[arin-ppml] ARIN-prop-173 Revisions to M&A Transfer Requirements (Updated Version)

[Owen DeLong]

Opposed as written.

While I support some of the intent of the proposal, here are  number of problems with this particular proposal:

FIrst, ARIN has no authority or ability to compel exclusivity. All ARIN can provide is a guarantee that the numbers assigned/allocated are unique among cooperating parties. That is, no other RIR nor the IANA nor ARIN will assign/allocate conflicting numbers to another party.

Verb tense mixture of assigns and allocated in the last sentence of the second paragraph of proposed 8.1.

Creating a policy which is punitive to LRSA signatories is, IMHO, counterproductive. We want to create reasons for legacy registrants to sign LRSAs, not provide additional hurdles to that process.

Removal of needs basis from section 8.2 is also not desirable, IMHO.

Proposed 8.2.2 should allow the fee to be removed by signing an RSA and not only the LRSA.

Defining legacy numbers is in error. There are no such things as legacy numbers. There are legacy registrations, numbers which are subject to a legacy registration, and holders of legacy registrations (aka legacy registrants).

Numbers are no longer the subject of a legacy registration once they are covered under an RSA.

Registrations for which ARIN provides services without a contract are the legacy registrations of concern in the current policy debates and we should, IMHO, seek to minimize the extent to which such registrations are treated differently, not create additional policy to create additional differences in their treatment.

Owen

On Jul 5, 2012, at 9:08 AM, ARIN wrote:

> ARIN-prop-173 Revisions to M&A Transfer Requirements
> 
> The proposal originator revised the proposal.
> 
> Regards,
> 
> Communications and Member Services
> American Registry for Internet Numbers (ARIN)
> 
> 
> ## * ##
> 
> 
> ARIN-prop-173 Revisions to M&A Transfer Requirements
> 
> Proposal Originator - Marc Lindsey
> 
> Date - 5 July 2012
> 
> Policy type - Modification to existing policy
> 
> Policy term - Permanent
> 
> Policy Statement
> 
> Delete sections 8.1. and 8.2 in their entirety and replace them with the following:
> 
> 8.1 Principles
> 
> ARIN will not change its registration databases to record the transfer of number resources between organizations unless such transfer complies with this Section 8. ARIN is tasked with making prudent, fair and expeditious decisions when evaluating registration transfer requests.
> 
> It should be understood that number resources directly assigned or allocated by ARIN are not 'sold' under ARIN administration. Rather, such number resources are assigned by ARIN to an organization for its exclusive use, provided the terms of the applicable Registration Services Agreement between ARIN and the organization governing use of such number resources continue to be met by such organization.  Number resources administered and assigned by ARIN are done so according to ARIN's published policies.
> ARIN directly assigns and allocated number resources, based on justified need, to organizations, not to individuals representing those organizations.
> 
> The transfer policies in this Section 8 create certain exceptions and exclusions for legacy numbers ("grandfather policies").  The grandfather policies are intended to satisfy key policy objectives while promoting greater participation in the ARIN community by organizations holding legacy numbers.  The grandfather policies allow organizations holding legacy numbers to retain some of the historic benefits attached to their legacy numbers.
> 
> The benefits of the grandfather policies are not available for legacy numbers if:
> 
> (a) they are voluntarily and permanently released by the original registrant or its successor (or assign) to an RIR for re-issue to other organizations; where such releases are supported by reliable evidence retained by ARIN or the applicable RIR of the organization's informed and voluntary consent or agreement to permanently release the numbers; or
> (b) the original registrant or its successor (or assign) of such number enters into an LRSA or RSA expressly referencing the legacy numbers as governed by the terms and conditions of an LRSA or RSA.
> 
> 8.2. Mergers and Acquisitions
> 
> When the transfer of any number resource is requested by the current registrant or its successor or assign (the "new entity"), ARIN will transfer the registration of such number resources to the new entity upon receipt of evidence that the new entity has lawfully acquired the number resources from the current registrant as the result of a merger, acquisition, reorganization or name change.  ARIN will maintain an up-to-date list of acceptable types of documentation.  Transfers under this Section 8.2 shall not be contingent upon the new entity's justification of need for the transferred numbers.
> 
> 8.2.1  If the transfer request pertains to non-legacy numbers or legacy numbers governed by an LRSA or RSA at the time such transfer request is first submitted to ARIN, the new entity shall be required to execute, in its own name, an RSA covering the transferred numbers, and pay the applicable registration fees.
> 
> 8.2.2 If the transfer request pertains to legacy numbers that are not, as of the date that the request is first submitted to ARIN, governed expressly by an existing RSA or LRSA, the transfer shall not be contingent upon the new entity entering into or complying with an RSA, LRSA or any other form of written agreement with ARIN.
> 
> For each transfer of legacy numbers under this Section 8.2.2, ARIN shall assess, and the new entity shall pay, a one-time change charge as set forth in the fee schedule unless the new entity elects, in its discretion, to enter into an LRSA covering the transferred legacy numbers and pays the applicable registration fees.
> 
> Add the following new definition to Section 2:
> 
> A "legacy number" means any number resource that meets the following two conditions:
> 
> (1) the number resource was issued to an entity (other than a Regional Internet Registry) or individual (either, the "original legacy holder") prior to ARIN's inception on Dec 22, 1997 by or through an organization authorized by the United States to issue such number resources; and
> 
> (2) the original legacy holder (or its legal successor or assign) of such number resource has not voluntarily and permanently released the number to a Regional Internet Registry for subsequent allocation and assignment in accordance with such RIR's number resource policies and membership (or service) agreements.
> 
> Rationale
> 
> The current version of 8.2 actually discourages legacy holders from (a) updating the WHOIS database, and (b) paying fees to assist with records management associated with the WHOIS database.  Some entities that currently control resources do not attempt to update the WHOIS records because the current transfer process puts at risk their ability to retain and use their numbers.
> 
> Under the current process, a legacy holder or its lawful successor must first prove that it is the lawful successor (which is necessary and appropriate).  But it then must also justify its need to continue using the numbers it obtained prior to ARIN's existence.  Once the successor entity passes the needs hurdle, it is required by ARIN to execute an RSA (not an LRSA) as if the numbers were newly allocated from ARIN's  free pool.   The RSA (and LRSA) substantially alters the rights conveyed to the successor and subjects its numbers to audit and possible revocation under then-current policy.  There is, therefore, very little incentive for an M&A successor entity to update the ARIN registry database records.
> 
> For non-legacy registrants, the process should also be less burdensome and uncertain.  Ensuring the continuity of a company's IP addressing scheme as part of an M&A transaction should be within the control of the entities directly involved.  ARIN's discretionary approval of transfers in this context introduces an undesirable and unnecessary contingency.
> 
> Entities concerned about whether their M&A related registration database record update request will be rejected by ARIN simply do not attempt to fully update the records.
> Minimizing the barriers for both legacy and non-legacy holders to update the WHOIS database when changes are required to accurately reflect normal corporate reorganization activities will help increase the accuracy of the WHOIS database, which benefits the community as a whole.
> 
> Timetable for implementation - Immediate
> 
> 
> _______________________________________________
> PPML
> You are receiving this message because you are subscribed to
> the ARIN Public Policy Mailing List (ARIN-PPML at arin.net).
> Unsubscribe or manage your mailing list subscription at:
> http://lists.arin.net/mailman/listinfo/arin-ppml
> Please contact info at arin.net if you experience any issues.