EFA appreciates the opportunity to respond to the Issues Paper "Domain Monetisation and the 
'Close and Substantial Connection' Rule". As a founding member of auDA, EFA has supported the 
development of the Australian .com.au domain space as a qualified domain space for Australian 
businesses seeking a web presence for their business. The continuing role of the "close and 
substantial connection" rule in preserving the quality and usefulness of the .com.au name 
space is seen by EFA as an important brake against the .com.au name space becoming a diluted 
and degraded name space where legitimate businesses are crowded out by advertising links and 
misleading advertising portals.

The Australian Internet and end users expect that "widgets.com.au" contains information on a 
company that sells widgets, not Viagra. Removing the "close and substantial connection" rule 
would make every .com.au name suspect, and increasingly so as domain monetisers would 
progressively buy up "the good names" to peddle advertising traffic. 

A pay-per-click website utilising a domain name with a name like widgets is not a valid use 
and the connection is neither close nor substantial. On the contrary, it is a classic case of 
"bad faith registration" and should be regulated by:
(a) Insisting on a close and substantial connection with the name by any registrant;
(b) Requiring registrars to verify that a registrant has a business, trademark, substantial 
product or service which establishes the necessary "close and substantial connection"; and
(c) Specifically referencing PPC sites as bad-faith registrations for auDRP purposes.

Accordingly, in response to Issue 1, EFA submits that only a "developed website" should be a 
permitted use of a domain name among the listed options. That is, a company that sells widgets 
and has a web presence may be permitted to monetise traffic incidentally to the purpose of 
providing a web presence for their business. The category of "Information website with ads" is 
a sub-category of a "developed website" in EFA's view.

As to issue 2, the impact and damage to the .com.au by the monetising of non-generic names by 
domain monetisation is greater than with generic names, but neither use is acceptable. Even 
advertising.com.au should resolve to a business that creates advertising, not a portal that 
makes money from PPC.

In EFA's opinion, end-users would prefer a "404" page to a misleading advertising page. There is 
no value in a parked domain.

As to Issue 3, the practice of "tasting" or "name-testing" is unacceptable for any legitimate 
use and would create problems for caching and archiving content. It is a scammer's practice and 
no responsible authority would allow it. The question of "how many names can one registrant have" 
is vexed, since complex businesses may have a number of legitimate web presences that cannot be 
served by sub-domains, and of course a registrant could set up a number of business entities that 
each hold the maximum permitted number of names. However, on balance the Australian Internet 
community could manage with a limit of 10 names per registrant provided that auDA had an over-
arching discretion to permit a greater number on application to auDA, or to suspend the 
registration of multiple names when it is clear that a single owner is behind a group of legal 
entities each holding 10 names.

Issue 4 is the "litmus test" for .au. If domain monetisation is permitted to sweep away the 
"close and substantial connection" rule, the name space has fallen to "Rafferty's Rules". Under 
a system where an intention to get PPC traffic from BHP is enough of a reason to hold "bhp.com.au", 
the Internet community and search engines would lose faith in the websites in .com.au. It would 
impose an economic burden on businesses to use auDRP and other legal mechanisms to protect their 
own names, trademarks and industry sectors. Australian websites would descend to the lowest 
common denominator, with the logical conclusion being a namespace equally divided between the sex 
industry and mortgage financiers. 

Put simply, if the intention to earn revenue from PPC traffic justifies holding a .com.au name, 
there is no reason to prohibit an unregulated secondary market in domain names, typo domains and 
any form of trademark infringement. It's like the Mafia claiming an interest in the building 
industry because of extortion of building companies. If the practice has been growing in .au, it 
is only because of the convenient blindness of certain registrars and the difficulty in detecting 
PPC sites within the hundreds of thousands of .au sites.

There may be a place for portal sites, but only those of high relevance and comprehensive coverage 
of applicable sites should be encouraged. A short list of "preferred partners" or "paid links" is 
useless as a portal site.

For the above reasons, and to keep .au as a quality name space, EFA strongly supports 
implementation option 1 being to renew and enforce the "close and substantial connection" rule 
under an ongoing commitment by auDA to police the rule as necessary.


Kimberley Heitman,
For and on behalf of the Board,
Electronic Frontiers Australia Inc
30th April 2006