To: Ira Magaziner (Office of the President)
Becky Burr (NTIA)
From: Boston Working Group
Date: September 28, 1998
Re: United States Department of Commerce
National Telecommunications and
Information Administration
Management of Internet Names and
Addresses
Docket Number: 980212036-8146-02
Please accept the following submission as a proposal in response to the document, Management of Internet Names and Addresses, above described. For sake of simplicity we shall refer to that latter document as the NTIA White Paper.
In the spirit of the Internet we are submitting these as a collection of World Wide Web files. These files are also available online at:
Attached are four documents.
The first two are our proposed
The second two are a reprise of the first two, except that they also show the differences between our work and that of IANA/NSI:
The NTIA White Paper called for the convocation of all interested parties to discuss and formulate an entity to assume management of certain matters involved with the operation of the Internet.
In response to this call the International Forum for the White Paper (IFWP) was formed. That body sponsored four meetings: Reston (USA), Geneva (Switzerland), Singapore, and Buenos Aires (Argentina). These were attended by approximately one thousand highly interested people from all walks of life; all kinds of institutions - technical, legal, educational, governmental, and business; and with all kinds of backgrounds and points of view. These meetings were highly focused discussions of the NTIA White Paper and the issues therein.
Mr. Magaziner, one of the persons to whom this submission is addressed, gave the key-note address at the Reston meeting, and, in Geneva, participated in the opening session along with Jon Postel of IANA, Christopher Wilkinson of the EU, Michael Schneider, a German lawyer representing European ISPs, and Dr. Tamar Frankel of Boston University.
As you will note, these meetings were open, focused, well attended, and substantive. The meetings were, without doubt, the most broadly based discussion of these matters in terms of both breadth of coverage and depth of analysis.
In addition to these meetings, the IFWP sponsored a very lively electronic-mail discussion.
From these meetings evolved a set of consensus points. A complete compendium of materials of the IFWP can be found via http://www.domainhandbook.com/ifwp.html.
The IFWP process itself did not result in a specific proposal in response to the NTIA White Paper. The reasons for this are complex and involved.
Nevertheless, the IFWP process did create a rich body of thought and of consensus. We, the Boston Group, elected to build upon that legacy.
Our work is based on the consensus points reached in the IFWP meetings and from the debates on the IFWP, Domain Name Policy, and IETF mailing lists.
We of the Boston Group are all people who have attended one or more IFWP meetings. Many of us submitted comments to the NTIA Green Paper. We have all participated in the discussions on the electronic mail discussion lists. We have all read the various proposals made by other bodies.
And we are all experienced members of the Internet Community. Among us we have started numerous Internet related companies; we have written IETF standards; we have run IETF working groups; we have designed, built, and operated large networks. And many of us are attorneys with long experience in matters pertaining to the Internet, business, privacy, and Intellectual Property.
In other words, despite the relatively small size of our working group in Boston, we represent an immense constituency and bring to bear a significant compendium of pertinent knowledge and experience.
Our working group includes:
Our scribe was Diane Thilly Cabell, an intellectual property attorney with Fausett, Gaeta & Lund, Boston. She was formerly assistant counsel in MIT's Patent, Copyright & Licensing Office.
Our meeting was hosted by Jorge Contreras, corporate attorney with Hale and Dorr of Boston, originally trained in Electrical Engineering at Rice University and now specializing in corporate and computer law. Please note that Mr. Contreras acted as a facilitator and that the statements and documents set forth here do not necessarily reflect his views or those of Hale and Dorr. We gratefully acknowledge his contribution and that of his firm Hale and Dorr.
It is our claim that our work represents a real consensus of the Internet Community as arrived at through a broad and open process, and represents a true response to the NTIA White Paper.
On September 19 we met in open session in Boston, Massachusetts. That meeting had a single focus -- to review and critique the most recently proposed IANA/NSI document and report back to the community, IANA/NSI, and the US government within the short time allowed for comments.
The review began with a discussion of expectations for the new entity, including prevention of capture by special interests, stable transition to the new authority, fair access and utilization of the root assets, flexibility for growth and user protection. The group identified the new entity's core responsibilities as the rights to (a) edit the root files, (b) assign the address space, and (c) control the operation, assignment and management of protocol parameters such as port numbers and enterprise numbers. This committee was unanimous in its belief that the beneficiary of the Internet Corporation For Assigned Names and Nunbers (ICANN) operations should be the end user and not any intermediary or trade group.
Enclosed is the result of that effort.
We note in passing that we submitted our proposals to IANA/NSI. However, it was, from our perspective a one-way process with no opportunity for discussion, much less any opportunity for a mutually agreed upon result. It was due to this apparent unwillingness to openly discuss issues that we felt that we had to proceed and submit our own proposal and not to defer to what we consider to be the inferior NSI/IANA proposal.
I might say that I (and I believe I speak for all of the Boston Group participants) believe that the September 28 IANA/NSI draft incorporates very, very few of our comments.
We (the Boston Group) do not endorse the September 28 IANA/NSI draft as it does not incorporate matters which we believe to be significant and which continues to reflect an organizational structure that will have vague lines of accountability, limited, if any, means for individual participation, have a high degree of susceptibility to capture by companies and organizations, and finally is not guaranteed to ever have a membership structure.
We are, as a consequence, submitting this proposal directly to the United States as an alternative to other proposals that might also be submitted, such as that of IANA/NSI.
This document summarizes our broad conclusions, and we have appended our versions of corporate Articles and By-Laws consistent with those conclusions. The changes from the IANA/NSI baseline are relatively few, although the matters are significant, and the overall structure and language has been preserved. We have brought the proposal into alignment with the international consensus. In particular we have streamlined the structure to emphasize transparency, accountability, and fairness, all of which were prime values, not only of the international consensus, but also of the NTIA White Paper itself.
We are prepared to continue this process, and have appointed Diane Thilly Cabell (dc@mama-tech.com) to be the coordination point for the group. Comments and amendments are welcome, and in the event that any suggestion is not clear, the participants would be happy to respond with further clarification. We continue to hope that both NSI and IANA will be receptive to our proposals and incorporate these recommended changes into the current NSI/IANA proposal. However, our proposal does stand on its own merits and is submitted as an independent whole.
Before providing a summary of review points, we would like to record our support for the general progress that has been made by the contributing parties during this iteration of the Articles and by-laws. It is clear that significant progress has been made in recent weeks following on the debates and discussions of the IFWP process. Trying to meld the myriad of views, comments and opinions into one consistent set of legal documentation acceptable to all is an almost impossible task. The fact that all parties have drafted such an outcome in short order is a significant achievement and the key participants from both organizations deserve full recognition.
Notwithstanding the progress made, there are eight areas where we attempted to enhance the NSI/IANA proposal:
The Articles currently identify four key functions of the new entity (names, numbers, zones and protocols).
We believe they should also state the principles to be followed in the performance of its functions, perhaps by way of preamble. For instance, to "perform its functions so as to foster a fair, open, transparent, and competitive environment for the Internet, assuring equal access to essential resources."
We also felt it necessary to more clearly identify the subject matter over which the new enterprise is to exercise its powers and to clarify the degree to which the new enterprise may pass control to others.
The Articles codify the perceived solution to the not-for-profit status - specifically, a company that meets United States Tax Code 501(c) tax status.
We believe that the Articles should record WHAT principles that we aim to achieve (i.e., not-for-profit, no benefits to inure, etc.) as well as HOW this will be achieved. The HOW is currently recorded as a particular way in which it is done in California, and may be the most appropriate.
As we understand it, the key benefits of a 501(c) company are twofold: tax exemption for the entity, and tax deductions to private donors. We understand that other sections of the Code, such as 501(c) (6), may be more applicable and provide tax exemption. We also believe that gifts and payments to (c) (6) organizations are generally tax deductible business expenses.
We do not offer a legal opinion as to ICANN's qualification for (c) (3) status in light of its stated purposes, though we do have concerns about such qualifications and the requirement in the Articles that it meet such qualification, including whether the current draft may create an unintended legal impediment to ICANN's continued existence or invalidate its actions if it is found not to have been performing functions contemplated under that section.
In addition, it is important to create a company that is financially viable. It should be able to pay any taxes, and it should not have to rely on being gifted goods in order to survive. This company is a crucial piece of the Internet infrastructure. Clearly where the company can get additional benefits this makes good business sense, but we believe the principles should be recorded in the Articles, and not derived from an assumed tax status.
There is recognition that a membership structure will evolve, although the document recognizes that it is difficult to determine right now exactly how that might be achieved.
This gives some confusion to the reader, as a number of clauses are contingent on whether there is, or whether there is not, a membership structure in place at any particular time.
IANA/NSI draft 4 leaves the issues of if and how a membership structure shall be implemented to the Interim board. The White Paper requires, and the IFWP reached unequivocal consensus on the IF portion -- the entity MUST have a membership structure in order to guarantee fair representation. This is not an open issue. The only questions relate to WHO are members and HOW they shall elect their representatives.
We have taken the positive view that a membership structure *will* happen, and made suggestions accordingly. Our redrafting has a clear flow as follows:
We fully support the creation of Supporting Organizations (SOs) as policy advisory committees to the Board. We see their role as originating proposals and expert advice to the Board in their particular functional disciplines.
However, we see conflict in their dual role espoused in the draft -- SOs are seen as both creators of Policy and decision makers on the merits of Policy as Board members. If the supporting organizations are also the primary means through which ICANN will obtain a membership, there is a great risk of politicizing the SOs. This would lessen the ability of the SOs to make objective technical and policy recommendations. This real conflict can be avoided by defining the role of SO's as that of advisory committees, composed of representatives from new and existing organizations, and we have re-drafted accordingly. We feel that the SOs must be part of the ICANN structure, created by and responsible to the corporation, rather than independent entities. Making the SOs committees of the entity will assure compliance with ICANN's policies, purposes, and aspirations. We do not believe it appropriate for ICANN to be controlled by and subservient to independent organizations that can appoint members to the Board of Directors.
This results in reduction of the Board by 9 members. Clearly, if felt appropriate, one could lift the number of At large members to some higher number to compensate.
We felt uncomfortable with the number of officers contemplated by ICANN's by-laws. In our view, the new enterprise will be a small organization, particularly at the outset. The various registries and other external organizations will do most of the actual "work".
We believe that the new enterprise should start initially with the minimum set of officers required by law. Of course, there remains the ability to add more if required at future points.
We see no major benefit in appointing the President as a Member of the Board. A clear separation between the Board (as policy maker) and the President (who as the CEO executes Board policy) removes potential for conflict and enhances governance within the new company. Furthermore, we foresee that there could be legal difficulties that arise due to the self-extending nature of allowing the board to designate a non-Board member as President who thereby assumes a seat on the Board.
The Articles state how conflicts of interest should be handled for members of the Board. We would like to see similar provisions for Officers and Employees too, as there is real potential for conflicts to arise.
For instance, one current scenario has potential to see an employee of the company being,
The company needs to constitutionally address these issues to protect its interests as well as those of its employees.
We were both surprised and troubled by the fact that the by-laws were used to define the basic structure of the corporation rather that the Articles, where we believe the more basic and immutable principles must be stated and preserved. Clearly we accept there are different ways of doing things. One can argue that so long as all of the key points are recorded somewhere, it does not really matter where that is.
Changing Articles involves a modification of the basic agreement by which the membership submits itself to governance by the organization and must require general consensus of the members. The by-laws should only involve the details of such governance (or administrivia) and may be subject to change by the board.
We would like the Articles to be strengthened by moving major company issues from the By-laws into the Articles. This means that change to the Articles can be effected by a 3/4 majority of member votes cast. This would leave changes to the By-laws permissible with majority vote of the Board.
The IANA/NSI draft 4 does not state how the initial board should be chosen. Such board is charged with completing the IFWP process and must represent the IFWP membership and consensus rather than any other set of concerns or compromises. Otherwise, it can not be trusted to faithfully perform its function. Furthermore, we believe that the discussion and resolution must be concluded by the people who have been involved in the discussions, understand the issues and our consensus, and are representative of and feel responsible to our diverse membership rather than to some other set of persons or interests.
Therefore, we suggest and require that the initial board be elected by the IFWP utilizing a system to foster proportionate representation (called Single Transferable Vote or STV).