberties Project, the Demand Progress Education Fund and the Revolving Door Project, among others, have accused ICANN and VeriSign of forming a de facto cartel that leads to excessive profits.

Representatives of the Republican Party have now also joined the discussion. Cathy McMorris Rodgers, Chairwoman of the House Energy and Commerce Committee, Bob Latta, Chairman of the Subcommittee on Communications and Technology, and Morgan Griffith from the Subcommittee on Oversight and Investigations contacted the NTIA on 25 July 2024 and requested additional information. The NTIA, both as a party to the agreement with VeriSign and as a member of ICANN's Governmental Advisory Committee (GAC), is responsible for supporting a domain name system that enables the growth of online commerce. Both private customers and companies are dependent on responsible administration. Monopolistic elements and excessive price increases, on the other hand, would hinder the ability of potential domain owners to do business online. Five questions then follow, centred on the first two:

1. Has the NTIA engaged in any negotiations with Verisign regarding the modification or renewal of the Cooperative Agreement? If so: a. When did these begin? b. When does the NTIA anticipate they will conclude?

2. Has the NTIA conducted or commissioned any studies on the following: a. The effect of the recent price increases implemented by Verisign on the .com domain name marketplace; or b. the impact of potential registration price increases on the .com domain name market?

3. Has the NTIA consulted with the Department of Justice or any other federal agencies regarding renewal of the Cooperative Agreement or the Registry Agreement?

4. Has the NTIA provided any opportunities for public feedback or comment on the Cooperative Agreement or Registry Agreement? If so, please provide the dates and method used.

5. Has the NTIA consulted or sought feedback from any other stakeholders or entities involved with the management of ICANN? If so, please provide the dates and parties consulted?

The politicians have not commented on the accusation that ICANN and VeriSign would form a cartel or an "incestuous legal triangle" together with the NTIA; it is possible that the EU Commission might take action. The NTIA has until 8 August 2024 to answer the five questions. So far, there are no concrete indications that the contractual relationship between the NTIA, ICANN and VeriSign could actually end on 30 November 2024; the .com resource is likely to be too important and valuable for all parties involved.

The letter can be found at:
https://d1dth6e84htgma.cloudfront.net/0 ... 231930.pdf