Voluntary code of conduct is a good first step to improving the domain broker ecosystem.
The Internet Commerce Association (ICA), a trade association for domain investors and related businesses, has published its voluntary broker code of conduct.
Domain brokers met at the ICA meeting in Las Vegas in January to discuss and create the code of conduct. At this time, it’s completely voluntary for brokers who are ICA members. Those who agree to adhere to the code will get a designation on the ICA website.
Currently, ICA is not getting involved in disputes with domain brokers regarding the code.
The code of conduct is a step in the right direction. While many domain brokers have upstanding ethics, others give the industry a bad name. Here are some scenarios that I’ve heard happen repeatedly:
- Domain Broker A advertises its client’s domain for sale. Domain Broker B says it has a buyer when it doesn’t, then it shops the domain to its client list (and sometimes at a higher price).
- A domain broker plays both sides of the transaction, charging the buyer a different price than the seller is told the domain sold for.
- A domain broker claims that a client is looking for a particular type of domain and asks people to submit their names. The broker then tells the domain owners that the buyer isn’t interested in their name, but the broker would like to represent the domain. There isn’t really a buyer; it’s just an attempt to get more domains under an exclusive contract.
- A domain broker tries to sell a domain it doesn’t own without making it clear to the prospect that it isn’t representing the domain owner. This sometimes comes up in UDRP cases in which the Complainant claims that the domain owner’s broker reached out trying to sell the domain to it.
The code of conduct addresses some of these issues. For example, it states:
Unless I have written authorization from the buyer, seller, or owner of a particular domain name, I shall not represent that I act for or on behalf of the buyer, seller or particular domain name, respectively. If I am soliciting interest for my services as a broker with respect to a domain name which I am not authorized by the domain name owner to represent on their behalf, I shall include in my initial outreach the following statement, “I am not acting for the domain name owner, nor am I authorized by the domain name owner to do outreach on this domain name”, and the statement shall be included in a prominent manner such that it will be noticed by the recipient.
I shall not represent both the buyer and seller in respect of the same domain name unless I have obtained the client’s consent and have disclosed the dual agency to the client.
The code of conduct is a good first step in improving the domain broker ecosystem.
Unless you have a process with consequences, people won’t abide by this. The internet is littered with false broker claims.
Trying to regulate and unregulated industry (domain name industry) won’t succeed.
A real estate broker has to be licensed, insured and bonded. We pay fees to ICANN etc and I have yet to see how it benefitted my business business.
Time for these organizations to start treating domain names as an aftermarket industry.
Also, time for new blood in this industry as well.
Andrew Allemann says
It’s just the first step. They might add consequences in the future. But there’s only so much you can do in a membership organization like this. They don’t regulate the domain business.
CS Watch says
Could crowdsource a lawsuit, i.e., GoDaddy knows ACPA law in and out—they have in-house legal, decades of UDRP appearances, and on-site UDRP-strategic continuing broker education. They are inviting suit for tortious interference on losses like PRU.COM. https://www.azbuslaw.com/aop/phoenix-litigation/tortious-interference/
The PRU.COM registrant, after ignoring GD’s emails, gets a phone call from a GD broker and says that he needs to know the identity of the buyer. GD already puts registrants at risk via their default landing pages, which imply that the name is for open sale to the public. The PRU.COM owner didn’t put his name on file with the GD reseller platform, he was just a registrant. It is tortious interference for a GD broker to hear that registrant’s phone statement REQUIRING offeror identity, and then pretend he doesn’t know full well that that means ‘my domain is not for sale to a TM holder with rights that pre-date.’ The registrant was adhering to ‘the ultimate legal rule of that broker’s trade’ in saying, ‘No, you can’t have a price term, and you must tell me who’s asking.’
The GD broker had a duty to stop cold upon the GD registrant’s offeror identification requirement–not play dumb and fish for a comment on valuation he can trot back with as if he’s been empowered to negotiate.
Agree that this is a good, worthwhile start. The biggest problem, of course, is that the most problematic brokers are not now and will never be members of the ICA.
With that in mind, domain owners / buyers could (should) choose to only work with brokers who are ICA members.
Snail Mucin says
Don’t see this doing much but good to have a framework.
Dan Cera says
A registrar code of conduct that would stop registrars like GoDaddy (an ICA member) from placing infringing ads on the landing pages of their clients domain names is likewise required! If Brokers have an obligation to their clients so should registrars. Can you imagine buying a domain name on GoDaddy auctions and mere weeks later being served with a UDRP. This is exactly what happened recently with sandels.com a case which is going to shed light on some of GoDaddy very unsavoury and predatory practices
Andrew Allemann says
If you’re talking about registrars placing PPC links on domains, that is a widespread practice that many registrars use. This has come up in previous UDRP decisions. Also, the practice of saying this domain might be for sale has come up.
This mostly is an issue with end users because most domain investors quickly switch over to a lander.
If this happened within weeks of buying the domain then you have a pretty good case.
Any member of the ICA can suggest a registrar code of conduct.