Eurid suspends more than 74,000 .eu domain names

IDG News Service - Alleged dirty business practices surrounding the registration process for the European Union's new top-level domain have resulted in more than 74,000 .eu Web addresses being suspended and 400 registrars sued for breach of contract.

Eurid vzw, the nonprofit organization in charge of the .eu registry, took legal action after determining that a syndicate of registrars had systematically acquired domain names with the intent of selling them, a process known as warehousing, which is not permitted, the organization said yesterday.

According to Eurid, all of the 74,000 domains registered by the 400 registrars are actually in the hands of three U.K.-based companies: Fausto Ltd., Gabino Ltd. and Ovidio Ltd. The organization is convinced that the domain name holders and the registrars are one and the same.

The three companies could not be reached for comment. They appear to have identical Web sites, with static text describing their businesses and only the name of the company different in each case. The Web sites are at www.faustolimited.com, www.gabinolimited.com and www.ovidiolimited.com.

Court proceedings will begin shortly, Eurid said, after which it hopes to make the names available for registration.

Critics have said that the .eu domain name registration process is partly to blame for some of the alleged fraudulent behavior.

Earlier this year, Bob Parsons, CEO of domain name registrar GoDaddy.com Inc., accused Eurid of inept organization that allows companies to cheat the system by setting up bogus registrars to work on their behalf.

Eurid's registry system is designed to give each registrar equal access to the database and equal chances to register unclaimed names, according to Parsons. The registrars effectively "line up" to make a request for a .eu domain name. If the name is available, the registrar gets it for its customer. If it's not, the registrar goes to the back of the line to wait for another turn.

Parsons claimed that some companies spotted a loophole in the system: By creating additional, bogus registrars and applying for accreditation for them, they were able to multiply their chances of successfully making registrations.

"Phantom registrars" were created to hijack the .eu landrush, Parsons wrote in his blog.

Eurid claims that it constantly monitors the registrations of .eu domain names to ensure that all name holders are based in the EU, as required by the .eu public policy rules. The organization also strives to verify that all accredited registrars are acting in the best interest of consumers and businesses, it said.