auDA faces backlash over .com.au eligibility shake-up

The Internet Commerce Association has opposed auDA's plan to remove a long-standing eligibility pathway for .com.au and .net.au domain registrations, warning that the change could affect a large share of existing registrants.

The dispute centres on auDA's in-principle approval of a recommendation to remove the rule that lets Australian registrants hold com.au and net.au names on the basis of goods, services, events, activities or premises connected with them, rather than a registered name.

That pathway has operated for more than 25 years and has been widely used for descriptive and generic domain names. If the change proceeds, registrants would instead need to qualify through name-based pathways such as a company or business name, a related entity, a partnership or trust, or an Australian trademark.

The association argued that the proposal would add administrative steps and costs for businesses, community groups and domain investors, while potentially leaving some with no basis to retain or register a name.

In a statement, the group said: "The Internet Commerce Association strongly objects to the auDA Board's decision to approve in principle a Panel recommendation that, if implemented, would take away the right of Australian registrants, whether businesses, community organizations or domain name investors, to hold com.au and net.au domain names on the basis of the goods, services, events, activities or premises connected with them, rather than a registered name.

For more than 25 years, that has been the broadest pathway for registering a descriptive or generic .au domain name. Under the proposed change, it would disappear. A registrant would instead need to qualify through one of the remaining name-based pathways, such as a company or business name, related entity, partnership or trust, or an Australian trademark. For many, that would mean new registrations, new fees and a new way to lose a domain name through a missed renewal. For some, it could mean no pathway at all.

This is a serious mistake, made on a divided recommendation and a thin evidentiary record on harm, cost and transition, and it will hurt the very people the .au namespace exists to serve."

The association said it made a submission to the policy panel reviewing the licensing rules and argued that removing the test was inconsistent with another recommendation that would still allow domain monetisation. It also pointed to auDA management's rejection of similar restrictions in 2019 after finding no evidence that domain investment was harming the .au namespace or creating scarcity.

Split panel

A central part of the criticism is the panel's lack of consensus. The association said four of seven members voted to delete the rule, two voted to keep it and one abstained before later backing the minority position.

The minority view included Erhan Karabardak, whom the association described as an Australian trademark and domain name lawyer and former Chair of auDA. According to the group, he found no strong evidence of harm, no cost assessment and no clear answer for existing registrants.

The statement also said the proposed position was out of step with rules in New Zealand, the United Kingdom, Singapore and other OECD countries.

The association criticised both auDA's process and the substance of the proposed change. It argued that the board was required to satisfy itself that the recommendation delivered the greatest net benefit before accepting it, and could have sought more information from the panel first.

According to the group, nothing in the published record shows that either step took place.

Cost concerns

The practical effect could be significant if estimates of affected domains prove correct. The association cited industry estimates that up to one million domain names may be exposed, which, at an annual business name fee of AUD $47, could add more than AUD $47 million a year in costs.

It also pointed to a higher estimate from David Warmuz, Chief Executive Officer of Trillion.com and Drop.com.au, who said registrar audits suggested the number could be as high as 2.5 million out of roughly 3.47 million com.au and net.au domain names.

The association said each of those registrants might need a new business name, a new trademark or a correction to a registration to add an existing business name. It argued that the burden would fall not only on investors, but also on ordinary businesses using descriptive addresses tied to their products, services or locations.

Examples in the statement included a bakery using applepies.com.au, a Sydney mortgage broker using mortgagebrokersydney.com.au, a school running an annual fete and a football club using the name of its home ground as a domain.

Existing holders

The treatment of current licence holders remains a major issue in the association's response. It said existing registrants had not been told what would happen to them if the rule were removed.

The group said it had asked auDA to require registrars to notify every registrant directly before any change affecting existing licences was adopted. It added that the published record did not show registrants as a class were notified that their licences were at risk before the board acted.

The association said the rules have not yet changed and draft rules are still expected to be published for public consultation. Its position is that the deletion should not proceed and that any concerns behind the proposal can be addressed through enforcement of existing rules.

It added that if auDA proceeds, any change should apply only to new registrations and all existing compliant registrations should be permanently protected, including rights to renew, manage and transfer them lawfully.

The group warned that a grandfathering arrangement that allows renewal but prevents transfer would not amount to meaningful protection for registrants.

"The ICA has stood with .au registrants since 2019. We will continue to assist Australian registrants, small businesses, community groups and industry participants in this unfortunate challenge to their registration rights."