ICANN Signs .XXX Contract with ICM Registry

MARINA DEL REY—The Internet Corporation for Assigned Names and Number on Friday finalized its contract with ICM Registry to run the .XXX sponsored top-level domain. The announcement was made on the ICANN blog in a post by ICANN general counsel John Jeffrey. “ICANN’s Board of Directors approved entering into the agreement during our recent Silicon Valley-San Francisco Public Meeting,” Jeffrey wrote. “We have now finalized negotiations and executed an agreement that’s posted at http://www.icann.org/en/tlds/agreements/xxx/. It includes some new and revised provisions that follow on from the agreement that we last posted for public comment in August 2010.” Jeffrey noted that the additional terms and conditions in the contract are unique to .XXX and inserted in order to address “heightened compliance measures, pricing and indemnification.” The first new requirement imposed by ICANN mandates that ICM provide “a compliance certification signed by the ICM CEO twice in the first year and annually after that, along with a summary of IFFOR’s audit of ICM’s compliance procedures. IFFOR is the sponsoring organization obligated to oversee the sponsored community’s policy development.” Backing up the increased vigilance of ICM by ICANN are additional processes that include a new mediation procedure. “The requirement that ICANN obtain at least three arbitration awards before requesting punitive or exemplary damages has been removed,” wrote Jeffrey. “In the event that a dispute can’t be resolved through mediation, ICANN may impose monetary or operational sanctions, and ICM may challenge them through arbitration.” ICANN has also taken the unprecedented step of increasing its per transaction registration fee from $1 to $2, “to account for anticipated risks and compliance activities and a fee escalator that will allow for increases to the fees and to account for inflation.” Other protections have been put into place to further indemnify ICANN from anticipated disputes, including ones that “allow ICANN to manage any third party dispute proceedings at ICM’s expense. ICM’s consent would be required for ICANN to settle a proceeding in a way that requires ICM to pay monetary damages, and ICANN would be required to work in good faith to mitigate ICM’s expenses.” Jeffrey concluded, “Monthly reports must include a line item for ‘attempted adds’ (success and failure) and there are updated references to RFC’s on internationalized domain names. ICANN also has a right to consent to any proposed change to the definition of ‘Sponsored Community’ by the registry.” According to the just-signed contract, the timeline of following events is, as follows: Date Contract Signed (DCS): ICM/IFFOR Sponsoring Organization Agreement signed; IFFOR CEO, Board, Policy Council Members and Ombudsman announced; Back end provider contracts signed; IFFOR contracts for labeling and monitoring executed; System build begins. DCS + 30 Days: IFFOR Board and Policy Council Meeting; Procedures for registering .XXX names announced; Industry reservation materials provided to ICANN accredited registrars. DCS + 60 Days: Authentication and verification procedures published; Start Up Trademark Opposition Process (STOP) commences; Registrar agreements published and offered; Pre-launch of authentication of registrants begins. DCS + 90 Days: Progress report #1 published; Publication of Premium Names Policy and Country Names and Geographic Designators List; Stakeholder review of draft SIRR; System test begins; Registrar integration begins.