Dear Sirs: Date: December 15, 1999 From: Japan Network Information Center (JPNIC) Re: Appointing a "Domain Name Dispute Resolution Task Force" Contents: 1. Background and Outline 2. Positioning of the Task Force and its Makeup 3. Agenda for Deliberation 4. Schedule 1. Background and Outline * WHAT IS THE PROBLEM? -- CYBERSQUATTING (ABUSIVE REGISTRATION AND USE OF DOMAIN NAMES) Over the past few years, the problem of "cybersquatting" has become the focus of attention in relation to dot-com domains. Cybersquatting is the act of registering a domain name primarily for the purpose of selling it to the actual owner of a trademark or service mark for a high price, or registering a domain name to exploit the fame by deliberately attracting many users to a web site by creating a likelihood of confusion with the famous trademark or service mark. * FUTURE OF JP DOMAIN NAME SPACE AND MEASURES TO DEAL WITH CYBERSQUATTING In the United States, there have already been several trial cases concerning disputes over domain names. In Japan, meanwhile, the existence of some domain names violating trademarks has been indicated, but very few cases have been brought into court for resolution. One of the main reasons for fewer disputes in Japan is probably JPNIC's rules such as "one domain name for one organization" and "prohibition of transferring domain names." However, as the Internet rapidly becomes widespread in Japanese society, there is growing demand to abolish these rules and institute freer domain name registration. JPNIC is studying liberalization of domain name transfer based on mutual understanding between the parties and introduction of a general purpose SLD (Second Level Domain) under which one organization can register multiple domains. In order to achieve this goal, it will be necessary to prevent disputes arising between domain names and intellectual property rights (trademarks in particular) and to formulate procedures for resolving such disputes. * MOVEMENTS AT GLOBAL LEVEL -- ICANN'S ATTEMPT Meanwhile, in the area of gTLDs, including COM domains, significant progress is being made following discussions over the past few years. In accordance with a White Paper issued by the United States Department of Commerce in June 1998, the ICANN (Internet Corporation for Assigned Names and Numbers) was approved in autumn, 1998. Also, the White Paper requested the WIPO (World Intellectual Property Organization) to prepare a series of recommendations on the issue of resolving disputes over trademarks and domain names. At this request, the WIPO commenced the Internet Domain Name Process in July 1998. After receiving comments provided at its request made three times and as a result of public hearings held around the world, WIPO submitted a Final Report to ICANN in April 1999. In response to the report, ICANN began deliberations on "Chapter 3: Resolving Conflicts In A Multijurisdictional World With A Global Medium" in the Report. After it was decided to basically support the WIPO Final Report, ICANN advanced to producing specific documents. The board meeting held in late October approved the adoption of a "Uniform Domain Name Dispute Resolution Policy" and "Rules for Uniform Domain Name Dispute Resolution Policy." Meanwhile, a number of organizations called "dispute resolution service providers" that resolve disputes in accordance with the policy and rules have been established. The policy and rules were adopted in December 1, 1999 except for a few registrars, and a claim for resolving a dispute was already made against an existing domain name as of December 2. The main feature of the dispute resolution policy adopted by the ICANN is that those disputes resulting from "abusive registration and use of domain names in bad faith" shall be resolved in accordance with a "mandatory administrative dispute resolution procedure" stipulated in the policy, while other domain name disputes (e.g. when both parties have legitimate rights) shall be resolved through conventional ways such as trials and arbitration. It is difficult to determine whether registration and use of a domain name has been made in bad faith. The policy stipulates the following as evidence of the registration and use of a domain name in bad faith: (1) an offer to sell, rent or transfer the domain name to the owner of the trademark or service mark, or to a competitor of the owner of the trademark or service mark, for a value exceeding the actual amount required for the registration (2) registration in order to prevent the owner of a trademark or service mark from reflecting the mark in a corresponding domain name, provided that the domain name holder has engaged in a pattern of such conduct (3) registration in order to disrupt the business of a competitor (4) an attempt to attract, for commercial gain, Internet users to the domain name holder's website, by creating confusion with the trademark or service mark In terms of procedures, the policy has several characteristics including: - Non-involvement of the registrar (non-participation in the procedures, immunity from responsibility for the result) - Mandatory (party who has registered the domain name via a registrar who adopts the policy must submit to the dispute resolution procedure executed by a dispute resolution service provider if a third party has made a claim) - Unbinding (complaint can be submitted to a court during or after the procedures by a dispute resolution service provider) - Speedy (dispute resolution processes will in principle all be performed online; the time from the commencement of the procedures until the result is reflected on DNS will take approx. 55 days) - Low cost (approx. US $1,000 if one panelist is involved) * LOCALIZATION OF ICANN'S DISPUTE RESOLUTION POLICY TO JAPAN Given these efforts/achievements by ICANN and looking into the future of JP domains in pursuit of freer registration, JPNIC's Domain Name Working Group (DOM-WG) has decided to form a "Domain Name Dispute Resolution Task Force (DRP-TF)" consisting mainly of legal experts in intellectual property rights and unfair competition and existing mediating and arbitrating bodies/personnel. This Task Force will perform its tasks with the main aim of localizing the "Uniform Domain Name Dispute Resolution Policy" and "Rules for Uniform Domain Name Dispute Resolution Policy" formulated by ICANN while carefully considering the Japanese legal system and mediation and arbitration systems. In addition, the Task Force will also take into account the characteristics of the Internet as a globally borderless media in view of possible international disputes in performing its tasks. A result produced by the Task Force will be submitted to the JPNIC Steering Committee as a recommendation, then publicized in order to receive comments from the public as well. 2. Positioning of the Task Force and its Makeup The Task Force will be positioned as an external reporting subcommittee of the Steering Committee and report on deliberation results to the Steering Committee. The name, objective and makeup of the Task Force are as follows: Name: Domain Name Dispute Resolution Policy Task Force Abbreviation: DRP-TF Objective: Deliberate a policy for resolution of domain name disputes and specific measures and ways to implement the policy. Makeup (titles omitted from names; listed in the order of the Japanese syllabary): Chief Examiner Kazuko MATSUO Attorney-at-Law and Patent Attorney at Nakamura and Partners; former chairman of Intellectual Property Committee at the Japan Federation of Bar Associations; currently chairman of the Design and Trademark Sub- committee of the Intellectual Property Committee; Managing Director of the Japan Trademark Association Members Yasuhiko OSHIMOTO Patent Attorney at Oshimoto Patent and Trademark Office; former chairman of Trademark Committee of Japan Patent Attorneys Association; Deputy manager of Japan Trademark Association Office Hisashi ODA Legal Division, Fujitsu Ltd.; member of JEIDA, EIAJ, and JBMA Information Appliance Committee Intellectual Property Subcommittee; Member of the JPNIC Domain Name Working Group Masanobu KATO General Manager of Fujitsu Washington Office; member of the ICANN DNSO Names Council Takeshi KIKUCHI Attorney-at-Law at Shinbashi International Law Office; Vice president of Japan Industrial Property Arbitration Association; Director of Japan Commercial Arbitration Association Tsugizo KUBO Former Chairman of the Trademark Committee of Japan Intellectual Property Association (JIPA); Former member of the Panel of Experts for the WIPO Internet Domain Name Process; Member of the JPNIC Domain Name Working Group Takeshi KOJIMA Professor of Law at Chuo University Faculty of Law; Ministry of Justice Legislative Council on Civil Procedure; former president of Japan Civil Procedure Law Association Keita SATO Associate Professor of Law at Chuo University Faculty of Law Kensuke NORICHIKA Excecutive director of Software Information Center (SOFTIC); panel of experts for the WIPO Internet Domain Name Process Naomasa MARUYAMA Vice President of JPNIC Naoki MIZUTANI Mizutani Law and Patent Office; Attorney-at-Law; Patent Attorney; member of Intellectual Property Law Committee of Japan Federation of Bar Associations; special researcher of Software Information Center (SOFTIC) Masami MUROMACHI Attorney-at-Law; Tokyo Marunouchi Law Office Kozo YABE Attorney-at-Law Yuasa and Hara Vice Chair of Legal System Commitee, the Japan Trademark Association Member and Coordinator Toshihiro TSUBO Member of the JPNIC Domain Name Working Group; President of Global Commons, Inc. Observers Ministry of International Trade and Industry; Japanese Patent Office; Ministry of Posts and Telecommunications In order to facilitate the Task Force's operation, a Drafting Subcommittee will be formed with the following makeup. Drafting Subcommittee (titles omitted from names; listed in the order of the Japanese syllabary) Members: Tsugizo KUBO, Toshihiro TSUBO, Naomasa MARUYAMA, Masami MUROMACHI, Kozo YABE 3. Agenda for Deliberation The Task Force will deliberate the following agenda. (1) Policy for resolution of domain name disputes (2) Procedural rules for the dispute resolution policy (3) Connection with domain name registration rules (4) Others - Selection of dispute resolution service providers - Establishment of laws/regulations for the prevention of abusive domain name registration 4. Schedule The Task Force will be formed and proceed with deliberation in accordance with the following schedule. Early December, 1999 Members determined Notify the public of the establishment of the Task Force Initiate drafting for agenda items (1), (2) and (3) December 16 Internet Week '99 DOMAIN-TALK meeting Late December 1st DRP-TF Topic: Clarification of point at issue Late January, 2000 2nd DRP-TF Topic: Deliberation of draft document Late February 3rd DRP-TF Topic: Deliberation and determination of report document Mid March Domain Name Working Group March meeting Topic: Examination of report document Mid March Steering Committee Topic: Examination of report document Late March Notification to the public; call for public comments (2 months) Late May Formulation and publication of final document