Europeans open formal inquiry over Net domains

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BRUSSELS -- The European Commission's investigation of Network Solutions Inc. (NSI) entered a new stage with the opening today of a formal inquiry into complaints that NSI is abusing its dominant position in the market for assigning Internet domain names.

"This new antitrust inquiry is part of an overall monitoring of ongoing developments in the management of generic

top-level domain names and of the Commission's efforts to guarantee the openness of the Internet," said a Commission statement.

The formal inquiry was prompted by the filing of several complaints with the Commission against the Herndon,

Va.-based registrar, which for years had a lock on the business of assigning the domain names ending in .com, .net and .org thanks to a contract with the U.S. government. The U.S. has sought to turn administration of the Internet over to a new regime that included creation of the Internet Corporation for Assigned Names and Numbers (ICANN) last year.

The investigation follows more than a year of informal talks and monitoring that began as ICANN was launched. While the new regime ends NSI's monopoly over the award of top-level domain names, the Commission is concerned that highly restrictive provisions in its licensing agreements with companies wanting to enter the market for domain-name registration will prevent competition from taking off.

The Commission hopes to carry out its investigation in close cooperation with the U.S. Department of Commerce. On June 21, the Commission wrote to J. Beckwith Burr, associate administrator at the Office of International Affairs within the Commerce Department, expressing its concerns and requesting information about the Department's own views and findings.

"We are still waiting for a response," said Stefan Rating, spokesman for Competition Commissioner Karel Van Miert.

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