On June 20 2011, the board of the Internet Corporation for Assigned Names and Numbers (ICANN) approved a plan to increase the number of generic top-level domains (gTLDs) from 22 including .com, .net and .org to possibly hundreds.
The changes to the naming system, which are the culmination of six years of planning, discussions and public consultation, will mean that Canadian companies, organisations and individuals will be able to apply for a gTLD of their own design, which may be an existing trade-mark such as .microsoft, or a generic term such as .hockey. Parties obtaining these gTLDs will be required to operate a registry system and will be able to offer second-level domains to others, as registrars already do now, or maintain the gTLD for their own use. For example, a brand owner such as Kodak may register .kodak and make use of second level domains such as cameras.kodak, or lenses.kodak.
APPLICATION PROCESS
The application process to obtain a new gTLD will be rigorous and expensive with a fee of USD$185,000, as well as the costs of preparing the application and meeting the technical requirements. These costs will discourage casual cybersquatters, but that does not mean there will not be disputes arising from the new system. An objection procedure will form part of the application process for gTLDs. Grounds for objection include: "string confusion" objections, which arise when more than one party is applying for a gTLD that is the same or could be confused with another; legal rights objections by owners of registered or unregistered trade-marks; community objections; and limited public interest objections.
Canadian trade-mark owners may want to consider applying for a gTLD containing their company's brand(s) or perhaps a generic word that relates to their company's industry. If they choose not to apply for a gTLD, there is still an opportunity to obtain registrations for second level domains for their company brand in conjunction with the new gTLDs.
RISKS AND RISK MITIGATION
Along with the opportunities that the new gTLD process brings, there are also risks for Canadian trade-mark owners. Another party could register one of their company's trade-marks, or one that is confusingly similar, as a gTLD. Whether trade-mark owners choose to pursue a gTLD or are concerned that another party locks up one of their company's trade-marks, a company should be prepared to object to the applications of others. A list of gTLDs being applied for will be publicly available. Once the list is publicised, a short period of time will open for objections to be filed. Canadian trade-mark owners should be aware of these deadlines and be prepared to take swift action.
Another risk is that a third party will register a company's trade-mark as a second level domain. For this reason, companies should have a strategy for protecting their marks from registration as a second level domain once the new gTLDs are in place. New gTLD registrars will be required to have dispute mechanisms in place and means to
notify trade-mark owners. These mechanisms must include "sunrise periods" for registrations and the use of a trade-mark "clearinghouse" to be operated by an independent party chosen by ICANN.
The trade-mark "clearinghouse" will be a central repository for information pertaining to the rights of trade-mark holders to be authenticated, stored and disseminated. The clearinghouse will have two primary functions: authenticating and validating the trade-marks in the clearinghouse and serving as a database to provide information to the new gTLD registries to support pre-launch sunrise or trade-mark claims services.
Rights holders will be able to submit information on their trade-marks registered in Canada (including the owner name, certificate of registration, date of registration and first use and other pertinent information from the Canadian trade-mark register) for inclusion in the clearinghouse and will be notified if a party attempts to register a second level domain that is identical to one of their marks. Use of the clearinghouse is a proactive step a company can take to protect its trade-marks.
Although civil litigation is not part of the ICANN regime, Canadian trade-mark owners will still have the recourse of the courts to settle disputes on the basis of trade-mark infringement or passing off. The Canadian courts have experience adjudicating domain disputes with the existing gTLDs and that can be expected to continue with the new regime.
ICANN is expected to begin a rigorous public information and education campaign leading up to the first round of applications, which is set to begin on January 12, 2012 and run until April 12, 2012. More specific information will continue to be issued on the objection and dispute resolution processes and trade-mark owners may want to begin considering whether to register their brand as a top level domain or what steps to take to object to applications by others for similar or identical gTLDs or the registration of second level domains that may infringe existing rights.
The new gTLDs will be here to stay, and Canadian trade-mark owners may choose to participate in the process and use it to their companies' advantage or employ a defensive strategy. Both choices require awareness and a proactive approach. The system could be a new area of business for Canadian companies who want to have an increased presence in the Internet space, or simply want to expand their marketing in a progressive way.
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