Approved Resolutions | Regular Meeting of the ICANN Board | 10 November 2024

Rationale for Resolution 2024.11.10.01

After careful review of the Final Declaration in the Namecheap, Inc. v. ICANN Independent Review Process (Namecheap IRP), the Namecheap IRP Panel's recommendations, the Economic Report, the Namecheap Letter, the Supplemental Report, the public comments received in 2019 regarding the 2019 .INFO and .ORG Registry Agreements, the Board Accountability Mechanisms Committee's (BAMC) analysis and recommendations, as well as other relevant information, the Board has determined that the 2019 .INFO and .ORG Registry Agreements will be maintained without price control provisions. The Board also notes the Namecheap IRP Panel's recommendation that ICANN consider whether further clarity with respect to ICANN's decision-making and public comment processes might be useful, and the Board is directing the Interim President and CEO, or her designee(s), to consider whether further clarity regarding ICANN's decision-making and public comment processes would be beneficial, recognizing that there are Bylaws provisions and ICANN procedures already in place that provide guidance regarding the roles of the Board and ICANN org as well as regarding the public comment process.

Background Information

Namecheap, Inc. (an ICANN accredited registrar) initiated an IRP in February 2020, challenging, among other things, the lack of price control provisions in the 2019 .BIZ, .INFO, and .ORG Registry Agreements. The IRP Panel issued its Final Declaration on 26 December 2022.

IRP Panel's Final Declaration:

In terms of requested relief, Namecheap had urged the IRP Panel to reimpose price controls in the 2019 Registry Agreements for .BIZ, .INFO, and .ORG. The Panel did not grant the requested relief, noting that such an "order" is not within an IRP panel's remit.

The IRP Panel determined that Namecheap had "prevailed on some, but not all of its claims." (Final Decl., ¶ 451.) The Panel determined that: (i) Namecheap failed to prove that the removal of the price controls amounted to discriminatory treatment under the Bylaws; and (ii) several of Namecheap's claims were untimely, including all claims involving .BIZ.

The Panel also concluded that Namecheap prevailed on certain claims regarding the lack of price control provisions in the 2019 Registry Agreements for .INFO and .ORG, finding that: (i) ICANN did not reach its renewal decisions regarding the .INFO and .ORG Registry Agreements in an open and transparent manner; (ii) ICANN's renewal of these legacy agreements involved a policy decision to be made by the ICANN Board rather than the ICANN organization; and (iii) ICANN did not comply with the procedural requirements for ensuring that it promotes the global public interest and acts for the benefit of the Internet community as a whole.

IRP Panel's Recommendations:

In light of its declarations and its view that the noted violations "are procedural rather than substantive in nature," "[t]he Panel's overall recommendation is that the ICANN Board analyze and discuss what steps to take to remedy both the specific violations found by the Panel, and to improve its overall decisionmaking process to ensure that similar violations do not occur in the future." (Final Decl., ¶ 493.) The Panel also recommended that the Board consider taking the following actions: (1) decisions as to how to implement the Panel's declarations should be made by the Board; (2) consider implementing a process to conduct further analysis as to whether including price control provisions in the .INFO and .ORG Registry Agreements is in the global public interest that encourages participation of diverse stakeholders in an open and transparent manner; (3) consider remedial measures as to both .INFO and .ORG, but noted that the measures for .ORG may be stronger than for .INFO; (4) retain an economist to study whether .INFO and .ORG have sufficient market power that price control provisions may be desirable (or explain the reasons for not retaining an economist); (5) if the Board concludes that some form of price controls for .INFO and/or .ORG are in the global public interest, ICANN should seek to amend those 2019 Registry Agreements to include appropriate price controls; (6) the Board "may wish to consider approaching" the .INFO and .ORG registry operators about agreeing to some form of price controls, even before evaluating whether price caps are needed; and (7) consider "revisions to ICANN's decisionmaking process to reduce the risk of similar procedural violations in the future[,]" such as "adopt[ing] guidelines for determining what decisions involve policy matters for the Board to decide, or what are the issues on which public comments should be obtained." (Final Decl., ¶¶ 497-504.)

In explaining its recommendations, the Panel reiterated that Bylaws "Section 4.3 draws a clear distinction between the Panel's power to 'declare' and its power to 'recommend.' An IRP Panel may 'declare' that ICANN action violates the Articles and Bylaws, but can only 'recommend' that ICANN take specific action." (Final Decl., ¶ 472.) In accordance with the Bylaws, the Panel explicitly stated that it "will only declare whether ICANN violated the Articles and Bylaws, and will limit itself to recommending (not ordering) remedial action to the extent a violation is found." (Final Decl., ¶ 482; see also, Final Decl., ¶¶ 473-475, 483, 497.) The Panel also stated that: "While providing recommendations is consistent with the purpose of the independent review process, the Panel notes that it has no expertise or experience regarding the internal operations of ICANN, or with the diverse stakeholders in the global Internet community, aside from information presented in this proceeding. Thus, the Panel's recommendations are directed at identifying issues and measures that ICANN should consider and analyze further, in consultation with the Internet community." (Final Decl., ¶ 492.)

Board Resolution and the BAMC's Consideration and Recommendations

At its 11 June 2023 meeting, the Board:¹

• "[D]irect[ed] the Interim President and CEO, or her designee(s), to retain an economist to provide input regarding the current domain name system (DNS) marketplace with respect to the market power of .INFO and .ORG;" and
• "[A]sk[ed] the BAMC, following its receipt and consideration of the economist's input, to provide the Board with its findings and recommendations as to next steps."

Pursuant to the Board's 11 June 2023 resolution, ICANN retained Gregory K. Leonard, Ph.D., an economist with Charles River Associates, a globally recognized economic consulting firm, to provide input regarding the current DNS marketplace with respect to the market power of .INFO and .ORG. Dr. Leonard prepared a report addressing the issues identified in the Board's resolution (Economic Report) (summarized below), which was provided to the BAMC. At its 22 February 2024 meeting, the BAMC decided that it would be prudent to provide Namecheap with an opportunity to submit a response to the findings in the Economic Report. ICANN posted the Economic Report and the BAMC sent a letter to Namecheap, providing a link to the Economic Report and an opportunity for Namecheap to submit a written response to the Economic Report. Namecheap submitted a letter response on 15 April 2024 (Namecheap Letter), reiterating many of the same arguments that Namecheap raised in its IRP with regard to price control provisions and critiquing certain aspects and conclusions of the Economic Report (summarized below). In light of ICANN's transparency obligations and in an effort to address the IRP Panel's recommendations, the BAMC directed ICANN org to ask Dr. Leonard to provide a supplemental written response addressing the comments raised in the Namecheap Letter. On 31 August 2024, Dr. Leonard issued a written supplemental report responding to the Namecheap Letter (Supplemental Report) (summarized below).

Overview of the Economic Report

In accordance with the Board's 11 June 2023 Resolution, ICANN retained Dr. Leonard "to provide input regarding the current domain name system (DNS) marketplace as it relates to the market power of .INFO and .ORG." Dr. Leonard provided his Economic Report on 14 February 2024, entitled "Economic Analysis of Whether .info and .org Possess Market Power." Based on his extensive review and analysis of the DNS marketplace, market economies, the history of .INFO and .ORG registration pricing, and competitive market forces and other factors within the DNS marketplace, Dr. Leonard reached the following conclusions in his Economic Report:

• Dr. Leonard explained that, for the various reasons detailed in the Economic Report, "price controls are disfavored in market economies except in narrow circumstances where a firm has substantial and durable 'market power'—the ability to charge a price significantly above the competitive level for an extended period of time."

• After evaluating four years of registration pricing for .INFO and .ORG following the 2019 Registry Agreement renewals, Dr. Leonard found that "[d]uring that time, contrary to what would have been expected had the price control provision been constraining the wholesale registration prices of .info and .org, we did not see those prices increase significantly. Rather, the .org price has not increased at all and the .info price has not increased more than the price control provision would have allowed, had it been in place. In the absence of the price control provision, the wholesale registration prices for .info and .org were almost certainly constrained during the last four years by competitive market forces and other factors. Thus, the historical experience is consistent with .info and .org not having substantial and durable market power."

• Dr. Leonard further concluded that .INFO and .ORG have faced increasing competition from other TLDs over time, and that other TLDs have been growing in terms of registrations while registrations in .INFO and .ORG have fallen over time. Dr. Leonard also found that "the wholesale registration prices for .info and .org have been in line both with inflation as well as the registration prices of other TLDs," and that "market factors would constrain .org or .info from engaging in opportunism, such as by increasing renewal prices." All of which further indicated to Dr. Leonard that .INFO and .ORG do not possess substantial and durable market power.

• Dr. Leonard opined that, because PIR is a not-for-profit entity, it "would be contrary to PIR's stated goals to increase its registration price excessively by exploiting any market power it possessed."

• Dr. Leonard further noted that the above-mentioned factors (as explained in the Economic Report) "mean that registrars as well as registrants are protected from excessive wholesale price increases." Dr. Leonard went on to explain that "in addition[,] registrars have incentive and ability to pass on wholesale price increases to retail prices without losing many customers. This provides further protection to registrars from any adverse impact."

• Dr. Leonard further concluded that there is "no reason to believe that the lack of substantial and durable market power for .org and .info will change in the future."

Overview of Namecheap's 15 April 2024 Letter Responding to the Economic Report

Namecheap submitted a letter on 15 April 2024 in response to the Economic Report (Namecheap Letter). The Namecheap Letter reiterates many of the same arguments that Namecheap raised in its IRP regarding price controls as well as lodges several specific critiques regarding certain aspects and conclusions of the Economic Report, including but not limited to the following:

• Namecheap alleged that the Economic Report failed to comply with the IRP Panel's recommendation because it "is not a formal and detailed study of the extent of market power of .ORG and .INFO and fails to address a number of points that Namecheap made about .ORG's special market power."

• Namecheap alleged that the Economic Report lacked transparency because it purportedly did "not reveal the questions that ICANN asked [Dr. Leonard] to examine" and Namecheap asserted that the Economic Study is "biased" and "not analytical."

• Namecheap alleged that the Economic Report is flawed because there was "no detailed analysis of the market, no estimate of demand curves or analysis of cross-elasticities of demand, and no proper analysis of available close substitutes." Namecheap also claimed that Dr. Leonard ignored the likely reason why the .ORG and .INFO registry operators have not increased prices (namely, according to Namecheap, the operators are allegedly waiting until these proceedings are over to raise prices) and that Dr. Leonard "downplay[ed] future risks" of price increases. Namecheap also claimed that Dr. Leonard did not consider risks from "consolidation" of the TLDs operated by PIR and "consolidation" of Identity Digital's operation of .INFO and provision of back-end registry services for .ORG and other TLDs.

• Namecheap also alleged, based on a legal disclaimer in the Economic Report, that the Economic Report was made without a "duty of care" and that Dr. Leonard's employer, Charles River Associates, did not "sanction" the Economic Report.

Overview of the Economist's Supplemental Report

At the BAMC's direction, ICANN asked Dr. Leonard to provide a supplemental written response addressing the comments raised in the Namecheap Letter (Supplemental Report). Dr. Leonard reviewed the Namecheap Letter and issued his Supplemental Report on 31 August 2024 "to assist the ICANN Board of Directors in its consideration of the relevant issues by addressing the Namecheap Letter and providing additional discussion of the analyses [he] performed and the reasons why [he] reached the conclusion that .info and .org do not have substantial and durable market power." As explained in more detail in the Economic Report and the Supplemental Report, in Dr. Leonard's Supplemental Report:

• Dr. Leonard explained that, contrary to Namecheap's claims, the Economic Report clearly discloses Dr. Leonard's assignment from ICANN and that the Economic Report "is transparent in the manner that is customary for such economics reports."

• In terms of Namecheap's claim that estimating demand curves and evaluating cross-elasticities of demand is the only method for analyzing market power, Dr. Leonard explained that this is incorrect. In fact, given the unavailability of complete and reliable pricing data, such a demand estimation is not possible here. Rather, Dr. Leonard "determined that several of the other methods for assessing market power were the most likely to be informative." Specifically, Dr. Leonard: (i) evaluated historical pricing in .INFO and .ORG after the price caps were removed, which is a "standard tool … for assessing market power"; (ii) compared changes in .INFO and .ORG wholesale prices to inflation and changes in the prices of other TLDs as a "benchmark analysis"; (iii) "examined trends in the level and share of .info's and .org's registrations in the wake of the introduction of many new gTLDs," which is a "natural experiment" that is useful for assessing market power; and (iv) reviewed "qualitative evidence regarding customer substitution" of TLDs and "several factors that are idiosyncratic to the TLD marketplace and relevant to market power" in reaching his conclusion that .INFO and .ORG do not have sustainable and durable market power.

• Despite Namecheap's claims, Dr. Leonard stated that he did consider future risks of price increases, but he concluded that growing competition is likely to lessen that risk, and he did consider the "unique characteristics of .org," namely that it has acquired a semantic meaning associated with not-for-profit entities and is a legacy gTLD, but noted that if these characteristics equated to market power Dr. Leonard would have observed it in his market power analysis, which he did not.

• With respect to the "consolidation" concerns raised by Namecheap, Dr. Leonard did not find them problematic. The other TLDs operated by PIR have an extremely small share of domain name registrations (approximately 0.02%), and "PIR did not increase the registration fees of these other TLDs after acquiring them in 2020." Moreover, according to Dr. Leonard, there is nothing economically troubling about Identity Digital operating .INFO and providing back-end services for .ORG and other TLDs because "the wholesale registration price for a TLD is set by the registry operator, not the back-end operator, and the registry operators have the incentive to compete with each other for business."

• Finally, the Supplemental Report addressed the "non-economic issues" raised in the Namecheap Letter. According to Dr. Leonard, Namecheap misunderstood the legal disclaimer contained in the Economic Report, which is standard for reports like this and does not mean that Dr. Leonard did not exercise a "duty of care" in preparing, or that Charles River Associates did not "sanction," the Economic Report. Likewise, Dr. Leonard stated that his "conclusions were not pre-determined by any 'bias,'" but were "based on evidence" he reviewed. Dr. Leonard also remarked that whether the Economic Report complies with the IRP Panel's recommendation is a legal question, but he noted that he "was asked to assess the market power of .info and .org, which would appear to be a relevant question."

BAMC Consideration and Board Decision

Pursuant to the Board's directive in Resolution 2023.06.11.07, the BAMC, and then the Board, considered materials relevant to this matter including, but not limited to, the Namecheap IRP Final Declaration, the Economic Report, the Namecheap Letter, and the Supplemental Report.

After careful review of and discussion regarding the economist's input and supporting information regarding the current DNS marketplace and the .INFO and .ORG gTLDs in particular, as well as the points raised in the Namecheap Letter and in the public comments received in 2019 regarding the 2019 .INFO and .ORG Registry Agreements, both the BAMC and the Board have concluded that the 2019 .INFO and .ORG Registry Agreements should be maintained without price control provisions.

The BAMC noted and the Board notes here Dr. Leonard's expert input that "price controls are disfavored in market economies except in narrow circumstances where a firm has substantial and durable 'market power'—the ability to charge a price significantly above the competitive level for an extended period of time." The BAMC noted and the Board now notes that Dr. Leonard conducted multiple methods of analysis to reach his conclusion that .INFO and .ORG "do not have sustainable and durable market power," meaning .INFO and .ORG do not possess the ability to charge a wholesale price significantly above the competitive level for an extended period of time.

In particular, Dr. Leonard evaluated historical pricing in .INFO and .ORG after the execution of the 2019 Registry Agreements without price control provisions, which Dr. Leonard stated is a "standard tool … for assessing market power." In this analysis, Dr. Leonard found that "the .org price has not increased at all and the .info price has not increased more than the price control provision would have allowed, had it been in place." The BAMC and Board agree with Dr. Leonard that this likely means that competition, rather than the price control provisions, has historically restrained pricing in .INFO and .ORG.² The Board also notes that Dr. Leonard found it significant that the .ORG registry operator, PIR, is a non-profit organization that has publicly vowed to not significantly increase .ORG registry prices. Dr. Leonard also compared changes in .INFO and .ORG wholesale prices to inflation and changes in the prices of other TLDs as a "benchmark analysis." Based on this analysis, Dr. Leonard found that "the wholesale registration prices for .info and .org have been in line both with inflation as well as the registration prices of other TLDs." Dr. Leonard also "examined trends in the level and share of .info's and .org's registrations in the wake of the introduction of many new gTLDs," which, according to Dr. Leonard, is a "natural experiment" that is useful for assessing market power. On this front, Dr. Leonard found that "the number of registrations, as well as the share of registrations, on .info and .org has fallen over time." Dr. Leonard also reviewed "qualitative evidence regarding customer substitution" of TLDs and "several factors that are idiosyncratic to the TLD marketplace and relevant to market power." Specifically, Dr. Leonard viewed increasing competition in the DNS from ccTLDs and new gTLDs, registrants' ability to lock in existing gTLD registration prices for up to ten years, and the fact that PIR is a non-profit entity as significant curbs on any exercise of market power in .INFO or .ORG. The results of these various methods of analysis form the basis for Dr. Leonard's conclusion that .INFO and .ORG "do not have sustainable and durable market power."

In addition, Dr. Leonard provided further information, via his Supplemental Report, addressing the critiques raised in the Namecheap Letter and explaining that Namecheap's allegations did not alter the conclusions that Dr. Leonard has reached or the appropriateness of the methods Dr. Leonard used to reach those conclusions. For example, Dr. Leonard's Supplemental Report explained that "estimating demand curves and evaluating cross-elasticities of demand" is not the only method for analyzing market power, as Namecheap claims. Rather, Dr. Leonard "determined that several of the other methods for assessing market power [as described in the Economic Report and the Supplemental Report] were the most likely to be informative," given the data available and the question that was posed. Dr. Leonard further explained that his Economic Report was transparent in describing the assignment from ICANN, that he was not biased towards a particular conclusion, that he considered future risks of price increases and the "unique characteristics of .org," that the "consolidation" claims raised by Namecheap were not economically troubling, and that he exercised a duty of care in drafting the Economic Report, despite Namecheap's claims to the contrary. The BAMC and the Board appreciate Namecheap's comments and Dr. Leonard's responses thereto. In the BAMC's and the Board's view, Dr. Leonard presented a thorough, exacting and independent market power analysis that the BAMC and Board are justified in relying upon in reaching its decision to maintain the 2019 .INFO and .ORG Registry Agreements without price control provisions.

Furthermore, the BAMC and the Board agree with Dr. Leonard that competition in the DNS has increased over the years and will likely continue to increase. That is, today, registrants now have the option of registering domain names in numerous ccTLDs and in over 1,200 new gTLDs, which were added to the DNS resulting from the 2012 Round of the New gTLD Program, in addition to legacy gTLDs such as .INFO and .ORG. And the DNS will continue to expand and gTLD competition will continue to increase with the upcoming Next Round of the New gTLD Program. 

Also important to the BAMC's and the Board's consideration, as stated earlier, is Dr. Leonard's conclusion that, in market economies, price regulation is the exception not the norm because there are significant costs and risks associated with price regulation (or, in this case, price controls through contractual terms).³ One of the concerns is that ICANN could set the wrong price control level, which could negatively impact registry and registrar incentives and flexibility in offering their products and services.⁴ These risks are compounded by the fact that ICANN is not a price regulator⁵ and does not possess the institutional capacity, resources, or expertise to act as a price regulator or to affirmatively set prices in the DNS.⁶

Finally, the BAMC and the Board agree with Dr. Leonard's point that, even if one were concerned about .INFO and .ORG market power, the "price lock" provisions in the .INFO and .ORG Registry Agreements serve to protect from exercise of that market power. Specifically, the .INFO and .ORG Registry Agreements allow registrars, on behalf of their registrant customers, to register or renew .INFO and .ORG domain names for up to a 10-year total registration term, at the then-current price. Thus, registrants can protect themselves against any excessive price increases charged by registrars by locking in the existing registration price, which further mitigates any concerns about potential market power. Likewise, Dr. Leonard noted that registrars are also somewhat insulated from registry price increases because they are incentivized to pass price increases on to registrants.

While it is true that, when ICANN posted the 2019 .INFO and .ORG Registry Agreements for public comment, there were numerous comments expressing concerns that registry prices in the .INFO and .ORG gTLDs would exceed the levels permitted by the previous price controls, that has not come to pass this many years later, as Dr. Leonard has confirmed. In addition, Dr. Leonard reviewed the 2019 public comments and concluded that his findings regarding .INFO's and .ORG's lack of market power addressed the economics-related concerns about potential excessive future price increases voiced in those comments.

Based upon the Board's consideration of the IRP Panel's findings and recommendations, the Economic Report and the Supplemental Report, Namecheap's comments on the Economic Report, the public comments received in 2019 regarding the 2019 .INFO and .ORG Registry Agreements, the BAMC's analysis and recommendations, and other relevant information, the Board has determined that the 2019 .INFO and .ORG Registry Agreements should be maintained without price control provisions.

Furthermore, with the actions, analysis and decisions leading up to and contained in this Resolution and Rationale, ICANN has considered each of the IRP Panel's recommendations. Namely, the Board, with this and prior Resolutions on this matter, is the one making the decision as to how to implement the Panel's declarations, which addresses Panel Recommendation No. 1. By retaining an economist to provide a thorough report regarding the current DNS marketplace as it relates to the market power of .INFO and .ORG, as well as considering Namecheap's comments on the Economic Report, and with the Board providing this comprehensive rationale for its decision in an open and transparent manner, ICANN has addressed Panel Recommendation Nos. 2 through 6. And with respect to Panel Recommendation No. 7, the Board notes the Panel's recommendation regarding whether further clarity with respect to ICANN's decision-making and public comment processes might be useful, and directs ICANN org to consider whether further clarity regarding ICANN's decision-making and public comment processes would be beneficial, recognizing that there are Bylaws provisions and ICANN procedures already in place that provide guidance regarding the roles of the Board and ICANN org as well as regarding the public comment process.

These actions and decisions are within ICANN's Mission and are in the public interest as it is important to ensure that, in carrying out its Mission, ICANN is accountable to the community for operating within the Articles of Incorporation, Bylaws, and other established procedures. This accountability includes having a process in place by which a person or entity materially and adversely affected by a Board or organization action or inaction may challenge that action or inaction.

Taking this decision is not expected to have any immediate direct financial impact on ICANN. This action will not have any direct impact on the security, stability or resiliency of the domain name system.

This is an Organizational Administrative function that does not require public comment.

Rationale for Resolution 2024.11.10.02

Why is the Board addressing the issue now?

ICANN and ICM Registry LLC (ICM) entered into the current .XXX Registry Agreement (RA) for the operation of the .XXX gTLD on 31 March 2011, with an initial term of ten years that was extended to 30 November 2024. The proposed .XXX RA renewal was posted for public comment between 18 March 2024 and 29 April 2024. At this time, the Board is approving the proposed .XXX RA renewal for the continued operation of the .XXX gTLD.

What is the proposal being considered?

ICANN org and ICM have been discussing the path forward for the renewal of the .XXX RA for approximately four years. Since the beginning of these bilateral negotiations, ICM requested to remove the .XXX gTLD sponsorship and to align the .XXX RA with the RAs of the similar-concept .ADULT, .PORN, and .SEX gTLDs. The proposed .XXX RA renewal uses the Base RA without sponsorship and includes the following:

• Obligations from the two recent Global Amendments to the Base RA: those to combat DNS Abuse⁷ and employ the Registration Data Access Protocol to provide Registration Data Directory Services.⁸

• An expanded set of voluntary commitments that continue to include a blend of the existing .XXX voluntary commitments, similar to those in the .ADULT, .PORN, and .SEX RAs, and terms that reflect obligations from the current .XXX RA.

• Base RA provisions that benefit multiple stakeholders, including: code of conduct obligations; requirements for use of registrars and registry-registrar agreements; and provisions enabling ICANN to incorporate future global amendments to the Base RA into the .XXX RA without the need for additional or separate processes.

The Sponsorship Charter contained in the current .XXX RA in Appendix S is not being carried over in the .XXX RA renewal. However, key registry operator commitments and obligations originating from the .XXX sponsorship are carried over into the .XXX RA renewal in the form of voluntary Public Interest Commitments (PICs). When .XXX was first introduced, the sponsorship provided a means of developing policies and best practices to operate .XXX in a responsible manner. During the 2012 round of the New gTLD Program, these policies and best practices were proposed by ICM in its applications for the .ADULT, .PORN, and .SEX gTLDs and were incorporated into those RAs, without sponsorship, as voluntary PICs. The proposed .XXX RA renewal emulates the RAs of these other adult-themed gTLDs (.ADULT, .PORN, and .SEX).

The proposed .XXX RA renewal also includes an addendum that, consistent with other legacy gTLDs that have adopted the Base RA, modifies terms in the Base RA that are inapplicable due to the nature of the gTLD as a legacy (versus a new) gTLD. Such modifications include removing references to the initial delegation of the gTLD, entry into the root zone, statements made in the gTLD application, launch of the gTLD, pass-through fees related to the trademark clearinghouse, and the continued operations instrument provisions as they are not applicable to a legacy gTLD that has been in operation for over a decade.

Which stakeholders or others were consulted?

ICANN org engaged in bilateral negotiations with the Registry Operator to agree to the terms to be included in the proposed .XXX RA renewal that was posted for public comment. ICANN conducted a public comment period on the proposed .XXX RA renewal from 18 March 2024 through 29 April 2024. The summary and analysis report was published⁹ for the community on 13 September 2024, following briefing and consultation with the ICANN Board. 

What concerns or issues were raised by the community?

The Public Comment proceeding¹⁰ opened on 18 March 2024 and closed on 29 April 2024. ICANN received a total of nine comments on the proposed renewal of the .XXX RA. All comments received about .XXX moving to the Base RA were supportive of the approach, however, there was a divergence in opinion when it came to the question of removing the sponsorship. ICANN received five comments against removal of the sponsorship, two comments in favor of removing the sponsorship, and two comments that were neutral towards removal of the sponsorship.

Of note, the Governmental Advisory Committee (GAC) did not issue a public comment or mention the .XXX RA renewal in either its ICANN79 or ICANN80 Communiqués. Three of the public comments expressing opposition to the sponsor removal (from the At-Large Advisory Committee (ALAC), the Business Constituency (BC), and Michael Palage), utilize similar arguments and phrasing, including repeating some misconceptions and inaccurate assumptions.

Two former ALAC Vice-Chairs, Evan Leibovitch and Carlton Samuels, who each served as Vice-Chair during the initial delegation of the .XXX gTLD, submitted a comment in favor of the sponsor removal and noted their disagreement with the comment prepared and submitted by the ALAC.

Key concerns or issues raised by the community

1. Comments opposing sponsor removal – regarding the "first mover" advantage: A few commenters pointed out that the .XXX gTLD was applied for and approved in a special round for sponsored gTLDs, based on the existence of a community the gTLD served, the inclusion of a sponsoring organization that represented the community served and committed to use the gTLD for that community, and restrictions to ensure registrants belonged to that community. In the view of some commenters, the .XXX gTLD (in exchange for these commitments) has benefitted by being approved earlier and paying a much lower application fee than those of gTLDs from the 2012 Round of the New gTLD Program. Some commenters believe that participation in the sponsored gTLD round gave the registry a conditionally based economic and timing advantage, and that the Registry Operator should not be allowed to remove those restrictions and conditions placed upon .XXX because of the first mover advantage they received.

2. Comments opposing sponsor removal – regarding the perceived removal of registry operator commitments and obligations: Some commenters focused on registrant eligibility restrictions. These commenters asserted their belief that the sponsorship commitments bind the registry to additional registrant validation processes that help prevent distribution of child sexual abuse material (CSAM), abuse, and other harmful activities from occurring in the .XXX gTLD, and that these obligations should not be removed from the RA. Based on ICANN's analysis, these particular concerns are either overstated or based on inaccurate assumptions and misconceptions, which are explained in further detail in the comment summary report¹¹ and the Reference Materials.

3. Comments expressing support for the voluntary Public Interest Commitments to remain in the .XXX RA and assurances that the agreement is enforceable by ICANN. Three commenters noted the various benefits, such as consumer protection benefits, that they believed the voluntary commitments provided. These commenters explicitly expressed their desire for those commitments to remain in the .XXX RA and for those commitments to be complied with and enforced.

4. Suggestions from two commenters to include new obligations and commitments for the .XXX gTLD alone. For example, one commenter suggested that .XXX would benefit from (and ICANN should appoint) a separate, approved independent auditor to monitor and evaluate ICM's compliance with its prevailing baseline policies for .XXX, and that the .XXX RA include a new obligation for ICM to publish a quarterly report on anti-abuse metrics.

5. Comments from a few commenters voiced their support for the proposed renewal and sponsorship removal. Some commenters noted that the evolution of the .XXX RA and its harmonization with other gTLDs on the Base RA is reasonable and positive, and shared that the benefits of doing so include reducing public confusion regarding policy differences between gTLDs and improving uniformity of application for would-be registrants and the general public.

6. Commenters' misconceptions about existing obligations and commitments: As mentioned earlier, ICANN received comments from Mr. Palage, the BC, and ALAC that were each similar in nature. The focus of their concern appears to be centered around their belief that certain "commitments" made by ICM are being removed in the proposed .XXX RA renewal, specifically registrant restrictions, enhanced registrant verification, and enhanced abuse reporting. These commenters contended that changes to the commitments made by ICM in Appendix S to the current .XXX RA should have been made via the Registry Services Evaluation Policy (RSEP) process or, at a minimum, have been supported by a rationale.

The original public comment summary report was updated on 18 October to more fully address this specific point raised in the public comments. The report states:

The registrant verification practices and contract for labeling and monitoring noted in the comments refer to the Start-up Plan for .XXX (Appendix S, Part 4.1). Those practices are noted and connected to the .XXX TLD start-up and launch plans. If changes were made to the noted practices, such changes might have warranted submission of an RSEP request by ICM. The issue of whether or not an RSEP request should have been submitted by ICM if or when it changed its implementation of its Startup Plan does not directly impact the consideration of the proposed .XXX RA renewal.

What significant materials did the Board Review?

As part of its deliberations, the Board reviewed various materials, including but not limited to, the following materials and documents:

• Current .XXX Registry Agreement, Amendments, and Appendices

• Public Comment Proceeding

• Clean proposed .XXX renewal agreement and addendum

• Letters from GoDaddy: rationale letter and response to public comments letter

• Letter from the International Foundation for Online Responsibility (IFFOR) and IFFOR posted Questions & Answers

• Summary and analysis of public comments

What factors has the Board found to be significant?

The Board carefully considered the public comments received for the proposed .XXX RA renewal, along with the summary and analysis of those comments. The Board also considered the terms agreed to by the Registry Operator as part of the bilateral negotiations with ICANN org.

The Board notes that in 2014, ICANN and ICM agreed to Amendment No. 2 to the current .XXX RA, wherein obligations and formats from several of the technical specifications of the Base RA were incorporated into the .XXX RA, including Data Escrow, WHOIS, and Zone File Access. In 2017, ICANN and ICM agreed to Amendment No. 4, which further aligned parts of the .XXX RA with the Base RA. This amendment added Public Interest Commitments (PICs), both those mandated in all gTLDs subject to the Base RA, as well as voluntary commitments from ICM. Amendment No. 4 also introduced a premise where the fees owed from the Registry Operator to ICANN could be adjusted from $2.00 per transaction down to the Base RA level of $0.25 per transaction over the course of several years with each adjustment contingent on a successful audit by ICANN. The Board notes that current fees owed by the Registry Operator for .XXX have reached alignment with the fees set forth in the Base RA. The effort to migrate .XXX from its legacy RA to the Base RA has been ongoing for nearly eight years as an initiative of ICM and in line with ICANN's general practice of transitioning legacy RAs to the Base RA, where appropriate. In 2017, when ICANN and ICM agreed to amend the .XXX RA, many features of the Base RA were incorporated into the .XXX RA. With this renewal, the Board notes that it is a logical next step to complete the transition using the proposed .XXX RA renewal that was posted for public comment as the way forward.

The Board also acknowledges and recognizes the benefits of aligning the .XXX RA with the Base RA, which: provides additional safeguards and security and stability requirements compared to legacy agreements; contains standardized technical and reporting obligations for registry operators; provides for operational efficiencies for ICANN org; establishes consistency for end users; and allows for the automatic adoption of any future approved global amendments (such as the recent Registration Data Access Protocol (RDAP) global amendment and DNS Abuse global amendment).

The Board acknowledges that over a decade has passed since the .XXX gTLD was delegated and launched. With the introduction of more than a thousand new gTLDs, the TLD marketplace has evolved. Pornography exists on the Internet in many namespaces. The issues of Child Sexual Abuse Material (CSAM) and other forms and types of abuse, including Domain Name System (DNS) abuse, are also not unique to the .XXX gTLD. The Board acknowledges that ICM applied for .XXX during the period of time where sponsored applications were accepted in the early 2000s. However, the fact that ICM succeeded in an earlier round of expansion of gTLDs does not mean that it is inappropriate to consider whether there can be changes to its RA.

The Board notes that the .XXX gTLD was not delegated until 2011, six years after .MOBI was delegated in 2005 and only two years before the first new gTLDs were delegated. The marketplace has evolved significantly over the past 13 years since .XXX was delegated, with the introduction of more than 1,000 new gTLDs, including adult-oriented gTLDs such as .PORN, .ADULT, and .SEX, among other developments. The Board acknowledges that as ICANN looks to evolve and improve upon legacy gTLD RAs in the renewal process, there is also past precedent for removing a legacy gTLD sponsorship. ICANN considered the request from the legacy .MOBI gTLD registry operator and the Board approved a resolution¹² for the legacy .MOBI RA to take on the Base RA and remove its sponsorship in its most recent renewal. Other legacy, sponsored gTLDs such as .AERO and .COOP requested to retain the sponsorship, or, like .CAT, .TEL, and .TRAVEL, opted to convert to community gTLDs during their RA renewal. Only the registry operators of .MOBI and .XXX have made the request to remove the sponsorship. ICANN org did not receive any comments or objections to the removal of .MOBI's sponsorship.

The Board notes that when .XXX was first introduced, the .XXX sponsorship provided a means of developing policies and best practices to operate .XXX in a responsible manner. During the 2012 Round of the New gTLD Program, these policies and best practices were proposed by ICM in its applications for the .ADULT, .PORN, and .SEX gTLDs and were incorporated into those RAs without sponsorship as voluntary PICs.

The Board also notes that the current .XXX sponsor, the International Foundation for Online Responsibility (IFFOR), expressed its opinion that the policies that are in place (and will remain in place in the .XXX RA renewal) have been "extremely effective" and that it is not necessary to maintain a sponsorship with regard to .XXX in order to ensure the effectiveness of those policies:

"We feel that the Baseline Policies that were developed by IFFOR at the creation of the .XXX registry and which remain in force have been extremely effective."¹³

"Those [IFFOR Ombudsman] reviews have revealed how effective the policies have been, and continue to be, in preventing abuse within the .XXX namespace. We understand that ICM Registry plans to incorporate those policies within a revised .XXX Registry Agreement. The continued use of those policies and practices, we believe, will produce similar results going forward, and does not require IFFOR to serve as the Sponsoring Organization to ensure they are effective."¹⁴

The Board acknowledges each of the comments that raised concerns about the removal of the .XXX sponsorship, and notes that the concerns raised within these comments tie the prevention of child sexual abuse material, abuse, and other harmful activities to registrant eligibility requirements. While the registrant eligibility requirements noted by commenters are not maintained within the proposed .XXX RA renewal, key commitments and protections that were included in the current .XXX RA in order to protect against abuse still remain in the proposed .XXX RA renewal as voluntary PICs. Based upon the comments submitted,¹⁵ the Board finds that many of the arguments and comments made against removing the sponsorship are based on inaccuracies and were provided without evidence to support the allegations and concerns raised.

The Board notes that the .XXX RA renewal emulates RAs of other adult-themed gTLDs (.ADULT, .PORN, and .SEX). These three adult-themed gTLDs are similar in concept to the .XXX gTLD, yet are operated as gTLDs on the Base RA and include voluntary PICs with similar obligations and commitments as those contained in the best-practice policies developed for the .XXX gTLD that are designed to combat CSAM. In addition, all four of these adult-themed gTLDs are operated by registry operators that are under GoDaddy Registry's ownership. While .ADULT, .PORN, and .SEX contain similar voluntary commitments as .XXX, a key difference from .XXX is that they do not include a requirement to be a member of an adult-themed community to register a name. Considering the history and evolution of .XXX, the changes seen in the marketplace and introduction of thousands of new gTLDs, and input provided by the Registry Operator, IFFOR (the .XXX sponsor), and the sponsored gTLD community, the Board concludes it is practical to evolve the .XXX RA to model these examples. In addition to emulating the other adult-themed, non-sponsored gTLDs, the proposed .XXX RA renewal retains key protections and registry operator commitments from the current .XXX RA by including the existing PICs and obligations and provisions currently contained in the .XXX RA and Sponsorship Appendix S.

Based on the above, the Board believes that proceeding to execute the .XXX renewal RA as proposed for public comment does not raise potential significant security, stability, and competition issues.

The Board notes that the current .XXX RA calls for presumptive renewal of the agreement at its expiration so long as certain requirements are met. The .XXX RA renewal is subject to the negotiation of renewal terms reasonably acceptable to ICANN and the Registry Operator. The renewal terms approved by the Board are the result of the bilateral negotiations called for in the current .XXX RA, which was shared with the community for transparency and input, and transitioning to the form of the Base RA would not violate established Generic Names Supporting Organization (GNSO) policy.

Are there positive or negative community impacts?

The Board's approval of the proposed .XXX RA renewal offers positive technical and operational benefits. As mentioned above, the Board recognizes the benefits of aligning the .XXX RA with the Base RA, which provides additional safeguards and security and stability requirements compared to legacy agreements, contains standardized technical and reporting obligations for registry operators, provides for operational efficiencies for ICANN, establishes consistency for end users, and allows for the automatic adoption of any future approved global amendments (such as the recent RDAP global amendment and DNS Abuse global amendment).

For instance, the proposed .XXX RA renewal provides that, in the event that any of the emergency thresholds for registry functions is reached, the Registry Operator agrees that ICANN may designate an emergency interim registry operator of the registry for the gTLD, which would mitigate the risks to the stability and security of the DNS. Furthermore, technical onboarding of the Registry Operator to comply with the provisions in the Base RA will allow the registry to use uniform and automated processes, which will facilitate operation of the gTLD. There will also be positive impacts on registrars and registrants. The transition to the Base RA will provide consistency across registries leading to a more predictable environment for end-users. The fact that the proposed .XXX RA renewal mandates the use of accredited registrars that are subject to the current 2013 Registrar Accreditation Agreement also provides numerous benefits to registrars and registrants.

Are there fiscal impacts or ramifications on ICANN Org (strategic plan, operating plan, budget); the community; and/or the public?

There is no significant fiscal impact to ICANN expected from the .XXX RA renewal.

Are there any security, stability or resiliency issues relating to the DNS?

The .XXX RA renewal is not expected to create any security, stability, or resiliency issues related to the DNS. Using the Base RA to renew the .XXX RA helps establish certain benefits including standardization in the industry, end-user benefits, and a more future-proof agreement. The technical and operational consistency provided for in the obligations within the Base RA leads to a more consistent experience for Internet users, registrants, registrars, ICANN, and the industry as a whole as well as more equitable treatment of registry operators. Additional safeguards included in the Base RA benefit end-users and the broader industry. These safeguards include the registry operator code of conduct requirements, the requirement for equitable treatment of registrars, and provisions for Emergency Back-end Registry Operators, among others. Lastly, the .XXX RA renewal using the Base RA is now able to automatically adopt any approved global amendments, such as the recent RDAP and DNS Abuse global amendments, thus better aligning the .XXX RA with overall contract evolution.

Is this decision in the public interest and within ICANN's mission?

This decision is in the public interest and within ICANN's mission.

In the context of the New gTLD Program: Next Round, the Board raised concerns about the inclusion of PICs/registry voluntary commitments (RVCs) that could have the effect of restricting content in gTLDs in the Next Round RAs. This concern was raised given the limited scope of ICANN's Mission as set forth in the ICANN Bylaws, Article 1, Section 1.1. In light of this concern, the Board directed ICANN org to facilitate a community consultation to ensure that the framework for implementing these recommendations in the Next Round is consistent with the ICANN Bylaws.

The Board acknowledges that parallels have been drawn between the discussions concerning RVCs in the Next Round RAs and the terms in the .XXX RA renewal. ICANN org noted this in the public comment on the proposed .XXX RA renewal and the matter has been considered at great length. The .XXX RA renewal published for public comment retains voluntary PICs that are in the current .XXX RA and carries over pre-existing terms that are in the current .XXX RA (in the form of voluntary PICs in the .XXX RA renewal).

The Board notes that the voluntary PICs in the proposed .XXX RA renewal are not new commitments, but rather reflect restrictions and obligations that are already in effect for .XXX in some form and that are already subject to ICANN Contractual Compliance oversight and enforcement. Commenters shared that they want these commitments to be retained in the .XXX RA renewal. Retaining these terms in the .XXX RA renewal agreement is consistent with gTLDs from the 2012 round of the New gTLD Program using the Base RA and emulates the other adult-themed gTLDs from the 2012 round (ADULT, .PORN, and .SEX).

Rationale for Resolution 2024.11.10.03

This ICANN Risk Appetite Statement articulates the level of risk that ICANN is willing to take and retain on a broad level to deliver its mission. Specifically, the ICANN Risk Appetite Statement:

• Communicates to staff that they need to pursue objectives within acceptable risk limits.

• Provides input for prioritization for planning and budgeting.

• Assists the Board by offering a clear framework on acceptable risk levels.

• Encourages a culture of proactive risk management rather than risk aversion, ensuring that risk management is shared across all ICANN staff.

• Demonstrates ICANN's commitment to responsible and proactive risk management, enhancing the organization's reputation with stakeholders.

As part of the Target Operating Model for a mature Risk Management Framework, ICANN strives for a comprehensive Risk Appetite Statement.

The Risk Appetite Statement specifies the level of risk ICANN is willing to take and retain, thereby demonstrating ICANN's risk appetite that can then be used to guide the operations of ICANN.

ICANN's Risk Appetite Statement, in conformance with standard industry practice, is a high-level articulation of the risks faced by ICANN. The intention is to provide a concise overview that is accessible to all. However, risks often involve vulnerabilities or threats to the organization, and it would be imprudent for any organization to publicly provide specific details of such risks.

The initial Risk Appetite Statement approved in 2020 was developed by the organization's Risk Management function in collaboration with representatives of every function within ICANN. The Risk Appetite Statement was reviewed by the organization Executive Team and approved by the ICANN President and CEO for initial consideration by the Board Risk Committee. The Board Risk Committee then reviewed and recommended that the Board approve the ICANN Risk Appetite Statement. The Board Risk Committee recently re-reviewed the Risk Appetite Statement that the Board adopted in 2020 and have recommended some revisions, which the CEO Risk Management Committee also reviewed.

Adopting the revised Risk Appetite Statement is in the public interest and is also fully consistent with ICANN's mission as it articulates the risk appetite of ICANN, which will be used to guide the operations of ICANN.

Adopting the BRC's recommendation has no financial impact on ICANN and could have a positive impact on the security, stability and resiliency of the domain name system.

This is an Organizational Administrative Function that does not require Public Comment.

Rationale for Resolutions 2024.11.10.04 – 2024.11.10.05

Today's Board action in approving an amendment to the Fundamental Bylaws set out at Article 4, Section 4.2(d) and Section 4.3(d) represents a path to closure of the conversation about the Cross-Community Working Group on New gTLD Auction Proceeds (CCWG-AP) Recommendation 7. With this amendment, ICANN's Reconsideration (Article 4. Section 4.2) and Independent Review (Article 4, Section 4.3) processes will not be available for challenges to decisions to approve or not approve an application to the ICANN Grant Program. Those exclusions will be formally built into the ICANN Bylaws, without any other modification to either accountability mechanism.

The Cross-Community Working Group on New gTLD Auction Proceeds '(CCWG-AP) Final Report included Recommendation 7, which states in relevant part "Existing ICANN accountability mechanisms such as IRP or other appeal mechanisms cannot be used to challenge a decision from the Independent Project Applications Evaluation Panel to approve or not approve an application. Applicants not selected should receive further details about where information can be found about the next round of applications as well as any educational materials that may be available to assist applicants. The CCWG recognizes that there will need to be an amendment to the Fundamental Bylaws to eliminate the opportunity to use the Request for Reconsideration and Independent Review Panel to challenge grant decisions." Though the Board previously accepted Recommendation 7 on 12 June 2022, on 23 October 2023, the Board revisited that action because of implementation challenges that arose during the design of the ICANN Grant Program. The Board explained:

In order to account for the design work that has progressed since the Board's June 2022 action which defines different stages of assessment of individual applications, from admissibility to eligibility to substantive evaluation by an Independent Application Assessment Panel, the Board expects the limitation to restrict access to ICANN's accountability mechanisms for all decisions on those individual applications, not limited only to those made by the Independent Application Assessment Panel (as stated within the CCWG-AP recommendation). Anything short of this comprehensive view makes it possible that some applicants could have access to ICANN's accountability mechanisms for decisions on their individual applications as long as that action wasn't taken by the Independent Application Assessment Panel. If allowed, this uneven access to the accountability mechanisms still risks the use of auction proceeds to defend against accountability challenges on individual application decisions in a manner the CCWG-AP wished to protect against.

The Board, considering alternative means to achieve the CCWG-AP's stated goal, asked ICANN org to produce a more general Bylaws amendment that would provide a process through which the ICANN community could signal its intent to limit the use of ICANN's Accountability Mechanisms. A draft Bylaws amendment to Article 4, Section 4.1, drafted to support this more general approach was posted for Public Comment in April 2024. The comments received in that forum confirmed the ICANN community was not satisfied with and did not support the general process approach.

The ICANN Board also, in March 2024, sent a letter to the Chartering Organizations to the CCWG-AP explaining that an update to the CCWG-AP's Recommendation 7 to remove the words "from the Independent Project Applications Evaluation Panel" would cure much of the Board's concerns in supporting full implementation of the CCWG-AP's Recommendation 7. That letter confirmed that there are two dependencies to the Board approving the distribution of any grants within the ICANN Grant Program: (1) updating Recommendation 7 and (2) amending the Bylaws to confirm the restriction access to ICANN's Accountability Mechanisms. To date, ICANN has heard back from all Chartering Organizations, with all but one stating either support or non-objection to proceeding with the updated text. The seventh Chartering Organization, the Governmental Advisory Committee (GAC) noted a need for further clarification of how the Board would address the potential for other impacts on the ICANN Accountability Mechanisms that were evident in the disfavored Bylaws proposal as posted for comment in April.

In July 2024, after consideration of the public comment received on the earlier proposal to amend the Bylaws, the Board determined that it was no longer pursuing the general approach that was highly disfavored. Instead, the Board initiated a new Fundamental Bylaws Amendment process that provides specific exclusions from the use of the Reconsideration and Independent Review Processes for decisions on individual applications in the ICANN Grant Program. As both the Reconsideration and Independent Review processes already enumerate excluded topics for claims or disputes, the proposed amendment approved today adds to each of those exclusions, relying on language as contemplated within an updated Recommendation 7 ("cannot be used to challenge a decision to approve or not approve an application").

Nine comments were received in the August 2024 Public Comment proceeding on the revised proposal. Every commenter was supportive of the proposed amendments as posted, including comments confirming that the updated proposal implements the intention of Recommendation 7.

This action supports the Board's duty and interest in remaining accountable for the use of the auction proceeds funds that support the ICANN Grant Program. The approval of this Bylaws amendment helps mitigate the risk that auction proceeds will be used to defend against accountability challenges on individual grant decisions. This decision also fills a gap created in the Board's October 2023 decision, as that decision did not impact third party access to ICANN Accountability Mechanisms for challenges related to the ICANN Grant Program. The Bylaws amendments approved today impose an exclusion regardless of whether the challenge would be brought by an applicant or a third party.

The Board notes that while the path to resolution of how to address Recommendation 7 has been long and spurred controversy, the outcome here shows the power of ICANN's multistakeholder community. The checks built into the ICANN Bylaws regarding public comment and the powers of the Empowered Community to weigh in on Bylaws amendments have now brought about a result that is better scoped for the ICANN Grant Program and the public interest. The Board thanks the community for the productive dialogue and efforts to reach this outcome.

The Board's October 2023 actions removed the need for a fundamental Bylaws change, and required reliance on contractual terms and conditions as the sole mechanism to make the ICANN Accountability Mechanisms unavailable. The Board notes that while it is formally rescinding those actions, the Board is not directing any amendment to the ICANN Grant Program Terms and Conditions as published for the first cycle of applications. First, all applications within the first cycle have already been received. Second, it is an operational decision to put the applicants on notice that their methods of challenge will be limited, even though the Terms and Conditions itself will no longer be the relevant source to substiate and enforce such limitations.

The next step for the Fundamental Bylaws Amendment Process is the Empowered Community Approval Process. The Board looks forward to participating in the Community Forum on this issue. The next step for the ICANN Grant Program is that the Board will conclude its confirmation with the Chartering Organizations to the CCWG-AP regarding updating Recommendation 7, and will formally renew its approval of that Recommendation 7 in advance of any Board action on a slate of successful applicants within the first cycle of the ICANN Grant Program.

Today's action is directly related to how the ICANN Community may hold ICANN accountable to its mission and work. Today's action is in the public interest, and is aligned with ICANN's Bylaws, in preserving accountability for funds under the ICANN Grant Program and faithfully implementing the recommendations of the community.

This actions is not anticipated to result in any impact to the security, stability or resiliency of the Internet's DNS. Nor is this action anticipated to result in any budgetary or financial implications.

This is an Organizational Administrative Function decision requiring public comment.

Rationale for Resolution 2024.11.10.06

Consistent with all personnel with the ICANN organization, the Interim President and CEO is to be evaluated against specific performance goals, which the Interim President and CEO sets in coordination with the Compensation Committee and the Board.

The Compensation Committee discussed and agreed with the Interim President and CEO on a set of performance goals for the Interim President and CEO for FY25. The Board has evaluated these goals and agrees that they are appropriate and consistent with ICANN's Strategic and Operating plans.

Taking this decision is in furtherance of ICANN's Mission and is in the public interest in that the Interim and President and CEO's performance goals are fully consistent with ICANN's Strategic and Operating plans.

The decision to adopt FY25 performance goals for the Interim President and CEO will not have a direct fiscal impact on ICANN. This decision will not have an impact on the security, stability or resiliency of the domain name system.

This is an Organizational Administrative Function that does not require public comment.