What Domain Names Are and How They Work
Domain names serve as identifiers of a specific online address that is registered by an organisation or an individual. They comprise textual segments separated by dots (e.g.: rdj.ie). Domain names make locating websites easier by connecting the IP address (which is a sequence of numbers and, as such, difficult to remember) of the website to the domain name. When a user enters a domain name into a browser, the browser interrogates the Domain Name System to search the domain name and find the associated IP address.
There are two main categories of domain names. Those ending in an abbreviation indicative of the nature of the domain name (e.g. .com for “commercial”) are called generic top level domains (“gTLD”). Those ending in an abbreviation indicative of a specific country (such as .ie or .uk) are called country-code top-level domains (“ccTLD”).
The Internet Assigned Numbers Authority (“IANA”) provides pools of unallocated IP addresses to regional Internet registries (“RIR”). Each RIR maintains a public database providing information about IP address assignments (also known as a “WHOIS Database”).
Like trademarks, domain names are registered on a “first come, first served basis”. Once an individual or an organisation becomes the registrant of a domain name, they gain a monopoly over it for as long as the registration fees are paid.
Property or A Contractual Right?
Businesses often register their company name, business name or trademark as domain name. This may be the reason why, especially in the context of transactions, domain names are often grouped together with intellectual property rights (“IP Rights”). From a commercial perspective, domain names are often perceived as digital real estate which accrues value over time. However, the rights of the domain name registrant with respect to the domain name do not fit neatly into the category of tangible or intangible property. A domain name registrant does not have absolute right and title to the domain name, nor can they take possession of the domain name in the same manner in which the owner of land or of another tangible asset does. Domain names also do not meet the criteria for protection by copyright, patents, industrial designs or other IP rights. For this reason, the prevailing opinion is that the right to a domain name is merely a contractual right.
The terms and conditions of some of the leading domain name registrars and registration service providers expressly state that the registration of a domain name does not create a property right for the registrant and that a registrant must not in any way transfer or purport to transfer a proprietary right in a domain name or grant or purport to grant a security or encumber or purport to encumber a domain name registration. The terms and conditions of other domain name registrars are ambiguous as to the rights of the registrants.
Registering a Domain Name
The registration of a domain name is a simple process, which is carried out online. A domain name may be registered directly with an accredited registrar or via a registration service provider. The process involves:
- identification of an available domain name;
- identification of a registrant;
- nomination of administrative, billing and technical contacts;
- acceptance of terms and conditions; and
- payment of registration fees.
As at the date of writing, the Internet Corporation for Assigned Names and Numbers (“ICANN”) which has an administrative role in relation to gTLDs and ccTLDs, has accredited over 3,000 companies for the purposes of domain name registration.
The right to use a domain name is subject to the ICANN Uniform Domain Name Dispute Resolution Policy (“UDRP”) which came into force in 2000 and regulates the resolution of domain name use and registration disputes between parties, other than registrars.
Common Practical Issues
Identifying the registrant
When a domain name is registered in the name of an organisation or an individual, no certificate of registration is issued. Instead, the registrant's identity is entered into a WHOIS Database, which includes information such as identification of the domain name registrant, date of registration, registration expiry date, host name and IP address for the domain name servers. Originally, a WHOIS Database was publicly accessible in full. Following the entry into force of the GDPR, ICANN changed its approach to the availability of the data within a WHOIS Database, introducing tiered access and limiting publicly available information. As a result, currently, registrant data is not publicly available. A third party looking to gain access to such data, must either request proof from the registrant directly or make a disclosure request with the domain name registrar or operator and provide information about its legal basis for the request.
The absence of publicly available domain name registrant information causes practical difficulties mainly in the context of due diligence and domain name disputes. In due diligence, the prospective buyer or investor looks to verify that any domain names instrumental to the business are registered in the name of the company which is being acquired or invested in. When this data is not publicly available and no certificates of registration are issued, the prospective buyer or investor must rely on alternative verification tools such as reviewing print-outs or screenshots of the business' records showing that it is the registrant of the domain name or negotiating some form of supervised login access to the business' domain name management portal.
When a domain name dispute arises, a prospective complainant must identify the registrant in order to seek to exercise its rights. Under the UDRP Rules, a complaint may be submitted without identification of the domain name registrant. Once the domain name registrant is identified, the complainant may continue to pursue to the complaint or choose to withdraw it.
Registrations in the name of individuals
Often, in the course of due diligence, it transpires that business crucial domain names are registered not in the name of the company, but in the name of an individual such as a founder, shareholder, the CTO, or the IT services provider. Issues arise when there is disagreement between the individual concerned and the business or if the individual in question is no longer involved with the business, cannot be easily located or is deceased.
Competing legitimate interests
A domain name serves a similar purpose to a trade mark in that it is used to identify the provider of products or services or the products or services themselves. Consequently, the domain name registrant may wish to register the domain name as a trade mark. Also, the registration of a domain name may lead to infringement of third party trade mark rights.
Registering a domain name identical to another's earlier trade mark, company name or trade name or registering in bad faith a domain name in one or more gTLD or ccTLDs is referred to as cybersquatting. Cybersquatters register domain names in this way and later offer them for sale to the trade mark or trade name owner for a price much higher than the original domain name registration fee.
To assist in counteracting cybersquatting, ICANN created the Trademark Clearinghouse, which is a centralised database of verified trade marks, connected to each gTLD launching. Trade mark owners can submit their trade mark data to the Trademark Clearinghouse database before or during the launch of new gTLDs. The trade mark ownership is verified and the trade mark owner is given a unique authentication key, which gives access to participation in the so-called Sunrise period of the new gTLD. During the Sunrise period, the holder of the unique authentication key has first priority to the domain name registration.
During a 90 day period following the Sunrise period of a new gTLD, where a party seeks to register a domain name coinciding (including so called “fuzzy matches”) with a trade mark recorded in the Trademark Clearinghouse, they are notified of a potential trade mark infringement and cannot proceed to registration unless they acknowledge such notification. If the party continued to register the domain name despite acknowledging the notice, the Trademark Clearinghouse notifies the trade mark owner of the domain name registration. Trade mark owners whose trade marks are registered with the Trademark Clearinghouse receive continuous notifications of potential infringement past the initial 90 days period.
Trade mark owners can also rely on the UDRP to make a complaint against the registrant of a domain name and in this way to prevent its use. Under the UDRP, there are two remedies available – transfer of the domain name or its cancellation. The UDRP procedure is cheaper than court proceedings and lasts around 60 days from the date of receipt of the complaint by the dispute resolution service provider.
UDRP proceedings do not preclude the complainant from submitting the dispute to a court for resolution. In such cases, the court decision will prevail.
The Uniform Rapid Suspension System (“URS”) is another system established by ICANN, available solely to new gTLDs and intended to complement the UDRP. The system is expedited, and the examiner makes a determination on the basis of the applicant's submission without further investigation, gathering of documents or hearings. For this reason, the remedies under the URS are suspension of the domain or the return of the domain to the registrant (if the complaint is unsuccessful). For this reason, the URS is not an appropriate route where the trade mark owner wishes to be transferred the domain name.
The URS determination does not prejudice court proceedings or UDRP proceedings.
Reverse domain name hijacking (sometimes referred to as “reverse cybersquatting”) is defined in the UDRP as using the UDRP in bad faith to attempt to deprive a registered domain name holder of the domain name. If, after considering submissions, the administrative panel appointed by a dispute resolution service provider decides a complaint concerning a domain-name registration was submitted in bad faith or with the aim to harass the domain name holder, such panel may declare in its decision that the complaint constitutes an abuse of the administrative proceeding.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
