Josť Miguel Piquer
Department of Computer Science
University of Chile
Patricio V. Poblete
Department of Computer Science
University of Chile
AbstractFor over a year, the .CL top-level domain has been operating under a set of rules that allow for the resolution of conflicts for domain names by an arbitration system. These rules have been very successful in solving the conflicts that have occurred, and also in preventing others, as the mere existence of this system appears to have discouraged many would-be name pirates. Even though the process includes a thirty day publication period, this does not introduce a significant delay in the activation of new names, and the system is largely transparent for bona fide applicants.
Table of Contents
- The Registration Policy
- Experience with the Policy
- Problems Encountered
- Future Evolution
IntroductionSince 1986, the Department of Computer Science of the University of Chile has been in charge of handling domain name registrations under the .CL top-level domain. (Our experience in the early days of the Internet in Chile has been published in .)
For nearly a decade, the process of handling domain name applications ran on a very informal basis, with no written rules, and also no conflicts. We basically followed RFC1591  (after it was published), tried to be fair, and hoped that everyone would act in good faith. The smooth operation of the .CL name registry earned it a reputation of being efficient and reliable. Also, while more and more registries started charging for their services, registrations under .CL remained free.
However, in early 1997 it was already apparent to everybody involved in the administration of the registry, and to many members of the community, that it was not feasible to keep providing a free service forever. All the resources used by the registry were provided by the University of Chile, something that was reasonable when the technology was unknown to the general public and used mostly by universities, but as the number of registrations grew, and most of them started coming from commercial entities, it became increasingly harder to argue that the University of Chile should continue subsidizing this indefinitely.
It was also clear that we had been lucky in avoiding conflicts so far, but it was inevitable that they would happen sooner or later.
These considerations led us to gather a group of volunteers, including several lawyers specialized on intellectual property and on the Internet, to write a draft policy, that would be a sound basis for domain name registrations. This policy would include a mechanism to resolve disputes, and would be our first explicit set of rules. This draft underwent several revisions in the first half of the year, and we had meetings with some ISPs to ask for their input on this matter.
While this process was going on, two events happened that had an important influence on it. The first was the beginning of a race between two companies to register as many generic names as they could (e.g. "restaurants.cl", "travel.cl" and so on) in the hope of using them to create an index analogous to the "Yellow Pages" of the telephone world, using the DNS to implement it. This obvious misuse of the DNS was possible because it cost them nothing to register hundreds of domain names.
Disturbing as it was, this phenomenon further convinced people that some form of charging was necessary. To socialize this problem, we started publishing the applications in our web page (http://www.nic.cl) as they were received, in effect making public our "in" queue. Fortunately, as the names requested were generic, and not brand names, the implications from the point of view of intellectual property were not significant.
The second event happened shortly thereafter, and consisted again of two companies (different from the previous two) racing to grab several hundred well known names, including the proverbial "cocacola.cl".
In a few days, the public listing in our web page alerted the press and the business community, and the commotion that followed brought for the first time in Chile the DNS and the Internet to the front page of the national newspapers.
As soon as the media began reporting on this, we started feeling the pressure from the companies that felt themselves victims in this situation. Many of them, for whom the Internet was still a mystery, and RFC1591 notwithstanding, blamed the University of Chile for allowing this to happen. Several of these companies complained to the Rector of the University, who demanded an explanation from us. The complaints announced their intention of taking legal actions against the University. Another company went even further, and filed suit against the applicant and against the University of Chile, claiming their constitutional rights had been violated, their point being that by simply allowing an application to be filed for "their" domain name, and not rejecting it outright, we had violated their property rights for that name.
After considering several options, we decided that the new policy should go into effect immediately, and all applications, including those still in the queue, should comply with it. We shut down the service for one working day (a Monday), and worked non-stop through the previous weekend to revise and publish the draft policy, changing our systems accordingly. On Monday evening we were able to begin accepting applications again, with a new web page, a new a registration form with the scripts to process it, and a procedure for charging for registrations.
Before long, normality had returned to the process and the many parties that considered themselves victims of attempted name piracy were able to make use of the provisions of the policy to defend their rights.
We will describe next the basic ideas in the current policy, and how it differs from the one that was introduced then. We will also present some statistics to evaluate the results of its application.
The Registration PolicyThe policy is based on making all the information available to all parties, allowing them a reasonable time so they can react to applications that they believe may threaten their rights on some name, plus an arbitration system to adjudicate domain names.
To do this, applications are published automatically in our web page, and listed there for thirty days. During that period, the applicant has to submit (by fax) a signed statement declaring that he/she knows the policy and accepts it. We also require faxed copies of documents attesting the existence and identity of the applicant in Chile (tax ID for companies, personal ID for individuals). Also during that thirty day period the applicant must pay the registration fee.
To introduce a minimal delay on the technical functioning of a newly created domain name, we activate new domain names as soon as the faxed papers are received, often on the same day the domain was requested. Officially, this activation is on a trial basis, contingent on the fulfillment of the payment and identification requirements. This way, applicants may start using their domains right away, and in a large majority of the cases, keep using them with no interruptions from then on.
In the case of domain name conflicts, the policy allows for other, competing, applications to be filed during the thirty day publication period. A second applicant for a domain name has to fulfill all the requirements as the first applicant, but of course the trial activation is not available in this case.
After each applicant has had its thirty days to comply with all requirements, those that have failed to meet them (e.g. by not paying) are discarded. Afterwards, if there are no opposing applications the domain is adjudicated to its only applicant. If there are two or more valid applications, an arbitration process begins. First, the two parties are allowed ten working days to agree on the name of an arbiter of their choice. Failing that, the NIC appoints an arbiter chosen in a "round-robin" fashion from a list. The arbiter first tries to help the parties reach an agreement, and if that is not possible, hears the arguments from each side, and makes a decision.
The list of arbiters is compiled by ACHIPI (the Chilean Industrial Property Association), but it is open to all qualified persons, and the actual composition includes members of ACHIPI as well as non-members.
Experience with the PolicyThe following graph shows the total accumulated number of applications received and granted from September 1997 until January 1999.
As the graph shows, we did not enjoy the luxury of starting slowly. On the contrary, the rate of arrival of applications during those first days has yet to be matched. This is clearly an effect of the panic caused among businesses by the attempt to grab a massive number of domains in late August 1997.
The following graph shows the number of new conflicts for each month. We define a conflict as a domain name requested at the same time by more than one applicant.
It has been surprising to us that the conflicts that have occurred have been distributed in a very irregular fashion. At first glance, the number of cases of attempted name piracy has been very large, numbering some five hundred among approximately eight thousand applications. However, almost all of them have come in "waves", and have been triggered by applications submitted by no more than five different applicants. After the fist such wave, that motivated the introduction of the policy, and where in the course of a few days more than three hundred well known names were requested by just two applicants, there have been two additional cases where applications for a large number of domain names corresponding to well known brand names were submitted. In all those cases, the applicants did not get the domains they requested, sometimes because they did not pay for them, or because they withdrew their applications after the owners of the respective brand names reacted by submitting their own applications. In exceptional cases, the arbitration process has begun, but in all of them the first applicant withdrew his claim at the initial hearing. In only one case the trademark owner did not act within the thirty days period, and the applicant was assigned the domain. In this case, only several months later did the trademark owner contact our NIC to inquire about that particular domain.
In light of the extremely low yield for the would-be pirates, it is surprising that they keep trying. It seems a fact of life that at least twice a year someone will have the bright idea of going through the phone book requesting all company names that are not yet registered as domain names.
Of all other "normal" conflicts, there have been 19 that have arrived at the arbitration stage. Of those, in 14 cases one of the parties has finally withdrawn its application, while in the remaining 5 the arbiter has had to make a decision.
In three cases, instead, one of the parties has gone to the courts to file a suit. Because of the slowness of the normal Chilean judicial system, all of them have taken a speedier route by claiming that their constitutional rights have been violated. This kind of claim have to be resolved very quickly, so it is seen first directly by the Appeals Court, and it can be appealed to the Supreme Court.
In one of those cases, the claim was considered moot because the supposed pirate did not comply with the NIC requirements within the thirty days, and the application had already been rejected automatically by the time the court was to hear the case. In the other two, the complainants lost, and the courts ruled that the University was under no obligation to run a check on the possible trademark status of the domain names requested. As for any possible trademark infringement, the ruling said that it was not a matter of constitutional rights.
In summary, brand name holders have been very unsuccessful by going to the courts, while on the other hand have had almost 100% success by following the procedure set by the policy of the NIC.
Problems EncounteredIn the course of the first year of application of the policy, we encountered a number of minor problems that led to some amendments, that were introduced exactly a year from the beginning of its application.
Several of the problems had to do with applicants missing the deadlines for various reasons. As most of them had no opposition from another party, and seemed to be making a good faith effort to comply but were late nevertheless, we started extending the deadlines in those cases, but finally arrived at a situation where some applicants were many months late, and showed no signs of trying to comply.
After giving notice and waiting for an additional period, we had no alternative but to start deleting those domains, and afterwards established a firm policy of deleting domain name applications as soon as they missed their deadlines. The result has been that a much larger fraction of the applicants have complied, and the rest have had to re-apply if they still want the domain.
Another source of problems was the documentation we requested to be submitted. At first, we followed the advise of the more strict of our lawyers, and required a statement with an original signature, and photocopies of the incorporation papers of the companies and of their ID card. Not surprisingly, this turned out to be extremely cumbersome, and we later reduced it to a minimum set of documents, to be sent by fax instead of by regular mail. As a minimum, we have found that we cannot avoid requiring a signed statement from the applicant, and a copy of the ID document that would allow us to have some evidence that the applicant legally exists, and is correctly identified.
Still with this reduced set of documents, we found that in many cases we had to delete applications where the fee had already been paid, but the corresponding documents had never been submitted. This was an undesirable situation, because many applicants felt that since the fee had been paid, we had no right to delete the application. So, to make it increasingly harder to forget to fax those papers, we decided to require that they be sent prior to the activation of the domain. Applicants that need to have a domain operating quickly have found that sending a fax is something they can readily do after filling our web form to request the domain.
The most significant change we had to make was in the arbitration process. When we had to start applying the new policy in a hurry, there was one already existing arbitration panel that was available, well known and respected by the business community and did not require the signing of any previous agreement between it and the university.
As it turned out, this panel, established and operated by the Santiago Chamber of Commerce, provided a much needed service, but had several drawbacks. One was that their arbiters knew very little about the Internet, and found it very difficult to make decisions on these matters. Another problem was that these disputes did not have a clear monetary value attached to them, so their fee schedules were not applicable. As disputes of indeterminate value, often the fees of the arbiters tended to be very high, and applicants, that had to pay them, complained about the cost.
Because of this, in cooperation with ACHIPI, a new arbitration system was established, where the panel of arbiters would include people that knew both the Internet and the intellectual property laws, and where the fees would be significantly lower than before. This system has been operating for just a few months, but the initial experience with it has been very positive.
Future EvolutionAlthough the system has reached a great degree of stability, there are some standing issues that need to be addressed. Our policy provides a way of solving the conflicts that arise during the thirty day publication period, but they have no way of dealing with conflicts that may appear afterwards. The problem is a hard one, because it might mean taking away a name from someone who has been using it for a long time on the Internet, if the opposing party were to succeed in proving that they have a better right to that name.
For this reason, we have refrained so far from including these among the conflicts that are handled by the arbitration system. However, there are some cases where there is a strong sentiment in favor of allowing the "reopening" of a closed case. Namely, when it can be determined that the first applicant has acted in bad faith (e.g., to prevent a competitor from registering his domain).
It is unclear at the time whether the arbitration process will be extended in this direction, and it is unlikely that it would be extended beyond that. Therefore, it becomes crucial that all interested parties be informed of the applications as they are published, so they do not lose the opportunity of defending their rights.
Currently, our listing in the web satisfies this need, and many people have adopted the habit of checking the list periodically. But some steps need to be taken to make this list more visible, and we have started talks with the "Diario Oficial" (the official publication medium for laws and official announcements) to have their web edition include a link to our page.
However, if we consider the future growth of the number of domain applications, it is quite probable that very soon the publication list will be too large, and we will have to add new ways of disseminating this information. One way we may do that is by letting people join a notification list, allowing them to state a list of names they might be interested in being notified about. By using approximate searching, regular expressions, etc., we could provide a powerful information system for the community of users of NIC Chile.
A final problem we are facing is the abuse of the information available at our web site. Some local spamming for advertisement are using our contact information (available to the public on our web site) to construct bulk e-mail lists. The difficulty here is that our operation is based on making the contact information public. However, maybe very large queries (as listing all the domains registered) should be forbidden.
ConclusionsOur experience with the application of this policy has proved that a system based on publication of domain name applications, and the use of arbitration to adjudicate domains in the case of disputes is a viable way to run a registry. One of our priorities has been to minimize the problems that this could cause to the vast majority of applicants, who are not involve in any disputes and only want to have their domain available as soon as possible.
During the operation of the system a seemingly high number of conflicts appeared (around 5% of the requests). However, most of them never got to the arbitration process, because one of the applicants had withdrawn its request. Only a tiny number of requests did reach the arbitration stage (around 0.2%). This seems to indicate that domain name disputes are fewer than expected, and we believe that this should be true also at an international level under generic domains.
We have introduced the changes that have seemed necessary to eliminate those aspects of the system that turned out to be unnecessarily complicated or costly, and we feel that we are approaching a kind of "steady state" that should make the DNS a stable component for the development of the Internet in Chile.
- Baeza-Yates, R., Piquer, J.M., and Poblete, P.V., "The Chilean Internet Connection or I Never Promised You a Rose Garden", INET'93, http://www.nic.cl/inet93/paper.html
- Postel, J., RFC1591: Domain Name System Structure and Delegation, http://www.nic.cl/rfc1591.html