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What is the nature of domain disputes?

Intellectual Property Insights

While designed to serve the function of enabling users to locate computers (and people) in an easy manner, domain names have acquired a further significance as business identifiers and, as such, have come into conflict with the system of business identifiers that existed before the arrival of the Internet and that are protected by intellectual property rights. Domain disputes arise largely from the practice of cybersquatting, which involves the pre-emptive registration of trademarks by third parties as domain names. Cybersquatters exploit the first-come, first-served nature of the domain name registration system to register names of trademarks, famous people or businesses with which they have no connection. Since registration of domain names is relatively simple, cybersquatters can register numerous examples of such names as domain names. As the holders of these registrations, cybersquatters often then put the domain names up for auction, or offer them for sale directly to the company or person involved, at prices far beyond the cost of registration. Alternatively, they can keep the registration and use the name of the person or business associated with that domain name to attract business for their own sites. – WIPO.

Considerations for domain name strategies

Protecting a domain name is important to protect the company brand against domain disputes. A domain name is registered in order for a website to exist online (for example, “companyname.co.za” and “companyname.africa”) and this forms the basis of the online brand. A domain name can only be registered to a company if it is not already registered to another proprietor. If a company’s preferred domain name has already been registered by another party, it is necessary to think of a different domain which still reflects the brand or alternatively, to consider purchasing the existing domain name from the other party.

It is also important to consider registering domain names with a defensive strategy in mind, to ensure that others do not register a domain name that could be linked to your company or cause any user confusion. For example, although a nursery could register a primary domain with their company name (for example, “plants.co.za” if available), the company can also consider registering derivatives (for example, “plantsSA.co.za”) so that no one else uses this domain name. It is not uncommon for a competitor or a domain name trader to register a domain name which has the effect of limiting a company’s ability to register a specific domain name.

Domain name transfers

Ownership of a domain can be transferred from one proprietor to another. This would be applicable to mergers and/or acquisitions, and should also be considered when trade marks are assigned from one proprietor to another. In certain instances, a moratorium period post-registration or post-prior transfer may be applicable. A domain name transfer can also occur where a domain is changed to a different domain name registrar. Before transfer, it is important to ensure that the domain names have in fact been registered, are owned by the seller and that the seller is willing to transfer ownership. A domain name strategy for these acquired domains is essential in the full commercial exploitation thereof. Read more about Domain Names.

Posted on 24 August 2009
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