Registrar Advisory Concerning Registration Transfers Within the Auto-Renew Grace Period
The purpose of this advisory is to assist ICANN-accredited registrars
in understanding the effect of transfers of sponsorship of registrations
between registrars that occur while a name is within the Auto-Renew Grace
Period.
The Grace Period Policy for every TLD for which ICANN accredits registrars
is set forth in Appendix C to the relevant registry agreement. In the
case of .com, .net, and .org TLDs the policy is available at < http://www.icann.org/tlds/agreements/verisign/registry-agmt-appc-16apr01.htm#3 >.
Similar policies will apply in .biz, .info, and .pro, but will not have
effect until registrations in these TLDs begin expiring in late 2002.
Accordingly, this advisory uses the .com/.net/.org policy as an illustration.
The Grace Period Policy defines the "Auto-Renew Grace Period"
as follows:
"The Auto-Renew Grace Period is a specified number of calendar
days following an auto-renewal. An auto-renewal occurs if a domain name
registration is not renewed by the expiration date; in this circumstance
the registration will be automatically renewed by the system the first
day after the expiration date. The current value of the Auto-Renew Grace
Period is 45 calendar days."
In other words, when a domain-name registration reaches its expiration
date, it gets renewed for one-year automatically by the registry. The
.com/.net/.org registry charges the registrar a US$6.00 fee for the new
one-year registration term. The registration is then subject to the "Auto-Renew
Grace Period", under which the following special rules regarding
transfers between registrars apply:
Transfer (other than ICANN-approved bulk transfer). If a domain is
transferred under Part A of Exhibit B to the Registry-Registrar Agreement
within the Auto-Renew Grace Period, the losing Registrar is credited
with the Auto-Renew charge* and the year added by
the Auto-Renew operation is cancelled. The expiration date of the domain
is extended by one year up to a total maximum of ten by virtue of the
transfer and the gaining Registrar is charged for that additional year,
even in cases where a full year is not added because of the 10-year
maximum limitation.
Bulk Transfer (with ICANN approval). Bulk transfers with ICANN approval
may be made during the Auto-Renew Grace Period according to the procedures
in Part B of Exhibit B to the Registry-Registrar Agreement. The expiration
dates of transferred registrations are not affected. The losing Registrar's
account is charged for the Auto-Renew.
(*Note: this is true despite the language in Appendix
G that states that "The losing registrar's registration fees
will not be refunded as a result of any ... transfer." In effect,
the losing registrar is not receiving a refund of paid registration fees,
it is just in a position to avoid incurring a permanent charge for the
one-year registration term going forward.)
Based on these rules (again, these are the current rules from the .com/.net/.org
registry "Grace Period Policy"), registrars receive a credit
equal to the US$6.00 auto-renewal fee for every registration that is transferred
away within 45 days of its auto-renewal.
The rationale for this "refund rule" with respect to names
that are transferred away during the Auto-Renew Grace Period is that the
losing registrar will no longer be sponsoring the name in the registry
for the remainder of the year and should not bear the cost of maintaining
its registration. The gaining registrar is charged US$6.00 for the one-year
associated with transfer of sponsorship of the name. The system's design
allows registrants to transfer their names to a new registrar within 45
days after the expiration of their registration with no resulting registry
fees to the losing registrar.
Registrants who transfer names within the 45-day Auto-Renew Grace Period
should check with the registrar from which they are transferring regarding
a possible refund. Even though losing registrars receive refunds of auto-renewal
fees they have paid to the registry in these circumstances, not all registrars
make refunds to customers. The effect of failure of the losing registrar
to refund is that the registrant pays registration fees to both the losing
registrar (for the auto-renew) and to the gaining registrar (for the transfer),
but only receives a one-year extension of term.
In summary, registrars should note (and advise their customers) that
in most cases where a name is transferred within 45 days after its expiration/renewal
date, the successfully transferred registration will only be extended
by one year, not two years as might be expected. In such cases, the transfer
during the Auto-Renew Grace Period simultaneously triggers a removal of
the auto-renewed year and a credit to the losing registrar, and a charge
to the gaining registrar for the year added to the registration term as
a result of the transfer.
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