Public Comment
Proposed Amendment to .XXX Registry Agreement to Transition to New Fee Structure and to Adopt Additional Safeguards
Open Date
12 October 2016 23:59 UTC
Close Date
1 December 2016 23:59 UTC
Staff Report Due
15 December 2016 23:59 UTC
Brief Overview
Updated as of 20 January 2017
An error in the announcement published on 12 October 2016, and in the Staff Report of Public Comment Proceeding published on 23 December 2016 has been identified. The error was not present in the proposed amendment to the .XXX Registry Agreement which the community commented on. The error has been corrected in both publications to align with the text in the proposed amendment to the .XXX Registry Agreement.
Purpose: This Public Comment period aims at gathering community input on the proposed amendment to the .XXX Registry Agreement to, among other things, modify the fees payable to ICANN schedule and also to add additional safeguards and compliance audit requirements.
Current Status: ICM Registry LLC (ICM), the Registry Operator of .XXX TLD, has requested a review of the terms of the .XXX Registry Agreement pursuant to Section 4.3 which contemplates a potential review at least once every three calendar years following the Effective Date.
As a result of the bilateral negotiations between ICANN and ICM, this proposed amendment has been drafted to effect the requested changes. ICANN invites public comment on the proposed amendment to the .XXX Registry Agreement to revise its fee structure and also to add both additional safeguards and compliance audit requirements.
Next Steps: ICANN will prepare a Public Comment Summary and Analysis Report at the conclusion of the comment period. ICANN will consider these comments as it considers approval of the proposed amendment to the .XXX Registry Agreement.
Section I: Description and Explanation
On 30 March 2011, ICM Registry LLC entered into a 10-year Sponsored Registry Agreement with ICANN for .XXX (https://www.icann.org/resources/agreement/xxx-2011-03-31-en). Due to the sensitive nature of the TLD, Section 3.1(h) was added to the .XXX Registry Agreement whereby the Registry Operator shall deliver annually to ICANN a certification executed by the chief executive officer of the Registry Operator certifying as to the Registry Operator's compliance in all material respects with the terms of this Agreement. Such certification shall be accompanied by a non-confidential summary of the nature and quantity of complaints received and processed by the Registry Operator, based on the most recent audit conducted by the International Foundation for Online Responsibility ("IFFOR") Ombudsman pursuant to the Registry Operator's Compliance Reporting System (CRS). Additionally, Section 7.2 – Fees to be Paid to ICANN – of the .XXX Registry Agreement was calibrated to account for anticipated costs associated with additional contractual compliance monitoring.
In February 2016 and pursuant to Section 4.3 of the .XXX Registry Agreement, ICM requested to engage in good faith negotiations regarding possible changes to the terms of the Agreement, including, without limitation, to Section 7.2 regarding fees and payments to ICANN. ICM's request is that ICANN amend the .XXX Registry Agreement to lower the per transaction registry fee from $2.00 per transaction to the per transaction fee contained in the new gTLD Registry Agreement.
As part of the review process, ICANN conducted a review of contractual compliance under the .XXX Registry Agreement and found the Registry to be in substantial compliance with its contractual requirements. Additionally, ICANN reviewed the most recent IFFOR audit report of the Registry Operator's CRS and found that the system is not only fully functional, but exceptionally functional and compliant for its intended purposes. ICM conveyed its belief that IFFOR's Audit Report and trend analysis demonstrate effectiveness regarding mitigating abuse on the .XXX gTLD and further maintained that the .XXX gTLD no longer carries risk, for either ICANN or the Internet stakeholders initially concerned with the launch of .XXX. ICM explained that the data shows that the system has been enhanced beyond its original capabilities and has now demonstrated high levels of utility for its operation and ease of use, which is evidenced by a pattern of decline in cases.
During the course of discussions, ICM informed ICANN that ICM would agree to add both additional safeguards contained in the form new gTLD Registry Agreement, and a phased implementation of a reduction of fees based on ICM's compliance with the terms of the .XXX Registry Agreement.
Following negotiations, ICANN and ICM agreed to submit the proposed amendment to the .XXX Registry Agreement for public comment. The proposed amendment to .XXX Registry Agreement includes the following:
- An increase in the quarterly fee payable to ICANN from $2,500 to $6,250, except that, until the first adjustment to the per transaction fee is effective, the total registry-level fees will not be less than US$90,000 per rolling twelve month period (as currently provided in the .XXX Registry Agreement).
- A staged reduction in the per transaction registration fee from $2.00 to $0.25 over a period of several years if ICM passes a compliance audit tied to each stage of the fee reduction.
- The inclusion of certain rights protections mechanism set forth in the new gTLD Registry Agreement.
- The inclusion of contractual and operational compliance audits rights consistent with those contained in the new gTLD Registry Agreement.
- The inclusion of the additional public interest commitments that are contained in ICM's Registry Agreements for its new gTLDs referenced in Section III of this proceeding.
ICANN invites public comment on the proposed amendment to the .XXX Registry Agreement.
Section II: Background
ICM entered into a Sponsored Registry Agreement with ICANN for .XXX on 30 March 2011 (https://www.icann.org/resources/agreement/xxx-2011-03-31-en). ICANN and ICM have agreed to three previous amendments to the .XXX Registry Agreement relating to, among other things, data escrow, WHOIS output, bulk zone file access, monthly reporting and internationalized domain names.
Section III: Relevant Resources
- .XXX Registry Agreement: https://www.icann.org/resources/agreement/xxx-2011-03-31-en
- .ADULT Registry Agreement: https://www.icann.org/resources/agreement/adult-2014-10-16-en
- .PORN Registry Agreement: https://www.icann.org/resources/agreement/porn-2014-10-16-en
- .SEX Registry Agreement: https://www.icann.org/resources/agreement/sex-2014-11-13-en
Section IV: Additional Information
Updated as of 20 January 2017
An error in the announcement published on 12 October 2016, and in the Staff Report of Public Comment Proceeding published on 23 December 2016 has been identified. The error was not present in the proposed amendment to the .XXX Registry Agreement which the community commented on. The error has been corrected in both publications to align with the text in the proposed amendment to the .XXX Registry Agreement.
- Proposed Amendment to .XXX Registry Agreement [PDF, 444 KB]
Comments Closed
Report of Public Comments