By Alan Gahtan - Jan/Feb. 1997
Introduction
Why are Internet domain names important? Because each computer on the Internet is identified with a difficult-to-remember electronic address known as an Internet Protocol or IP address. An IP address is like a telephone number that identifies one particular computer connected to the Internet. An IP address is composed of four groups of numbers. For example, 198.121.13.225.
Unlike telephone numbers, IP addresses are not defined hierarchically. So therefore, while all telephones in Canada and the United States may have a telephone number that begins with "1" (the international telephone country code), followed by a three digit area code which further narrows the region, not all IP addresses within a certain city or even within North America necessarily begin with a common preface code.
Internet domain names are used as an easy-to-remember alias which can point to a specific IP address. The system works by employing multiple domain name servers (DNS) which provide access to a replicated database used to map specific domain names to specific IP addresses. Domain names therefore function as electronic addresses.
The a copy of the DNS database for each top-level or root-level domain name hierarchy (see below) is periodically propagated out from a master copy kept on a designated machine. Obtaining a domain name is simply the agreement of the organization managing the master copy of the DNS database for a particular top-level domain to insert an entry in their database associating the selected domain name with the domain name registrant’s IP address.
Obtaining a domain name that is easily remembered or easily associated with a particular organization becomes important similar to a telephone number which corresponds to an easily remember mnemonic (ex. 1-800-collect or 1-800-flowers). A domain name, just like a trademark in the real physical world, can also tie in goodwill associated with a particular organization or product.
Many organizations choose to use a component of their legal name or a trade mark name as their domain name. A problem arises when multiple parties attempt to lay claim to the same name. In some cases, someone with no intention of actually using a particular domain name will register it anyway in order to later sell it to a party that may want to use it.
Make Up of an Internet Domain Name
In general, Internet domain names consist of two components. A "top-level" domain name hierarchy which is the component to the right of the right-most period in the domain name and a "second-level" domain name which is the component to the left of the right-most period in the domain name. A third-level domain name or further sub-domain names could also be defined to the left of, and separated by a period from, the second-level domain name.
There are currently two varieties of top-level domain names. The first variety, which includes the .com name mentioned above, categorizes entities by type of organization. The .com name is given to commercial organizations, while others such as .org, .gov, .edu and .net are assigned to non-commercial organizations, government agencies, educational institutions and network providers, respectively. Responsibility for assigning second-level domain names within these top-level domain name hierarchies lies with Network Solutions, Inc. (NSI).
A second and alternative variety of top-level domain names categorizes organizations by a two letter country code corresponding to the ISO 3166 standard. For example, the top-level domain name for Canada is .ca. Responsibility for assigning second-level domain names within each country’s top-level domain name hierarchy is delegated to an organization within each country. In Canada, this responsibility lies with the CA Domain Committee (CADC).
While a .us top-level domain name hierarchy does exist, almost all domain names issued to US organizations have been by the type of organization variety issued by NSI. In Canada, organizations are free to use either variety of top-level domain name hierarchy. Outside of Canada and the US, organizations are assigned domain names only under the two-letter country top-level domain name hierarchy.
Canadian organizations applying for a domain name therefore have a choice between either obtaining a domain name under the NSI organization type hierarchy or under the .ca hierarchy from CADC. NSI and CADC each has different policies and it may be advantageous for some organizations to register under one rather than the other.
Domain Name Structure
Under the NSI naming scheme, the name to the left of the right-most period in the domain name is the organization’s name. For example, in the domain name of borden.com, the .com is the top-level domain name, and denotes the type of organization, and borden is the second- level domain name which under this scheme is the organizational name component.
CADC, on the other hand, utilizes a Domain Name System (DNS) framework together with aspects of the CCITT X.500 directory naming scheme. The X.500 directory service standard incorporates a tree-structured name space. The CA domain is structured according to Canadian political geography with entities registered at appropriate levels.
The second-level domain consists of provincial and territorial abbreviations and the names of national organizations. Subordinate to the second-level domain is a third-level domain that consists of locality names, and provincial and territorial organization names. Finally, a fourth-level domain is used for local organizations and is expected to be used for individuals.
This structure is easier to illustrate in practice. A national organization such as the CBC or the TD Bank would obtain a second-level domain name of cbc.ca or tdbank.ca, respectively. An organization that operated strictly in one province, such as the Law Society of Upper Canada, would obtain a third-level domain name of lsuc.on.ca.
In order to qualify for a second level or "national" domain name, an organization must (1) have offices or other points of presence (which can include host computers or dial-up facilities, wholly owned by that organization) in more than one province or territory; or (2) be incorporated or chartered nationally; or (3) own a registered Canadian trademark which is being put forward in full as the organizational part of the domain name.
Likewise, to qualify for a third-level or "provincial" domain, an organization must have offices or facilities in more than one locality or be incorporated provincially or territorially. Provincial and territorial governments, referral hospitals, and post-secondary degree or certificate granting educational institutions such as universities or colleges should have third level domain names.
Fourth-level or "municipal" domains are used for small organizations that do most of their business in one locality or city such as a business with only one location and also include hospitals, libraries, municipal governments and schools.
It should be noted that once issued a domain name, an organization can create and administer further sub-domain names within its assigned domain name. Therefore, the CBC can, for example, create a domain name called news.toronto.cbc.ca for its Toronto news office.
Selection of the Organizational Name
To obtain a registration from CADC, the organization name portion of the domain name must be either (a) the organization’s name set out in a manner that sufficiently identifies the real name of the organization or (b) an organization’s registered trade mark. Where an organization’s name is long, a descriptive abbreviation of the organization’s name should be used. Also note that certain names, such as geographic place names are reserved at certain levels and obscene names are not permitted.
Permitted characters in a domain name include letters, digits and the hyphen. Upper and lower case may be mixed or a domain name may be entirely in upper or lower case. Hyphens may be used to separate words if necessary or consistent with normal references to the property name of an organization.
In contrast, the only real limitation imposed on the organizational portion of a domain name sought to be registered with NSI is that the exact domain name must not already be registered (for example, globalserve.com is treated as a different name than globalserve.net). NSI will even accept an organizational name component of a domain name which is identical to one registered under a country top level hierarchy (ex. NSI will permit the registration of company.com where there is already a company.ca registration).
Dispute Resolution
The general rule is that domain names are registered on a "first come, first served" basis. However, disputes still arise especially when a holder of a trademark corresponding to a domain name is denied use of the domain name because another party has already obtained a domain name registration for that name. The potential for conflict as one moves from trademarks to domain names is great because whereas the same trademark may be owned by different owners in different lines of business, it may be possible to only register one domain name corresponding to such trademark.
CADC advises domain name applicants that it is their responsibility to ensure that they have the right to use the chosen name. Registration of a domain name does not confer any legal rights to that name and applicants are advised to consider registration of a trademark if they have not already done so.
NSI goes a step further, in that an applicant for a domain name from NSI must represent in their application that the selected domain name, to the best of the applicant’s knowledge, does not interfere with or infringe upon the rights of any third party. As well, an applicant for a domain name from NSI must agree to indemnify NSI and other listed entities against any claims arising out of or related to the registration or use of a domain name. A limited exception to this requirement is available for qualifying governmental or non-profit entities.
Registrants of domain names issued by NSI must agree to abide by NSI’s Domain Name Dispute Policy (the "Policy"), which was last amended on September 9, 1996. Although NSI states that it does not determine the legality of a domain name registration and does not act as arbiter of disputes between registrants and third party complainants arising form the registration of a domain name, in practice, the Policy can be used to trigger certain actions including revoking use of a particular domain name by any party until the dispute is settled by a court.
CADC has taken the approach of not implementing a dispute resolution policy but rather directs parties with a disputes over the rights to use a particular name that such disputes are to be settled between the contending parties using normal legal methods.
Only One Domain Name Per Organization
The number of permissible registrations also differs between NSI and CADC. CADC will only accept the registration of one domain name per organization. There are two exceptions to this rule. The first is for a temporary overlap interval for an organization changing from one CA domain name to another. The second is for an organization whose legal name has both an English form and a French form, and which wishes to apply for one CA domain name corresponding to each form.
Since an application for a CA domain name is made on behalf of an entire organization, it is important that the person responsible for an organization’s corporate image approve the change. In fact, the CA domain name application requires the applicant to provide the name and position of the individual of the applying organization with the authority to determine its electronic identity and who has approved the application internally.
In contrast to the restrictive CADC rules, NSI only "prefers" that each organization register one domain name but will accept multiple registrations.
Risk of Loss
Pursuant to NSI’s Policy, once an organization obtains registration to a domain name, a third party’s rights to interfere with such use are limited. However, a holder of a domain name can still lose the right to continue using it if the third party challenger can produce a certified federal trade mark registration (which can be a foreign registration) that has an effective date of registration or a date of first use that is prior to the date the domain name was issued to the current holder. In such a situation, the domain name holder must be able to show a trade mark registration or will risk losing use of the domain name. This trade mark registration does not need to be dated prior in time to the one produced by the challenger but must be dated prior in time to the date the domain name holder was notified of the challenge to their use of the domain name.
The strict requirements imposed by CADC for obtaining a domain name, coupled with the use of the geographic sub-domain identifiers, means there is less of a potential for conflict between multiple organizations since each can utilize an identical organization name in their domain name as long as they operate and register in different geographic hierarchies.
However, one disadvantage of registration under CADC and its hierarchial approach is that an organization’s domain name may change if its legal structure changes. For example, this might occur if a provincially incorporated organization becomes federally incorporated and then wishes to change from a third-level to second-level domain name. In contrast, all domain names issued by NSI are second-level domain names and need not change if the organization changes its base of operation or incorporating jurisdiction.
Also, under certain conditions, a dispute in respect of a domain name issued by NSI will result in the domain name being placed "on hold" pending resolution of the dispute. In contrast, CADC will generally not take away use of an existing domain name unless instructed to by a court.
Lastly, since CADC only deals with Canadian domain names, it will only recognize valid Canadian registered trade marks in contrast to NSI which gives any foreign trade mark registration equal weight with a Canadian or US trade mark registration.
Administrative Caveats
Another difference between obtain a domain name registered under CADC versus NSI is that the former is currently free (aside from administrative fees imposed by the Internet Service Providers who assist in obtaining the registrations) while NSI charges US $100 per each .com domain name for an initial registration covering a two year period. Subsequent annual renewals are US $50.
Failure to pay NSI’s fee by the expiration date can result in the domain name being taken out of service as of the expiration date. If the fee is not paid within two months after expiration then the domain name may be given to someone else and therefore permanently lost. If a particular domain name happens to be rarely used, there is a danger that loss of service due to failure to pay the renewal fee could go unnoticed for the sixty day period.
NSI does send invoices by e-mail and regular post to the contacts listed in its database for each domain name that is about to expire (i.e. the technical and administrative contacts). However, the contact information contained in their database may not have been entered correctly and/or may have changed. Following a successful registration of a new domain name, it is therefore important to confirm the contact information and expiry date listed for a particular domain name in the appropriate Whois database maintained by the registering entity (i.e. NSI or CADC). It may also be prudent to make an entry in a tickler system which can provide a reminder of the expiry date.
Domain names, unlike trademarks, do not need to be actually used in order to maintain ownership rights to them. However, a pre-requesite to obtaining a domain name is that at least two designated DNS servers must be set up to resolve (i.e. contain an entry for) that domain name. It is possible that if these two designated servers, which should also be listed in the Whois database entry for a particular domain name, stop responding to requests for that domain name then such domain name may also be at risk of being lost.
The Internet Service Provider (ISP) market place is still very volatile. It is therefore preferable to register a domain name through an ISP that is expected to be around in the long run. While the bankruptcy of an ISP or a problem with its DNS server designated to resolve a particular domain name will be quickly obvious with domain names that are in active use, such a failure may go unnoticed in the case of a domain name that has been registered but not actually put into use. The bankruptcy of the ISP and staff turnover may also result in a failure to respond to any messages sent to the technical contact for a particular domain name from the domain name issuing organization. This reemphasizes the importance of ensuring that the adminstrative contact listed in the Whois database for a particular domain name is someone from the domain name registrant’s organization and that such entries are kept up to date.
New Top Level Domain Names
The Internet Assigned Numbers Authority, the body responsible for setting technical standards for the Internet, is planning to establish up to 50 new "top level" domain name registries. This will allow owners of identical trademarks to obtain a domain name which more closely identifies their business, for example, "macdonalds.hamburgers" and "macdonalds.leasing".
Existing domain name holders must watch closely to ensure that they can obtain their preferred choice under the new scheme. Nevertheless, the .com top level domain names will likely continue to be a sought after commodity for commercial enterprises. How valuable are these .com domain names? Well, CNET, a large electronic publisher on the Internet, unsuccessfully bid $50,000 for television.com.
Related Sources: Canadian Legal Resources | Cyberlaw Encyclopedia | Entrepreneur Resources | Canadian Technology | Precedents | Alan Gahtan
© 2005 Alan M. Gahtan. All Rights
Reserved | Use is subject to these Legal
Terms
Disclaimer: Not all materials may be applicable in your jurisdiction. Not intended to be a
substitute for professional advice. No implied endorsement of, or affiliation with, any
linked sites. Path to individual pages may change - please link to home page only.
Linking Info