As of 1 June 2008, a new and more flexible registrant transfer policy comes into effect, allowing domain name registrants to transfer their domain name licence to another eligible entity for any reason. The new policy has been approved by the Australian domain name administrator .au Domain Administration Ltd (auDA) - the policy authority and industry self-regulatory body for the .au domain space.

Key Features of the New Policy

Exact details and wording of the new policy is not yet available. However, the following key features of the policy are available here and can be summarised as follows:

  • .au domain names can not be registered for the sole purpose of resale;
  • a 6 month holding period for newly registered .au domain names applies;
  • after 6 months domain names may be offered for sale/transfer by any means;
  • standard transfer forms will be used for processing transfers; and
  • auDA will ask parties for voluntary and confidential disclosure of the sale method and price.

The current domain name registration policy including domain name eligibility criteria remain unchanged. Similarly, the new policy will have no effect on the current dispute resolution policy.

What will this mean?

From 1 June 2008, there will be an open secondary market for .au domains, the same as the .com secondary market. Under the current policy , registrants are prohibited from advertising for sale and from transferring their .au domain names for a list of reasons including as part of a sale of business operations, an assignment of intellectual property, circumstances of liquidation, transfer between related entities and as part of settlement of a dispute.

Of concern is whether the more relaxed transfer policy will facilitate "cybersquatting" -registering of domain names in bad faith, with the sole intent to sell that domain name to its rightful owner. However, in light of the 6 month holding period as well as the unchanged eligibility criteria and dispute resolution process this appears unlikely. Nicholas Weston, the law firm behind the Australian Trade Marks Law Blog has a strong interest in domain names and will continue to provide dispute resolution services that rely on the "legitimate interest" and "bad faith" factors to protect rightful owners from warehousing and domain name speculation. The firm also recommends registration of critical domain names as trade marks, to take advantage of the relevant provision of the .au Dispute Resolution Policy (auDRP) which assists when a domain is identical or confusingly similar to a registered trade mark.

However some remain critical of the fact that the policy regulates against speculative trading as discussed in Marcus Browne's recent article. Browne discuses the changes with Larry Bloch, CEO of NetRegistry who on this point says "this is classic anti-business behaviour from auDA, not everyone buying something wants to use it, there's always a section in any market that simply trades".

Overall, relaxing of the rules appears to have been well received amongst relevant traders and businesses and the more flexible transfer policy appears to create a more practical and streamlined system.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.