At its meeting on Thursday, the ICANN Board approved two proposals by the Generic Names Supporting Organization (GNSO) Council.
The changes will impose a financial penalty on registrars who engage in excessive domain tasting.
Domain tasting is the practice of testing a domain name (such as a mis-spelling of a generic word or brand, or re-registration of lapsed domain name) to see if it can generate revenue from advertising.
Under existing rules, applicants benefit from a five-day period (the so-called add-grace period) after which their fees can be refunded, making tasting effectively cost-free.
Some estimates are that more than 90% of domains registered every month are not kept beyond the add-grace period.
A similar practice, known as kiting, also takes advantage of the add-grace period, by constantly re-registering domain names but deleting them within the five days.
Now the ICANN Board has agreed a policy to ban gTLD registrars from offering a refund for any domain name deleted during the add-grace period that exceeds 10% of the registrar’s net new registrations in that month, or 50 domain names, whichever is greater.
That change should deter registrars who encourage large-scale tasting, while retaining the refund in cases where there are genuine reasons not to keep the domain (such as a mistake in the registration, or non-payment by the applicant).
The Board also agreed to make the 20 cent fee paid to ICANN for every domain name registered non-refundable, whether or not the domain name is kept beyond the add-grace period.
Kristina Rosette, special counsel with Covington & Burling who sits on the GNSO Council, told Managing IP: “I am cautiously optimistic that the combined effect of the add-grace period restriction and the imposition of the ICANN fee will be to essentially eliminate tasting. The key will be the speed with which the AGP restriction is implemented. Based on the draft document posted by ICANN staff and our dialogue with them on Saturday during the GNSO Council working session, my best guess is three months.”
