Here is the InternetNZ position on the second policy for discussion in Singapore. The original policy text can be found here: http://www.apnic.net/__data/assets/text_file/0009/56871/prop-106-v001.txt ------------------------------------------------------------------------ InternetNZ position on prop-106-v001: Restricting excessive IPv4 address transfers under the final /8 block ------------------------------------------------------------------------ Authors: Dean Pemberton dean(a)internetnz.net.nz javascript:; 1. Executive Summary -------------------- Prop-106 suggests that based on observations of APNIC IP resource transfer history records, some LIRs seems to be collecting IPv4 address blocks from the ‘final /8’ (103/8). It also suggests that this is being accomplished through the use of multiple accounts to apply for individual /22s, and then transferring these blocks to a single account and that this kind of behaviour is against the spirit of the final /8 policy (prop-088). Prop-106 intends to restrict IPv4 address transfers which were allocated/assigned from the final /8 block. In assessing whether Iupport, oppose, or adopt a position of neutrality on a particular policy proposal, three questions are considered: 1. Does this policy seek to address a well-defined, well-accepted problem? 2. Will the solutions outlined within the proposal effectively mitigate the stated problem? 3. Does the policy proposal fit with InternetNZ policy principles? After consideration the questions above, InternetNZ believes that: 1. Based on information provided by the APNIC secretariat, there is no evidence supporting a threat to exploit any perceived loophole in the APNIC transfer policy. As such this proposal does not address a well-defined, well-accepted problem. 2. The options presented within this policy proposal will have no material effect on the sorts of IP resource hoarding activity being suggested to occur in the problem statement. 3. This policy proposal does not fit within several of InternetNZ policy principles, namely those of: Openness, Market competition, Working with the architecture of the internet and accessibility of the internet for all. As such InternetNZ opposes the adoption of APNIC prop-106 as presented in version 001. 2. Does this policy seek to address a well-defined, well-accepted problem? ------------------------------------------------------------------------ Prop-106 states: "The current APNIC IPv4 address transfer policy allows to obtain a maximum of /22 distribution(s) per each APNIC account holder. We propose add a restriction to IPv4 address transfer policy to restricting excessive IPv4 address transfers under the final /8 block." This proposal looks to close a perceived loophole in APNIC's transfer policy that is suggested would allow a single actor to obtain, through mergers and acquisitions (M&As), more than their allowed /22 from the final /8. Prop-106 suggests that this activity has already been observed and as such a policy is required to close the perceived loophole. In considering if this perceived loophole exists and is actually being exploited, InternetNZ has used information provided by the APNIC secretariat. There are 16,384 /22 blocks available from 103/8. APNIC has made 2,110 (12.9%[1]) delegations so far. Of those delegations, 32 (1.5% of allocations, or 0.2% of the total available) have been transferred. This consists of 24 standard transfers and 8 M&A transfers. 15 APNIC members have more than a single /22 from 103/8 associated with their account. The highest number is 5 x /22s in one account. These five /22 blocks represent 0.03% of the address space within 103/8. It would appear, based on this information, that there is not currently a large amount of activity looking to exploit any perceived loophole in existing APNIC transfer policy. As such, InternetNZ does not believe that this proposal seeks to address a well-defined, well-accepted problem. 3. Will the solutions outlined within the proposal effectively mitigate the stated problem? ------------------------------------------------------------------------ Prop-106 suggests two options that claim to close the perceived loophole in APNIC's transfer policy: Option 1: Restrict IPv4 address transfers under the final /8 address block for two years. Option 2: Set a deposit for transfers under the final /8 range. Pay ten years of APNIC's annual fees for transferred address block[s] in advance when receiving the final /8 address range by address transfer or account name change. Both of these options seek to dissuade an actor from transferring 103/8 addresses from multiple shell companies to a single APNIC account. It should be noted however, that there is nothing to stop such an actor from registering and using the same addresses and wilfully failing to notify APNIC. In such a scenario the actor would have access to multiple /22s from the 103/8 block, but the APNIC registration database would reflect that these were held by different entities. The options presented in prop-106 are intended to influence the behaviour of actors that are operating outside the intent of the last /8 policy. InternetNZ suggests that if such actors exist, and are seeking to operate outside APNIC policy, they are unlikely to comply with the proposed policy presented here. As such, InternetNZ believes that this proposed policy will have no material effect on the sorts of IP resource-hoarding activity that is suggested in the problem statement. 4. Does the policy proposal fit within InternetNZ policy principles? ------------------------------------------------------------------------ A set of eight policy principles[2] underpin the work of InternetNZ and help ensure that our approach to Internet-related public and technical policy is transparent and predictable. Internally, the principles guide the development of policy positions and statements. Externally, they explain the basis of InternetNZ’s views to our stakeholders and to the general public. Any proposal that InternetNZ takes a position on is evaluated against these principles. Six of the eight principles apply with respect to prop-106. They are the following: ** Principle No. 1 The Internet should be open and uncapturable. ** In considering a policy proposal using this principle, InternetNZ looks to see if there will be a material effect to openness and/or non capturability. Openness -------- As stated above, there is a material concern that one outcome of this policy would be to discourage actors to from interacting with APNIC during merger & acquisition activity (regardless of their intentions for procuring the addresses). Such a move would have a material effect on the openness of the Internet through an erosion of trust in the ability of the APNIC database to accurately represent the ownership of IP resources. Uncapturable ------------ There is a small chance that an actor could register multiple companies, gain /22 resources and then acquire them. Information provided by the APNIC secretariat shows that this situation is either not occurring, or is occurring at such a low level as to not pose a material threat to the capturability of the Internet. It is accepted that should this situation change in the future that intervention may be required and a watching brief should be kept on the situation. ** Principle No. 2 Internet markets should be competitive. ** For a market to be competitive it must not place any significant barriers on new entrants, nor should it place significant barriers on the natural growth of organisations through M&As. As stated above, prop-106 proposes to place barriers on any entity looking to complete M&A activity involving IP resources from 103/8. If these actors have benign intent and wish to operate within APNIC policies, these barriers will place an undue burden on them. If on the other hand the actors have malicious intent, there are numerous ways for them to avoid the burdens imposed by these policies and achieve their outcomes. As such InternetNZ believes that this policy will have a negative impact on the competition within the Internet market. ** Principle No. 3 Internet governance should be determined by open, multi-stakeholder processes. ** APNIC has an open, multi-stakeholder policy development process. This proposal does nothing to alter that. ** Principle No. 4 Laws and policies should work with the architecture of the Internet, not against it. ** By placing barriers in the way of all M&A activity, APNIC may discourage actors from updating IP resource usage in the APNIC database. This would cause a loss of trust in the integrity of the information in the APNIC database. As this information is used to make decisions related to security, incident response and even routing decisions on the Internet, InternetNZ believes that the effects of this proposal could act against the architecture of the Internet. ** Principle No. 6 The Internet should be accessible by and inclusive of everyone. ** The Internet is undergoing a significant period of growth, especially in developing markets (such as BRIC[3]). While it is an established fact that IPv4 addresses have all but been exhausted and IPv6 represents the only sustainable future direction, access to IPv4 resources is currently a major requirement for the rapid deployment of Internet access throughout these growing economies. InternetNZ believes that placing barriers such as those proposed by prop-106 on M&A activities may have a negative effect on Internet deployment and growth within developing economies in the region. ** Principle No. 7 Technology changes quickly, so laws and policies should focus on activity. ** There is clear evidence of significant activity in terms of Internet growth within the region. This is shown through the allocation of 11-12% of the final /8 in a relatively short period of time. Given that IPv6 is accepted as the only clear future deployment direction for the Internet, yet there is a clear short-term demand for IPv4 resources, InternetNZ believes that barriers should not be placed in the way of getting these resources to those who require them to provide solutions to current technical problems. 5. Summary ---------- After consideration of the material above, InternetNZ believes that: 1. Based on information provided by the APNIC secretariat, there is no evidence supporting a threat to exploit any perceived loophole in the APNIC transfer policy. As such this proposal does not address a well-defined, well-accepted problem. 2. The options presented within this policy proposal will have no material effect on the sorts of IP resource hoarding activity being suggested to occur in the problem statement. 3. This policy proposal does not fit within several of InternetNZ policy principles, namely those of: Openness, Market competition, Working with the architecture of the internet and accessibility of the internet for all. As such InternetNZ opposes the adoption of APNIC prop-106 as presented in version 001. Dean Pemberton Policy Advisor InternetNZ dean(a)internetnz.net.nz javascript:; ________________ [1] Some delegations are of smaller size (/24 or /23) so the utilisation is actually closer to 11%. [2] https://internetnz.net.nz/content/Policy-Principles [3] http://en.wikipedia.org/wiki/BRIC