SIDN Dispute Settlement

When a dispute about a .nl domain name arises, parties can go to civil court. This often takes a lot of time and a lot of money. Fortunately, there is also an alternative to civil courts in disputes of this kind, namely the arbitration procedure of the World Intellectual Property Organization (hereinafter: WIPO). The advantages of this procedure are the relatively quick decision, the free mediation process before the decision and the expertise of the Stichting Internet Domeinregistratie Nederland  (hereinafter: SIDN) and WIPO. The decision will be based on the SIDN dispute settlement (hereinafter: the settlement). Below we will explain this regulation (version 31 December 2013) per article and explain how such a procedure usually proceeds intending to be a guideline for the regulation.

The dispute settlement scheme applies to all domain names with the top-level domain “.nl”. The regulation leaves open the possibility to go to civil court during the proceedings or instead of the proceedings. The judgment of a judge will take precedence over the decision of the arbitrator.

Under the scheme, the claimant can only bring one type of claim. The plaintiff can only claim that he or she – instead of the current domain name holder – becomes the new holder of the domain name. The claim only extends to a mandatory transfer of the domain name. The arbitrator is not authorized to make judgments concerning other claims, such as claiming damages or court order against costs.

The Claimant must base his claim on the following (cumulative) grounds:

1. the domain name holder’s domain name is identical to or corresponds to such that confusion may arise with:

2. the domain name holder is not entitled to a legitimate interest in the domain name;
3. the domain name is registered in bad faith or used in bad faith.

If the claimant’s claim is not based on these grounds, the mediation process will not commence and the arbitrator will not declare him or herself competent. In practice, ground a is in most cases a protected brand or trade name. A dispute with a personal name, a legal entity under public law or an association or foundation is less common. A trademark is a registered sign. It can be registered as a word mark and/or logo. A trade name, on the other hand, does not have to be registered to qualify for protection. Contrary to popular belief, registration of the trade name with the Chamber of Commerce is not required. A trade name is protected if it is used by the company concerned. An indication of this may be that the company is known to the public under this name. In many cases, the disputes relate to a domain name that contains the brand name, behind which a generic word is added with or without a hyphen. It also often happens that the domain name deviates only slightly from the brand name or trade name. The dispute judge will determine whether this generic addition or this minor deviation is sufficient to remove the risk of confusion.

Further, we would like to discuss the Oki Data criteria. These have been developed in practice and relate to the resale of products of a certain brand. These four criteria can be used to demonstrate a legitimate interest in the domain name.

1. The domain name holder must offer the goods or services of the brand on its website;
   2. The domain name holder   must use the website to only sell the goods or services that are protected by trademark law;
   3. The domain name holder may not register so many domain names with the brand name that it is no longer possible for the trademark holder to use the trademark in a domain name;
   4. The website must accurately describe the relationship between the domain name holder and the trademark holder.

The regulation also mentions ground c concerning the possible evidence by parties. We will also return to this in the explanation of the following article.

In practice, bad faith, in particular, means attracting the public to the website by using another person’s brand or trade name. In this way, the awareness of the other is lifted. In bad faith, it is sufficient that there is registration in bad faith or use in bad faith. Both do not have to be satisfied. In addition, there may also be a suspicion of bad faith, for example, if the domain name holder changes the website or the domain name moves after hearing the dispute. By this behaviour, the Defendant implicitly acknowledges that it was wrong for this.

As mentioned above, the scheme itself also mentions several examples of evidence.

Regarding ground b (the legitimate interest), the regulation indicates that the domain name holder can demonstrate a legitimate interest by, among other things, the following circumstances:

1. before hearing the dispute, the domain name holder used the domain name to offer products or services in good faith or made preparations for the domain name holder
2. the domain name holder is generally known under the domain name; or
3. the domain name holder uses the domain name for legitimate non-commercial purposes, without enticing consumers in a misleading way.

If one of these circumstances is involved, it has not yet been said that the claim will be rejected in any case. It is only an indication that the domain name holder has a legitimate interest in the domain name. In principle, it is up to the claimant to demonstrate that the domain name holder uses the domain name in bad faith (ground c). This can also be deduced from the examples the scheme provides for the taking of evidence. After all, these examples are aimed at demonstrating bad faith and not at denying bad faith. To demonstrate in bad faith, the scheme provides the following examples:

The claimant initiates a procedure with WIPO by drawing up a condition following the model requirement. The requirement must then be emailed, including attachments, to the WIPO Arbitration and Mediation Center. There are costs associated with submitting the claim, provided that it ultimately decides by the arbitrator. If a solution is reached in the mediation process, the claimant does not owe the costs. Payment is not required until a dispute settler has been appointed.

Within three days of receipt of the claim, it will be checked whether the condition meets all requirements. If the claim meets this requirement, the provisions including an instruction letter will be sent to the domain name holder. This instruction letter includes the steps that the domain name holder must take if he or she wants to defend him or herself and also the start date of the procedure.

If the claim does not meet all the requirements, the Claimant will be informed and has five days to correct the defects.

Once SIDN has been notified of the receipt of the claim, it will no longer cooperate with the cancellation or change of holder of the relevant domain name until the procedure has ended. In other words, the domain name is “frozen”.

The domain name holder would be wise to defend himself against the requirement. In the first place, because it gives the claimant insight into the situation of the domain name holder. This can come in handy during the mediation process. Secondly, access to this mediation process requires that defence has been lodged. Without defence, there will be an immediate ruling and no mediation will take place. Finally, the defence is, of course, important if it ultimately decides by the arbitrator. Without a defence being lodged, the arbitrator will only look at the claim. It seems obvious that filing a defence increases the chances of a favourable decision for the domain name holder. It can be argued in the defence that the grounds on which the claim is based are not satisfied.

The defence must be emailed to WIPO no later than twenty days after the commencement date of the proceedings. This statement of defence should be submitted following the model statement of defence. The attachments must be added to this email. The claimant must also receive this email (utilizing a CC).

The mediation process starts within five days after WIPO has sent the defence to SIDN. The mediation process is voluntary and confidential. There are no costs associated with the mediation process. If the parties appoint a lawyer for the mediation, he may charge hours for this.

The mediation process is as follows. First, a mediator will be appointed. This mediator will call the parties several times (depending on how busy and where parties are available). He or she listens to the wishes of the parties and uses them to determine whether the parties can agree. Moreover, the mediator will then not only look at a possible transfer of the domain name but also whether parties might have something else to offer each other. The mediation process ends thirty days after the start unless the mediator has previously concluded that mediation will not offer a solution. With the consent of both parties, the period of the mediation process can be extended twice by another thirty days.
If the mediation proves successful, the mediator will inform both parties and WIPO of this and the procedure will be terminated. The costs that the plaintiff actually would have had the dispute been settled by the arbitrator are no longer owed by the plaintiff.

If the mediation is not successful, the mediator also informs both parties and WIPO. The claimant is then obliged to pay the amount due within ten days, after which the procedure will be resumed. If the claimant fails to do so, the procedure will be terminated.

If the claimant has received payment, a dispute resolution will be appointed within five days. This appointment is then made known to the parties.

The arbitrator will handle the dispute as an impartial and independent party. If the arbitrator has a personal or business relationship with one of the parties or has already expressed an opinion on the case to one of the parties before the appointment, the arbitrator must refuse to act. This means that the arbitrator will be replaced.

The arbitrator decides on the admissibility, relevance and valuation of the evidence provided by the parties. If no statement of defence has been lodged by the domain name holder, the arbitrator will only consider the requirement. In most cases, it will then be allocated, unless the claim seems unlawful or unfounded. This also shows the importance of a (good) defence.

After the claim and statement of defence have been submitted, the mediation process has been closed and a dispute settler has been appointed, the dispute settler may ask the parties to further explain their positions in writing or to submit additional documents. It is also possible that the parties supply additional documents on their initiative. Whether these are allowed is up to the arbitrator of the dispute.

Documents that have not been submitted correctly or documents that have been made available to the mediator will not be admitted to the procedure.

After the appointment of the arbitrator, the written procedure is in principle closed. As discussed in Article 11, in some cases further documents may still be allowed.

In principle, the dispute will not be handled orally, unless the arbitrator deems this necessary to make a decision.

If the written procedure is closed, the arbitrator will send the written decision to WIPO within 14 days (barring exceptional circumstances). WIPO will send this to the parties no later than three days after receipt of the decision. In addition to the decision on the dispute, the award includes:

The parties must not have direct contact with the dispute settler. The communication between parties and the dispute settler is via WIPO.

In principle, all communication will be via e-mail. In the claim and the defence, parties can indicate a preference for other means of communication, if notification via email is impossible. Parties can opt for notification by registered mail or by fax. In principle, any other conceivable means of communication is possible, as long as there is a confirmation of receipt. Notices to WIPO should be sent to the following email address: domain.disputes@wipo.int.

If both the claimant and the respondent reside or are established in the Netherlands, the language of the proceedings will be Dutch. In exceptional cases, the arbitrator may decide that English is the language of the case, or that English documents may be submitted. If the claimant or respondent does not live or is established in the Netherlands, the language of the proceedings will be English. The opposite applies to what is stated above: in exceptional cases, the arbitrator can decide that Dutch is the language of the case, or that Dutch documents may be submitted.

WIPO or the arbitrator of disputes may require the parties to enclose a translation with each document submitted in a language other than the language of the case.

If a party fails to comply with the regulation or fails to do so in an incomplete manner, the arbitral tribunal will attach the consequences that appear to him to be correct. As a result, documents may not be admitted to the process.

The procedure can be terminated prematurely in three cases (before the arbitrator has decided), namely:

1. if the parties have settled before the arbitrator has made a decision;
2. if it appears that it is not necessary or possible to continue the procedure; or
3. if the claimant withdraws the claim during the proceedings.

Such premature termination of the procedure will be reported by WIPO to parties and SIDN so that SIDN terminates the freezing of the domain name (Article 6).
At the request of the plaintiff, the procedure can be temporarily suspended to settle.

In the event of premature termination, the costs paid by the plaintiff will not be returned, unless a dispute settler has not yet been appointed and the costs are therefore not yet due.

If the arbitrator decides to grant the claim from the claim, SIDN will cooperate – after ten days after being informed – of the change of domain name holder of the relevant domain name. If SIDN receives proof from the respondent within these ten days that the dispute will be brought before a civil court, SIDN will not cooperate with the change of the domain name holder.

In the event of an assigned claim, the claimant must apply for a change of the domain name holder to SIDN and conclude a service agreement with SIDN. The SIDN agreement with the respondent ends due to the change of the domain name holder.

Participation in this WIPO procedure does not prevent the plaintiff and respondent from submitting the dispute to a civil court, outside of these regulations.

In principle, the decision will be made public by WIPO or SIDN in its entirety, unless the arbitrator decides otherwise.

The costs that the claimant owes for starting the procedure at the time that a dispute settler has been appointed consist of the fee of the dispute settler and administration costs. As long as the payment has not been received, WIPO is not obliged to handle the matter further. If payment is not received in full, the claim will be deemed to have been withdrawn and the procedure will be terminated. If in the opinion of WIPO or the dispute settler, costs must be incurred that are not already covered by the amount paid, parties may be asked to reimburse these additional costs.

WIPO, SIDN, the arbitrator of disputes, the registrar concerned and the directors or employees of these institutes are not liable to the claimant or defendant for any damage whatsoever resulting from acts or omissions under the scheme.

SIDN can change or replace the scheme for a new scheme. Disputes that have already been brought before will then be handled based on the “outdated” regulation.