ICANN's Uncertain State: 2014

By Philip S. Corwin
Philip S. Corwin

In a recent video interview conducted while he attended the World Economic Summit in Davos, Switzerland, ICANN CEO Fadi Chehade stated "legitimacy comes from accountability".

That statement is correct. It is also troubling, in that many of ICANN's recent policies and activities raise serious questions regarding whether it is sufficiently accountable and therefore perceived as acting in a legitimate manner — as well as whether it is continuing to faithfully abide by the Affirmation of Commitments (AOC) it entered into when the US government terminated direct oversight of ICANN in 2009.

One thing is very clear: ICANN's President & CEO, with the full knowledge and backing of its Board, has seized on Edward Snowden's unauthorized revelations of NSA intelligence activities involving the Internet as a rationale for seeking to sever its remaining tie to the U.S government embodied in the contract to operate the IANA function. His "foreign policy" activities have included public endorsement of harsh criticism of the U.S. voiced by Brazil's President in a September 2013 UN address. ICANN's Internet governance initiatives have bewildered many observers, as ICANN's remit is limited to coordination of the Internet's unique identifier systems, particularly the DNS namespace, with security and stability its top priority.

ICANN has also attained "international status" in Switzerland that may presage its intent to abrogate the AOC and transfer its headquarters from Los Angeles to Geneva. ICANN may terminate the AOC at any time by providing 120 days' notice but is constrained from doing so as long as the U.S. remains counterparty on the IANA functions contract.

In reality the designated counterparty for the IANA contract has no bearing on any government's ability to conduct intelligence activities via the Internet. Yet the ICANN-led initiative has now resulted in multiple developments focused on calls to "globalize" ICANN and the IANA function. However, the IANA contract is a strategic asset of the United States and cannot be transferred without U.S. acquiescence; such "globalization" could even require Congressional authorizing legislation.

But such globalization also raises profound legal and political issues — as well as the central question of whether a successful quest to transform ICANN into an International Organization with greatly diminished or even no U.S. ties would result in an organization with very substantial self-funding capabilities — but without meaningful accountability and accompanying transparency. Central to all these issues is the question of whether ICANN presently is and will remain sufficiently accountable and transparent. That is a particularly critical question given that ICANN need not rely on appropriations from any government of international organization — with a current operating budget exceeding $180 million and initial revenues from the new gTLD program already in excess of $300 million and quite possibly rising to more than $500 million once public auctions are held to resolve gTLD contention sets. Indeed, so long as there is interest among future applicants — whether it is voluntary or not, as could be the case for generic word brands seeking to protect their trademark at the top level of the DNS — ICANN can proceed to further increase its revenues through additional rounds of new gTLDs.

ICANN's initiatives to sever its historic ties with the U.S, as well as five top-down mandated ICANN Presidential Strategy Panels undertaken absent any prior consultation with its own stakeholder community, have caused consternation within that community. While ICANN rhetoric focuses on maintaining and strengthening its multi-stakeholder model, its current practices indicate a management intent on redefining the structure and operations of the model. Intentionally or not, ICANN's Internet Governance and Strategy Panel initiatives have also diverted the focus of its community and the public from the ongoing implementation of ICANN's largest and most challenging program in history — the delegation of more than one thousand new gTLDs. While more than one hundred new gTLDs have launched to date their impact on security and stability, trademark rights, and consumer protection and competition authorities is just beginning to be recognized and evaluated — and early signs are worrisome.

All of these developments should raise concerns among policymakers, particularly within the U.S., and demonstrate the need for focused oversight, investigation, analysis and decision-making before the situation evolves past the point of no return.

For readers who are not inclined to wade through the full, nearly 24,000-words version [PDF] of this article, the following Executive Summary provides its main points. The full-length version contains extensive additional exploration and documentation of the topics addressed. The author hopes that this report and analysis makes a meaningful contribution to the very consequential Internet governance debate that is reaching a new plateau of engagement in 2014.

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Executive Summary

Montevideo Statement

Brazilian Internet Governance Meeting

European Commission Declaration

Potential Consequences of ICANN and IANA Globalization

ICANN and IANA "Globalization" Requires U.S. Government Acquiescence

ICANN's Quest for "international Status"

Accountability and Transparency

Presidential Strategy Panels

Conflicts of Interest

New gTLD Second Level Trademark Protections

New gTLD Top Level Protections

Public Protections for New gTLDs relating to Regulated Industries and Professions

Name Collisions

Use of Auctions to Resolve Contention Sets

Conclusions and Next Steps

This status report has documented a wide range of concerns and questions regarding ICANN’s current operations and future plans. Central to all of them is the issue of whether ICANN is currently operating with sufficient accountability and transparency, through a bottom-up consensus process, and in the interest of the global Internet-using public. The answers to these questions will determine the future stability and security of the domain name system and the growing global e-commerce that it supports.

As ICANN has deliberately precipitated a new global debate on the question of whether the IANA function contract should be transferred from the United States to another entity, it is incumbent that the U.S. government engage in an open and public discussion of the legal requirements for and implications of such action. Given the likelihood that any such transfer may require implementing legislation, and in any event should only be undertaken by the Executive Branch with the unmistakable backing of Congress, there is a clear and present need for all of the Congressional committees with jurisdictions and responsibilities related to this critical issue to begin to engage in focused oversight, investigation, analysis and decision-making. Given the history of the development of the DNS this responsibility falls upon the U.S. and should not be shirked.

By Philip S. Corwin, Founding Principal of Virtualaw LLC, a Washington, DC Law and Public Policy Firm. He also serves as Of Counsel to the IP-centric law firm of Greenberg & Lieberman. Views expressed in this article are solely his own.

Related topics: ICANN, Internet Governance, Policy & Regulation, New TLDs


Institutional maturity Avri Doria  –  Feb 21, 2014 2:56 PM PDT

It had long been an assumption that institutional maturity, and remaining true to its multistakeholder nature, would enable ICANN to gain control of its own fate - and control of the IANA contract.

As expressed in this report, and many other indicators, it is obvious that ICANN has not yet achieved the requisite level of maturity.  It is behaving as a rebellious teenager and breaking all the rules, as if it were invulnerable.

While it may be possible for ICANN's President and Board to achieve its independence from the US control, a goal I support, by doing so in the currently precipitous way, it risks losing everything, including IANA. Perhaps it is time for some group to start preparing its bid for when ICANN abrogates its contract with the US and does lose the contract.

In the meantime, those of us who still care about ICANN need to do everything we can to convince the ICANN Board to return to ICANN's multistakeholder modalities and stop the madness.