Implementation of the .eu Top Level Domain

This Communication takes stock of the preparations that were needed for the creation of the “.eu” TLD and informs the European Parliament and the Council on the implementation, effectiveness and functioning of the “.eu” TLD as foreseen in Article 8 of Regulation (EC) No 733/2002 on the implementation of the “.eu” TLD. The European Registry for Internet Domains (EURID) was designated by the Commission as the “.eu” TLD Registry.

The paper describes the framework legislation and measures for the protection of end users. The latter includes the reservation of names, the phased registration period and the Alternative Dispute Resolution (ADR) procedure. The Commission also describes the sunrise period, whereby holders of prior rights recognised or established by national and/or Community law and public bodies benefit from a specific period of time ("sunrise period") during which the registration of their domain names is exclusively reserved to such holders of prior rights. These rules have been further developed by the Registry through the "sunrise rules". Considerable efforts were made by the Registry to simplify as much as possible the sunrise procedures taking into account that the sunrise period concerns prior rights established under the laws of the Member States. Special consideration had to be given to the different legal systems and to the different means that were required to prove the existence and validity of those rights. This necessarily had an impact on the complexity of the application procedure.

With regard to the ADR system, disputes within the ADR system for “.eu” may be initiated against bad faith or abusive registrations from third parties or against decisions taken by the Registry. he level of the fees for ADR proceedings is based on the cost recovery principle. The ADR fees (starting at €1,850) compare favourably with those charged by similar arbitration bodies. In view of the good results during the first year of operations, the Czech Arbitration Court lowered its fees by 7% as of 1 January 2007. There is a further 10% discount on the ADR fees applicable to the parties who use advanced esignature during ADR Proceedings.

The effectiveness of the “.eu” TLD system can be gauged on the basis of two indicators: the number of domain names applied for and the efficiency of the Registry in dealing with the daily functioning of the registration system. A year after launch, some 2.4 million “.eu” names are been registered under the “.eu” TLD, making “.eu” Europe's third most popular country code top level domain name, and the seventh most popular TLD worldwide to date. Within the EU, the “.eu” is only surpassed by the national Top level domains (ccTLDs) for Germany and the United Kingdom while globally, only .com, .net, .org and .info can claim more registrations. Moreover, now that the initial wave of registrations has passed, there is an increasing trend towards using .eu domains once they have been registered as opposed to simply registering them as a precautionary measure. Thanks to the huge interest in “.eu” and the high number of registrations, the Registry has managed to lower the fees associated with owning a “.eu” domain name. As of 1 January 2007, the price for registering a domain name and the annual renewal fee was reduced from 10 to 5 €. Taking into account the non-profit character of the “.eu” Registry further reductions may be envisaged in the future. Note that this fee is charged to accredited “.eu” registrars that, in turn, set the prices for their customers. Many registrars bundle their services to include web hosting and email packages, for instance. Nowadays, the price for a domain name under “.eu” starts at around 15€, thus matching the prices usually charged for other domain names under .com, .net, .co.uk, .de, etc… All in all, it can be concluded that the launch of the “.eu” TLD has been a successful and effective exercise, which meets real demand among the European citizens, industry and other organisations.

To assess the performance of the registration system an independent audit was performed at the end of the phased registration.  The findings of the audit report can be summarised as follows:

- as concerns the validation of rights during the Sunrise, the auditor established that the selection of the validation agent and the drawing up of the applicable rules for the Sunrise was done according to the specifications of the PPR and within the confines of an acceptable economic (cost) and operational (throughput) model for the execution of the process. In view of statistical data, the auditors concluded that no discrimination could be found against citizens of any particular Member State;

- regarding abusive registrations, the Registry consistently maintained the first come – first served principle. As regards to "warehousing practices" by some registrars, the Registry performed investigations based on sampling and complaints and terminated the contract with those registrars whose practices were proven inadmissible;

- as concerns registration by non-eligible registrants, the Registry performed post-factum investigations and revoked, where appropriate, domain names which consequently became available again to the public;

- the several hundreds of registrars accredited to the Registry with the sole purpose of massively obtaining domain names for certain registrants (the so-called "phantom registrars") was the subject of legal proceedings brought by the Registry before the relevant courts;

-regarding operational and technical questions, the findings of the audit report confirm the robustness of the system implemented by EURid which has proven appropriate in view of the load and volume of applications during the Sunrise period and afterwards;

- in relation to the massive registrations taking place after 7 April 2006, i.e. at the moment when applications were open to the wider public ("landrush") and subsequent releases ("mini-landrush"), this is a phenomenon that many other registries have also experienced. This practice seems to be the result of technical craftsmanship and performance on the side of the registrars. After careful and extensive sampling of the EURid registry logs, no evidence was found by the auditors that parties would have been unduly advantaged, nor that the first-come first-served principle was infringed, nor that unallowed manipulations were performed upon the database by any party, nor that the logging system was tampered with, nor that the protective firewalls installed by EURid were broken.

- as concerns the assistance to end users, the Registry put in place a support team to handle telephone calls, e-mails, faxes and postal mail from the opening of the "Sunrise" phase (7 Dec 2005). However, the support team appears not have kept track of its exchanges with third parties with a proper ticketing system until July 2006.

Conclusions: the audit report shows that the Registry has overall performed very efficiently during the start up phase of the “.eu” TLD and in full conformity with the legal framework. There is no indication that the level of disputes or problems within “.eu” was any higher than for any comparable TLD. Being a successful TLD that attracts high numbers of registrants inevitably involves having to deal with complaints about disputed domain names. Given the history of disputes in other TLDs over the years, a certain level of complaints was to be expected. To the surprise of some observers, the launch of “.eu” attracted a lot more registrations than expected. Some of the registrations were speculative and/or defensive, but most were in good faith. Some, inevitably, will have been made by people trying to "exploit" the system for financial gain. Such behaviour was to a large extent anticipated. Indeed, a large part of the discussions on “.eu” when the legislation was being adopted by the European Parliament and the Council was on how to minimise abuse. The evidence suggests that that legal framework and the implementation of defensive measures by EURid has been largely effective in this respect. As the start-up phase finished some time ago, the objectives for the “.eu” Registry have evolved. The challenges now are to further improve the service given to customers by, for instance, the adoption of a code of conduct for registrars. Moreover, the promotion of further registrations as well as that of the actual use of the “.eu” TLD by citizens, institutions and companies should be ensured.