Romania enforces diacritical marks on domain registration – how does this impact the market?

Nowadays, many Romanians don’t use diacritical marks when writing in Romanian anymore, so the recent decision to include diacritical marks in local domain names has taken the market by surprise. The main domain registrar in Romania, ROTLD, which is under the management of the country’s National Research and Development Institute in IT (ICI Bucharest) has decided to allow it. What does this mean for the market, for existing and for new domain owners? Lawyers believe the new domain names, containing diacritical marks, will create confusion and potentially generate losses for the owners of the earlier domain names. In Romanian, diacritical characters are “ă”, „â”, „î”, „ș” and „ț”. What not many people know is that domain names are different from intellectual property rights, such as a trademark right or a copyright. In other words, simply owning a domain does not confer any ownership rights, such as a registered trademark does, nor do they offer an exclusive right similar to the ones conferred by intellectual property rights. “Domain names merely confer a right of use. The person who registers a certain domain name, either a company or a natural person, shall usually create a website associated with the domain name and use it in order to promote itself or its activity,” explains Elena Grecu, Attorney at law and Intellectual Property Consultant with Nomenius. The ROTLD announced in the beginning of June it was updating its software, allowing diacritical marks in domain names. “We are convinced that hundreds or even thousands of domain names containing diacritical characters have been registered since the moment I.C.I. Bucharest has revealed its new software. The most important matter at hand is the fact that many of these domain names, as well as many of the domain names that are going to be registered in the near future either are or will be very similar to already registered domain names. This aspect will surely create confusion on the relevant markets, as well as potentially generate losses for the owners of the earlier domain names,” Elena Grecu further explained. Those who had registered earlier domain name who already own a similar registered trademark, can use said trademark to file a counterfeiting action against the registrant of the newer domain name, with diacritical markets. “The registered trademark also offers its owner the prerogative to address the WIPO Arbitration and Mediation Center in order to settle any conflict as well as to acquire the transfer of the domain name registered in bad faith by another entity,” the lawyer added. Even if the earlier domain name owner does not have that trademark, it is still possible to convince the court to transfer the domain name with diacritical marks to the owner of the prior domain name. This will however happen only if the latter proves that the registration of the newer domain name containing diacritical characters has been registered in bad faith, with an unfair purpose in mind- such as blackmailing the owner of the prior domain name. But usually, bad-faith is fairly hard to prove in court, so registrants of descriptive domain names are disadvantaged by the new rules. Lawyers advise buying the new, similar domain names. “I noticed that most of the individuals who register domain names hoping to make an undeserved profit usually build a small website and publish the link on a few other web pages (so their website can appear on Google or other search engines). Afterwards, they just wait for the registrant of the earlier website to find it and approach them in order to negotiate the transfer of the newer domain name,” Grecu explains. The main problem is that legally speaking, a domain name cannot be transferred through an onerous juridical act - the Transfer Agreement cannot specify an amount of money - so another problem arises: the payment must be made in “black money”. “So, to avoid such circumstances, I advise all honest professionals to register all domain names with diacritical characters similar to the one already registered as soon as possible,” she concluded.