Cybersquatting up as domain name speculation grows

The number of “cybersquatting” disputes over Web site domain names shot up by 25% in 2006, figures from the World Intellectual Property Organization (WIPO) have revealed.

A total of 1,823 complaints alleging cybersquatting -- the abusive registration of trademarks as domain names -- were filed with WIPO’s arbitration and mediation center last year, the highest number since 2000.

WIPO warned that the domain name system was at risk of becoming an arena for “speculative gain” as cybersquatters rushed in to snap up and exploit domain names containing brand names and other intellectual property.

Trademark owners faced new problems arising from the evolution of the domain name registration system, WIPO added. Cybersquatters were using software to automatically register expired domain names and “park” them on pay-per-click portal sites.

WIPO said companies’ intellectual property rights were also threatened by developments such as the option to register names free of charge for a five-day “tasting” period, the proliferation of new registrars and the establishment of new generic top-level domains.

The developments combined to create more opportunities for wide-scale, often anonymous, registration of domain names that could breach intellectual property rights.

WIPO deputy director general Francis Gurry said: “While electronic commerce has flourished with the expansion of the internet, recent developments in the domain name registration system have fostered practices which threaten the interests of trademark owners and cause consumer confusion. Practices such as “domain name tasting” risk turning the domain name system into a mostly speculative market.”

He added: “Domain names used to be primarily specific identifiers of businesses and other internet users, but many names nowadays are mere commodities for speculative gain. The rate at which domain names change hands and the difficulty to track such mass automated registrations challenge trademark owners in their pursuit of cybersquatters.”

Gurry called for “concrete policy responses” to the problem.

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