To register a domain – very easy and very difficult!

When registering a new company, early registration of a domain is remarkably important, because each domain name must be unique and the domain registration sphere is run by the principle of “first come, first served“. Due to this domain names are registered by malicious persons, whose main goal is to cut profit from a possible sale of the domain name to its rightful owner.

Generally, the first step in establishing a company, is registering the business name and then the domain, under which goods and services are offered. Before establishing a company, it is not reasonable to disclose the name as this might lead to the loss of the possibility to register the domain. Conducting business with domain names is common in Estonia and all over the world. Persons who conduct business with domain names, register the names of domains that contain common words and expressions in order to later sell them to businesses. Most common are “.com” domain names. As a result, when creating a homepage, companies might discover that the domain name they want is already registered and when visiting that site, there is just information that this domain is for sale.

An article published in the Estonian business daily Äripäev on 15 June 2017 described a situation that occurred with a Finnish governmental party. The party in question, Uusi Vaihtoehto (New Alternative) was formed after the party The True Finns split. The new party was registered but they could not use the domain name www.uusivaihtoehto.fi, because this one was registered 27 minutes after the new party name was publicly announced by Annti Roine, a manager of a Finnish IT company. Antti Roine claimed that the purpose of his action was not malicious, but to give others a useful lesson. The politicians lost the domain name of their new party just because they disclosed the name of their party before registering its domain.

The procedure of registering a domain name is just a formality, meaning that no substantial analysis on who owns the rights to the name is conducted. The first registration application is simply satisfied. Since registering a domain name costs around 10 euros and takes just a couple of minutes, every person can use the registration system. That is also why that at first this might seem simple and trivial but may later cause a lot of troubles, if it is overlooked.

Overlooking the possibility to register the domain early might cause the necessity to change the name of the company in order to find a suitable domain name. To prevent problems, the best solution is to register the name of the domain as early as possible – definitely before any public announcements, press releases, or company registrations.

The simplicity of registering a domain name has its upsides as well. For example, the spread of WannaCry, the cause of a recent spyware attack (this was the virus that locked all the data in computers and demanded a ransom for unlocking them) was tamed by registering a domain name that communicated with the spyware.

The most used domains in Estonia are registered domain names that end with “.ee” and the most used international domain names end with “.com”, “.eu” and “.net”. Natural persons, companies, as well as institutions are entitled to register an indefinite number of .ee domains. However, the desirable domain name must be available, because it is not possible to register two identical domain names.

In Estonia, it is possible to file a complaint to a Domain Disputes Committee if someone has registered a domain name that coincides with a trademark belonging to someone else, or with a company’s registered name in the Business Register, or another righteous name.

The Supreme Court explained in a ruling in 2006 that despite some problems, it is not rational to regulate the organization of domain names with legislation. Other countries have also avoided regulating the Internet on a national level.

A domain name’s functions largely resemble a trademark because it provides information, depicts heritage and has an advertising function. Using trademark law, the proprietor of a trademark registered in Estonia (including EU trademarks) is entitled to prohibit other persons from using a domain name for the same kind of goods and services in Estonia, if the domain name can be accounted as using a trademark. But if no goods or services are offered in Estonia under the domain name, there is no business-related result and in such a case the proprietor of a trademark registered in Estonia is not entitled to even start any proceedings.

By Gertrud Sein and Karolina Ullman

If you have questions regarding trademarks or domain names, please contact NJORD partner Karolina Ullman.

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