October 27, 1999
Ms. Esther Dyson
Internet Corporation for Assigned Names and Numbers
4676 Admiralty Way
Suite 330
Marina Del Ray, CA 90232
Re: Request for a Procedural Policy
Dear Ms. Dyson:
Introduction
The Office of Advocacy, U.S. Small Business Administration,
("Advocacy") submits this letter to request that the Internet
Corporation for Assigned Names and Numbers ("ICANN") adopt and
publish a policy statement on major issues that affect domain name
holders. ICANN has not issued a formal policy statement on such
crucial matters as notice and comment, openness, and transparency.
Procedural questions have arisen at almost every stage of
ICANN’s activities throughout its existence and are
undermining the consensus needed for ICANN to operate effectively.
Furthermore, Advocacy believes that procedural policies are
mandated by ICANN’s Memorandum of Understanding with the U.S.
Department of Commerce ("DoC" or "Commerce Department") and
through ICANN’s Bylaws for the Interim Board.
Advocacy recommends that ICANN open a proceeding at its Los
Angeles meeting in early November to solicit proposals and
submissions on possible procedural policies. After receiving
submissions, ICANN should issue a proposed procedural policy for
public comment and then adopt a policy that incorporates the
comments received. This process for drafting a policy should allow
sufficient time for public input on all matters affecting material
interests.
Also, ICANN should base its procedural policy on the
Administrative Procedure Act. Regulatory actions by the Commerce
Department are subject to the APA. Because of ICANN’s close
and particular relationship with the DoC, any procedural policy
should be based on the APA and incorporate the same duties and
protections.
Finally, a little over two weeks ago ICANN proposed amendments to
its Bylaws and allowed 14 days for comment. These amendments would
remove the only meaningful section in the Bylaws that deal with
transparency and procedures. In that section’s place, ICANN
is proposing a vapid sentence that essentially removes all
openness and transparency requirements on ICANN. Advocacy
considers this proposal and the insufficient notice and comment
period all the more evidence that a procedural policy is needed
and needed now.
Background
The United States Congress established the Office of Advocacy in
1976 by Pub. L. No. 94-305, codified as amended at 15 U.S.C. §§
634(a)-(g), 637, to represent the views and interests of small
business within the U. S. federal government. Its statutory duties
include serving as a focal point for concerns regarding the
government’s policies as they affect small business,
developing proposals for changes in U.S. Federal agencies’
policies, and communicating these proposals to the agencies. 15
U.S.C. § 634(c)(1)-(4).
Small businesses are a crucial element of the U.S. economy and the
Internet. In 1998, there were 23 million small businesses in the
United States, which represent more than 99 percent of all
businesses in this country. Small businesses employ 52 percent of
private workers and employ 38 percent of private workers in
high-tech occupations. Virtually all of the net new jobs created
in the United States in the past few years were created by small
businesses.
Small businesses use of the Internet is rapidly expanding. In the
past two years, small businesses with access to the Internet have
doubled from 21.5 percent to 41.2 percent. Thirty-five percent of
small businesses maintain a Web site and one in three maintain
business transactions through their site. Any policy that
detrimentally affects the ability of these small businesses to use
the Internet would have a significant impact on this nation’s
economy and limit the effectiveness of the Internet as a tool of
business, commerce, and communication.
1. Current Procedural Difficulties
ICANN has been troubled from the beginning with questions about
procedure and process. Commenters have repeatedly raised questions
about ICANN’s openness, accountability, and transparency,
particularly since ICANN’s actions in Singapore to adopt specific
language for the registrar accreditation despite serious objections.
Advocacy believes that these procedural concerns are legitimate, and,
to the extent they are being ignored, de facto barriers are being
erected to meaningful participation of small businesses and
individuals in the ICANN decision-making process. Advocacy has broken
these procedural concerns down into four different issue areas.
a. Notice to the General Public Insufficient
Many of ICANN’s notice deadlines are too short for small
businesses and individuals to respond in a timely and informative
manner. Far-reaching policy thus far has been adopted after very brief
comment periods – which can be as short as a week. These brief
comment periods were particularly noticeable at ICANN’s latest
public meeting in Santiago. For example: a proposal to lengthen the
term of the initial at-large directors was posted August 18 with
comment due by August 26; the staff report on at-large membership was
posted August 11 with any comments due by August 26; bylaw amendments
were posted September 16 and the deadline for public comment was Sept
27; comments on the Uniform Dispute Resolution Policy was posted on
September 29 and was due on October 13, comments for another set of
Bylaw amendments were posted October 8 with comments due on October
22, and just last week on October 21 ICANN posted a draft charter for
the Ad Hoc Working Group on Convergence with comments due before the
meeting on November 2 - 4.
Furthermore, it is difficult for small businesses to monitor all of
ICANN’s activities as they are posted on several different Web
pages without any organization or central list. In order to keep
appraised of all the different actions and activities of ICANN, the
Domain Name Supporting Organizations, and the constituency groups, an
interested party must visit on a daily basis: icann.org, dnso.org,
ipcc-meetings.com, www.ncdnhc.org, and bcdnso.org. Often times, these
sites are poorly organized and notices of important actions are hard
to find unless you are intimately familiar with the layout.
b. Handling of Comments Problematic
Procedural difficulties also extend to ICANN’s handling of
comments after they are received, including the posting of comments
and consideration of comments. Comment posting is an important step in
the overall process as it allows participants to view other
submissions and to respond to them. The current organization of posted
comments is jumbled and difficult to follow. The listings provide
sparse information and that does not facilitate quick review of
comments. Also, comments from several different proceedings are merged
together into a single list, adding to the confusion.
On a related note, ICANN does not have any means of recognizing
receipt of comments, as Advocacy discovered when its comments
regarding the UDRP, which were filed on time, were not posted on
ICANN’s Web page. Upon further inquiry, Advocacy learned that
ICANN had no record of the comments, even though Advocacy’s
e-mail program said that the comments had been sent and the office
received no notification that the e-mail was not delivered.
c. Scope of Authority Questioned
Industry representatives, consumer advocates, and members of the U.S.
Congress have questioned ICANN’s scope of authority. Questions of
authority have arisen during the adoption of the UDRP, the
consideration of the proposed $1 fee on all domain name registrants,
ICANN’s ability to enforce a definition of a "famous trade mark",
and ICANN’s ability to impose contracts upon all domain name
registrants enabling them to take away the domain name at any time.
These questions of authority and legitimacy are especially
troublesome, because they are beginning to undermine the validity of
ICANN’s proceedings and eroding support for its efforts. It is
imperative that boundaries be drawn on ICANN’s authority so that
its ability to strike a consensus is not impugned.
d. Openness and Transparency Concerns
Participants also have raised concerns about ICANN’s
consideration of comments once they are received. Because ICANN does
not address comments directly nor refer to them in its decision-making
process, many commenters believe that their comments were not given
adequate consideration or were ignored out of hand. Regardless of the
veracity of this claim, ICANN makes no meaningful effort to offer
evidence that a process exists to ensure that all comments are
considered.
Congressman Thomas J. Bliley, chairman of the House Commerce
Committee, also brought attention to ICANN’s closed board
meetings. While some of the board meetings are now open, most board
decisions seem to be made during private meetings with the discussions
announced at public board meetings. Other meetings also remain closed,
including special committees on IP address convergence and new generic
TLDs. Advocacy understands that complete openness and transparency at
all levels may not be feasible. However, decisions made at closed
closed-door meetings and backroom dealings raise suspicions about
ICANN’s fairness – suspicions that are undermining
ICANN’s credibility.
2. A Procedural Policy Is Necessary and Proper
ICANN needs to adopt a written and enforceable procedural policy. It
is not just a good thing to do; it is essential. Advocacy believes
that ICANN’s Bylaws for the Interim Board and the Memorandum of
Understanding ("MoU") with the Commerce Department require it to adopt
such a policy. Furthermore, a definite policy will further
ICANN’s goal of consensus. Without a definite policy, ICANN will
continue to be hounded by questions of procedure, openness, and
transparency, which will cast doubts on it’s ability to perform
the tasks assigned to it by the Department of Commerce.
a. A Procedural Policy Is Required by ICANN’s Authority
Advocacy is of the opinion that ICANN is required to create a
procedural policy by its authoritative documents. Both the Memorandum
of Understanding and ICANN’s Bylaws for the Interim Board require
the organization to develop and adopt procedural policies that will
ensure openness and transparency.
The Memorandum of Understanding was intended to "promote the design,
development and testing of mechanisms to solicit public input . . .
into a private-sector decision making process." Section II.C.4. The
MoU also directed ICANN to create a private-sector management system
that reflects a bottom-up management, Section II.C.3. Both parties are
to design, develop, and test procedures, Section II.B. V.A.1, and to
manage the functions listed in the MoU in a transparent,
non-arbitrary, and reasonable manner. DoC will provide expertise and
advice on methods and administrative procedures for conducting open,
public proceedings concerning policies and procedures, Section V.B.2.
ICANN’s Bylaws, before the recently proposed amendments, echo the
MoU’s emphasis on process. An entire article is dedicated to
transparency and procedures. Advocacy finds the language of the first
section, which has been targeted for deletion, particularly
compelling:
ICANN shall operate to the maximum extent feasible in an open and
transparent manner and consistent with procedures designed to
ensure fairness. In addition to the specific procedures set forth
in these Bylaws, the Initial Board shall investigate the
development of additional transparency policies and transparency
procedures designed to provide information about, and enhance the
ability of interested persons to provide input to, the Board and
Supporting Organizations. Any such additional transparency policies
and procedures shall be widely publicized by the Board in draft
form, both within the Supporting Organizations and on a
publicly-accessible Internet World Wide Web site maintained by the
Corporation (the "Web Site"). Any such additional transparency
policies and procedures may be adopted only after a process of
receiving and evaluating comments and suggestions has been
established by the Board, and after due consideration of any
comments or suggestions received by the Board.
Article III, Section 1
This language clearly and specifically directs ICANN to initiate and
adopt a procedural process that facilitates meaningful public
involvement. It provides a functional roadmap as to how ICANN should
conduct itself while adopting a procedural process. Advocacy is
gravely concerned by ICANN’s recent proposal to strike this
provision. This section is the only meaningful section in the Bylaws
on transparency and openness, and ICANN is suggesting it be deleted,
only allowing a 14-day comment period and scheduling the decision for
a telephone meeting shortly thereafter. This entire process leads
Advocacy to the conclusion that ICANN has already made its
determination and has no intention of addressing, much less responding
to, public comment.
b. A Procedural Policy Is Necessary for Consensus
Separate and apart from the procedural requirements of the Bylaws and
the MoU, a process is necessary to reach the consensus necessary for
ICANN to function. To arrive at a consensus, ICANN will need
participation from industry, government, and Internet users. If people
feel their participation is acknowledged and considered, they will be
more willing to accept the decisions of ICANN. Many parties that wish
to contribute to the ICANN process are not large corporations,
individuals with flexible schedules, or English-speakers. A procedural
policy will assist all of these people to give their input to ICANN.
For example, a procedural policy will allow adequate time for response
to ICANN proposals, which will improve comments and encourage
participation. It is important for consensus that ICANN be accessible
and its procedure is clear and predictable.
3. Advocacy Requests that ICANN Initiate a Process to Adopt a
Procedural Policy at the November Meeting in Los Angeles
Advocacy requests that ICANN initiate a process, as required by
ICANN’s Bylaws for the Interim Board and the MoU with the DoC, to
adopt a procedural policy. This process should begin immediately, at
ICANN’s meeting in Los Angeles at November 2 - 4. Time is of the
essence; ICANN has operated too long already without procedure firmly
in place. Therefore, Advocacy proposes the following schedule:
At its November meeting, ICANN should request submissions for a
procedural policy. It should accept those comments up until two weeks
before its first public meeting in 2000. At its first public meeting
in 2000, ICANN should issue its own proposal on a policy statement and
ask for comments up until two weeks before a second public meeting in
2000, scheduled for a time that would allow adequate opportunity for
public comment (certainly no less than 60 days). At the second public
meeting in 2000, ICANN Board should adopt a specific procedural
policy, explaining reasons for its decision and replying to
suggestions received during the comment period.
Advocacy believes that meetings scheduled to discuss these issues
should allow sufficient time for adequate comment. A thorough and
deliberative process is necessary to consider a procedural policy that
will affect every action ICANN takes and impact every participant to
the ICANN process.
At this time Advocacy only makes this one recommendation to ICANN on
the specifics of a procedural policy. ICANN should model its
procedural process after the APA. DoC is subject to the APA and
because of the relationship between ICANN and DoC, Advocacy believes
that it is necessary and appropriate to extend it to ICANN as well.
The APA has been tested and proven as a "checks-and-balances" process
that protects the rights of parties while giving those parties a
meaningful opportunity to participate. Furthermore, DoC is charged
under the MoU with providing expertise and advice on methods and
administrative procedures. DoC is intimately familiar with the APA and
can provide better advice and expertise on a procedural policy that
will work for ICANN if it is based on the APA.
Advocacy understands that the international nature of ICANN will
require that it consider and adopt policies to accommodate
international concerns but a policy based on the APA should facilitate
that. A full comment period initiated by ICANN will bring these issues
to the fore, and ICANN should consider additional procedures to
respond to comments. The APA should remain the base line for the
policy.
Conclusion
Small businesses throughout the world have a major interest in how
domain names are governed. No one believes the task is easy, but no
organization should assume to itself power to govern an international
system without meaningful participation by those entities which have a
major stake in the issue – not if it wants to remain credible and
avoid becoming a target for an international investigation. What
Advocacy is recommending here are some first steps for engaging
stakeholders in ICANN’s work. To summarize:
* ICANN should adopt a procedural policy to address four issues:
notice to the general public, handling of comments, scope of
authority, and openness and transparency. A procedural policy is
required by the ICANN’s MoU with the Commerce Department and
by ICANN’s Bylaws for the Interim Board and is necessary for
ICANN to reach the consensus it needs to meet its duties under the
MoU.
* ICANN should start the process of constructing procedural rules at
its meeting in November in Los Angeles. Any delay would further
exasperate the problem and would undercut ICANN’s ability to
fulfill its mandate under the MoU, namely, that ICANN accommodate
the broad and diverse interest groups that make up the Internet
community.
* ICANN should not adopt the proposed amendment that would reduce
Article III Section 1 to a single vague sentence, as it runs
counter to ICANN’s duty under the MoU. Furthermore, a notice
and comment period of 14 days did not allow sufficient time for
meaningful public comment. Should ICANN reduce this section as
proposed, it will serve as a signal to all interested parties,
that ICANN does not consider openness and transparency a condition
precedent to fair and informed decision making.
Sincerely,
/s/ _____________________
Jere W. Glover
Chief Counsel for Advocacy
/s/ _____________________
Eric E. Menge
Assistant Chief Counsel for Telecommunications