It seems that this practice has changed slightly. These days these opportunists simply park domain names (as the term suggests, domain names are registered and placed in a kind of holding space with a hosting service provider) that correspond with trademarks and then sell them at the highest price possible. To park a domain, a registrant simply needs certain server details for the hosting service he/she uses. It is not a very complex or pricey option at all. To add to this, anyone can register any available domain name for about R50 for co.za domain names. Unfortunately rules governing this sort of activity are not yet finalised and there is some doubt how effective they will be so for the time being, anyone who fails to register the domain names that correspond with their trademarks and related trade names is exposed to these characters.
It is therefore advisable to register the relevant domain names before releasing the name or details of a new service to ensure that the trademark that may be registered in respect of that service is adequately protected online. Another reason that this is so important is that a domain name is often a form of identity online. A person looking for a company will often type in the company’s name as a domain (for example, "www.yourcompany.co.za") as a starting point. You really want that domain name to point to your website and not to your competitor so register those domains.
It is also a good idea to register the same domain name at different domains to afford your trademarks a degree of protection internationally. These international domains include ".com", ".net" and ".org" domains.
Mike Silber sent me a mail yesterday evening and pointed me to the .za Domain Name Authority’s website (the Authority was established in terms of the ECT Act to manage the .za namespace). Mike is a member of the Authority’s board of directors. He is also a consultant to Michalsons, a local firm of ICT (Information Communications Technology) lawyers and one of South Africa’s authority on these issues. Anyway, the page he pointed me to has a link to the new alternate dispute resolution rules which were promulgated in November 2006.
It seems that where we are in the process is that there has been a call for service providers who wish to be accredited as ADR service providers to submit their details for consideration. Presumably qualified service providers will be accredited once this process is complete and we will then have a mechanism to implement these rules.
Thanks for the email and the link, Mike.