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Domain name brokers FAQ
Once registered, a domain name is the property
of it's owner. Like other forms of property (real estate, for example), domain
name ownership can be transferred between owners who may agree to pay for this
property transfer. Selling a domain name, therefore, is very similar to selling
a house or a car.
Like selling your house, you have two main options for
selling a domain name that you currently own:
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Contact potential buyers directly; or
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Use a domain brokerage or listing service.
We'll review these options in more detail below and provide a
summary of the process for transferring
domain ownership.
In addition, the leasing of domain names
is becoming a popular and simple alternative to selling names. You will
find more information on this topic below as well.
Finally, see our WARNING about
restrictions on selling .info domain names registered on or before August
31, 2001.
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The legal registrant of a domain name is the
original Administrative Contact listed at the time of registration,
regardless of whether the Administrative Contact information has been changed
since then. If the administrative contact information has been changed since
the original registration, the most recent administrative contact information
entered will be visible in the WHOIS record. However, this information may not
be that of the actual registrant of the domain name.
In the event that you would like to sell your domain name,
the only way to legally change the registrant information on file is to undergo
an official Transfer of Registrant with your registrar. Simply editing contact
information (such as Organization and Administrative contacts) does not
constitute a Transfer of Registrant.
Registrars typically charge a fee -- often comparable to new
registration fees ($25-$35) -- to transfer domain registrations, so consider
this cost when selling a domain name.
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The WHOIS service makes information about who is
responsible for a domain name publicly available. Based upon the contact
information from a WHOIS look-up, you are permitted to contact the owner of a
domain name. One viable, though labor intensive, approach to selling your
domain is to contact the current owners of related domain names.
For example, if you own the domain name "autoloans.com" you
might try sending an email to the Administrative Contacts for "loans.com" (or
even several bank domain names) and indicate your interest in selling your
domain. From that point forward, you are free to negotiate for the
purchase of the name and arrange for ownership transfer. See
Transferring Domain Ownership for more details.
We recommend working with a professional broker or a
knowledgeable attorney to facilitate any transaction that results from directly
contacting another party unless the purchase price is below $500.
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Brokers connect buyers and sellers of domain
names. Most brokers facilitate these transactions through an automated online
listing or auction service, although others work on an individual basis with
buyers and sellers. While sellers can often list their names for free, most
brokerages earn commissions on any sales, generally 5% to %20 of the purchase
price paid by the seller.
In addition, most larger domain brokers provide an escrow
service which holds purchase funds from the buyer in a trust account until the
official transfer of ownership has been completed and verified. Brokers
may charge between $100 and $300 for this service and in many cases the service
can be used independent of the listing or auction services.
Many brokers also provide free parking
for domain name sellers and fee-based appraisal services to assess the value of
a particular name.
Some websites, called domain listing services, allow users to
list and sell their domain names free of commissions. These listing
services commonly route purchase offers directly to the seller's email
address. While free, listing sites often lack the professional and
complete services offered by a broker, and provide no legal protection for
buyers and sellers.
One important note: some
brokers require a seller to agree to list their domain name exclusively with
that broker for a defined period of time -- often 3 to 6 months.
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Some brokers and listing companies provide domain
parking services which create a single web page to advertise the sale of your
domain. This page is then displayed when a WWW user enters
your domain name into their browser. Since parking promotes your domain name
and the brokerage itself, many companies offer this service for free --
so-called "free parking."
Your domain parking web page usually allows an interested
buyer to make a purchase offer in one of two ways:
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offers are emailed directly to you; or
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offers are communicated to you via the brokerage.
Naturally, most brokerages that provide parking services
route offers through their web site in order to maintain control of the
purchase process.
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Leasing is an alternative to selling domain names in which rights to
use of the domain are rented for a defined period of time. Leasing a domain
name is much simpler, faster, and cheaper process than selling since no Transfer
of Registrant is required. Rather, the you just change the DNS information to
point to the renter's server.
For the lessor (the domain owner -- you), leasing is an
appealing option to selling since you retain total control over the DNS
information. If the lessee (renter) does not pay their rent, the DNS
record can easily be changed to prevent further traffic to the lessee's
website. Despite this control, it is advisable to have a solid lease
agreement in place.
Many different types of lease agreements can be used and we
suggest you use an attorney or professional broker to draft the contract. The
following are points to consider when developing the contract:
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Term
- How long will the lease be? Terms may be as short as month-to-month up to
several years. You should also consider specifying options for additional
terms (like a 1 year lease with two 1 year options) and the rent amount for
those terms.
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Purchase Option
- Does the lessee have an option to buy the domain name at anytime during the
lease, and if so at what price?
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Loyalty
- Are you allowed to sell the name if you receive an offer from a third party
while your lessee is renting?
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Price - What is the rent amount? How frequently is it paid --
monthly, quarterly, yearly? Is the rent amount fixed for the term of the
contract or does it increase over time?
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As part of the intellectual property protection incorporated into the
launch of the new .info top-level domain, Afilias offered a
"Sunrise Period" to enable trademark holders to register their marks in
advance of the general public. Sunrise names have a "created on" date prior
to September 1, 2001.
Sunrise names are not currently eligible for ownership
transfer as they are locked for up to 180 days following the close of the
Sunrise period on August 31, 2001. Additionally, all Sunrise names are subject
to challenge until December 26, 2001; current Sunrise domain name registrants
may lose ownership of the domain name as a result of a challenge proceeding,
thereby making it impossible for them to sell and deliver the name in question.
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