A New Age Dawns for Online Brand Protection: The Expansion of gTLDs

In a move which will dramatically change the face of the Internet, in June 2011, the board of The Internet Corporation for Assigned Names and Numbers [ICANN] voted in favour of opening up the possibilities for registrable gTLDs.

What is a gTLD?

The abbreviation gTLD is short for generic Top-Level Domain which is an Internet extension that appears at the end of a website address such as “.com”, “.net” or “.org”. From the earliest registrations in 1985 until this year, there have only been 22 gTLDs registered. The most common of these are “.com”, “.net” and “.org”. ICANN and commentators in the industry expect that this number will increase exponentially in the coming years following ICANN’s decision.

Release of “.XXX” Domain Name

In September 2011, we saw the registration of a new gTLD, “.XXX”. This domain name is a taste of things to come. It can only be registered by an individual, business or entity which is a member of the online adult entertainment industry or who is supplying products or services to that industry. The release of this gTLD will open up a wide range of new marketing opportunities for those in that industry.

The registration of “.XXX” was applied for some time ago, and it is not part of the forthcoming wave of gTLD registrations. Other industry specific gTLDs which have already achieved registration include “.jobs”, “.travel” and “.museum”. Until now, these gTLDs have not been widely used and are not commonly known. It is predicted that this will all change in 2012.

Expansion of gTLDs

From 12 January 2012 to 12 April 2012, applicants will be able to apply to ICANN for the registration of new gTLDs. The types of gTLDs that can be applied for fall within 4 broad categories.

These are:

1. Brands – “.yourbrandname” / “.yourproductname” / or “.yourcompanyname”;

2. Geographic – continents, UN regions, countries, territories, provinces, states, or cities;

3. Generic – products (“.car” / “.computer”), activities (“.hike” / “.sport”), community groups (“.volunteers” / “.eco”), or industries (“.law” / “.bank” / “.carpenter”); and

4. Internationalised Domain Names – TLDs consisting of non-latin alphanumeric characters eg. Arabic, Chinese, or Russian characters.

The repercussions of the introduction of these expanded categories are potentially huge.

Who can Apply?

Established corporations, organisations, or institutions in “good standing” may apply for a new gTLD. Applications from individuals or sole proprietors will not be considered. In considering an applicant’s eligibility, ICANN will perform background screening on the general business diligence and criminal history of the applicant, and the applicant’s history of cybersquatting behaviour.

It is important to note that applying for a gTLD (e.g. “.yourcompanyname”) is not the same as applying for a second level domain name (e.g. yourcompanyname.com.au). An applicant for a new gTLD is applying to create and operate a registry business supporting the domain name system. A successful gTLD application will be subject to the code of conduct set out in the gTLD Applicant Guidebook and possibly accreditation requirements.

It will be at the discretion of a successful gTLD applicant, as the registrar of that gTLD, whether other second or third level domains using the gTLD can be applied for by members of the public or whether the use of the gTLD is limited to use by the registrar, or the use of the gTLD is limited in some other way.

The application process is complex and the evaluation period is expected to range from 9 to 20 months, depending upon the complexity of the application.

The evaluation fee is estimated at US$185,000, with the possibility of additional smaller fees becoming payable during the process, again depending upon the complexity of the application.

Implications for Brand Protection

The touted benefits of, for example, brand name TLDs include:

• Increased online brand recognition and direct navigations (with reduced instances of consumers guessing URLs) and reduced reliance on search engine navigation and optimisation;

• Increased online consumer confidence by the creation of a trusted name space for your brand; and

• Reduced administrative burden in managing a domain name portfolio across multiple TLDs.

But what are the ramifications for brand protection? What happens if you miss out on your .brandname TLD?

Instances of cybersquatting are already rife on the internet in the realm of second level domain names. It is possible that the instances of cybersquatting and extortion will increase with the dawn of this new age. While the evaluation fee may dissuade some cybersquatters from registering a “.brandname” domain name for personal gain, given the potential value that could be attributed to a registered brand name TLD, there is a real possibility that there will be some who are not deterred.

The application process provides for an objection period. The comprehensive gTLD Applicant Guidebook (available on the ICANN website) sets out the objection and dispute resolution policies and procedures.

There are four grounds for objection to a gTLD application.

These are:

1. String Confusion Objection;

2. Legal Rights Objection;

3. Limited Public Interest Objection; and

4. Community Objection.

The term ‘String’ refers to the combination of characters which constitute a gTLD.

The most relevant ground of objection for brand protection purposes is obviously the Legal Rights Objection. Generic Names Supporting Organisation (GNSO) Recommendation 3 provides that:

“Strings must not infringe the existing legal rights of others that are recognized or enforceable under generally accepted and internationally recognized principles of law.”

A “rightsholder” has standing to file a Legal Rights Objection. At this time, the precise stage in the application process when objections may be filed is not clear. Once a valid objection has been filed, it will be referred to the relevant Dispute Resolution Service Provider and resolved in accordance with the New gTLD Dispute Resolution Procedure set out in the gTLD Applicant Guidebook.

For potentially infringing second level domain names, it is understood that the existing ICANN Uniform Domain-Name Dispute-Resolution Procedure will apply.

Apart from the filing of objections and engaging in ICANN’s dispute resolution procedures, depending on the circumstances of each case, action may be able to be taken against a registrar or other domain name holder for trade mark infringement under the Trade Marks Act 1995 (Cth), for misleading and deceptive conduct under the Australian Consumer Law, or at common law for passing off on your brand and reputation.

Due Diligence

The other side of the coin is that it is imperative that aspiring applicants carry out thorough due diligence prior to applying for a gTLD. Similarly, registers of gTLDs should be searched as part of the due diligence process prior to applying for a trade mark.

Are Your Brands Protected?

Before the registration of the new gTLD commences and the new age for brand protection dawns, it would be prudent for businesses to consider whether their brands are adequately protected now. For example, are your business and product names and logos registered as trade marks? Remember, a business name or domain name does not give the holder any proprietary rights in that name.

What can we do for you?

DW Fox Tucker can advise and assist you in all areas of intellectual property law, including:

• Applications for Australian and International trade marks;

• Conducting online due diligence searches for Australian and international brands;

• Providing advice in relation to and assist with the gTLD application process;

• Negotiating deals for assignment of gTLDs and second level domain names;

• Objections to gTLD Applications;

• Enforcement of trade marks and actions under the Australian Consumer Law and for passing off;

• Advising and acting in relation to dispute resolution;

• Monitoring applied for gTLDs; and

• Carrying out an IP Audit on your business.

For more information, please contact:
Sandy Donaldson

Sandy Donaldson
Director
p.  +61 8 8124 1954
e.  Email me

This communication provides general information which is current as at the time of production. The information contained in this communication does not constitute advice and should not be relied upon as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Should you wish to discuss any matter raised in this report, or what it means for you, your business or your clients' businesses, please feel free to contact us.

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