202012.21

The starting point of the limitation period in the cnDRP: rejecting the creation date of the domain name in favor of the date of the occurrence of a new fact

Unlike other regulations for the out-of-court resolution of domain name disputes, Article 2 of the cnDRP (China) sets a time limit to start a cnDRP procedure. However, imposing such a deadline, based exclusively on the date of registration of the domain name, is not appropriate:
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197. The WIPO Interim Report recommended that a time bar to the bringing of claims in respect of domain names (for example, a bar on claims where the domain name registration has been unchallenged for a designated period of years) should not be introduced. It was considered that such a measure would not take into account that the underlying use of a domain name may evolve over time (with the consequence that the use of a domain name may become infringing through, for example, the offering for sale of goods of a different sort to those previously offered on the website); that any related intellectual property rights held by the domain name holder may lapse; and that a time bar would in any event be undesirable in cases of bad faith.

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199. It is not recommended that claims under the administrative procedure be subject to a time limitation.” (WIPO, Final Report of the WIPO Internet Domain Name Process, April 30, 1999, paras. 197 and 199).

Indeed, imposing a deadline equals to neglect cybersquatters’ tactics. The hypothesis is that of a domain name, the use of which shows no apparent threat until the expiration of the time limit to file a cnDRP complaint. Take the example of a domain name similar or identical to a trademark, but the use eliminates any risk of confusion. In this way, the domain name holder suggests that he has a right or a legitimate interest in the domain name and uses it in good faith. In such circumstances, any cnDRP complaint would fail. However, one should not be naive. Cybersquatters are investors. They are patient and fully aware that the domain name’s value will increase tenfold overnight in the absence of any expeditious out-of-court procedure. For example, it suffices to modify the website’s content in such a way as to generate a risk of confusion and to offer to transfer the domain name against the payment of a “ransom”. Despite the appearance of new facts demonstrating, in an almost irrefutable manner, the cybersquatter’s bad faith, the trademark’s owner is helpless since the deadline has expired. The victim, disarmed because deprived of recourse, is placed, to his dismay, in a situation of denial of justice. Finally, the only possible recourse being a negotiation, the cybersquatter is in a strong position to demand a price that he sets himself. Basically, by setting the date of registration of the domain name as the only starting point of the limitation period, article 2 of the cnDRP results in a double penalty: the absence of expeditious extrajudicial recourse and an increase in the value of the domain name. Admittedly, the termination of the transfer contract could be examined later. Indeed, one could consider that this contract is vitiated, taking into account the coercion exerted by the cybersquatter on the trademark’s owner. However, this would add up the difficulties that could be avoided by making a simple modification to Article 2 of the cnDRP. To put an end to this unfair situation, if one persists in maintaining a limitation period, it would be sufficient to set the starting point of limitation on the date of the occurrence of a new fact.


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