[arin-ppml] Recommended Draft Policy ARIN-2014-1: Out of Region Use - updated legal assessment

[ARIN]

There was a request to repost the updated legal assessment of 2014-1 
which is going to be discussed here at ARIN 35 this morning.

The updated legal assessment is included in the Draft Policy text below 
and can be found at:

https://www.arin.net/policy/proposals/2014_1.html

Regards,

Communications and Member Services
American Registry for Internet Numbers (ARIN)


## * ##


Recommended Draft Policy ARIN-2014-1
Out of Region Use

Date: 24 December 2014

AC's assessment of conformance with the Principles of Internet Number 
Resource Policy:

This proposal enables fair and impartial number resource administration 
by clearing up a significant ambiguity in policy and practice. This 
proposal is technically sound, as no technical issues are raised by 
permitting a single network operator to use resources from one RIR in 
any region. This proposal is supported by the community. Permitting out 
of region use allows operators with facilities spanning more than one 
region to obtain resources in the most direct and convenient way, and to 
utilize their numbers more flexibly and efficiently. The concerns of law 
enforcement and staff raised by the first staff and legal assessment 
have been mitigated by the latest amendments.

Problem statement:

Current policy neither clearly forbids nor clearly permits out or region 
use of ARIN registered resources. This has created confusion and 
controversy within the ARIN community for some time. Earlier work on 
this issue has explored several options to restrict or otherwise limit 
out of region use. None of these options have gained consensus within 
the community. The next logical option is a proposal that clearly 
permits out of region use while addressing some of the concerns 
expressed about unlimited openness to out of region use.

Policy statement:

Create new Section X:

ARIN registered resources may be used outside the ARIN service region. 
Out of region use of IPv4, IPv6, or ASNs are valid justification for 
additional number resources if the applicant is currently using at least 
the equivalent of a /22 of IPv4, /44 of IPv6, or 1 ASN within the ARIN 
service region, respectively.

The services and facilities used to justify the need for ARIN resources 
that will be used out of region cannot also be used to justify resource 
requests from another RIR. When a request for resources from ARIN is 
justified by need located within another RIRÂ’s service region, the 
officer of the applicant must attest that the same services and 
facilities have not been used as the basis for a resource request in the 
other region(s). ARIN reserves the right to request a listing of all the 
applicant's number holdings in the region(s) of proposed use, but this 
should happen only when there are significant reasons to suspect 
duplicate requests.

Comments:

a. Timetable for implementation: Immediate

b. Anything else

Current policy is ambiguous on the issue of out of region use of ARIN 
registered resources. The only guidance on the issue in current policy 
is Section 2.2, which defines the the role of RIRs as “to manage and 
distribute public Internet address space within their respective 
regions.” Some in the community believe this means out of region use 
should be prevented or restricted, while others believe this is only 
intended to focus efforts within the region and not define where 
resources may be used.

Previous policy proposals have explored restricting or otherwise 
limiting out of region use, but none have gained consensus within the 
ARIN community. Several standards for restricting out of region use were 
explored, but all of them were perceived as interfering with the 
legitimate operations of multi- or trans-regional networks.

The requirement to have a minimal level of resources deployed in the 
region (/44 for IPv6, /22 for IPv4, 1 ASN) is an attempt to respond to 
law enforcement and some community concerns. An absolute threshold 
ensures that those applying for ARIN resources are actually operating in 
the region and not simply a shell company, but it avoids the known 
pitfalls of trying to use percentages of the organization's overall 
holdings to do that. The use of officer attestation and the possibility 
of an audit is an attempt to prevent duplicate requests without 
requiring burdensome reporting requirements.

In summary, this proposal ensures that trans-regional organizations or 
service providers operating within the ARIN region may receive all the 
resources they need from ARIN if they wish to do so. This change is 
particularly important for IPv6. Requiring organizations get IPv6 
resources from multiple RIRs will result in additional unique 
non-aggregatable prefixes within the IPv6 route table.

#####

ARIN STAFF ASSESSMENT

Date of Revised Assessment: 15 January 2015

1. Summary (Staff Understanding)

This policy would allow out of region use of ARIN issued resources as 
long as the requesting organization is presently an ARIN registry 
customer and currently using the equivalent of a /22 IPv4 block, or a 
/44 IPv6 block, or an ASN on infrastructure physically located within 
the ARIN region. An officer attestation would be required to verify that 
the resource request is not a duplicate of one made to another RIR.

2. Comments

A. ARIN Staff Comments

There are registrants in the ARIN region, such as end-users, who are not 
necessarily ARIN members. The policy text has been updated to omit 
references to ‘Member’, and is understood to refer to organizations 
with an existing customer relationship & agreement with ARIN.

Current ARIN policy requires organizations to show a justified need for 
resources to be used specifically within the ARIN region in order to 
receive number resources from ARIN. If the draft policy were adopted, 
ARIN number resources could be requested for use in another region.

When processing resource requests for use in another region under this 
policy, ARIN staff would include any address space registered through 
another RIR and currently used (or available to be used) within that 
region in its evaluation of the organizationÂ’s justified need based on 
current ARIN policy.

This policy adds a new requirement that staff review utilization outside 
of the ARIN region, which will require additional time, and could delay 
the review and processing of requests of this type as well as other 
request types that ARIN currently handles.

This policy would be placed in the NRPM as "2.17 Out of Region Use".

[The following is an updated legal assessment of 2014-1]

B. ARIN General Counsel - Legal Assessment

19 March 2015

Counsel has significant and material legal concerns about this policy. 
Counsel recognizes and supports the issuance of resources to entities in 
the ARIN region that need number resources that will be used in both 
this region and in the remainder of the world. ARIN currently issues 
resources for these needs based on a needs based allocation methodology.

However, this proposed policy removes the requirement that there be any 
meaningful need for those resources in the ARIN service region, and 
allows all of the need to be outside the ARIN service region. This 
creates new legal challenges for ARIN which are identified below:

First, ARIN is governed by ICANN ICP-2, which calls for establishment of 
a single RIR to serve each region. It further notes that multiple RIRs 
serving in single region is likely to lead to difficulty for 
co-ordination and co-operation between the RIRs as well as confusion for 
the community within the region. The implication of that governance 
structure is that each RIR can and should serve its service region. This 
policy would allow entities with no real connection to the ARIN's 
service region to obtain, for example, increasingly scarce IPv4 
resources from ARIN and related registry services. This policy would 
result in ARIN effectively providing registry services to other regions, 
and thus appears on its face to be inconsistent with ICP-2. ARIN has 
obligations to follow the global policy in ICP2, or seek changes in it.

Second, if the policy were adopted, ARIN could arguably become subject 
to the jurisdiction and laws passed by governments outside our service 
region. This may lead to ARIN being a litigant in courts of nations 
outside its service region and subject to their requirements and 
judgments. ARIN will need to accept greater legal expenditures and 
risks, as well as potentially larger costs in order to take this greater 
scope into consideration in ARIN's registry activities on an ongoing basis.

Third, the policy fails to recognize that ARIN is not likely to able to 
perform the function contemplated in the policy with certain countries, 
and related public or private entities. See as examples under US law: 
Cuba, Iran and North Korea. The policy could benefit from a specific 
carve out that ARIN may meet its obligations under the laws of 
governments in its service region, even if such requests would otherwise 
comply with ARIN policy. For those who assert that this requirement to 
conform to law is implicit and does not need to be stated in policy, it 
is important the community is under notice of this limit. This issue has 
not been an issue for ARIN prior to this proposed policy.

Fourth, ARIN may be subject to significantly greater political oversight 
by national governments in its service region that will wish to evaluate 
why ARIN alone of the 5 RIRs is assuming a duty to service all of the 
world's community. It may be argued by governments in ARIN's region that 
this is a potential breach of ARIN¹s fiduciary obligations to its own 
region, and to examine whether it is consistent with ARIN¹s non-profit 
status and other corporate documents.

Fifth and finally, counsel is concerned that the policy will lead to an 
increase in fraudulent applications from out of region requestors, and 
issuance of resources to those who fraudulently file, since ARIN is not 
as well positioned to successfully discover such fraud by out of region 
requestors.


[Legal Assessment in the staff assessment dated 15 January 2015]

B. ARIN General Counsel - Legal Assessment

[15 January 2015]

Counsel supports the issuance of resources to entities in the ARIN 
region that need number resources that will be used in this region and 
in the remainder of the world. ARIN currently issues resources for these 
needs based on a needs based allocation methodology. This proposed 
revised policy now requires that there be /22 of deployed IPv4 resources 
in the ARIN service region, and once that installation exists it allows 
all of the recipientsÂ’ needs outside the ARIN service region to be met 
by ARIN. The requirement of a meaningful physical presence of the 
recipient in the service region was absent from the prior version, and 
is an improvement. (The draft policy does not explicitly spell out that 
the recipient must have an actual physical presence, as well as a 
corporate legal entity, in the ARIN region, but implies the requirement 
indirectly by stating that the requester must presently be using 
resources in the ARIN region and thus already comply with ARINÂ’s 
existing requirements.

The single remaining aspect that continues to create legal and policy 
concern is that the policy as written and interpreted calls for ARIN to 
allocate resources solely for use out of the ARIN service region. By 
definition, those resources should be obtained from the RIR(s) in the 
service region(s) where the need exists. Counsel would strongly prefer 
that the policy require that there be a requirement that some of the 
resources being allocated be needed in the ARIN region. Such a modest 
limit would be consistent with ICP-2; it would be consistent with ARIN's 
stewardship responsibility to allocate the waning pool of IPv4 number 
resources, and will still meet the needs of ARIN based multinational 
entities who need resources across the globe.

This draft policy is inconsistent with ICP2. ARIN is governed by ICANN 
ICP-2, which calls for establishment of a single RIR to serve each 
region. ICP2 further notes that multiple RIRs serving in a single region 
is likely to lead to difficulty for co-ordination and co-operation 
between the RIRs as well as confusion for the community within the 
region. The implication of that governance structure is that each RIR 
can and should serve primarily its service region. Adoption of this 
policy will result in ARIN effectively providing significant registry 
services to ARIN qualified recipients in other RIR regions, and such a 
change should not be undertaken lightly but instead only after the 
framework provided in ICP-2 is updated (based on global discussion and 
consent) - to proceed otherwise would undermines ICP-2 and encourages 
parties to set aside its principles in an uncoordinated manner, risking 
in the very "confusion for the community" that ICP-2 helps deter at present.

ARIN cannot perform business functions contemplated in the policy with 
certain countries, and related public or private entities, such as 
relationships to Cuba, Iran and North Korea under U.S. law. This has not 
historically been an issue for ARIN prior to this proposed policy. It 
may be necessary to require ARINÂ’s implementation of this policy to 
require a certification that none of the resources will be deployed 
contrary to U.S., Canada or Caribbean nations law in this respect. If 
the draft policy is adopted and ARIN provides resources to qualifying 
entities for use outside of the region, it is essential that the present 
requirement for dispute resolution via arbitration at a location in 
ARINÂ’s service region as currently required in the RSA be maintained to 
assist in reducing the risk of ARIN becoming subject to the venue, 
jurisdiction and laws of legal forums outside the ARIN service region.

3. Resource Impact

This policy would have significant resource impact from an 
implementation aspect. It is estimated that implementation would occur 
within 5-6 months after ratification by the ARIN Board of Trustees. The 
following would be needed in order to implement:

Updated guidelines and internal procedures

Staff training

Additional time to review resource requests for out of region use as out 
of region utilization would now need to be included in the analysis of 
these requests

Engineering efforts to handle out of region business rules may be 
substantial.

4. Policy Statement
Proposal/Draft Policy Text Assessed
Draft Policy ARIN-2014-1 Out of Region Use
Create new Section X:

ARIN registered resources may be used outside the ARIN service region. 
Out of region use of IPv4, IPv6, or ASNs are valid justification for 
additional number resources if the applicant is currently using at least 
the equivalent of a /22 of IPv4, /44 of IPv6, or 1 ASN within the ARIN 
service region, respectively.

The services and facilities used to justify the need for ARIN resources
that will be used out of region cannot also be used to justify resource
requests from another RIR. When a request for resources from ARIN is 
justified by need located within another RIRÂ’s service region, the
officer of the applicant must attest that the same services and
facilities have not been used as the basis for a resource request in the 
other region(s). ARIN reserves the right to request a listing of all the 
applicant's number holdings in the region(s) of proposed use, but this 
should happen only when there are significant reasons to suspect
duplicate requests.




On 12/24/14 11:21 AM, ARIN wrote:
> Recommended Draft Policy ARIN-2014-1
> Out of Region Use
>
> On 18 December 2014 the ARIN Advisory Council (AC) recommended
> ARIN-2014-1 for adoption, making it a Recommended Draft Policy.
>
> ARIN-2014-1 is below and can be found at:
> https://www.arin.net/policy/proposals/2014_1.html
>
> You are encouraged to discuss Draft Policy 2014-1 on the PPML prior to
> the upcoming ARIN Public Policy Consultation at NANOG 63 in San Antonio
> in February 2015. Both the discussion on the list and at the meeting
> will be used by the ARIN Advisory Council to determine the community
> consensus for adopting this as policy.
>
> The ARIN Policy Development Process can be found at:
> https://www.arin.net/policy/pdp.html
>
> Draft Policies and Proposals under discussion can be found at:
> https://www.arin.net/policy/proposals/index.html
>
> Regards,
>
> Communications and Member Services
> American Registry for Internet Numbers (ARIN)
>
>
> ## * ##
>
>
> Recommended Draft Policy ARIN-2014-1
> Out of Region Use
>
> Date: 24 December 2014
>
> AC's assessment of conformance with the Principles of Internet Number
> Resource Policy:
>
> This proposal enables fair and impartial number resource administration
> by clearing up a significant ambiguity in policy and practice. This
> proposal is technically sound, as no technical issues are raised by
> permitting a single network operator to use resources from one RIR in
> any region. This proposal is supported by the community. Permitting out
> of region use allows operators with facilities spanning more than one
> region to obtain resources in the most direct and convenient way, and to
> utilize their numbers more flexibly and efficiently. The concerns of law
> enforcement and staff raised by the first staff and legal assessment
> have been mitigated by the latest amendments.
>
> Problem statement:
>
> Current policy neither clearly forbids nor clearly permits out or region
> use of ARIN registered resources. This has created confusion and
> controversy within the ARIN community for some time. Earlier work on
> this issue has explored several options to restrict or otherwise limit
> out of region use. None of these options have gained consensus within
> the community. The next logical option is a proposal that clearly
> permits out of region use while addressing some of the concerns
> expressed about unlimited openness to out of region use.
>
> Policy statement:
>
> Create new Section X:
>
> ARIN registered resources may be used outside the ARIN service region.
> Out of region use of IPv4, IPv6, or ASNs are valid justification for
> additional number resources if the applicant is currently using at least
> the equivalent of a /22 of IPv4, /44 of IPv6, or 1 ASN within the ARIN
> service region, respectively.
>
> The services and facilities used to justify the need for ARIN resources
> that will be used out of region cannot also be used to justify resource
> requests from another RIR. When a request for resources from ARIN is
> justified by need located within another RIRÂ’s service region, the
> officer of the applicant must attest that the same services and
> facilities have not been used as the basis for a resource request in the
> other region(s). ARIN reserves the right to request a listing of all the
> applicant's number holdings in the region(s) of proposed use, but this
> should happen only when there are significant reasons to suspect
> duplicate requests.
>
> Comments:
>
> a. Timetable for implementation: Immediate
>
> b. Anything else
>
> Current policy is ambiguous on the issue of out of region use of ARIN
> registered resources. The only guidance on the issue in current policy
> is Section 2.2, which defines the the role of RIRs as “to manage and
> distribute public Internet address space within their respective
> regions.” Some in the community believe this means out of region use
> should be prevented or restricted, while others believe this is only
> intended to focus efforts within the region and not define where
> resources may be used.
>
> Previous policy proposals have explored restricting or otherwise
> limiting out of region use, but none have gained consensus within the
> ARIN community. Several standards for restricting out of region use were
> explored, but all of them were perceived as interfering with the
> legitimate operations of multi- or trans-regional networks.
>
> The requirement to have a minimal level of resources deployed in the
> region (/44 for IPv6, /22 for IPv4, 1 ASN) is an attempt to respond to
> law enforcement and some community concerns. An absolute threshold
> ensures that those applying for ARIN resources are actually operating in
> the region and not simply a shell company, but it avoids the known
> pitfalls of trying to use percentages of the organization's overall
> holdings to do that. The use of officer attestation and the possibility
> of an audit is an attempt to prevent duplicate requests without
> requiring burdensome reporting requirements.
>
> In summary, this proposal ensures that trans-regional organizations or
> service providers operating within the ARIN region may receive all the
> resources they need from ARIN if they wish to do so. This change is
> particularly important for IPv6. Requiring organizations get IPv6
> resources from multiple RIRs will result in additional unique
> non-aggregatable prefixes within the IPv6 route table.
>
> #####
>
> ARIN STAFF ASSESSMENT
>
> Date of Assessment: 22 October 2014 to 13 November 2014
> 2014-1 “Out of Region Use”
>
> 1. Summary (Staff Understanding)
>
> This policy would allow out of region use of ARIN issued resources as
> long as the requesting organization is an ARIN member in good standing
> and currently using at least a /22, or a /44, or 1 ASN within the ARIN
> region.
>
> 2. Comments
>
> A. ARIN Staff Comments
>
> There are registrants in the ARIN region, such as end-users, who are not
> necessarily ARIN members. As written, this policy would not be available
> to an organization that is not currently a member of ARIN, due to the
> use of "ARIN member in good standing" in the policy text. Unless the
> intention is specifically to require ARIN membership, the policy text
> should simply reference "a registrant currently using at least the
> equivalent of a /22 of IPv4, or a /44 of IPv6 in the region."
>
> Staff would apply ARIN policy to all out of region requests to include
> asking for utilization details of resources registered in another RIRÂ’s
> database if the ARIN resources are being requested for use in that region.
>
> This policy adds a new requirement that staff review utilization outside
> of the ARIN region, which will require additional time, and could delay
> the review and processing of requests of this type as well as other
> request types that ARIN currently handles.
>
> B. ARIN General Counsel - Legal Assessment
>
> This policy has been improved from counsel's perspective since the last
> version was reviewed at ARIN 34 in Baltimore.
>
> Counsel recognizes and supports the issuance of resources to entities in
> the ARIN region that need number resources that will be used in both
> this region and in the remainder of the world. ARIN currently issues
> resources for these needs based on a needs based allocation methodology.
> This proposed revised policy now requires that there be /22 of deployed
> resources in the ARIN service region, and once that installation exists
> it allows all of the recipients' needs outside the ARIN service region
> to be met by ARIN. This is a substantial improvement from a legal
> perspective as it requires a "meaningful" or "material" physical
> presence of the recipient in the service region that was absent from the
> prior version. This meets a core objective answering my prior concern
> about the lack of such a requirement.
>
> This policy still represents a type of exception to ICP2, despite the
> helpful added requirement of the recipients /22 presence in region. ARIN
> is governed by ICANN ICP-2, which calls for establishment of a single
> RIR to serve each region. ICP2 further notes that multiple RIRs serving
> in a single region is likely to lead to difficulty for co-ordination and
> co-operation between the RIRs as well as confusion for the community
> within the region. The implication of that governance structure is that
> each RIR can and should serve its service region. This revised policy
> still allows entities with /22 technological connections to the ARIN's
> service region to obtain increasingly scarce IPv4 resources from ARIN
> and related registry services for needs outside the ARIN regions. This
> policy still will result in ARIN effectively providing significant
> registry services to ARIN qualified recipients operating in other RIR
> regions.
>
> If the draft policy is adopted and ARIN provides resources to qualifying
> entities for use outside of the region, it is essential that the present
> requirement for dispute resolution via arbitration at a location in
> ARIN's service region as currently required in the RSA be maintained to
> assist in reducing the risk of ARIN becoming subject to the venue,
> jurisdiction and laws of legal forums outside the ARIN service region.
>
> ARIN cannot perform business functions contemplated in the policy with
> certain countries, and related public or private entities, such as
> relationships to Cuba, Iran and North Korea under U.S. law. This has not
> historically been an issue for ARIN prior to this proposed policy. The
> new requirement to spell out that the recipient must maintain an actual
> physical presence, as well as a corporate legal entity in the ARIN
> region, reduces, but does not entirely eliminate this concern. It may be
> necessary to require ARIN's implementation of this policy to require a
> certification that none of the resources will be deployed contrary to
> U.S., Canada or Caribbean nations law in this respect.
>
> 3. Resource Impact
>
> This policy would have significant resource impact from an
> implementation aspect. It is estimated that implementation would occur
> within 5-6 months after ratification by the ARIN Board of Trustees. The
> following would be needed in order to implement:
>
> Updated guidelines and internal procedures
>
> Staff training
>
> Engineering efforts to handle out of region business rules may be
> substantial.
>
> 4. Proposal/Draft Policy Text Assessed
> Draft Policy ARIN-2014-1 Out of Region Use
> Date: 21 October 2014
> Problem statement:
> Current policy neither clearly forbids nor clearly permits out or region
> use of ARIN registered resources. This has created confusion and
> controversy within the ARIN community for some time. Earlier work on
> this issue has explored several options to restrict or otherwise limit
> out of region use. None of these options have gained consensus within
> the community. The next logical option is a proposal that clearly
> permits out of region use while addressing some of the concerns
> expressed about unlimited openness to out of region use.
>
> Policy statement:
> Create new Section X:
> ARIN registered resources may be used outside the ARIN service region.
> Out of region use of IPv4, IPv6, or ASNs are valid justification for
> additional number resources if the applicant is an ARIN member in good
> standing and is currently using at least the equivalent of a /22 of
> IPv4, or a /44 of IPv6, or 1 ASN within the ARIN service region,
> respectively.
> The services and facilities used to justify the need for ARIN resources
> that will be used out of region cannot also be used to justify resource
> requests from another RIR. When a request for resources from ARIN is
> justified by need located within another RIRÂ’s service region, an
> officer of the applicant must attest that the same services and
> facilities have not been used as the basis for a resource request in the
> other region(s). ARIN reserves the right to request a listing of all the
> applicant's number holdings in the region(s) of proposed use, but this
> should happen only when there are significant reasons to suspect
> duplicate requests.
>
> Comments:
> a. Timetable for implementation: Immediate
> b. Anything else
> Current policy is ambiguous on the issue of out of region use of ARIN
> registered resources. The only guidance on the issue in current policy
> is Section 2.2, which defines the the role of RIRs as “to manage and
> distribute public Internet address space within their respective
> regions.” Some in the community believe this means out of region use
> should be prevented or restricted, while others believe this is only
> intended to focus efforts within the region and not define where
> resources may be used.
> Previous policy proposals have explored restricting or otherwise
> limiting out of region use, but none have gained consensus within the
> ARIN community. Several standards for restricting out of region use were
> explored, but all of them were perceived as interfering with the
> legitimate operations of multi- or trans-regional networks.
> The requirement to have a minimal level of resources deployed in the
> region (/44 for IPv6, /22 for IPv4, 1 ASN) is an attempt to respond to
> law enforcement and some community concerns. An absolute threshold
> ensures that those applying for ARIN resources are actually operating in
> the region and not simply a shell company, but it avoids the known
> pitfalls of trying to use percentages of the organization's overall
> holdings to do that. The use of officer attestation and the possibility
> of an audit is an attempt to prevent duplicate requests without
> requiring burdensome reporting requirements.
> In summary, this proposal ensures that trans-regional organizations or
> service providers operating within the ARIN region may receive all the
> resources they need from ARIN if they wish to do so. This change is
> particularly important for IPv6. Requiring organizations get IPv6
> resources from multiple RIRs will result in additional unique
> non-aggregatable prefixes within the IPv6 route table.