Dot-org, or “.org,” is one of the oldest and largest domains on the Internet — a digital home for more than 10.5 million websites, many of them nonprofits.
The group that operates this massive registry is itself a Pennsylvania charitable organization — Public Interest Registry — and has been up for sale for months to a private equity firm.
Hundreds of groups, including several Pennsylvania nonprofits, opposed the deal through a petition called “SaveDotOrg,” saying they were alarmed about the possibilities of increased prices and other ways the new owners could seek to turn a profit.
On Thursday night those groups got their way. The board of the Internet Corporation for Assigned Names and Numbers (ICANN), which oversees the domain name system, rejected the $1.1 billion proposal.
ICANN’s board said Public Interest Registry “has enjoyed a close and responsible relationship with its community for nearly 20 years,” and that the board could not allow it to be sold to “an untested private equity firm.”
Under the proposed sale to Ethos Capital, Public Interest Registry would have been converted from a nonprofit to a for-profit corporation, and taken on $360 million in debt. ICANN’s board said there was too much uncertainty about whether the registry could repay that amount, potentially jeopardizing its “long-term financial stability.”
California’s Attorney General, the board noted, also said the debt burden and other aspects of the sale raised “serious concerns” for the nonprofit community, and had asked ICANN to block the proposal.
Oversight by Pennsylvania’s attorney general, which has jurisdiction over state charities, was another factor in the board’s decision. To become a for-profit, Public Interest Registry would need to get approval from the Pennsylvania Orphans’ Court, and the office of state AG Josh Shapiro has the power to review and weigh in on such a request.
ICANN’s board had a May 4 deadline to make its own decision, and said the Pennsylvania process wouldn’t be finished by then — so it still does not know Shapiro’s view on the matter, or whether the court will authorize the change.
The “lack of approval from the Pennsylvania authorities has remained an area of concern for the board,” according to its decision.
Shapiro’s office did not immediately respond to a request for comment on Friday.
Ethos Capital, in a statement, said the decision by ICANN “sets a dangerous precedent,” and opens the door for the organization to “unilaterally reject future transfer requests based on agenda-driven pressure by outside parties.
The firm is “evaluating its options at this time,” the statement said.
Public Interest Registry called the decision “disappointing,” but said the organization is “committed as ever” to its mission of running the dot-org registry. While the nonprofit is incorporated in Pennsylvania, it operates out of headquarters in Reston, Va.
Groups such as the Pennsylvania Child Care Association, Pennsylvania Interfaith Power & Light, and the Pennsylvania Association of Nonprofit Organizations, which has more than 1,000 members, had signed the “SaveDotOrg” petition, along with Girl Scouts of the USA, the YMCA, and the American Red Cross.
©2020 The Philadelphia Inquirer
Visit The Philadelphia Inquirer at www.inquirer.com
Distributed by Tribune Content Agency, LLC.