Tag: PIR

.ORG News – ICANN rejects the sale of the .ORG Registry to Ethos Capital

Sale of .ORG registry - PIR Public Interest Registry - dot ORG - Nameshield

The news came on 30 April through a press release from the ICANN Board announcing that it had taken the decision to reject the sale of Public Interest Registry (PIR), the .ORG registry, to the private equity firm Ethos Capital.

For reminder, at the end of 2019, the announcement of the sale of the .ORG registry to Ethos Capital created a real debate and caused several concerns from NGOs, such as the increase of .ORG prices and the implementation of rights protection policies that could lead to a form of censorship (Find all the articles on this subject on the blog).

In mid-April, while the organization had to decide whether or not to approve the sale of the registry, the transaction was still pending. ICANN allowed itself additional time to complete its review, after receiving numerous letters of opposition, including one from California’s Attorney General, Xavier Becerra.

The decision to reject this deal was finally announced on Thursday 30 April “as a result of various factors that create unacceptable uncertainty over the future of the third largest gTLD registry”.

One of the main reasons for this decision is the “change from the fundamental public interest nature of PIR to an entity that is bound to serve the interests of its corporate stakeholders, and which has no meaningful plan to protect or serve the .ORG community.”

Among the reasons for this rejection is also the issue of financing, since this transaction could compromise the financial stability of the registry. Indeed, the proposed sale would change PIR from a not-for-profit entity to a for-profit entity with a $360 million debt obligation, which would not benefit PIR or the .ORG community, but the financial interests of Ethos and its investors.

Furthermore, the PIR proposal to implement a “Stewardship Council“, which aimed to make the entity more accountable to the community, did not convince ICANN either. According to the organization, this council “might not be properly independent“.

ICANN’s decision is therefore a victory for the .ORG community and Electronic Frontier Foundation, which does not stop there and adds “the .ORG registry still needs a faithful steward, because the Internet Society has made clear it no longer wants that responsibility. ICANN should hold an open consultation, as they did in 2002, to select a new operator of the .ORG domain that will give nonprofits a real voice in its governance, and a real guarantee against censorship and financial exploitation.”

.ORG News – ICANN delays again the sale of the .ORG Registry

Sale of .ORG registry - PIR Public Interest Registry - dot ORG - Nameshield

A few months ago, in previous articles, we mentioned the sale by Internet Society of Public Interest Registry (PIR), the .ORG registry, to Ethos Capital, a private equity firm.

The .ORG is the reference extension for non-profit organizations and the .ORG registry represents more than 10.5 million domains. For reminder, the announcement of the sale of the registry caused several concerns in the NGO community.

In front of these many complaints, ICANN had already postponed the approval of the .ORG registry’s sale to Ethos Capital and requested additional information from Internet Society.

Further postponement of the .org registry’s sale after the intervention of the Attorney General of California

On Thursday 16 April, when the ICANN Board was to decide whether or not to approve the sale of the registry, it was finally decided at that meeting, to postpone it again until 4 May 2020. This fourth postponement was caused by a letter received the day before from California’s Attorney General, Xavier Becerra, asking ICANN to reject the sale. He explains that it “raises serious concerns that cannot be overlooked“.

“Empowering a for-profit entity that could undermine the accessibility and affordability of the .org domain, which serves nonprofits, should concern all of us” the Attorney General’s office told The Register.

The secret nature of Ethos Capital is a source of concern

In his letter, the Attorney General expressed several concerns about the transaction, including the secret nature of the proposed buyer, Ethos Capital: “Little is known about Ethos Capital and its multiple proposed subsidiaries“. Ethos Capital is criticized for its unusual corporation structure (the purchase involves six different companies, all of which were registered on the same day in October 2019) and its lack of transparency regarding its future plans.

In its notice published last Thursday, ICANN affirms having listened to the community and having demanded greater transparency and more guarantees from PIR. According to the organization, the Attorney General’s letter does not take into account the recent work that PIR has done regarding Public Interest Commitments, to make the entity more responsible to the community. ICANN requested PIR to strengthen these commitments, and a draft of the revised Public Interest Commitments has been provided to ICANN.

ICANN’s behavior and Internet Society criticized

ICANN has also been subject to a number of criticisms during the entire process, particularly as it appeared that the organization’s staff was pushing for approval of the transaction despite near universal opposition to it from the Internet community.

In addition, early last week, ICANN’s founding CEO Michael Roberts and original Board Chair Esther Dyson wrote a letter to Xavier Becerra criticizing the transaction and accusing their successors of abandoning ICANN’s core principles.

According to the Attorney General, this transaction will have an impact on ICANN’s reputation given the way the organization has handled the situation.

Not only ICANN and Ethos have been criticized by the Attorney General’s office, Xavier Becerra also blames the Internet Society for proposing the sale of the .ORG registry to Ethos Capital: “ISOC purports to support the Internet, yet its actions, from the secretive nature of the transaction, to actively seeking to transfer the .ORG registry to an unknown entity, are contrary to its mission and potentially disruptive to the same system it claims to champion and support“.

Xavier Becerra’s letter does not threaten ICANN with action if it does approve the sale. However, it does indicate that the Attorney General of California holds significant authority over the organization and is prepared to act, particularly since this sale could affect hundreds of thousands of other non-profit organizations.

“Given the concerns stated above, and based on the information provided, the .ORG registry and the global Internet community – of which innumerable Californians are a part – are better served if ICANN withholds approval of the proposed sale and transfer of PIR and the .ORG registry to the private equity firm Ethos Capital. This office will continue to evaluate this matter, and will take whatever action necessary to protect Californians and the nonprofit community.”

In a notice published last Thursday, ICANN thus declared the postponement of its decision: “We have agreed to extend the review period to 4 May 2020, to permit additional time to complete our review.”

.ORG news – NGOs against the .ORG registry’s sale to Ethos Capital

Sale of .ORG registry - PIR Public Interest Registry - dot ORG - Nameshield

At the end of 2019, the announcement of the .org registry’s sale, Public Interest Registry (PIR) by Internet Society to Ethos Capital, a private equity firm, created a debate, which was also the subject of a previous article on this blog.

For reminder, this announcement caused several concerns from NGOs, such as the increase of .ORG prices and the implementation of rights protection policies that could lead to a form of censorship, as is already the practice in some countries. These fears led Electronic Frontier Foundation (EFF) to launch the SaveDotOrg campaign to raise awareness about the potential impact of this sale. To date, 846 organizations and 25 119 people have signed this petition demanding Internet Society to stop the sale.

In front of these many complaints, ICANN postponed the approval of the .ORG registry’s sale to Ethos Capital and requested additional information from Internet Society.

« Public Interest Commitments »: The measures proposed to address the .ORG community’s concerns

In response to these criticisms, Ethos Capital and Public Interest Registry try to reassure by proposing the implementation of “Public Interest Commitments” (PIC), binding commitments which would ensure that the .org prices’ increase would be limited.

Among these commitments, they also propose the creation of a “Stewardship Council” (a council for the .org management) which could influence decisions taken by PIR and thus ensure the preservation of freedom of expression.

These PIC would be added to the Registry Agreement, the contract between the registry and ICANN regarding the functioning of the registry.

A for-profit registry to defend non-profit organizations?

During the last ICANN summit, organized remotely from 7 to 12 March 2020 because of the Covid-19 pandemic, several NGOs, including EFF, mentioned this .ORG registry’s acquisition by Ethos Capital and asked ICANN about how it plans to review the change of control of the .ORG registry.

According to EFF, forming a “Stewardship Council” will not resolve the NGOs’ concerns. Indeed, the initial members of this council will directly or indirectly be selected by PIR and PIR will have the ability to veto new council members, which would thus ensure that the council will stay in lockstep with PIR.

Regarding the .ORG prices, according to NGOs, the implementation of the PIC doesn’t ensure a limitation of the prices increase. An amending of the Registry agreement can be negotiated at any time by the registry’s owner and ICANN, despite a public opposition. That’s what happened in June 2019, when the .ORG Registry Agreement was revised to diminish registrants’ rights and remove price caps. Furthermore, ICANN indicated in 2019, its interest in exiting the role of price regulation, but the PIC implementation would place ICANN back into that role.

Therefore, according to NGOs, these “Public Interest Commitments” would not protect adequately the .org community.

The NGOs’ questions remained without answer during the last ICANN summit, and this acquisition is still under review by ICANN.

“We acknowledge the questions and concerns that are being raised” says ICANN. “To ease those concerns and maintain trust in the .ORG community, we urge PIR, ISOC, and Ethos Capital to act in an open and transparent manner throughout this process. […] We will thoughtfully and thoroughly evaluate the proposed acquisition to ensure that the .ORG registry remains secure, reliable, and stable.”

To be continued.

Why is the sale of .ORG registry a source of debate?

Sale of .ORG registry - PIR Public Interest Registry - dot ORG - Nameshield

In November 2019, a press release announced that .ORG registry, Public Interest Registry (PIR), a non-profit organization managed by Internet Society, is going to be sold off to Ethos Capital, a private equity firm.

.ORG is the extension for non-profit organizations. The acquisition of PIR by Ethos has quickly concerned the organizations using .ORG, on the basis of the potential misuse of the extension by its new owner, which has, by its very nature, profit motives.

The concern? That the registrations and renewals fees for .ORG domain names increase.

Yet, key figures of the Internet’s world, like Andrew Sullivan (Internet Society CEO) are exited, seeing in this a strong strategic partnership and a significant financial contribution allowing Internet Society to advance its mission of a “more open, accessible and secure Internet for everyone”, as he wrote in the press release about the acquisition of November 13, 2019.

It would seem that the fears created find their origin in the “surprise” and lack of transparency around the deal, since the transaction amount has not been disclosed.

These fears are, of course, the corollary of the removal on June 30, 2019, of the price caps imposed until now to .ORG fees (historically low) by ICANN, despite many reservations expressed by the community. Finally, the fact that Ethos has directly or indirectly a number of close connections to former ICANN members raises concerns to several voices of the industry.

The fear to see the increase of .ORG prices led Electronic Frontier Foundation (EFF) to launch the SaveDotOrg campaign, which aims to raise awareness about the potential impact of a .ORG price increase on the NGO’s budget constraints.

Also the possibility that Ethos Capital later implements a principle of rights protections that could lead to a form of censorship, as currently practiced in some countries wishing to silence NGOs.

In front of these protests, ICANN suspended the acquisition operation last December and requests clarification from the Internet Society.

More recently, in January 2020, a new candidate of the .ORG extension acquisition has appeared. It is a cooperative corporation (Cooperative Corporation of .ORG Registrants), gathering some web pioneer and former members of ICANN.

To be continued!