What is the Transfer Emergency Action Contact (TEAC)?

The Transfer Emergency Action Contact (“TEAC“) is a contact that each registrar must provide to ICANN through ICANN’s Radar Interface. This contact is to be used by other registrars, ICANN and the registries if there’s a need to quickly address issues with domain transfers between two registrars. The contact must respond (non-automated) to inquiries within four hours, though the final resolution may take longer.

The TEAC is part of the Inter-Registrar Transfer Policy (IRTP).

What is the ICANN FOA (Form of Authorization)?

The FOA (Form of Authorization) is an ICANN mandated message (basically an Email template) that the registrar needs to send to the “registered name holder” when an incoming (gaining) or outgoing (losing) transfer request is received.

The gaining side FOA is used in order to obtain the registered domain holder’s permission in order to transfer a name from another registrar to yours. The losing side FOA is used when another registrar has requested a transfer out for a domain that was previously held under your registrar. While the transfer out is auto-completed after five days. this gives the domain holder another chance to review the transfer that is going to happen to make sure it is happening with his knowledge.

The emails form part of the Inter-Registrar Transfer Policy (IRTP).

ICANN Requirements for Expired Domain Names

During a recent webinar, ICANN went through the new Expired Registration Recovery Policy (“ERRP”) for registrars – here’s the summary and what you need to know. Please make sure that you read the original Expired Registration Recovery Consensus Policy if you need any more details. Registrars have to comply with the new policy by August 31st, 2013. This policy was developed from the Generic Name Supporting Organization (GNSO)’s Post Expiration Domain Name Recovery (PEDNR) recommendations. ICANN’s Board of Directors adopted the policy and ran it through a public comment period.

Expired Registration Recovery Policy (“ERRP”)

  • Registrars can delete domain names any time after they expire
  • The existing DNS has to be “disrupted” for 8 days before deletion, meaning the domain name has to either be put on “Registrar Hold” effectively removing it from the zonefile or changing DNS to point to a registrar supplied site. If a page is displayed, it must include instructions for renewing the domain name.
  • The registrant must be able to renew the domain name any time before deletion.
  • If the domain is renewed the registrar must restore DNS “as soon as commercially possible”.
  • The registry automatically renews the domain one the day of expiry and charges the registrar’s prepaid account
  • If the domain transfers out or is deleted within 45 days of the expiry/autorenewal, the prepaid funds will be returned to the registar’s account
  • After the domain name is deleted (unless a delete happens within the first 5 days after registration), the domain (for all gTLDs other than sponsored gTLDs) will enter the “Redemption Grace Period” (RGP), which lasts 30 days. During this time the domain may still be restored by the registrar at a higher cost. This must be offered by registrars.
  • The domain name will then go into “Pending Delete” status and will be deleted after five days
  • Any fees for renewals, post expiration renewals and redemptions must be displayed/be available to the registrant at the time of registration, for example as part of the registration agreement.
  • The registrar’s published renewal policy also must reveal how renewal reminders will be sent.
  • ICANN will publish information on this process on their website, registrars will have to link to it.
  • Resellers will have to display all of this information as well.

Messaging Requirements

  • Notify registered domain holder of the expiry of their names at least two times
  • The notices may be combined for domains expiring at the same time.
  • Approximately one month and one week before expiration.
  • Sent in language of the registration agreement
  • Must be sent to the “Registrant at Expiration” (RAE), meaning the holder of the name at expiration.
  • If the name is not renewed until five days after expiry, another “Final Renewal Reminder” must be sent explaining how to renew the domain
  • Registrars that send more or other notices may continue to do so
  • No prescribed template
  • Registrants cannot opt out of notices.
  • All messages sent to the registered name holder must be available for audit.

Setting up an Offshore Domain Registrar: 5 Things to Keep in Mind

Judging from the inquiries we received over the last couple of weeks, apparently a number of people are looking at setting up an offshore domain registrar. So I figured it would be a good time to summarize 5 items to keep in mind when becoming ICANN accredited with an offshore company.

  1. Becoming accredited is just one step, you will also need a registrar solution (software or hosted service) to run your new domain name registrar.
  2. If you are looking at a hosted registrar solution, you will most likely only be hosting your registrar front-end on offshore servers. Make sure you know where your hosted registrar provider’s servers are located, as they may be subject to another jurisdiction.
  3. While your offshore jurisdiction may offer protection against legal “attacks”, the registry will be still located in another jurisdiction. While it is likely that the registry will fight anything that could set precedence and make them responsible for actions of registrants, it is still a possibility for a potential complainant to go directly to the registry.
  4. The commercial liability insurance that ICANN requires you to have is usually more expensive for an offshore entity than it is for a company located in the US or Canada.
  5. Do not buy an existing registrar, if the company is not already accredited in the right jurisdiction. Changing a jurisdiction for an existing registrar is complicated and takes time. In most cases it is easier to set up a new registrar.

Do not rely on the FTP Registry Transfer Report

Registrars that want to stay up to date on outgoing transfers and would like to give their registrars a timely chance to cancel stop pending transfer requests should not rely on the daily FTP reports provided by the Registry.

There are three methods available for obtaining information about the status of incoming & outgoing transfers:

  1. Transfer Reports from the registry FTP-Server
  2. EPP polling messages
  3. EPP Transfer Status Queries
  4. Transfer email messages

Most older registrar systems will rely solely on the FTP reports, which are not always published by the registry on times and have been delayed by several hours over the past years on several occasions. Considering that a transfer often takes five business days to complete, the user experience is already a bad one, so any additional delay should be avoided. Imagine an anxious registrant who is in the process of transferring their domain receiving an empty response from your whois server, since your system has not yet noticed that the transfer actually completed.

Experiences with most of the major registries have shown that it may not be a sound decision in a registrar implementation to rely on one only just one of the methods above. For .COM and .NET domains the Email Notifications are the most immediate and reliable method of receiving information about transfers. We recommend to poll these messages at least once an hour. Since email cannot be considered reliable today, we also recommend using the FTP report on top of the email notifications, which should be checked at least once daily. For full EPP registries, the polling notifications are the most direct information available.

Becoming an ICANN accredited Registrar

Due to a recent question on DNForum by DNGod (“Can buy ICANN-accredited registrar“), I decided to finally update and publish this post, which had been sitting around as a draft for a while. Thank you for the inspiration 🙂

Apply versus Buy

If your organization has decided to become an accredited registrar, there are two choices in order to become operation. You can either apply for a new accreditation, purchase a company that owns an existing registrar or lease an existing registrar. Either way has it’s advantages and disadvantages.

While we will also be looking at the cost of the actual transaction, please keep in mind that this article does not consider the actual cost of running a registrar, which is the same, no matter if you buy an existing accredited registrar or apply for a new accreditation.

Buying an existing Registrar

In reality in most cases you will actually not just be buying a registrar accreditation, but rather a company that is ICANN accredited. The price point is up to $30,000 USD for an offshore registrar, but we’ve seen prices under $10,000 USD recently. In most cases you will be operational faster than when going through a new registrar accreditation, but there are a number of other factors to consider. Most likely the registrar you will be buying is at least accredited for the COM & NET registries.

One time Cost:

  • $10,000 to $30,000 USD
  • plus reimbursement of any deposits/fees (registry credits)
  • Lawyer Fees
  • Possible Consultant Fees (about $2,500-$5,000 USD)

Pros:

  • If you are planning to have a retail presence, you may be starting out with some existing clients.
  • You don’t have to incorporate a new entity.

Cons:

  • Existing contracts may mean a delay before the registrar is yours and yours alone, for example if the registrar was used for drop-catching domains, there may be a 3 month notice needed in order to allow the drop catching registrar to attempt to move out their customers.
  • Depending on the responsiveness of the seller the sale may slow down as well.
  • Many registrars that are for sale are only set up to register a limited set of TLDs, so adding additional TLDs may be as time consuming as it is for a new accreditation.
  • Depending on where the company is registered you may have to change the jurisdiction of the company.
  • The registries may ask you to re certify and re-file paperwork such as credit applications once they are notified about the ownership change.
  • ICANN usually asks registrars with an ownership change to re-verify that the new owners meet all the requirements of the Registrar Accreditation Agreement (RAA).
  • You may have to continue to use the registrar system that the registrar has been using before, depending on your needs and existing contracts.

Recommendations:

  • Enlist a lawyer’s help to review the purchase contract.
  • Make sure the seller has provided you with all of the credentials & access for ICANN & the registries.
  • Ensure you are aware of any existing obligations contracts of the registrar, as well as any potential earnings.
  • Make sure that the registrar is in good standing with ICANN and all the registries and has been fulfilling all their requirements according to the RAA. Examples to watch out for here is for example the compliance with Registrar Data Escrow program.

Applying for a new registrar accreditation

One time Cost:

  • ICANN Application fee ($3,500 USD)
  • Possible Consultant Fees (usually from $6,000 to $10,000 USD)

It is important to note that there may

Considerations:

  • Proof of $70,000.00 USD working capital required (letter from bank etc.)
  • Commercial General Liability Insurance coverage of at least $500,000 (can be purchased from $500 USD & up)

Pros:

  • No existing registrants to worry about.
  • Starting from a clean slate, you don’t have to worry about the registrar’s history

Cons:

  • Accreditation process can be time consuming.
  • Time frame for the completion of the accreditation can be unpredictable, but can be as fast as under one month.

Recommendations:

  • Try to partner with a company that has gone through the process before and already has personal contacts at the registries and registrars.
  • Select your technology partner early in the process in order to ensure speedy completion of the registry signups and tests.

Leasing an existing Registrar

While this used to be a third option through an offering such as MyRebel.com (which appears to have been discontinued), we’re not aware of any current offerings allowing you to lease an existing registrar, but in order to be complete, I’ll still list our recommendations.

Cost:

  • Leasing a registrar does have a low initial setup fee.
  • The monthly cost, which includes access to a simple hosted registrar management interface, is about $1,500 USD per month.

Pros:

  • You can get started quickly without having to wait to change ownership on an existing registrar or needing to complete paperwork.
  • You have full access to the registry interfaces.
  • Any transaction is directly sent the registry, so you see the unfiltered registry response without any delay.
  • Since the service includes a hosted solution the service provider takes care of issues such as RDE, WDRP compliance and other code updates.

Cons:

  • The registrar is not owned by you.
  • You depend on the provider’s technical staff to provide you with access to your registrar.
  • You do not have control as to where the leased registrar is incorporated.

Conclusions and recommendations

If you are not in a huge rush to start using your ICANN accredited registrar, I would always recommend applying for a new accreditation rather than purchasing an existing registrar.

Disclaimer: DomainCocoon provides ICANN Accreditation Consulting, Frank Michlick is the founder of the company.

Can becoming an ICANN accredited Registrar save you money?

[Last Updated on Oct 27th, 2013]

Since many companies often mostly concentrate on the perceived cost savings of becoming an ICANN accredited registrar, we felt it would be a good idea to summarize the actual cost of maintaining an ICANN accredited registrar.

For smaller domain portfolio holders, this may actually not hold true – becoming an ICANN accredited registrar may initially increase the cost of holding the domains. However there are other advantages that should be taken into consideration, such as the improved security & control for your premium domain holdings held with your own registrar and even the right to participate a little more in ICANN politics.

One time fees due at the time of application

  • $3,500.00 USD non-refundable application fee (not considered in the financial exercise below)

Quarterly/Monthly Fees & Dues

  • Variable ICANN Fee, billed quarterly as set in the ICANN budget and divided by the number of registrars. For smaller registrars this fee usually ranges between $800 USD and $1,200.00 USD per quarter.
  • Fixed annual accreditation fee, $4,000.00 USD. These fees are first invoiced after your new registrar has become accredited.

Ongoing Cost

  • Registry Registration Fees per Domain Name Year (currently $7.85 for .COM)
  • Per Domain Name Year (registration, renewal, transfer) ICANN Fee (currently $0.18)

Other Considerations

  • ICANN requires the applicant to provide proof of at least $70,000.00 USD in working capital. (This amount does not need to be transferred to ICANN.)
  • ICANN required Commercial General Liability Insurance coverage of at least $500,000.
  • The individual registries may require additional pre-paid deposits and proof of available working capital.
  • The cost of licensing and running a registrar system.

In other words, your annual fees for maintaining most basic accreditation for just the COM gTLD are as follows:

  • $4,000 annual accreditation fee
  • $1,000 * 4 quarterly fee (mid-low range assumed)
  • ca. $1,000 commercial liability insurance (can be as low as $500)
  • Total $9,000.00 fixed cost per year

The base cost for a .COM domain name would be $7.85 + $0.18 ICANN fee, $8.03. Let’s assume that your current registrar charges you $9.00 per domain name year (including all fees), a difference of $0.97 of your base price. In order to get to the same price, you will have to process at least 9,279 (about $9,000 annual cost divided by $0.97) domain name years through your registrar to match the price of $9.00.

Please note that the actual number can be even higher, since this calculation does not include the cost of running a technology solution for an accredited registrar.