[ga] 74,000 .eu domains suspended and phantom registrars sued

[Danny Younger <dannyyounger@xxxxxxxxx>]

By Kieren McCarthy

Over 74,000 .eu domains have been suspended and 400
registering companies sued by the company in charge of
the European Union's top-level domain.

Non-profit organisation EURid has taken legal action
after a review of the system for .eu domains (which
went live in April) revealed a small number of
companies had registered several hundred phantom
companies in order to manipulate the system.

 A EURid spokesman told The Register that every one of
the 400 registrars had been sued for breaching its
contract with the company because they were
"warehousing" domains - storing them in order to sell
them on.

All the 74,000 domains registered by the 400
registrars were now in the hands of just three
companies - Ovidio Ltd, Fausto Ltd and Gabino Ltd, he
explained. "We are convinced the registrars are just a
front, and can be looked on as one and the same."

The company is waiting for court proceedings to begin
in Brussels in October. EURid then hopes to make all
the domains in question, which are currently "on
hold", available again as soon as possible, although
it is unlikely to be a position to do so until at
least the end of the year.

EURid stressed, however, that this legal action was
only the start of its review and it will continue to
investigate other complaints about phoney registrars.
It has already suspended an unspecified number of
other domains because the owner was unable to prove
they lived within the EU.

Since EURid's computer system worked by creating a
virtual queue of accredited companies who then took it
in turns to try to register a particular .eu domain,
the ?10,000 registration fee for each company made it
worthwhile for a few large US companies to flood the
system with front companies and then profit from
selling valuable .eu domains later.

The result was that a large number of domains were
taken by companies unknown in the registrar industry,
causing an immediate outcry from more established
companies.

Despite the controversy, the .eu top-level domain has
been an unexpected success with EURid announcing
earlier this month that it has sold its two millionth
.eu domain in just three months. 

http://www.theregister.co.uk/2006/07/24/eu_domains_suspended/

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