Three Things TLD Registries Must Know About China's Domain Name Regulation
Recently there have been a number of news reports/articles that are incorrect or misleading in interpreting China's domain name management policy (here and here). James has posted an article aiming to clarify what is going to in China's domain name market. Considering the potential negative impact of those reports on the participants of this market, I supplement James's post by pointing out three things, which I believe critical for any TLD registries that hope to have a better understand of China's domain name regulation and the special action based on it.
First, it is the Ministry of Industry and Information Technology (MIIT, formerly known as Ministry of Information Industry (MIT)) that is conducting a round of special action on domain name registration market according to the Measures for the Administration of Internet Domain Names (MIT Administrative Order No. 30, hereinafter as the Regulation). Some ones have confused MIIT with a newly established (2014) department called Cyberspace Administration of China (CAC). Although CAC is a high-profile inter-department coordinating agency, matters related to domain name industry is out of its perimeter. Instead, registry/registrar license application and approval fall into MIIT's responsibilities.
Second, the guideline of this action is the Regulation mentioned above (the full-text translation in English can be found here). The Regulation has always been publically available for free since its inception in 2004. Over the past one decade, all the players in this market are fully aware of the existence and the contents of this regulation. The essential requirement for registries and registrars is that they have to apply for a license before they start business in China. Accordingly, any registry without a license and registrar(s) providing registration service for the non-licensed TLD will be declared "illegal." The main articles related to this requirement are Article 12-13 for registry and Article 14-15 for registrar. Nowadays a revision of the regulation is under way to reflect the latest expansion of registry operators. However, except for the new requirement that any foreign registry has to establish a legal entity in China, all the other requirements for the license have maintained unchanged. Therefore, it is fairly safe to conclude that there is no "tightened control" or "new move" against New gTLD registries and registrars.
Third, MIIT's window is always open for applicants who might be interested in entering the Chinese market but have not been approved yet. All the materials needed for the application have been clearly listed in the Regulation. Up to now, there are 14 TLDs (belong to 8 entities) have been on the approval list by MIIT, and 3 of them ("网址" (IDN meaning web address) , "wang" and "top") are among the top 10 new gTLDs, according to nTLDStats. Besides those that belong to governmental agencies (CNNIC and CONAC), ZDNS is proud of being the backend service provider for all the rest TLDs, including "ren", "citic", "top", "商标" (IDN meaning trademark) and "网址." In addition, ZDNS has been involved in helping the registries apply for the license. Our experience indicated that no secret or undertable deals in the whole process. It is also worth noting that Zodiac (the registry for "wang") is a non-Chinese owned company.
It is regretful that some panic has been observed among registries and registrars due to those incorrect reports. However, based on my interaction with government officials and industry leaders, there is no need to panic. I hope the three points discussed previously could sort it out to some extent. After all, compared to other mature market, China is still an interesting and lucrative market where all registries and registrars are welcome.
By Jian-Chuan Chang, Senior Research Fellow at KENT and ZDNS