Direct ‘.au’ domain names are coming. Threat or opportunity?

After being on the cards for several years, the administrator of the .au country code Top Level Domain (ccTLD), au Domain Administration Limited (auDA), has recently announced the launch of .au direct registrations in the ‘second level’ (e.g. gadens.au) effective from 24 March 2022. Separately, the Australian Government is currently reviewing the terms on which it endorses auDA as the administrator of the .au ccTLD.

Direct registrations

While direct registration will unlock opportunities for people looking to register desirable domain names that are otherwise unavailable in the third level (e.g. gadens.com.au and gadens.net.au), the potential for conflict and confusion is likely to be a genuine concern for many registrants of existing domain names. Debate over the benefits and consequences of direct registrations has been longstanding.

For existing registrants of .au third level domain names, they will have a 6 month window from 24 March 2022 to exercise a priority status to apply to register at the second level the exact match of their existing third level domain name. If they do not avail themselves of that opportunity, the second level domain name will become available to anybody on a ‘first come, first served’ basis. Some observers may find it surprising that, whereas the eligibility rules for domain names such as those in .com.au were tightened in April this year, direct registrations will only be required to meet the ‘Australian presence’ requirement.

The priority allocation process will come with a number of conditions:

• Third level domain names with a creation date on or before 4 February 2018 will afford the applicant ‘category 1’ priority for the second level domain name.
• Third level domain names with a creation date after that date and before 24 March 2022 will afford an applicant ‘category 2’ priority.
• Category 1 applicants will have priority over category 2 applicants.
• As between competing category 2 applicants, the third level domain name with the earliest creation date will afford its holder the right to register the second level direct domain name.
• As between competing category 1 applicants, they will either need to reach agreement between each other or otherwise renew their applications annually until such as time as only one applicant remains. For so long as there remain competing category 1 applications, the domain name will not be allocated.
• If there are no priority applications, the domain name will be generally available and allocated on a ‘first come, first served’ basis, but subject to the Australian presence requirement.

For so long as an application for a third level domain name is pending during the six month application period, the applicant will not be permitted to transfer its eligible third level domain name to another person or change any registrant information during that period. It’s unclear what happens should there be an unresolved conflict between category 1 applicants.

This could be problematic, for example, in the cases of business sales or restructures where there may be a delay on domain name transfers. It could also be problematic for those whose third level domain name is unintentionally registered incorrectly and does not meet the licensing rules, thereby exposing it to challenge and potential removal, in turn undermining the applicant’s priority rights. It is also uncertain whether registrars will be able to charge premium prices for those looking to make priority applications.

For current registrants looking to rely on priority claims, they should review their current registrations to assess where they may stand in the priority queue and whether that position is as strong as it can be.

Review of auDA’s Terms of Endorsement

In being granted the right by ICANN to administer the .au ccTLD, auDA is required to assure ICANN that it is appropriately endorsed by the Australian Government for that purpose. The Government’s current Terms of Endorsement, which outline the Government’s expectations of auDA, were made in 2018. The Department of Infrastructure, Transport, Regional Development and Communications is currently seeking submissions for the purpose of its review of the Terms of Endorsement and whether they are fit for purpose. The closing date for submissions is 10 September 2021.

Should you have views on the content of the Terms of Endorsement or the regulation and administration of the .au ccTLD by auDA more generally, there is an opportunity now to make a contribution.

If you have any concerns or queries regarding your domain name portfolio, your options for priority to direct .au domain names, or the Government’s review of auDA’s Terms of Endorsement, please do not hesitate to contact Gadens’ experienced domain name practitioners.

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Authored by:

Adam Walker, Partner
Renee Smith, Associate