[arin-ppml] 2008-6: Emergency Transfer Policy for IPv4 Addresses

[Robert Bonomi]

> Date: Tue, 30 Sep 2008 10:29:38 +0100
> From: <michael.dillon at bt.com>
> Subject: Re: [arin-ppml] 2008-6: Emergency Transfer Policy for IPv4 Addresses
>
> > It is really quite simple.  
> > 
> > What is granted in a block assignment from a RIR  (or the 
> > original DARPA
> > address-coordinatior) is not 'ownership' of the addresses, 
> > but just a "right to use" license for those integers in a 
> > particular context.
>
> Precisely!
> The context is what is all-important. Read your RSA and the
> ARIN policies to see what the context is and you will discover
> that you do not, in fact, have a licence which you can buy
> and sell. 

And the applicibility of any of that that to 'legacy' licensees is?

>           You must have technical justification for having those
> IP addresses.

>From early days, one had to have justification at the time the application
was made.  There was no requirement to return them if that justification
vanished.  "Polite", yes, but required, no.

As for the recipient of the transfer, ARIN can simply require that they
justify their need (to the same standard as a direct applicant would), 
_and_ sign a current RSA. before the license transfer is approved.

(Incidentally, note that this last pretty much prevents a recurring
 secondary market, because anybody that is covered by a modern RSA
 does have to give the license back to ARIN if it's not being used.
 and that would _include_ the "buyer" of a block. :)

> > The *license* is, itself, "property", and  can bought and sold. 
>
> If that were true then ARIN policy would be irrelevant.

Wrong.

ARIN (and predecessors) _issue_ the licenses, and thus control the terms,
*if*any*, under which it can be transferred, and to whom.

Note: for many years, there has been a substantial business in buying and 
      selling various kinds of licenses -- software, for example. (Or, in
      Illinois, truck-driving ones. :)

All 'post legacy' licenses are non-transferrable, in their entireity.

The status of legacy licenses is much less clear.

In _either_ case, *nothing* prevents the license-holder from delegating some
of that space to another party. Historically, such a delegation of address-
space has been done only with accompanying 'connectivity' service provisioning.
*BUT*, I can't see anything in the 'rules' that prohibits doing the former
_without_ the latter.  "Vice-versa" is _not_ uncommon.  I don't see anything
that prohibits a 'disjoint' use of address-space.

Whether or not 'transfers' are allowed will be absolutely irrelevant and 
immaterial.  If transfers are prohibited. then the 'seller' will simply
"rent" the block to the 'buyer', without including connectivity, but
including authoriztion for the 'provider of choice' of the 'buyer' to 
announce and route those addresses.  

One way or the other, it _will_ happen. *UNLESS* the _entire_ 'world' moves
to IPv6  before the IPv4 exhaustion point.

> > It is, arguably a 'derivative object', because it's existence 
> > is derived from another thing.
> > 
> > It is not a "derivative instrument", because those things are 
> > a 'contract to enter into a contract'.
>
> Not according to Forbes Investopedia which has this to say:
>
> In finance, a security whose price is dependent upon or derived from one
> or more underlying assets. The derivative itself is merely a contract
> between two or more parties. Its value is determined by fluctuations in
> the underlying asset.

By that definition, RIR 'licenses' are not derivitives. 

The underlying numbers are not assets. And the value of them does not fluctuate.

The value is entirely in the "right to use", and the "guarantee of uniqueness".

A 'lease' of the 'right to use' would be a derivitive.  A sale, or other
transfer would _not_.