1. What is cybersquatting?

Cybersquatting is the practice of registering domain names which reflect well-known or famous existing businesses or other entities in the hope of selling them for a profit or otherwise taking advantage of the public profile of the name.

Cybersquatting includes the registration of names which may not be identical to famous or well-known names but may be sufficiently similar.

2. Cybersquatting on the decline

Cybersquatting is becoming less common for the following reasons:

(a) Business awareness: Businesses are now much more aware of the importance of registering their domain name as soon as possible.

(b) New registration regulations: new regulations govern the registration of domain names. The regulations make it more difficult to register a name in which you have no legitimate interest.

Applicants for a .com.au domain licence must register through Internet Names Worldwide (INW). Applicants must warrant to INW that the registration of the name or the way in which it will be used will not infringe any third party rights. INW can terminate the domain name license if this warranty is breached. If a name is a registered trademark the registration of that name would be in clear breach of the INW warranty. The requirement extends also to the registration of .com domain names.

(c) New pre-launch procedures: give trade mark owners an opportunity to assert their rights and a means of alerting prospective applicants of a potential conflict.

When new top level domain name .biz was launched there was an opportunity for trade mark owners to assert their rights before registration was open to the public. Once open to the public the trade mark owners were notified of any competing applications and had an opportunity to resolve who was entitled to the domain name before the domain name went live, either in Court or through a dispute resolution process.

(d) Breach of trademark: cybersquatting can be challenged as a breach of trademark.

See fact sheet on Trademarks, Domain Names and Passing Off.

(e) Other legal liability: it may be possible to challenge cybersquatters under a common law action of passing off and as a breach of trade practices legislation dealing with misleading and deceptive conduct. See Consumer Protection fact sheet.

(f) Dispute resolution by WIPO: corporations and others whose identity rights are infringed through cybersquatting will often refer the matter to the dispute resolution process of the World Intellectual Property Organisation (WIPO).

This process usually results in the domain name being either transferred from the cybersquatter or deregistered without having to deal with cybersquatters directly. It is also possible to make a complaint under Internet Corporation for Assigned Names and Numbers (ICANN) which applies to most .com domain names and other world wide domain name registrars. To be successful the following must be proven:

* domain name of the pirate is identical or confusingly similar to a trademark or service mark in which the complainant has rights;
* the pirate has no rights or legitimate interests in respect of the domain name; and
* the pirate’s domain name has been registered and is being used in bad faith.

Bad faith includes circumstances where the domain name was acquired in order to sell or rent it for a price in excess of the amount spent to register or acquire it to the complainant who is the owner of the trade mark. A trade mark registration will demonstrate more clearly that the complainant has rights to the trade mark.

Also, new dispute resolution procedures are being provided especially for trade mark owners during the launch of new top level domain names, eg STOP (Start Up Trademark Opposition Policy) was introduced specifically for the .biz launch.

3. Protecting your name against cybersquatters

Register your domain name as soon as possible. Many early cybersquatters were opportunistic and took advantage of the fact that companies were in no hurry to register a domain name.

When new domain names are launched there is an opportunity in the early stages of the launch for trade mark owners to assert their rights before registration is open to the public, make sure that you avail yourself of the opportunity. Further, do not forget to submit a registration application since asserting your intellectual property rights does not create any special rights with respect to registering a particular domain name.

Register your business or organisation name as a trademark. While there is no express requirement that a complainant have a trade mark in order to have the right to complain about a domain name registration, it does provide evidence of proprietary rights in the mark.


Other relevant Articles on this site:
Trade practices and consumer protection

Other relevant Fact Sheets:
Domain Names
Trade Marks, Domain Names and Passing Off

End Notes