Report prepared for Consultancy study on the Institutional Framework and Corporate Governance for the Administration of Internet Domain Names in Hong Kong Deliverable 3 (Part I): Report on international desk research Gov3 limited | 83 Victoria Street | London | SW1H OHW | UK | www.gov3.net CONTENTS Page Executive Summary 3 Part I: Cross-country Overview 1 Introduction 6 Background 6 From “best practice” to “international practices mapping” 8 Structure of the report 9 2. Governance and government 11 Governance versus Government in general 11 Governance versus Government in the ccTLD best practice debate 13 Government role in ccTLD management: desk research findings 17 3 Synthetic overview of desk research findings 22 Organisational structure 22 Policy priorities 24 Governance processes 24 Operational practices 28 Forward orientation 33 4 International practices mapping 35 Policy priorities, organisational type, and government control matrixes 35 Governance matrixes 39 Operational practices matrixes 41 5 Conclusive Considerations 48 Part II: Country Reports (see separate document) 2 EXECUTIVE SUMMARY This is the report on the findings of the international desk research activity, during which we have used web-based research, and a trawl of relevant published academic and market research, to pull together an assessment of the current state of domain name registration in the agreed list of 13 selected countries: Australia, China, Finland, France, Germany, India, Japan, Republic of Korea, Singapore, Sweden, Taiwan, the UK and the US. The report is in two main parts: Part I, which synthesises our key findings across all the countries; and Part II, which examines each country in turn against a common analytical framework. From “best practice” to “international practices mapping” For a number of reasons explained in the introduction of the report, we have modified the original focus on the concept of ‘international best practices’ to that of ‘international practices mapping’. It is not possible to assess in a prescriptive way the relevance of all possible organisational and governance settings /choices for ccTLD regimes, without considering each institution’s priorities and the wider context in which it is embedded. We have therefore interpreted the desk research findings developing several ‘positioning matrixes’, and then mapping the selected countries against them. By doing so, we highlight a number of possible choices to be considered in the option appraisal phase of the study and also some key dimensions that the OGCIO may want to study further for a few countries, for which the desk research may be integrated with more in depth analysis through interviews with stakeholders and experts. Strategic alternatives Among the 13 countries surveyed there are five cases in which the ccTLD registry is, though in different ways, part of the government (China, Finland, India, Korea, Singapore), two cases of for profit companies (Japan and US), while the remaining seven cases (Australia, Canada, France, Germany Sweden, Taiwan, UK) can be clustered together within the ‘not for profit’ group, although under different forms. As for the relation between government and the ccTLD registry our findings show that in the majority of the surveyed countries (11 out of 14) the government retain some formal levers of potential control. Only in Germany, Sweden and the UK are there no formal relations between the registries and the government, although even such cases some informal potential mechanisms can be identified. One view often expressed in the global debates on Internet governance is that government control is associated with a stronger ccTLD focus on the preservation of the public interest. Our research does not support that view. In brief our research does not find a clear and unequivocal correlation between, on the one hand the levers of control retained by the government, and on the other hand a clear preference over one of the two poles represented by the preservation of the public interest and the pursue of commercial goals. Especially it does not support the view that registries with a closer relation to government pursue the public interest only, while those with only informal relation to the government pursue only commercialisation goals, overlooking the public 3 interest. Similarly, it does not always follow that registries operating as for profit or not for profit organisations, always place higher emphasis on commercialisation and market growth than government operated registries. In terms of more operational practices, the report considers in some detail, as an indication of the actual level of regulation/deregulation, the restrictions imposed on applicants, namely: Location requirements Limits on number of number of domains names per applicant Three clusters are identified using these two dimensions: Fully deregulated cluster (no location requirements and no limits on number of domain names per applicant) including China, Germany, India, UK; Heavily regulated cluster (imposing both location requirements and limits on number of domain names per applicant) including Japan, Korea, Singapore, Sweden, Taiwan; An intermediate cluster (imposing location requirements but no limits on number of domain names per applicant), including Australia, Canada, Finland, France, US These three clusters (see figure below) show that there is no unequivocal pattern of relation between, level of government control on the one hand, and actual regulation on the other, thus confirming to same extent what had already emerged from the policy priorities matrixes. A synthetic assessment of all the dimensions analysedIntermediate uncovers three ideal-typical models of ccTLD management Level of government control ♦ = low High Government Marketer Autonomous Marketer ♦ in ♦ = medium ♦ de ♦ uk ♦ cn ♦ = High ♦ kr ♦ se ♦ sg Countries codes ♦ tw Intermediate Model Au = Australia ♦ au cn = China ♦ fi fi = Finland Market ♦ jp ♦ fr fr = France Orientation de = Germany in = India jp = Japan kr = Korea sg = Singapore se = Sweden tw = Taiwan uk = United Kingdom Low us = United States Low Open Governance High Orientation 4 The categorisation below describes these clusters in terms of three ‘ideal-typical models’ that synthesis, on the basis of an unstructured and qualitative assessment, the dimensions considered in our research: 1) The “Independent Marketer”, matching the cases of Germany and UK, can be characterised as follows: Only informal relations with the government Rate commercialisation high among policy priorities… …but does not overlook the generally defined public interest Fully deregulated in terms of restriction on applicants Fully transparent and fairly open 2) The “Government Marketer”, matching the cases of China and India, can be characterised as follows: Government operated Rate high both the commercialisation the generally defined public interest high among policy priorities Fully deregulated in terms of restriction on applicants Not very open and transparent 3) The “Intermediate Model”, matching perfectly only Australia and Canada and to some extent other profit (Japan) and not for profit registries (France, Sweden) can be characterised as follows: Is a not for profit organisation endorsed by, and accountable to, a specific law Rate high both the good governance and the generally defined public interest high among policy priorities… …a bit less high commercialisation Fully or partially regulated in terms of restriction on applicants Fully transparent and open These three models highlight a number of possible choices to be considered in the option appraisal phase of the study and also some key dimensions that the OGCIO may want to study further for a few countries (one per model), for which the desk research may be integrated with more in depth analysis through interviews with stakeholders and experts. 5 1. INTRODUCTION 1.1 Background The Office of the Government Chief Information Officer (OGCIO) of the Government of the Hong Kong Special Administrative Region Government aims to review the institutional framework and corporate governance for the administration of Internet domain names in Hong Kong in order to make recommendations with implementation proposals on how the existing framework and arrangements can be improved. Since the governance and administration arrangements for the .hk domain were put in place, there have been a number of developments which may impact on them. First of all, an increasing importance of national governments role, as the proportion of ccTLD domain name registrations have continued to grow reaching in 2005 about 40% of the total number of registered domains worldwide1. So the question of the role of national governments within the administration of national domain names has moved to the forefront. Second, changes to Internet governance at global level, with significant debate particularly on the role of ICANN. Third, an evolving though fragmented understanding of what constitutes good practice in ccTLD governance and administration. Fourth, new challenges raised by technological changes for national ccTLD governance regimes. These factors amount to a significant change from the environment in which the current Hong Kong domain name administration arrangements were established. Against the context of environmental change described above, the OGCIO has set the objectives for the study that are listed in Figure 1 below. Figure 1: Study Objectives (a) understand the interest and expectation of the