Ethos

The Legal Enforceability of PIR’s Public Interest Commitment

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Originally published in CircleIDBY ALLEN GROGAN

Excerpts from Allen Grogan’s March 3, 2020 .ORG Community Engagement

Since Ethos announced its investment in PIR last fall, Ethos has welcomed the opportunity to engage with .ORG registrants and users to hear their ideas and answer their questions. We listened to concerns expressed in the community, and we worked to address them. We announced a number of voluntary commitments that Ethos is prepared to make, and then we listened to feedback from the community on the scope of those commitments, as well as on the enforceability of those commitments.

One of the recurring themes that we heard loud and clear is that key commitments should be legally enforceable, should not be subject to unilateral modification by PIR, and that the community should have some ability to enforce those commitments.

Another recurring theme that we heard was that the community should have input on key policies. As a result of this dialogue, about ten days ago we announced that we would embody these Public Interest commitments in the form of a PIC, a Public Interest Commitment, that would become a legally binding amendment to PIR’s Registry Agreement for .ORG and be enforceable, both directly by ICANN and by members of the community through the PIC Dispute Resolution Procedure.

We had previously talked about embedding some of these commitments in the Certificate of Formation of a Public Benefit LLC, but we heard from critics who said it would be too easy for PIR to change those Public Benefit LLC commitments in the future, and that those commitments might not be binding if, in the future, someone else takes over the operation of .ORG. So we wanted a mechanism where PIR could not unilaterally change these commitments, and where these commitments would continue to be binding upon future operators of .ORG.

The PIC, the Public Interest Commitment in the form of an amendment to the PIR Registry Agreement with ICANN, meets the key criteria that the community said were important. First, it’s legally binding on PIR. It’s legally enforceable by ICANN. It’s also legally enforceable by the community through the PIC Dispute Resolution Procedure.

Second, because it’s part of the Registry Agreement, it is not subject to unilateral modification by PIR. Any change would constitute an amendment to the Registry Agreement. That’s a process that currently requires ICANN’s consent, public comment and ICANN Board approval.

And importantly, because these commitments are part of the Registry Agreement with ICANN, they will continue to apply to .ORG regardless of who operates .ORG in the future. Ethos fully intends to stand by the commitments it makes, and we believe that a Public Interest Commitment that becomes part of the Registry Agreement with ICANN meets the criteria that were demanded by the community.

Public Interest Commitments become part of a legally binding amendment to the Registry Agreement with ICANN. These commitments can be enforced in two ways: by ICANN itself, because they’re part of a contract between ICANN and PIR, and also by members of the community through an ICANN procedure known as the PICDRP, the Public Interest Commitment Dispute Resolution Procedure.

Under ICANN policies, these legally binding commitments cannot be unilaterally modified by PIR, and they will apply to .ORG regardless of who operates .ORG in the future.

The commitments that would be built into the ICANN Registry Agreement and become legally binding are, first, for a period of eight years from the effective date of the current Registry Agreement, fees charged to registrars for initial or renewal registration of a .ORG domain name would not increase by more than 10% a year on average.

This is pursuant to a precise formula. At no point in time would the average increase exceed 10%. Front loading of price increases would not be permitted. To be clear, this is not to say that PIR will increase prices 10% each year on average. It only means that if PIR does decide to increase the price, it won’t exceed that limit. Furthermore, .ORG pricing is always constrained by the competitive marketplace of registrars and registrants.

This eight-year price commitment is longer than the contractual limitations on prices in the only other TLDs that are currently subject to price caps, which are .COM and .NET. And, as noted, in reality .ORG pricing is constrained now and in the future by the competitive market of registrars and registrants, and also by the growing market for many other new domains such as .FOUNDATION and .CHARITY. In addition, registrants always have the protection that they can renew their domain names for up to ten years before any price increase would go into effect, should there be an increase.

The .ORG community will be able to judge us by our track record over the next eight years, and we believe our performance will demonstrate to everyone that claims that have been put forward of wild and indiscriminate price increases will prove to be unfounded.

In addition to these price commitments, PIR would make the following additional commitments in the PIC, which would have no expiration date. PIR would commit to form a Stewardship Council that would have specific authority to veto PIR’s policies regarding freedom of expression and protection of customer information. PIR would establish and fund a Community Enablement Fund to help support the financing of initiatives undertaken in support of .ORG registrants. And PIR would commit to publish an annual report assessing its compliance with the PIC and the ways in which PIR has pursued activities for the benefit of .ORG registrants during the preceding year.

Enforceability by ICANN comes about because ICANN has a contractual compliance department. If the ICANN compliance department learns of potential non-compliance with a PIC or receives a complaint, which can be submitted by anybody in the world, ICANN’s compliance team will investigate. And if PIR is found to have breached the PIC and fails to cure that breach, ICANN can pursue various remedies, up to and including termination of the Registry Agreement.

Enforceability by community members comes about through this PICDRP process, the Public Interest Commitment Dispute Resolution Procedure. Anyone who believes that PIR has failed to comply with a PIC, and that they’ve been harmed as a result, can report the alleged non-compliance to ICANN for review and investigation. It can be referred by ICANN to a PICDRP panel, which you can think of as being kind of analogous to an arbitration proceeding, and the conclusions of that panel would be binding on PIR.

We heard from community members who said they wanted a direct enforcement mechanism, we listened, and we responded with a PIC that offers this to the community.

Allen Grogan is a legal advisor to Ethos Capital. Read the full transcript of the March 3, 2020 Community Engagement at www.keypointsabout.org/events

Source: http://www.circleid.com/posts/20200310-the-legal-enforceability-of-pirs-public-interest-commitment/