If the timeline for turn-around of clarifying questions (CQs) remains two-weeks, the long pole in your CQ tent is likely to be revising your Q50 letter of credit or escrow agreement to meet the ICANN requirements. Based upon ICANN comments, it appears that many applicants are having trouble meeting the specific letter of credit (LOC) or escrow agreement language. To remedy this ICANN should consider publishing what it considers acceptable language for an LOC or escrow agreement.
This would clarify what appears to be conflicting guidance that ICANN presented in the Guidebook and Supplemental Notes for Question 50. The Guidebook states that unconditional release of funds is required. However, in the Supplemental Notes for Q50 under paragraph 1.6, ICANN provided recommended wording for the beneficiary statement including: "in the event of a failure of a critical registry function as described in the foregoing sections of the Applicant Guidebook".
We've seen clarifying questions during the pilot where applicants who used the exact wording recommended by ICANN in the Supplemental Notes were provided a Q50 clarifying question stating that their COI instrument did not meet the "unconditionally entitled to a release of funds" requirement.
We assume that all of the applicants have submitted their applications with the intent of trying to meet ICANN's detailed Applicant Guidebook requirements. ICANN published Continuing Operations Instrument guidance that was specific.
The value of the COI is half the battle for the question 50 three points. Getting the LOC or escrow agreement correct is the other half.
ICANN Clarifying Questions - How Are They Structured? (Part 1 of 3)
ICANN Clarifying Questions - How to Respond (Part 2 of 3)
ICANN, please consider publishing example acceptable LOC/escrow language so that applicants can confidently work with their banks or financial partners to meet the question 50 exacting language for scoring 3 pts. This would reduce the volume of unnecessary clarifying questions for 47, 48 and 49 during the heavy workload of initial evaluation.
By John Matson, Co-Founder and COO of Architelos. Mr. Matson has advised Fortune 500 companies on cost structures, margin enhancement and implementation of new growth-oriented business models. He has performed several projects for ICANN, including advising on the new gTLD program and benchmarking previous gTLD launches. Architelos provides Top-Level Domain (TLD) application guidance and front-office services for clients in the DNS and IP industry. Mr. Matson can be reached directly at email@example.com.
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