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Ten Things You May Not Know About the New gTLDs

1.  The new generic top level domain (gTLD) applications contain numerous “public portions” that will be publicly accessible.  Although financial and other sensitive information will remain private, companies should work with their counsel to confirm that the information in the “public portions” is appropriate to disclose.  Applicants may also consider whether such public disclosures will negatively impact their businesses before applying for a gTLD. 

2.  Although the goal is to offer the next application round within a year after the April 12, 2012, close of the initial application round, it will likely be three to five years before there is a second opportunity to apply for one of the new gTLDs—if ever.   

3.  Applicants must choose whether to apply for a “.brand” mark for their trademarks (e.g., .cannon), or a “community-based” designation using a common noun (such as .bank) or a location (e.g., .Paris) before filing, as there will be no opportunity to change the application afterward. 

4.  Even after rigorous testing and delegation, the new gTLDs may not work due to network operators (such as ISPs and webhosters) that may not immediately support them completely, software applications that may not recognize new/unknown gTLDs and other incompatibility  issues.  The Internet Corporation for Assigned Names and Numbers (ICANN) Applicant Guidebook states, “ICANN encourages applicants to familiarize themselves with these issues and account for them in their startup and launch plans.  Successful applicants may find themselves expending considerable efforts working with providers to achieve acceptance of their new top-level domain.” 

5.  In addition to the $185,000 application fee and the escrowing of three full years of operating costs, an annual payment of $25,000 must be made to ICANN, which covers only the first 50,000 domains.  Any amount over that is $0.25 per domain.  If a company outsources its domain name portfolio management, rather than running its own registry, there will likely be additional costs per domain charged by the delegated domain registry operator as well.   

6.  When the ICANN board voted to move ahead with the new gTLDs, it also discussed creating a $2 million fund, whereby application fees would subsidize applicants from developing countries (the transcript of that meeting appears at http://isoc-ny.org/icann41/06-20_singapore_gtld_vote.txt).  

7.  ICANN will conduct background checks to screen each applicant, including an investigation of the applicant’s principal officers, directors, partners, major shareholders, the business itself, general business diligence, criminal history (crimes of trust, such as crimes in the fields of banking or finance) and cybersquatting history.  Although the background information will not be publicly available, an “extended evaluation” process and/or failure to register will be part of the public  record, which might allow people to draw negative inferences from the rejection of certain applicants. 

8.  There will be a “loser pays” system.  In a dispute resolution proceeding between two gTLDs appearing before an ICANN-designated dispute resolution service provider (DRSP), both parties must submit to ICANN an advance payment of the estimated adjudication fees (to cover the “entire cost of the proceeding”). Only the prevailing party will receive a refund of its advance payment.   

9.  If an applicant chooses to delegate the operation of its registry to a third party, there are only a handful of exceptional providers to choose from, and each of those companies can likely only support a half-dozen new gTLDs per year (or less).  

10. It is a first come, first served situation.  The first applicants to provide ICANN with a complete application and any requested additional information will make the transition to delegation first.  However, if there are any problems with the security/stability of the new gTLDs (e.g., DNS and/or root zone issues), then ICANN will stop the process of transitioning to delegation for all remaining gTLD applicants who have been approved and notify them that their applications  will be delayed indefinitely until all of  the security/stability issues are resolved. 

© 2019 McDermott Will & Emery

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Jorge Arciniega, Intellectual Property Attorney, McDermott Will Emery law Firm
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Jorge Arciniega is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm's Los Angeles office.  Jorge focuses his practice on intellectual property, advising clients throughout the world on trademark and copyright selection, creation, protection, registration and enforcement.

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Lynne Boisineau, McDermott Will Emery Law Firm, Intellectual Property Attorney
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