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Applicant Support Program

NCUC Issue Forum

(Experimental workshop)

In collaboration with:

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Welcome to the NCUC Issue Forum!

To the participants:

(You were designed with a category representing organizations or groups who can apply for the Applicant Support Program)

Please share a real example of your category.

(Wisdom)

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Introduction

What is the purpose of this (experimental) workshop as an NCUC Issue Forum?

Creating new leaders regarding the ASP so they can be propagation agents within their local communities and networks: Noncommercial guiding non-commercial
Various presenters, 5 min explanation of each section of the ASP Handbook, giving an overview

(Pedro)

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What is the ASP?

A program that provides assistance to eligible entities who need to apply for a new gTLD:

financial, mostly related to reduction of fees (when applying and when operating) and
non-financial assistance, mostly around guidance and capacity building in different formats

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ASP and Next Round

ASP and the New Generic Top-Level Domains: Next Round

Next Round gives a possibility of applying for new top-level domains with longer lengths and different scripts, expanding the DNS
Different, but connected - ASP is part of Next Round, but we have two different applications
Final Report SubPro: “The Working Group affirms that the primary purposes of new gTLDs are to foster diversity, encourage competition, and enhance the utility of the DNS”

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Thank you for joining our experimental workshop!

The idea that we can work through a new document together – take pieces of it, study them, and share them is a powerful concept.

Thanks to Pedro, Michaela, Frank, Houda, Emmanuel and Bolu – and Benjamin!

(Kathy Kleiman)

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The final Applicant Support Program (ASP) Handbook is out and the Applicant Support Program will open November 19^th!

=> ICANN Staff worked very hard to incorporate our comments and create Handbook with readable text, great graphics and useful checklists!

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My piece of today’s puzzle:

Why would an organization apply for a New gTLD and be a successful and sustainable New gTLD Registry?

(Very briefly)

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What does a Registry do?

At the technical level?
At the operational level?
At the financial level?

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At the Technical Level:

“The role of the registry operator within the Internet ecosystem is to keep the master database of all domain names registered in each top-level domain (TLD) and generate the "zone file" that allows computers to route Internet traffic to and from TLDs anywhere in the world.”

Welcome Registry Operators, https://www.icann.org/resources/pages/registries/registries-en

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At the Operational Level: Can Registries sell their domain names themselves?

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At the Operational Level: Can Registries sell their domain names themselves?

No. “All domain name registrations in the TLD must be registered through an ICANN accredited registrar.”

ICANN’s Base Registry Agreement, https://itp.cdn.icann.org/en/files/registry-agreements/base-registry-agreement-21-01-2024-en.html

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More Operational Activity:

Domain name acceptance: Many Registries must convince Internet Service Providers (ISPs) and Webhosts to recognize their gTLD string – the quest for “universal acceptance.”

DNS Abuse Mitigation and Abuse Contact: gTLD Registry Operators must publish a domain name abuse contact with accurate contact details including a valid email address or webform, and mailing address, for the person who handles reports about malicious conduct in the gTLD.

Monthly reporting: Registries provide Detailed Reports to ICANN each month, including all domain names created, renewed, transferred, and deleted.

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Financial Obligations:

In addition to paying for its own officers, marketing, financial, security and legal support, and offices, a registry must pay ICANN:

25 cents for each domain name registered, and
An annual Registry Fee of $25,000 ($6,250 each quarter).

… and these fees are going up soon.

(With some reduction for ASP Grantees – details TBD)

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So New gTLD Registries need good plans to be successful and sustainable registries!

Now passing to Michaela!

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Who is eligible for the Applicant Support Program?

Nonprofit, charity or equivalent organization
Intergovernmental organizations (IGOs)
Indigenous / tribal peoples’ organization
Micro or small businesses social enterprise
Micro or small business operating in a less-developed economy

(by Michaela N. Shapiro)

The ASP aims to serve the global public interest by fostering diversity, encouraging competition, and enhancing the utility of the DNS

The intent of the ASP is to make the New gTLD Program application and evaluation processes and fees more accessible to entities that would like to operate a registry but would otherwise be unable to apply, because of financial and resource constraints. ASP applicants that qualify will receive percentage-based reductions on the base gTLD evaluation fee and other gTLD evaluation fees

IGO: defined as (i) an ‘Intergovernmental organization’ having received a standing invitation, which remains in effect, to participate as an observer in the sessions and the work of the United Nations General Assembly; or (ii) a Specialized Agency or distinct entity, organ or program of the United Nations

Examples: support to ensure others have a fighting chance (ex: .amazon; .cherokee)

4) micro or small business social enterprise; 5) micro or small business operating in a less-developed economy

Pro bono service

Operating a gTLD is a technology-based service
comprised of many requirements and expenses, such as acquiring equipment, establishing operations, hiring and training staff and providing customer service.
connect potential applicants who wish to establish a new public interest gTLD registry in their community with organizations who wish to offer either financial or non-financial assistance

Reduced fee

reduced evaluation fee of USD $47,000 instead of the full evaluation fee of USD $185,000.

Eligibility entity determination: social impact or public benefit micro/small-sized business

Has fewer than 50 employees; total assets less than 5 million USD; annual sales less than 5 million USD

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Why is this important?

Freedom of Expression

New gTLD's enable communities and organisations to express their affiliations
Enable new voices to join the internet ecosystem
Free and fair use of domain names (the right to use all words/names) rights

Increasing Representation on the Internet

Aiming to reduce financial burden
Ensuring diversity (linguistic, cultural, geographic, etc.)
Preventing online censorship
Increasing competition // choice in the domain name market

Entrepreneurship. Create your own business model and establish accessibility policies for your TLD. If your customers want tighter security, make your TLD a high-security zone.

Increased control. You set the rules and the price for those registering your TLD.

Ongoing revenue stream. Your customers could renew their domain names year after year.

Innovative marketing opportunity. Build better brand definition, brand awareness, brand loyalty and trust by having full control over your own TLD.

Innovative business models. When new gTLDs combine with other emerging Internet technologies, such as IPv6, RFID chips, and cloud computing, new products and services are possible.

Internationalized Domain Names (IDNs). Increase market reach by making the Internet completely accessible to users whose local languages use non-Latin characters.

Engage your community. Create a rallying point for supporters of your cause, community or culture to unite with a community-based TLD.

Bring together your geographic area. Celebrate your local citizens, commerce, activities, and culture with a geographic TLD.

Relevant HR Instruments

“Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.” - UDHR, Article 19
“Everyone shall have the right to hold opinions without interference.” ICCPR, Article 19(1)
“Everyone shall have the right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of his choice. - ICCPR, Article 19(2)

Free and fair use of domain names: New gTLD's enable communities and organisations to express their affiliations through their domain names such as .gay or .community, and therefore have FoE implications.

New gTLD subsequent procedures: How gTLD applications are reviewed and vetted has implications for FoE, particularly when it comes to ensuring diversity and preventing online censorship (examples include opposition by governments on the grounds of public interest - as in the case of .catholic or .islam, or the potential for automatic censorship of domain names blacklisted by governments - regardless of the location of registration).

Through their domain names such as .gay or .community, and therefore have FoE implications

Examples include opposition by governments on the grounds of public interest - as in the case of .catholic or .islam, or the potential for automatic censorship of domain names blacklisted by governments - regardless of the location of registration

Newly formed entities,”and those organizations “in jurisdictions that do not provide readily available information.” In its contribution to the second proceeding for Proposed Language for Draft Sections of the Next Round Applicant Guidebook, the NCSG called on the IRT to create these rules and equivalencies as soon as possible, and in all events for this next and upcoming rounds of New gTLDs to achieve the clear language and purpose and goals of SubPro Recommendation 22.4 for all entities named, not only the world’s largest.

NCSG also called for ICANN to provide flexibility also for noncommercial organizations and indigenous peoples which, consistent with SubPro Final Recommendation 22, may not look like US non-profit organizations (educational and charitable US non-profits being classified under a section of the US tax codes), but are nevertheless important and legitimate organizations whose applications we are seeking and have committed to fairly reviewing and evaluating. We call on the IRT to write express rules for the Background Screening of the broad and international range of organizations that ICANN hopes will apply for the Applicant Support Program (ASP). It would be utterly unfair and disheartening for these entities to be accepted into the ASP only to be disqualified on technicalities in the Background Screening.

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Overview of Eligibility and Equivalency Determination

Eligibility for ASP – Nonprofit Equivalency Requirement:

U.S. nonprofits enjoy special 501(c)(3) tax-exempt status, allowing donors to claim tax deductions.
Non-U.S. organizations must prove they are equivalent to U.S. 501(c)(3) nonprofits to be considered eligible under ASP’s “nonprofit or charity” category.

(Frank Anati)

Must meet one of three criterion for nonprofit/charity/equivalent

The organization must be a registered, recognized nonprofit, nongovernmental, and/or charitable organization with relevant regulatory authority
The organization must have a current, valid Equivalency Determination certificate completed by a qualified tax practitioner.
If the applicant does not meet a) or b) requirements, then it needs to respond to the following questions c) through i) to determine nonprofit / charitable status.

Does the applicant certify that it is organized for charitable purposes by showing that it has recognized legal status in its respective country
If applicable, does the applicant certify that it is primarily engaged in activities that are charitable, defined as at least 85% of its overall operational resources, are dedicated to accomplishing one or more charitable objectives?
If applicable, does the applicant certify that on dissolution, its assets will be transferred for charitable purposes?
If applicable, does the applicant certify that it does not engage in political activities or political campaigns for public office, including supporting political campaigns, raising funds for political candidates, making campaign contributions, publicly supporting or opposing political candidates, posting partisan messaging online, comparing the applicant’s stance on an issue to a political candidate’s views?
Organization certifies that its net assets do not benefit any private persons

Pro bono services

Operating a gTLD is a technology-based service
comprised of many requirements and expenses, such as acquiring equipment, establishing operations, hiring and training staff and providing customer service.
connect potential applicants who wish to establish a new public interest gTLD registry in their community with organizations who wish to offer either financial or non-financial assistance

Reduced fee

reduced evaluation fee of USD $47,000 instead of the full evaluation fee of USD $185,000.

Eligibility entity determination: social impact or public benefit micro/small-sized business

Has fewer than 50 employees; total assets less than 5 million USD; annual sales less than 5 million USD

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Proving Nonprofit Eligibility for ASP

ASP Handbook Compliance:

Primary Route: Meet ASP Handbook’s eligibility criteria by providing documentation as a recognized nonprofit, charity, or similar organization in your country.
Alternative Route: Non-U.S. applicants without local nonprofit recognition can provide a certified Equivalency Determination .
Alternate Route: Upload governing documents in the ASP Application System, if applicant certify that it is organized for charitable purpose.

Steps for Equivalency Determination :

Conducted by a licensed U.S. tax practitioner (e.g., attorney, accountant).
Organizations like NGOsource provide ED services, confirming if a foreign nonprofit operates with purposes and restrictions similar to U.S. 501(c)(3) entities.

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Equivalency Determination Benefits and Key Takeaways

Why Equivalency Determination Matters:

Establishes credibility and ensures compliance with ICANN’s ASP nonprofit criteria.
Provides confidence to ICANN and donors that the applicant organization serves a public good and aligns with U.S. charitable purposes.
Resources:
ASP Handbook: Outline of the full application process, eligibility, and requirements.
Equivalency Determination Providers: Organizations like NGOsource can facilitate ED, enhancing the application’s standing for ASP.

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General Business Due Diligence

Support Applicant Review Panel

Evaluation

Review

General Business Due Diligence is about Legal compliance review, submission check of all required documents, satisfaction of eligibility criteria of the new gTLD program, Background screening.

Phases

(Dr Houda CHIHI)

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General Business Due Diligence: Steps�

Completeness (Documents) Check

General Business Due Diligence

Legal Compliance Check

Organizational Check of the Applicant

Background Screening

https:/newgtlds.icann.org/en

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Legal Compliance Check

Applicant acknowledgment that ICANN have to follow all applicable U.S. regulations and laws, including the economic sanctions administered by the Office of Foreign Assets Control of U.S. Regulations.

Completeness Check

Submission of the required documents during the process of ASP, which will be reviewed by ICANN
If documents are missing there will be a possibility to submit them.

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Applicant Support Program: Next Round Organizational Check

1. Good corporate standing meeting applicable regulations and laws
2. Applicant should not have any convictions of fraud, crimes or subject to any kind of judicial determination
3. No problems related to funds misuse or taxes issues.
4. No connection with organized crime
5. No problem with cybersquatting or intellectual property infringement

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Background Screening

Background Screening is requested as it is about a independent third-party assessing risk and eligibility confirmation for both individuals and organizations.
Review of documents submitted and searching for other evidences that could be relevant
The result of Background Screening ensures the approval or rejection of the application.

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Purpose of financial need test:

ICANN requires applicants to demonstrate that paying the full gTLD fee would be financially challenging.

Criterion: Demonstrating financial hardship to pay the full gTLD fees

- Applicants must describe how the financial support from ICANN enables the application process for the gTLD.�- Additionally, they need to justify why paying the full gTLD evaluation fee (e.g., $250,000) presents a financial hardship.

Example: Indigenous language preservation organization

- A nonprofit dedicated to preserving Indigenous languages through digital archiving.�- With an annual budget of $200,000 from grants, this nonprofit cannot cover the full gTLD evaluation fee, which exceeds 100% of their yearly funding.

Financial Need Requirements

(Emmanuel Vitus)

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Documentation & Indicators

Required financial documentation:

- Applicants must provide audited financial statements from the last two fiscal years.�- Documentation should include: Balance Sheet, Profit/Loss Statement, Cash Flow, and Equity Statements, and others.

Eligibility indicators for financial need:

- Annual revenue should be ≤ $5 million, with cash and cash reserves ≤ $5 million.�- Ownership: Entity must not be owned or controlled by a for-profit organization that exceeds the financial criteria.

Example: Environmental conservation NGO

- A small nonprofit focused on promoting eco-friendly practices, with an annual revenue of $300,000 and $20,000 in cash reserves.�- Applying for a gTLD to enhance community engagement, the $250,000 gTLD fee is financially prohibitive and represents 80% of its budget.

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Detailed Requirements

Purpose of financial viability test:

To ensure that applicants can cover any unsupported costs associated with the gTLD evaluation process, ICANN requires applicants to demonstrate financial viability.

Criterion: Ability to cover unsupported portion of gTLD Fee

- Applicants must submit a narrative or funding plan explaining how they will fund the portion of the gTLD fee not covered by ICANN.�- Documentation can include revenue sources such as donations, partnerships, or internal reserves.

Example: Low-budget educational nonprofit

- This nonprofit offers free digital literacy classes and relies on local donations and volunteer support.�- Plans to fund the gTLD application through a combination of community donations and partnerships with local businesses.

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Commitment Deposit and Key Indicators - Expanded Example

Commitment deposit requirement:

- Upon conditional approval, applicants must submit a $2,500 deposit to demonstrate their commitment to the gTLD application process.

Key Indicators for financial viability:

- Ability to clearly outline funding sources for any unsupported gTLD fees.�- Adherence to the deposit requirement as a show of financial commitment and readiness.

Example: Educational nonprofit commitment plan

- With $50,000 in annual funding, this organization dedicates part of its reserves for the deposit.� - Additional funding comes from community fundraising events planned specifically to support the gTLD initiative.

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Application Support Program

Phase 2

Phase 1:�There are no payments required to enter into the Phase 1 of the Applicant Support Program.��This includes the General Business Due Diligence and Public Responsibility Due Diligence stages.

What Are The Costs Involved?

Phase 2:�Financial Need Criteria and Financial Viability Criteria already explained.��A financial viability deposit of $2,500 is required as part of the Financial Viability Criteria.

Application fee for the next round GTLDs is - $227,000

(Bolutife Adisa)

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Application Support Program

11 November, 2024

What Are The Costs Involved?

If ASP reduction is 75% of $227,000 = $170,250�Applicant pays (Max) = $56,750

If ASP reduction is 85% of $227,000 = $192,950�Applicant pays (Min) = $34,050

*Cost reduction will vary fron 75% to 85% based on the number of Successful Applicants

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Small groups discussion!

What do you think would be the main challenges for the applicant you are representing?

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Congratulations!

After several months you learned your ASP application was successful!

Now, what comes next?...

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How will ICANN support ASP successful applicants?

Marika Konings (VP, New gTLD Program Lead)

What does the non-financial support look like to help applicants prepare their New gTLD Application?
What is ICANN doing to reach the communities represented in this workshop?
And how can NCUC and NCSG help?
Other questions

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Thanks!

(Should the conversation continue in Seattle?)