Annex 03 - Recmmendatin #3 Annex 03 - Recmmendatin #3: Redefining ICANN s Bylaws as Standard Bylaws and Fundamental Bylaws 1. Summary Currently ICANN nly has ne class f Bylaws. All ICANN Bylaws can be changed by a 2/3 vte f the ICANN Bard. The Bard is nt required t cnsult the ICANN cmmunity r the wider public befre changing these but has vluntarily dne s up t this pint. The CCWG Accuntability is recmmending splitting the ICANN Bylaws int Fundamental Bylaws and Standard Bylaws where Fundamental Bylaws will be mre difficult t change. Specifically the CCWG-Accuntability recmmends that: Public cnsultatins be required n all changes t ICANN Bylaws, bth Fundamental and Standard. The requirement fr public cnsultatins is added t the ICANN Bylaws as a Fundamental Bylaw t ensure that ICANN must cntinue t engage with the cmmunity in the future. Any changes t Fundamental Bylaws require apprval frm bth the ICANN Bard and cmmunity as utlined in the respective Cmmunity Pwer (see Recmmendatin #4: Ensuring cmmunity invlvement in ICANN decisin-making: Seven new Cmmunity Pwers ). The threshld fr ICANN Bard apprval fr changing a Fundamental Bylaw is raised frm 2/3 t 3/4. Why is the CCWG Accuntability recmmending this? The CCWG-Accuntability felt that it was crucial t ensure that ICANN Bylaws that embdy the purpse f the rganizatin (Missin, Cmmitments and Cre Values) and are meant t ensure the accuntability f the ICANN Bard cannt be changed by the ICANN Bard acting alne. 2. CCWG-Accuntability Recmmendatins 1 The CCWG-Accuntability recmmends: Splitting the ICANN Bylaws int Fundamental Bylaws and Standard Bylaws. Examples f Fundamental Bylaws include: 30 Nvember 2015 1
Annex 03 - Recmmendatin #3 The Missin, Cmmitments and Cre Values The framewrk fr the Independent Review Prcess The prcess fr amending Fundamental Bylaws and Articles f Incrpratin The seven Cmmunity Pwers The Cmmunity Mechanism as the Sle Designatr, i.e. the Empwered Cmmunity The IANA Functin Review, Special IANA Functin Review and the Separatin Prcess required by the IANA Stewardship Transitin prpsal The Pst-Transitin IANA Gvernance and Custmer Standing Cmmittee als required by the IANA Stewardship Transitin prpsal The right f inspectin be granted t the sle designatr, as utlined in the Califrnia Crpratins Cde 6330. ICANN Bylaws be designated as Fundamental Bylaws that wuld be mre difficult t change. Remaining (r Standard ) Bylaws wuld als require cnsultatin befre they can be changed. Requiring apprval fr any changes t Fundamental Bylaws and Articles f Incrpratin frm bth the ICANN Bard and cmmunity as utlined in the respective Cmmunity Pwer (See Recmmendatin #4: Ensuring cmmunity invlvement in ICANN decisin-making: Seven New Cmmunity Pwers ). Raising the threshld fr ICANN Bard apprval fr changing a Fundamental Bylaw r Articles f Incrpratin frm tw-thirds t 75%. 3. Detailed Explanatin f Recmmendatins 2 What is a Fundamental Bylaw? 3 ICANN Bylaws describe hw pwer is exercised in ICANN, including setting ut the rganizatin s Missin, Cmmitments and Cre Values. Tgether with the Articles f Incrpratin, the Bylaws are an essential part f ICANN because they set the scpe f the rganizatin s crprate authrity, determine its gvernance framewrk and define wrking practices. 4 Tday, ICANN Bylaws can be changed by a reslutin f the Bard upn a 66% majrity vte. The CCWG-Accuntability believes that the set f key Bylaws fundamental t ICANN s stability and peratinal cntinuity and essential fr the cmmunity s decisins-rights shuld be given additinal prtectin frm changes by requiring cmmunity apprval f any amendments. These key Bylaws will be identified as Fundamental Bylaws. 30 Nvember 2015 2
Annex 03 - Recmmendatin #3 5 As such, the CCWG-Accuntability prpses t make Fundamental Bylaws harder t change than Standard Bylaws in tw ways: 1. By sharing the authrity t authrize changes between the ICANN Bard and the ICANN cmmunity (rganized thrugh its Supprting Organizatins and Advisry Cmmittees in the Empwered Cmmunity utlined in Recmmendatin #1: Establishing an Empwered Cmmunity fr enfrcing Cmmunity Pwers ) 2. By requiring a higher threshld t authrize changes t Fundamental Bylaws than fr Standard Bylaws. 6 The establishment f Fundamental Bylaws wuld indirectly enhance ICANN s accuntability t the glbal Internet cmmunity by sharing the authrity f decisin-making mre widely and increasing the difficulty f amending these key aspects f ICANN. 7 This recmmendatin is imprtant in the cntext f the IANA Stewardship Transitin because the histric cntractual relatinship with the U.S. Gvernment prvided assurance t the cmmunity that the fundamental nature f ICANN was unlikely t be changed withut widespread agreement. Withut that relatinship in place, prcedural prtectins and mre widely shared decisin-rights n cre cmpnents f ICANN s scpe and authrity shuld help maintain the cmmunity s cnfidence in ICANN. 8 Establishing Fundamental Bylaws 9 T implement the establishment f Fundamental Bylaws, a new prvisin wuld be added t the Bylaws that sets ut: 1. Which sectins f the Bylaws are Fundamental Bylaws (i.e. a list f the articles/sectins/subsectins that are fundamental). 2. Hw new Fundamental Bylaws can be defined and hw existing Fundamental Bylaws can be amended r remved. 10 Adding New r Amending Existing Fundamental Bylaws 11 While the CCWG-Accuntability recmmends frtifying certain aspects f the ICANN Bylaws, the glbal public interest wuld nt be served if ICANN culd nt fundamentally evlve in respnse t the changing Internet envirnment. Therefre, the CCWG-Accuntability recgnizes the imprtance f the ability t define new Fundamental Bylaws ver time, r t amend r remve existing nes. 30 Nvember 2015 3
Annex 03 - Recmmendatin #3 12 T establish a new Fundamental Bylaw r t amend r remve an existing ne, the fllwing steps wuld be fllwed, where the ICANN Bard (r the staff thrugh the ICANN Bard) is prpsing the additin r amendment: The Bard prpses a new Fundamental Bylaw, amendment f a Fundamental Bylaw r remval f a Fundamental Bylaw. The Bard apprves the additin, amendment r remval f the Fundamental Bylaw with a 3/4 vte f all standing Directrs. The cmmunity apprves the additin, amendment r remval f the Fundamental Bylaw by deciding t use its pwer as an Empwered Cmmunity t apprve the change (See Recmmendatin #4: Ensuring cmmunity invlvement in ICANN decisin-making: Seven new Cmmunity Pwers ) 13 If the additin, amendment r remval f the Fundamental Bylaw is agreed upn by bth the ICANN Bard and the cmmunity: The new/revised Fundamental Bylaw wuld appear in the Bylaws, and an apprpriate reference t the text as a Fundamental Bylaw wuld be added (if needed) t the part f the Bylaws that lists them. In the case f an amendment t existing Bylaws text, the text wuld be updated. In the case f a remval, the text wuld be remved. 14 The CCWG-Accuntability des nt prpse that the cmmunity gain the pwer t directly prpse changes t the Bylaws. 15 Which f the Current Bylaws Wuld Becme Fundamental Bylaws? 16 The CCWG-Accuntability suggests that nly critical aspects f the ICANN Bylaws be defined in the Fundamental Bylaws t avid intrducing unnecessary rigidity int ICANN s structures. The CCWG-Accuntability cncluded that suggesting that all changes t ICANN Bylaws shuld face 30 Nvember 2015 4
Annex 03 - Recmmendatin #3 the same threshlds that are prpsed fr Fundamental Bylaws wuld harm, nt help, ICANN s verall accuntability. 17 The CCWG-Accuntability views critical aspects as thse that define ICANN s Missin, Cmmitments and Cre Values, the requirements f the IANA Stewardship Transitin, and the cre accuntability tls the cmmunity requires. 18 Accrdingly, the CCWG-Accuntability recmmends that the fllwing aspects be made Fundamental Bylaws as a part f Wrk Stream 1: 1. The Missin, Cmmitments and Cre Values 2. The framewrk fr the Independent Review Prcess 3. The prcess fr amending Fundamental Bylaws and/r Articles f Incrpratin 4. The pwers set ut in Sectin 7 f this reprt 5. The Cmmunity Mechanism as the Sle Member Mdel 6. The IANA Functin Review and the Separatin Prcess required by the CWG- Stewardship s prpsal 7. The Pst-Transitin IANA gvernance and Custmer Standing Cmmittee structures, als required by the CWG-Stewardship s prpsal 8. The right f inspectin granted t the sle designatr, as utlined in the Califrnia Crpratins Cde 6333. 19 T address the questin related t whether the ICANN Bylaw regarding lcatin f ICANN s headquarters shuld be a Fundamental Bylaw, the CCWG-Accuntability referred t the Affirmatin f Cmmitments paragraph 8(b), where ICANN affirms its cmmitments t: (b) remain a nt fr prfit crpratin, headquartered in the United States f America with ffices arund the wrld t meet the needs f a glbal cmmunity and determined that ICANN s present Articles f Incrpratin already state that ICANN is a nnprfit public benefit crpratin rganized under Califrnia law: 3. This Crpratin is a nnprfit public benefit crpratin and is nt rganized fr the private gain f any persn. It is rganized under the Califrnia Nnprfit Public Benefit Crpratin Law fr charitable and public purpses." 20 Any change t ICANN s Articles f Incrpratin wuld require apprval by the Bard: 9. These Articles may be amended by the affirmative vte f at least tw-thirds f the directrs f the Crpratin. When the Crpratin has members, any such amendment must be ratified by a tw-thirds (2/3) majrity f the members vting n any prpsed amendment. 21 Under the prpsal fr the Cmmunity Mechanism as Sle Member, the Member wuld need t apprve any change t ICANN s present status as a Califrnia nnprfit public benefit crpratin. 22 The headquartered cmmitment in 8b is already in the current ICANN Bylaws, at Article XVIII Sectin 1: OFFICES. The principal ffice fr the transactin f the business f ICANN shall be in the Cunty f Ls Angeles, State f Califrnia, United States f America. ICANN may als have 30 Nvember 2015 5
Annex 03 - Recmmendatin #3 an additinal ffice r ffices within r utside the United States f America as it may frm time t time establish. 23 While the Bard culd prpse a change t this Bylaws prvisin, the Empwered Cmmunity mechanism culd blck the prpsed change. 24 In its Initial Draft Reprt, the CCWG-Accuntability asked cmmenters whether Bylaws Article XVIII Sectin 1 shuld keep its current status as a Standard Bylaw, r be designated as a Fundamental Bylaw. 25 Tw cnsideratins suggest that the CCWG-Accuntability shuld nt prpse that Article XVIII be designated as a Fundamental Bylaw: Public cmment n the first and secnd draft was evenly split n the questin f whether t designate Article XVIII a Fundamental Bylaw. Supprting this designatin were several cmmenters frm the Cmmercial Stakehlders Grup f GNSO. Gvernments were amng thse expressing strng ppsitin. Secnd, the Empwered cmmunity culd blck any prpsed change t ICANN Bylaws Article XVIII, which states, The principal ffice fr the transactin f the business f ICANN shall be in the Cunty f Ls Angeles, State f Califrnia. 26 Cmmunity Pwer: Apprve Changes t Fundamental Bylaws 27 Establishing Fundamental Bylaws wuld ensure that critical aspects f the pwers and prcesses required t maintain ICANN s accuntability t the cmmunity, and the rganizatin s Missin, Cmmitments and Cre Values, can nly be changed as a result f brad cnsensus f bth the ICANN Bard and the cmmunity. 28 Thrugh the Empwered Cmmunity, Supprting Organizatins and Advisry Cmmittees wuld have t give psitive assent t any change prpsed by the ICANN Bard befre the change was finalized, as part f a jint decisin prcess between the ICANN Bard and the cmmunity. By creating this special jint decisin prcess, authrity t change fundamental aspects f ICANN s gverning framewrk is shared mre bradly than it is tday. 29 The CCWG-Accuntability is wrking under the assumptin that the Bylaws prvisins that are recmmended t becme Fundamental Bylaws are nt likely t change frequently. Where changes are made, they are unlikely t arise n shrt ntice r will be needed t deal with shrtterm peratinal situatins. The CCWG-Accuntability therefre des nt believe that this Cmmunity Pwer, as prpsed, pses any challenges t ICANN s nging peratinal viability r efficiency. 30 Such changes require a high degree f cmmunity assent, as the purpse f this pwer is t make changing Fundamental Bylaws pssible nly with very wide supprt frm the cmmunity. 31 Fr further infrmatin abut the fur ther cmmunity pwers recmmended by the CCWG- Accuntability, see Recmmendatin #4: Ensuring cmmunity invlvement in ICANN decisinmaking: Seven new Cmmunity Pwers. 30 Nvember 2015 6
Annex 03 - Recmmendatin #3 4. Changes frm the Secnd Draft Prpsal n Wrk Stream 1 Recmmendatins 32 This is a list f key changes frm the secnd draft prpsal, which affect this sectin: Change frm Sle Member t Sle Designatr/Empwered Cmmunity (see Recmmendatin #1: Establishing an Empwered Cmmunity fr enfrcing Cmmunity Pwers) Change frm 3/4 vting supprt in the secnd draft t fur in favr and nt mre than ne bjecting in the third draft fr the cmmunity t apprve changes t Fundamental Bylaws. 5. Stress Tests Related t this Recmmendatin 33 N/A 6. Hw des this meet the CWG-Stewardship Requirements? 34 These recmmendatins meet the CWG-Stewardship requirement that the CCWG- Accuntability recmmend the creatin f Fundamental Bylaws and that these include the fllwing: ICANN Budget: Cmmunity rights regarding the develpment and cnsideratin f the ICANN Budget ICANN Bard: Cmmunity rights regarding the ability t appint/remve Directrs f the ICANN Bard, and recall the entire Bard ICANN Bylaws: Incrpratin f the fllwing int ICANN s Bylaws: IANA Functin Review, Custmer Standing Cmmittee and the Separatin Prcess Independent Review Panel: Shuld be made applicable t IANA Functins and accessible by managers f tp-level dmains 7. Hw des this address NTIA Criteria? 35 Supprt and enhance the multistakehlder mdel Ensuring the multistakehlder mdel accuntability mechanisms cannt be mdified withut the Empwered Cmmunity s apprval. 36 Maintain the security, stability, and resiliency f the Internet DNS 30 Nvember 2015 7
Annex 03 - Recmmendatin #3 Establishing Fundamental Bylaws that prvide additinal prtectins t ICANN Bylaws that are critical t the rganizatin s stability and peratinal cntinuity 37 Meet the needs and expectatin f the glbal custmers and partners f the IANA services N/A 38 Maintain the penness f the Internet N/A 39 NTIA will nt accept a prpsal that replaces the NTIA rle with a gvernment-led r an inter-gvernmental rganizatin slutin N/A 30 Nvember 2015 8