New Zealand’s largest domain name registrar, Domainz, will be prevented from registering new domains for 48 hours next month after receiving a sanction from domain name commissioner Debbie Monahan.
Monahan announced the sanction yesterday. Domainz was penalised for slow updates of the term of some registrations, leading to the possibility of double-billing nameholders who switched registrars.
In order to minimise the risk of non-payment, Domainz initially registers a domain for a month and extends the term once payment has been received. Monahan says problems arose when a nameholder paid Domainz and then tried to change to a different registrar, but the register had not been updated to reflect the payment.
Investigation of the issue began in February, Monahan told Computerworld.
“One of the reasons for the sanction is the time it’s taken [to correct],” she says. “I am aware that at least five registrants were affected.”
Asked how the penalty was assessed, she says 48 hours is “long enough to make an impact".
Current nameholders will not be affected, Monahan says. The sanction applies only to the registration of new names and to transfers.
Domainz CEO Derek Locke says the financial impact of the sanction will be minimal, but the public relations fallout might have a longer-term impact.
“It’s very difficult for us to know,” he says. “It certainly won’t be positive.”
Locke says Domainz has faced a large number of implementation issues in adapting to the new shared registry system, and has received no other complaints about transfers.
“You have to say, the implementation has gone pretty smoothly, if this is the only thing that’s gone wrong.”
The sanction is fair, he says. “We want to put it behind us and move on. It’s not going to happen again.”
By initially registering domains for only a month, Domainz limits its exposure to $2 instead of $24, Locke says.
“Our history suggests that 18% of people don’t renew.”
Domainz had a monopoly on .nz registrations until October last year, when the new shared registry system came into effect.
It is the first registrar to receive a “serious” sanction, Monahan says and it has fixed the problem.
“I think it’s a sign of a new market.”