Can registries reclassify your domain as premium before renewal?

A reader asks about registries moving domains into premium pricing.

Domain Name Wire reader Collin Love reached out to me recently with a question about premium domains in new top level domains.

Premium domains are those priced higher by the registry. Most premium domains come with a higher initial registration fee and higher renewals.

Collin was lucky enough to register a lot of great .xyz domain names (e.g., advertise.xyz, encryption.xyz, hub.xyz) before the registry implemented premium pricing on the best names. He wrote:

I have been lucky enough to avoid this “premium” mess as all of my .XYZ domains have the registry’s default pricing (which, based on my registrar invoices, appears to currently be $8.56 per year). However, I recently had a prospective buyer ask me if the .XYZ registry could ever change the pricing of an extant default-priced .XYZ domain from the registry default to somewhere in the “premium” price bracket.

The buyer’s concern is if they acquire the domain from Collin and the registry later reclassifies the domain as a premium with higher renewal prices.

The answer to this question is in section Sec 2.1.c of the registry agreement. Here’s the relevant section:

(c) In addition, Registry Operator must have uniform pricing for renewals of domain name registrations (“Renewal Pricing”). For the purposes of determining Renewal Pricing, the price for each domain registration renewal must be identical to the price of all other domain name registration renewals in place at the time of such renewal, and such price must take into account universal application of any refunds, rebates, discounts, product tying or other programs in place at the time of renewal. The foregoing requirements of this Section 2.10(c) shall not apply for (i) purposes of determining Renewal Pricing if the registrar has provided Registry Operator with documentation that demonstrates that the applicable registrant expressly agreed in its registration agreement with registrar to higher Renewal Pricing at the time of the initial registration of the domain name following clear and conspicuous disclosure of such Renewal Pricing to such registrant, and (ii) discounted Renewal Pricing pursuant to a Qualified Marketing Program (as defined below). The parties acknowledge that the purpose of this Section 2.10(c) is to prohibit abusive and/or discriminatory Renewal Pricing practices imposed by Registry Operator without the written consent of the applicable registrant at the time of the initial registration of the domain and this Section 2.10(c) will be interpreted broadly to prohibit such practices.

This section states that the renewal pricing must be the same for all domains. There is an exception that allows registries to charge a higher renewal price for premium domains:

The foregoing requirements of this Section 2.10(c) shall not apply for (i) purposes of determining Renewal Pricing if the registrar has provided Registry Operator with documentation that demonstrates that the applicable registrant expressly agreed in its registration agreement with registrar to higher Renewal Pricing at the time of the initial registration of the domain name following clear and conspicuous disclosure of such Renewal Pricing to such registrant…

Domains can have premium annual renewals as long as the registrant is told about the premium renewal upfront. Registries that offer premiums with this model require registrars to tell registrants this when they register the domain.

The last sentence in the quoted text emphasizes what the reader is concerned about. ICANN is clear about why the registry contract includes a restriction on charging more for a domain renewal than other domains if it’s not marked premium when it is registered:

The parties acknowledge that the purpose of this Section 2.10(c) is to prohibit abusive and/or discriminatory Renewal Pricing practices imposed by Registry Operator without the written consent of the applicable registrant at the time of the initial registration of the domain and this Section 2.10(c) will be interpreted broadly to prohibit such practices. (emphasis added)

ICANN doesn’t want a registry to be able to say, “Gee, someone invested a lot of money in building a site on this domain, so let’s charge a lot to renew it because they’ll have no choice but to pay.”

So the answer to Collin’s question is no, a registry cannot decide the domain you registered at standard prices should be moved to a premium tier when you renew it.

Registries can change the base price for renewals, though. Some registries have jacked up prices but, in all of the cases I’m aware of, the registry grandfathered existing registrations.

Also, if a domain name expires and drops, the registry can apply a premium to the next registrant. Two examples of registries applying premiums to dropped domains include .co and .xyz.