A memorandum of understanding will be formally signed in Geneva next week which will bring global self regulation to a key part of the Internet. Over the next 100 days (from 31 April) an entire structure will be created to control the registration of international domain names and expand the categories of domains, adding seven new types of commercial domain to the existing ones of .com, .net and .org. The new structure includes procedures to resolve disputes over who is entitled to a particular domain name.

This initiative to extend and order the process of registering international domain names is a very significant one. It will change the rules for domain name registration in every country in the world. It is also likely to lead to significant new business for domain name registration companies, a number of which are already advertising what they describe as pre-registration facilities for the new domains, a practice which has been denounced by the Internet Society, one of the prime movers behind the new system. The first registrations under the new system are likely to be made in the autumn of this year, so there is clearly no need to rush in straight away, particularly as the ground rules for the new system are still being formulated. But no business wants to lose the right to use its name on the Internet in the domain name goldrush, or to allow someone else to trade electronically on the back of their hard-earned goodwill by using a similar domain name, so the issue will have to be faced soon.

The changes to the domain name registration system will require a significant proportion of the commercial Internet community to reappraise its registration strategies:

  • Businesses should consider whether or not they need to register their names in any of the new domains, instead of or in addition to any current registrations. The new categories are .firm, .store, .web (to emphasise activities on the WWW), .arts, .rec, .info (for information services) and .nom (for individuals). Retailers will have a particularly difficult choice to make, as during the transition to the new regime they could register in the existing .com and co.uk domains and the new .firm, .store and .web domains as well.
  • major brand owners will have to extend the scope of their existing registrations to protect them from pirates. Although there will be a new procedure to challenge infringers who register others brand names, it will be quicker and easier for brand owners to register first. There will be nothing to stop, say, smirnoff.web or smirnoff.firm being applied for by anyone who can find the registration fee and, as any lawyer will tell you, prevention is far quicker and cheaper than cure.
  • The significance of the .com domain as the symbol of international business is expected to be significantly reduced under the new system, because of the new domains being created. In addition, US companies are to be encouraged to use the co.us domain. This means that it will be less useful to register in the .com domain and rely solely on a registration there as the most commercially important domain.

So, don't panic, but do start thinking carefully now about what you should be doing soon. The Internet is maturing very fast into a global commercial infrastructure and your decisions now about your online identity will have lasting implications for your business.

For further advice please contact us.

This newsletter is correct to the best of our knowledge and belief at the time of going to press. It is, however, written as a general guide, so it is recommended that specific professional advice is sought before any action is taken.

Garretts is authorised by the Law Society of England and Wales to carry on investment business.