Domain Resale Code of Ethics

In the face of the rising tide of domain name squatting, which deprives all but the best-funded enterprises and individuals of the use of uncounted thousands of domain names, I hereby propose a code of ethics for reselling domain names. Comments and suggestions are welcome on the discussion page.

Wherefore

Domains of interest to multiple parties should not be used for trivial purposes, such as revenue generation through pay-per-click advertising without any useful content. It is in the interest of minimizing the wasteful use of such domains that the following rules are proposed.

Proposed Rules

(revised 2006-03-27)

• Domain names may also have a set asking price, and be retained by the seller until another party offers to buy at the set price; however, this price should not be in excess of twice the amount invested in the domain's registration (i.e. the total of all registration fees paid for the domain by the seller).
• Domain names may be sold at auction, as this allows the marketplace to set a fair price; someone who has paid a substantial amount for a domain is unlikely to use it for trivial purposes. The auction reserve or initial asking price should not be higher than the set price given above.
• The seller may make efforts to ensure that the domain will be used as the home for a site that is substantially useful, rather than just being resold to the highest bidder, but this is not required.
• A domain name that is not being used purposefully should not be retained for longer than (say) two years; it should either be auctioned, its registration not renewed, or its resale price should be set significantly lower than the maximum described above. (This part needs some work.)

Notes

• In the early days, when InterNIC was the only domain registrar, initial registration for all TLDs was $100 ($50/year, two years' initial registration required).
• Need to come up with a more detailed definition/description of what constitutes "purposeful" vs. "exploitative" uses of domain names

Issues

• Enforcement: Once we have a code which seems reasonable to most people, how do we get domain resellers to adopt it? A number of tools suggest themselves, though I'm sure there are some I haven't thought of:
  • A banner which only conforming sites may use (much like banners provided by other trust-enhancing services)
  • A whitelist of resellers known to follow the spirit of the code
  • A blackist of resellers known not to follow the spirit of the code