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The problem
The World Intellectual Property Organisation detected that there was an increase in Internet crime during the COVID-19 pandemic caused by the greater number of cybersquatting cases.
The practice of registering a name as a domain name that is the same as a known trade mark, a famous person’s name or the name of an important company or event has been common practice since the authorised providers responsible for assigning domain names began operating.
The aim of cybersquatting is to obtain a domain name in order to speculate and attempt to sell it at a higher price to a person who is interested in acquiring it, which is usually a legitimate user or holder of the exclusive right.
This situation has become popular because the domain name registration system, whether for generic top-level domains (gTLD) or top-level country code domains (ccTLD), is extremely easy since no complicated procedures or specific requirements are needed to register a name and obtain ownership of a domain name.
As a general rule, the first person that submits an application and makes the payment is the one that obtains the domain name. Moreover, the costs for registration of a domain name are quite affordable, which makes acquiring them even easier.
However, the person who applies for registration of a domain name must make a statement about its legitimacy to use the chosen name and that it does not infringe any third party’s rights. Moreover, such person is also obliged to be subject to the out-of-court domain name dispute resolution proceeding. With these simple rules a mechanism has been set up that enables control to be conducted a posteriori on the legitimacy of the holder of the domain name to use the registered name.
The rules
The Uniform Domain Name Dispute Resolution Policy and the applicable Rules provide a proceeding in certain cases for recovering a name registered as a domain name.
By virtue of section 2 of the Uniform Policy, the applicant for a domain name must represent and warrant the following to the authorised domain name provider:
“(a) The statements that have been made in the Registration Agreement are complete and accurate;
(b) To the applicant’s knowledge, the registration of the domain name will not infringe upon or otherwise violate the rights of any third party; and
(c) The applicant will not knowingly use the domain name in violation of any applicable laws or regulations. It is the applicant’s responsibility to determine whether its domain name registration infringes or violates someone else’s rights.”
Section 4 stipulates that the domain name holder must be subject to an out-of-court dispute resolution proceeding in the event a third party, (a complainant), asserts, in compliance with the Rules of Procedure, that:
“(i) The applicant’s domain name is identical or confusingly similar to a trade mark or service mark in which the complainant has rights; and;
(ii) The applicant has no rights or legitimate interests in respect of the domain name; and;
(iii) The applicant’s domain name has been registered and is being used in bad faith.”
The complainant must prove or provide evidence that each of these three basic elements are present, specifically as follows:
“(1) The way in which the domain names are identical or confusingly similar to a trade mark or service mark in which the complainant has rights; and
(2) The reason why the respondent Party (domain name holder) must be considered not to have rights or legitimate interests in respect of the domain names, subject to the claim; and
(3) The reason why the domain names must be considered to have been registered and are being used in bad faith.”
The proceeding is managed by specialised institutions, such as the WIPO Arbitration and Mediation Center, which has a specific division that deals with disputes related to domain names and the claims are resolved by experts on the matter.
Another aspect that should be highlighted is that the administrative proceedings are fast, cheap and efficient. However, their greatest virtue is their flexibility, because they enable the parties to reach an agreement to settle the dispute and conclude the proceedings without needing to appoint an expert, which implies lower costs.
A possible solution
Cybersquatting is often linked to other infringements of exclusive rights. These mainly affect the holder of registered trade marks; therefore domain names are usually recovered through claims filed through legal proceedings.
However, there are cases in which recovering a domain name is urgent or necessary.
There are also other situations that could arise due to how easy it is to acquire and transfer domain names, which enables the ownership to be changed, and this can happen while the proceedings are in process. The domain name may even expire because they are usually registered for short periods of time (1 year) and are then free to be acquired again by a third party, which is often not a party in the legal proceedings previously filed for infringement of exclusive rights.
In these cases, the best option is to resort to the dispute resolution proceeding due to the advantages implied by the short time in which a domain name can be recovered, which with this brief explanation we would certainly recommend.
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