[AfrICANN-discuss] Fwd: RE: JAS working group draft 2nd milestone report

Alice Munyua alice at apc.org
Thu May 12 15:04:51 SAST 2011

Dear all,

Not sure how many of you have had a chance to look at this JAS working 
group second milestone report.
the GAC is preparing comments on it and any comments from African 
stakeholders/community would be appreciated.




  Draft Second Milestone Report

    As a follow-up to its first Milestone Report and in response to
    requests from its charters as well as the Board and Government
    Advisory Committee, this Joint Application Support Wording Group is
    pleased to submit a Second Milestone Report to its chartering
    organizations, the ALAC and GNSO.

The work given to this community working group (WG) has presented 
enormous challenges to its membership, most of whom care deeply about 
reducing obstacles for proposed TLD applications by or supporting 
communities in developing economic environments.

The WG has determined that a detailed description of the process flow, 
metrics and procedures for determining whether an application meets the 
criteria and how this application will be dealt with is required. Given 
the eventual target audience of this document and our desire to have it 
presented and read unedited, the authors have attempted to adopt a 
simple format while maintaining accuracy and consistency with previous 

*Part 1: WHY provide applicant support?*
*Part 2: WHEN should support be provided?*
*Part 3: WHO qualifies for support? and HOW do we evaluate the 
*Part 4: WHAT do qualified applicants get?*
*Part 5: HOW will the process work and how does it relate to the gTLD 
Applicant Guidebook (AG)?*

      Part 1 - Why provide new applicant support?

During the International ICANN Meeting in Nairobi in March 2010, ICANNs 
Board recognized the importance of an inclusive New gTLD Program and the 
concern expressed by ICANN stakeholders regarding the financial and 
technical obstacles faced by applicants from developing economies 
seeking to offer new gTLDs. The Board issued a Resolution (#20) at 
requesting ICANN stakeholders…

/"...to develop a sustainable approach to providing support to 
applicants requiring assistance in applying for and operating new gTLDs."/

In April 2010 the GNSO and ALAC co-chartered a Joint Working Group on 
Applicant Support, also known as the “*JAS WG”* (and referred hereafter 
as the *WG*), in direct response to this Board resolution. The main 
objective of this WG is to develop a sustainable approach to providing 
support to Applicants requiring assistance in applying for and operating 
new gTLD Registries.

In November 2010 the WG presented the Board with a Milestone Report 
which suggested several mechanisms for providing support to Applicants. 
These included cost reduction support, sponsorship and funding support, 
modifications to the financial continued operation instrument 
obligation, logistical support, technical support for applicant in 
operating or qualifying to operate a gTLD, and exception to the rules 
requiring separation of the Registry and Registrar function.

Since the release of the Milestone Report, both the ICANN Board and the 
Government Advisory Committee (GAC) have requested further clarification 
and details from the WG. And while the Board (at its Trondheim meeting) 
refused to approve differential pricing for applicants in need of 
assistance, the GAC (in its “Scorecard”) has requested that the issue be 
reconsidered and the WG will continue to explore this option.  At its 
Brussels meeting with the GAC in late 2010 held to discuss the 
Scorecard, the Board confirmed that ICANN could implement a differential 
fee schedule forapplicants in need of assistance, but added that 
appropriate criteria and mechanisms would need to be proposed to enable 
it to happen.

This WG is comprised of members who support these aims and are committed 
to lowering the barriers to full participation in the gTLD program by a 
truly global and inclusive community. It is Chartered by both ICANN's 
At-Large Advisory Committee (ALAC) and its Generic Names Supporting 
Organization (GNSO); though the two charters are similar but not 
identical; a comparison between the two charters is available in this 
downloadable document 

    Part 2: When should support be offered? In this round or wait until

This WG has determined that in order to be most effective, this program 
(of support for in-need applications) be implemented for the first and 
subsequent rounds. Several reasons are provided in support of this 

    * Board Resolution 2010.03.12.46-47 clearly expressed the need to
      ensure that the New gTLD Program is inclusive. Much of the ICANN
      global community, particularly from developing regions, has
      welcomed this decision.
    * With every new gTLD application round, the market competitive
      disadvantage of under-served communities increases. ICANN should
      not cause or allow the New gTLD Program to further the gap in gTLD
      Registry representation from other regions. The diversity,
      competition and innovation the New gTLD Program could bring should
      be an opportunity to all around the world since the Internet is a
      global resource that belongs to all. ICANN has the obligation to
      look closely into this issue and fulfill its responsibility to
      serve the global public interest by allowing accessibility and
      competition for all around the world.
    * There  is no indication whether, in subsequent rounds, fees will
      be reduced and, in case there is any reduction, by how much.
      Therefore there is no benefit in waiting.
    * Informal market research by some of the WG members indicates there
      is built-up demand for new gTLDs, including IDN gTLDs. There is
      expectation for a considerable number of applications. One of the
      main concerns is that, without some sort of assistance program,
      the most obvious and valuable names (ASCII and IDNs), will be
      taken by wealthy investors. This may limit opportunities in
      developing regions, for local     community institutions and
      developing country entrepreneurs. Of the current 21 New gTLD
      Registries, 18 are located in USA and three are in western Europe
      (with one having a sales/marketing presence in Asia). None are
      located anywhere else.
    * While, per policy, ICANN plans for a second round, the timeline
      for this to happen is, at best, uncertain. Experiences from
      previous rounds add to the uncertainty. For example, ICANN
      communicated during the last round that this was to be followed
      soon by new rounds, nevertheless, it is taking almost a decade for
      a new round to materialise. Since ICANN cannot give guarantees and
      certainty of when future rounds will take place, those who cannot
      afford to participate in the program during this round, due to the
      current elevated fees, is perceived as an unfair and non-inclusive

    Part 3 - Who qualifies for support? and How are gTLD applications
    evaluated against the above criteria?

The WG has determined a number of criteria to be used in the 
determination of a gTLD application eligible for support and/or cost 
relief (in this document called the “/eligible application/”):

*To qualify for eligibility under this program,*

*1. The Application must demonstrate service to the public interest, 
including one or more of the following characteristics*

   1. Support by and/or for distinct cultural, linguistic and ethnic
   2. Service in an under-served language, the presence of which on the
      Internet has been limited
   3. Operation in an emerging market or nation in a manner that
      provides genuine local social benefit
   4. Sponsored by non-profit, civil society and non-governmental
      organizations in a manner consistent with the organizations'
      social service mission(s)
   5. Operated by local entrepreneur, providing demonstrable social
      benefit in those geographic areas where market constraints make
      normal business operations more difficult


*2.* *The Applicant must demonstrate financial capabilities and need*

   1. (See notes below)


*3.* *The Application must NOT have any of the following characteristics:*

   1.  From a governmental or para-statal applicant (subject to review,
      see below)
   2. A TLD string explicitly based, and related to, a trademark (ie. a
      "dot brand" TLD)
   3. A string that is, or is based on, a geographic name
   4. Sponsors or partners who are bankrupt or under bankruptcy protection
   5. Sponsors or partners who are subject of litigation or criminal
   6. Otherwise incapable of meeting any of the Applicant Guidebook's
      due diligence procedures

*Applicants will be expected give a self-declaration that they are 
eligible to receive support under these criteria*

      3.1 Notes on the application's public interest qualifications

          3.1.1 - Support by and/or for distinct cultural, linguistic
          and ethnic communities

The “.cat” Catalonian TLD is seen by many linguistic, ethnic and 
cultural communities as a success story that has helped to preserve and 
indeed grow the language and culture. Many such groups -- especially 
those with geographically dispersed diasporas -- see a TLD as unifying 
icon that will facilitate Internet use while encouraging community 
growth. We would note especially, linguistic minorities protected by 
treaties such as the European Charter for Regional or Minority Languages 
and the Council of Europe Framework Convention for the Protection of 
National Minorities.The WG agreed that the applications by such 
communities, should they meet the requirements of need, should be 
eligible for relief/support.

          3.1.2 Service in an under-served language, the presence of
          which on the Internet has been limited

A number of WG members have advocated support for the build out of TLD 
strings in non-Latin scripts by communities that use these scripts and 
have to date been un-served or under-served on the web.

As a part of this, the group has identified two categories of groups 
that might receive support – communities that regularly use more than 
one script but might otherwise be unable to afford full-price build out 
of two scripts; and smaller script communities whose scripts are very 
limited on the web.

The WG did achieve consensus that as long as the Applicant is providing 
build-out of a language whose web-presence is limited and they meet the 
other criteria we should give support.

To address the needs of these groups, partial (but not consensus) 
support has been expressed for concept of “bundling” -- that is, 
reducing the price of a TLD string in an “under-served” language script 
that accompanies a conventional application for the similar string in a 
Latin script.

3.1.3 - Operation in an emerging market or nation

The WG achieved full consensus in agreeing that the criteria offered to 
judge applications give preference to those originating within the 
world’s poorer economies. Rather than having ICANN undertake the 
distracting task of determining where such economies are located, we 
would refer instead to the internationally agreed upon UN DESA list:

   1. Least developed countries: category 199;
   2. Landlocked Developing Countries: category 432; or
   3. Small Island Developing States: category 722.
   4. Indigenous Peoples, as described in Article 1 of Convention No.
      169 of the International Labor Organization and the UN Declaration
      on the Rights of Indigenous Peoples

          3.1.5 Operated by local entrepreneur, in those geographic
          areas where market constraints make normal business operations
          more difficult

While for-profit companies, private-public partnerships and hybrid 
entities can be eligible, the WG agrees that this support program must 
not be used as a substitute for conventional business risk; and the 
applicants set out in 3.3 are not eligible for support. It should be 
used to enable new gTLDs that could -- without this program -- be 

Note for 3.1.3 and 3.1.5 The WG agreed that other forms of social 
benefit (including but not limited to: increasing skills; investment in 
the skills base of a target community; fostering gender balance and 
presence of minorities; positive contribution to regional or national 
economies) must be considered.

      3.2 Notes on Financial Need

The overriding consensus of the WG is that *financial need and 
capability is the primary criteria for determining eligible 
applications.* Such need and capability is to be demonstrated through 
the following criteria:

   1. Applicants must be capable of of contributing $45,000 towards
      ICANN's application fee, unless ICANN waives, or lowers
      application fees.
   2. Where applicants anticipate scheduled fees, such as for extended
      evaluation, the applicant must be capable of contributing a
      quarter of the scheduled fees.
   3. Applicants must be capable of of contributing $45,000 towards
      registry operational costs, if the applicant proposes to operate
      its own registry platform. If the applicant proposes to share
      registry operational costs with other qualified applicants, the
      applicant must be capable of contributing the pro rated
      proportional share of this cost.
   4. Applicants must be capable of of contributing $45,000 towards
      registry continuity operational costs, if the applicant proposes
      to fund its own continuity operation. If the applicant proposes to
      share registry continuity operational costs with other qualified
      applicants, the applicant must be capable of contributing the pro
      rated proportional share of this cost.

To demonstrate need, Applicants will be required to submit materials to 
the program administrators, detailing the various constraints which 
negatively affect the Applicant's ability to acquire and implement a 
gTLD without assistance under this program. Applicants should provide 
background on economic, technical, administrative, legal, and/or 
socio-cultural factors within their environment which are causing these 
constraints. As well, Applicants will be requested to detail any 
applicable constraints on management, human resources, IT infrastructure 
and the Applicant's technical capabilities.

      3.3 Notes on ineligible criteria

        Applications by governments or government-owned entities

By consensus of the WG, purely Governmental or para-statal applicants 
have been listed as not entitled to receive support. However, at the 
ICANN San Francisco meeting the WG received a request from the GAC to 
consider including Government applications from Developing Countries for 
support.  The WG will work to obtain a mutually acceptable definition 
and criteria to fit Government applications with the GAC WG, but 
recognizes the difficulty in measuring a government’s “need” and concern 
of the appropriateness of offering support for one government over 
another if resources are limited. The GAC WG has offered to review the 
JAS criteria and provide its recommendations on a formulation of a 
solution for possible support to Developing Country Government applications.

    Part 4 - What benefits do qualified applicants receive?

The WG recommends a number of different kinds of support to be made 
available for eligible applicants, which fall into the following categories:

*4.1 Financial support/relief from ICANN*

4.1.1 - Cost Reductions

The WG recommends the following fee reductions to be made available to 
all applicants who are determined as meeting the criteria established 
for support:

    * Waive (consensus for this in the Milestone report) the Program
      Development Costs (US$26,000)
    * Lower risk/contingency cost (US$60,000)
    * Review Base cost (US$100,000) to see if reduction can be made
    * Cost reductions to encourage the build out of IDNs in small or
      under-served languages.
    * Lower registry Fixed Fees
    * Exemption or deferment of IPv6 implementation requirements as possible

Further reductions recommended

    * Reduction of the Financial Continued Operation Instrument
      Obligation to 6-12 months

4.1.2 - Staggered Fees

Instead of paying the entire fee upon acceptance of the applications, 
applicants meeting the criteria established for support could pay the 
fees incrementally. Staggered fees payment enables an applicant to 
compete for strings that might otherwise have gone to the first and/or 
only group with enough money to apply.

4.1.3 - Partial refund from any Auction proceeds

Qualified applicants receive a partial refund from any auction proceeds 
- for which they can repay any loans or invest into their registry. It 
could be used to refill the disadvantaged applicant’s foundation fund 
for subsequent rounds.

*Note: Ongoing support will be limited to five years*

*4.2* * Non-financial support/relief from ICANN *

    * Logistical assistance
    * Technical help
    * legal and filing support
    * Awareness/outreach efforts including efforts to ensure more people
      in under-served markets are aware of the new gTLD program and what
      they can do to participate in it
    * Deferred requirement of DNSSEC
    * Relaxed vertical integration regulations

*4.3 Support from third parties facilitated by ICANN*

4.3.1 - Pool of collected resources and assistance

    * Translation support
    * Logistical help
    * technical support
    * Awareness and outreach
    * Infrastructure for providing IPv6 compatibility
    * DNSSEC consulting
    * IDN implementation support
    * Possible technical  setups

4.3.2 - Directory and referral service only for eligible applicants

    * Facilitating contacts with granting agencies and foundations
    * ICANN would facilitate but cannot commit to providing

4.3.3 - IPv6 Support

    * For registries located in areas where IPv6 connectivity is limited
      or unavailable, ICANN will facilitate support from IPv6 providers
      to provide IPv6 gateways into the registry IPv4 services.

*4.4 Financial support distributed by an ICANN originated (Development)* 

For any funding provided through ICANN by a benefactor that does not 
wish to administer that funding itself, these funds would be allocated 
by a specially dedicated committee. The Working Group recommends the 
creation of a development fund directed at new gTLD applicants who were 
determined as meeting the criteria established for support.

4.4.1 - Support Program Development function

The working group recommends that ICANN establishes a /Support Program 
Development/ function with an initial goal of securing a targeted 
commitment for an ICANN based development fund.

*4.5* * Financial support Distributed by External Funding Agencies*

There is consensus in the group that external funding agencies would 
make grants according to their own requirements and goals. ICANN would 
only provide those agencies with applicant information of those who met 
the criteria established for support.

    Part 5 - Evaluation process and relationship to the new gTLD
    Applicant Guidebook (AG)

The WG has determined, at this time, that best possible process to 
provide support for such applications is to be done through a process 
that is parallel to, and not a replacement of, the ICANN Applicant 
Guidebook. Thus, even after the Guidebook is formally approved, this WG 
can continue its work to refine those components of its mandate which 
remain unresolved. It is important that the AG make mention of this 
program and refer interested potential applicants to it, however it is 
not the WG's intention to otherwise affect the existing application 
process. To qualify for support applicants may be required to 
demonstrate that they meet this program's criteria on financial need and 
public interest; however such activity is intended to supplement, not 
replace, existing mechanisms in the AG.

The WG had full consensus that Applicants that receive support under 
this program should repay that support as possible, and that such 
repayments go into a sustainable revolving fund used to support the 
future applications. Repayment is dependent on the gTLD Operator's 
financial success and will take the form of either

    * a capital contribution or lump sum; or
    * an income contribution or annual instalment of until a lump sum is
      repaid; or
    * repayment of the full or a percentage of the reduced base cost fee
      expended by the Support Development Program.

The following broad steps /did not obtain thorough evaluation or full 
consensus/ by the WG, but have been suggested as a starting point to 
this process and will be further refined by the WG based on the Parts 1 
to 4 above. Note the process is meant to be to be in parallel with the AG-

1. the Application is assessed using the criteria described in Part 3 
and this Step takes place before the Application enters the AG process

2. the Application enters the AG process (that is, it is registered in 
the TAS and the Applicant pays the $5,000 deposit; the Application is 
checked for completeness, posted; Objection period; Background 
Screening; IE results posted)

3. a Due Diligence Review is done on the Application, Applicant and its 
partners to ensure it is still  eligible/needy during Step 1. and at 
points of the AG. This Review ensures the Applicant is /still/  eligible 
for support. It is suggested that this Review occurs at three points: 
upon initial evaluation of the Application, in the AG process- after the 
IE results are posted and after there is no string contention.

4. the Application progresses in the AG through Objections phase to 
String Contention. If there is a string contention then the Application 
will go through normal ICANN channels with the Applicant funding this 
additional step of the AG

5. once there is no string contention then the Application progresses to 
Contract execution, Pre-delegation check and Delegation

6. there is a Sunset Period for support with a cut off of 5 years after 
which no further support will be offered

7. if the new gTLD is granted the Applicant will fall under the 
safeguards provided by ICANN for all gTLD operators; but we should 
ensure that needy Applicants are aware of these requirements and are 
able to fulfil them

NOTE the Applicant is only reviewed for the duration of our support. If 
at any stage during the Support Development Program Evaluation Process 
or the new gTLD process, in particular during the Due Diligence Review-

    * the Applicant does not give information of the Application, itself
      and/or its partners when requested;
    * the Application's, Applicant’s and/or its partners’ financial and
      other circumstances change so that they are no longer eligible;
    * the Applicant withholds information about the Applicant, itself
      and/or its partners regarding its financial and other
      circumstances; or
    * it is discovered that the Application, Applicant and/or its
      partners are no longer eligible

Then Support may stop in two ways
A. Discharged- Aid stops upon notification to the Applicant and the 
Applicant and/or its partners may have to repay some or all of the funds 
already spent on the application. The Applicant may proceed with the 
Application at this point at its own cost.

B. Revoked or cancelled- used in cases where the Applicant was wrongly 
granted support (for example granted support as a result of giving false 
information about finances), the Applicant and/or its partners will have 
to pay all the funds already spent on the application and the 
application will be revoked/discarded at that point

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