Council Minutes 08/11/02
Minutes of the General Meeting of the Council of InternetNZ Held at the InternetNZ Council Room, L4, 4 Bond Street, Wellington, Friday November 8 2002 at 10:00 am
Note - for links to papers etc, see the Agenda.
Status: Minutes Adopted at Council Meeting 021214
1. WELCOME
The Secretary opened the meeting, noting that the President and Vice President had apologised for their absence, and had asked the Secretary to chair. However the Secretary said that the ByLaws state under 6.1, that Council elects the meeting chair in the absence of the President and Vice-President so the Treasurer was asked to and conducted the election for meeting chair.
02/101 MOVED: (Wallmannsberger/Carter) "THAT the Secretary be chair for the meeting."
CARRIED UNANIMOUSLY
The Secretary took the Chair. In response to a question he noted that a motion to move a ByLaw change regarding meeting chair could be moved under General Business. Cr Riley foreshadowed a motion to that effect.
Cr Forsyth arrives 10:05
2. ATTENDANCE
- PRESENT
David Farrar (Secretary), Chris Streatfield (Treasurer), Jonathan Ah Kit, Richard Bourne, Jordan Carter, Roger De Salis, Bert Felt, Grant Forsyth, Jennifer Northover, Bill Parkin, Simon Riley, Joop Teernstra, Nick Wallingford, Michael Wallmannsberger, Sue Leader (Executive Director) - IN ATTENDANCE
Frank March, Chair, NZOC, for items 10 - 11
Debbie Monahan, Domain Name Commissioner for item 11
Bob Gray, Chair Domainz, for items 7, 10, & 11.a.
Derek Locke, CEO, Domainz for items 7, 10, & 11.a.
Carol Stigley, Chair, .nz Registry Services, for item 9
Peter Dengate Thrush, Chair International Affairs Committee, to deliver short briefing item 10.a.
Richard Hipgrave, Navigate, for the duration of item 8
Zofia Krawczyk, Office Administrator - audio recording - APOLOGIES
Absence: Keith Davidson (President), Rick Shera (Vice President), Drew Whittle, Howard Frederick
Lateness: Jonathan Ah Kit
02/102 MOVED: (Secretary/Treasurer) "THAT the Apologies be accepted."
CARRIED
For: Secretary, Treasurer, Carter, De Salis, Felt, Forsyth, Northover, Parkin, Riley, Teernstra, Wallingford, Wallmannsberger
Against: Bourne
3. EXECUTIVE DIRECTOR ANNOUNCES DEPARTURE
Sue Leader, Executive Director, spoke to the meeting. She thanked the Council for the opportunity to participate in the ongoing restructuring planning, and noted that she had enjoyed her four and a half years with the Society. She commented that she was very pleased with the direction the restructuring had taken at Senior Staff level with a full Governance / Operational split. The Executive Director felt it was timely to inform Council that she had decided not to apply for the new position, and was looking forward to working with the Officers to appoint the new Executive Director. She noted that this decision was made with some sadness as this had been an incredibly interesting and productive time, and she had enjoyed the opportunity to work with the Society in the important work which the Society does. She finished by thanking current and past Council's for their support of her work.
The Secretary, on behalf of the Council, noted that there will be a more formal occasion for the Council to say thank you, and this is tentatively scheduled for the Friday 13 December, the evening before the next Council meeting.
02/103 MOVED: (Secretary/Treasurer) "THAT in the interim, the Council record a huge vote of thanks to Sue as the first staff member of InternetNZ, thanking her for all the work to transform the Society into something almost unrecognisable from when she came onboard, and that Council looks forward to working together over the next few months."
CARRIED UNANIMOUSLY by ACCLAMATION
4. MINUTES OF THE PREVIOUS MEETING
02/104 MOVED: (Secretary/Treasurer) " THAT the Minutes 28 September 2002 be adopted as a true and correct record."
CARRIED UNANIMOUSLY
5. MATTERS ARISING FROM THE MINUTES
There were no matters arising.
6. FUTURE OF DOMAINZ FUTURE TASK FORCE (FDTF)
The Secretary noted that Bob Gray, Domainz Chair was due. The President's Report has been circulated, which the Secretary presented in his absence.
The Secretary noted that the Report and consultation document had been available to Council for some time. Hasn't been a lot of comment and only formal submissions from Steven Heath who had stated a preference (also on his blog) for liquidation and an article in ComputerWorld by Paul Brislen favoured selling as going concern.
RECOMMENDATIONS: [last page of Report]:
- That Council receives the Report of the Taskforce
- That InternetNZ resolve that it wishes to divest Domainz as a going concern before 30 September 2003
- That the Future of Domainz Taskforce continue in existence until 30 September 2003 to consider, consult on, and eventually recommend to Council precise details of the divesture process.
Discussion:
Cr Riley: asks Domainz Board to comment - presume they participated and agree with recommendations.
Derek Locke and Cr De Salis confirm were involved and agree. Cr De Salis notes that doesn't understand why as recommendations approved by FDTF should need to come to Council.
Cr Forsyth: need to discuss at restrictions on divestiture. Not sure InternetNZ needs to involve itself in restrictions - not sure what the issues are. If the issues are competition issues there are other policies and processes in New Zealand to deal with this.
Secretary: Recommendations just say "terms acceptable to Council" - may include identity of purchaser, sale price etc. Didn't reach conclusions on qualifications of a potential purchaser, but Council may need to consider such concerns as ethical concerns if, for example, a company with a bad reputation wished to buy. Council will need to spend time on as further recommendations come back - different people will have different perspectives.
Derek Locke: noted concerns but must recognise that if add restrictions then the market value will be diminished.
Cr Teernstra: the language definition of unfair market dominance comes from philosophy of market regulation - suggest remove that language.
Cr Bourne: Clarification on two points: Section 3.2 - seems to say if can't find buyer liquidate? (Yes) Then need to be careful how restrict lest force liquidation. Recommendation 3 - is the FDTF responsible only to work through process of selling Domainz, not being involved in Domainz's ongoing business? (Yes)
Cr Carter: good report, pleased to see it, especially given the rush to prepare. Should not get too hung up on language - not here to make the decision on the actual sale, but to decide to divest. Should agree to 1,2, but 3 needs a revision to ToR for the FDTF - amend "and that a new ToR be provided for Council to adopt at next meeting".
Bob Gray arrives 10:21
Secretary - Noted that FDTF needs to report on new ToR next meeting of Council.
ACTION: FDTF needs to report on new ToR next meeting of Council.
Cr Forsyth: Note is happy to leave concern about terms of divestiture to the note for Recommendation 3 regarding new ToR, as that gives the FDTF a steer.
Cr Felt: Seems that Council will approve the sale? (Yes) Would like to remove provision for liquidation as prepares for failure.
Cr Riley: What is the process after today? Some sort of business case to come from Domainz?
Secretary: Puts ball into Domainz court - Directors will look at own business areas and come back to FDTF with update.
Derek Locke: Been hard to prepare business case as didn't know future, though did have a good steer. Now will look carefully at options and prepare business case, and potential divestiture, and ownership - expect can prepare overall strategy quickly as have done quite a lot of work.
Bob Gray: Key issue is how quickly "lose" nameholders. Did do forecasts, but really don't know what will happen. Potential purchaser would find hard to do a valuation at the moment. Can see doing some groundwork this year and early next year; by second quarter next year should have some clarity and be able to start negotiations with potential purchasers or if an IPO is considered the right way to go, then looking at the mechanics of how that might work. So think the third quarter next year would be the earliest where a potential purchaser could properly assess its value.
Cr Northover: Good report. Agree with Cr Forsyth - any restrictions should be minimal.
Cr Felt: Good report. We don't know the market, the best incentives are for the Domainz - leave it to them as have the motivation and know the market.
Derek Locke: Not going to know on names until February as that's when the price goes up, don't know how many will go on December 7.
Wallingford: final divestiture decision - several statements about maximising money - remember other side of the moral responsibility about how we obtained Domainz historically. Without trying to identify those issues, the Secretary has mentioned one - abuse of the system. We have to be responsible in our assessment.
Northover: Acknowledged Cr Felt's expertise - add him to FDTF.
02/105 MOVED: (Northover/Forsyth) "THAT Council receives the Report of the Taskforce"
CARRIED UNANIMOUSLY
02/106 MOVED: (Secretary/Treasurer) "THAT InternetNZ resolve that it wishes to divest Domainz as a going concern before 30 September 2003"
Discussion
After discussion as to whether it is useful to have the September date, or any date, an amendment was moved:
02/107 MOVED: (Felt/De Salis): THAT the motion be amended by deleting the words "September 30 2003".
Discussion clarified that the date was intended as a latest end point not a target date.
The Amendment was put.
LOST
For: Northover, Riley, Teernstra, Felt
Against: Secretary, Treasurer, Bourne, Carter, Forsyth, Northover, Wallingford, Wallmannsberger
Abstention: De Salis, Parkin
The original motion was now put:
02/106 MOVED: (Secretary/Treasurer) "THAT InternetNZ resolve that it wishes to divest Domainz as a going concern before 30 September 2003"
CARRIED UNANIMOUSLY
02/108 MOVED: (Secretary/Treasurer) - Noting that the FDTF will provide new ToR to the next meeting of Council "THAT the Future of Domainz Taskforce continue in existence until 30 September 2003 to consider, consult on, and eventually recommend to Council precise details of the divestiture process."
CARRIED UNANIMOUSLY
MOVED: (Northover/Riley) "THAT Cr Felt be added to FDTF".
The motion was referred to evote as Cr Felt wished to consider involvement.
ACTION: Council to evote on Cr Felt's appointment to FDTF once Cr Felt has advised willingness.
MOVED: (Teernstra/) "THAT the FDTF be instructed not to be guided by the idea of market regulation during the divestiture process."
The Secretary noted that this was too big a policy to add here - he will take back to FDTF.
Cr Forsyth: Cr Teernstra has characterised his concern, but believes other regulatory bodies in marketplace will do this, e.g., Council may decide that sale be referred to Commerce Commission.
Cr Parkin: Noted that this motion comes across as an additional Recommendation of FDTF needs to be clear is a separate motion from Council to FDTF.
Secretary: Noted the issues have been considered by FDTF.
Cr Wallingford: concerned that FDTF has to walk tightrope between maximising value and meeting objects of creating a competitive Registrars' market - by having no restrictions could result in a sale which might not be appropriate within our objective for the SRS.
The motion failed for want of a seconder.
- The Secretary noted that there was an issue in relation to Domainz which would arise under NZOC report.
- Cr De Salis: requested dealing with NZOC issue now as Domainz Board members present
- Secretary: Declined - NZOC chair not available until this afternoon and the Agenda was notified.
7. DOMAINZ Report
Bob Gray spoke to his published report .
- He noted the error in the Financial Statements - Note 7 re Management fee recorded as the former full year figure of $120K rather than the correct figure of $60K. Please click here to see corrected version.
- Next quarter's accounts will look quite different - e.g. almost $2M disappears with pre-payments transferred to Registry.
The Secretary thanked Bob Gray and Derek Locke for their attendance, and looked forward to seeing then after lunch in NZOC session.
02/109 MOVED: (Secretary/Wallmannsberger) THAT the Domainz report be received."
CARRIED UNANIMOUSLY
Bob Gray, Derek Locke, Cr De Salis depart at 11:10
A short leg-stretch break was taken from 11:10 - 11:15
Richard Hipgrave arrived - 11:16
8. RESTRUCTURING
Moved Into Committee at 11:16 [staff excluded. The Executive Director remained as not applying for the new position - the Secretary noted that the meeting will have the opportunity to go fully into committee if needed.]
Cr Ah Kit arrives 11:50
Carol Stigley arrives 12:13
Moved Out of Committee at 12:13 to deal with Item 9.
9. NZRS QUARTERLY REPORT
The Secretary stood down from the chair for this item as he is on the NZRS Board, and the Treasurer takes the chair.
Carol Stigley, Chair, NZRS, tabled the published Reports and thanked Council for setting a time she could attend between other meetings.
a. Quarterly Report
b. Tenure of Directors
Discussion:
- Cr Bourne: re directors retirement (3.a.) - the wording suggests there is a risk of keeping less useful directors
- Carol Stigley: this assumes current Directors not renewed, is longest serving regardless of term.
- Cr Northover noted that no budgets included.
- Carol Stigley: correct. Currently re-forecasting as budget is old - prepared a long time ago by SRS transition manager and though overall is within realms of the two 'scenario budgets'. Will be first budget to be adopted by Board. Next report will have reworked budget which goes forward to the future.
02/110 MOVED (Riley/Wallingford) "THAT Council adopt the policy on Directors' Tenure."
Secretary declares Conflict of Interest.
CARRIED
Abstention: Teernstra, Secretary
02/111 MOVED: (Treasurer/Wallmannsberger) "THAT the NZRS Report be accepted."
CARRIED
Abstention: Secretary
The Chair was resumed by the Secretary at 12.23, Carol Stigley departs
- Moved Into Committee at at 12:24 to continue item 8. Restructuring Session
- Moved Out of Committee at at 12:50 - Lunch - Recommendation 5 still to do.
A break was taken for Lunch from 12:50 - 13:15
Bob Gray, Derek Locke, Cr De Salis return
Frank March and Peter Dengate Thrush arrive
10a INTERNATIONAL AFFAIRS COMMITTEE (Part 1)
Peter Dengate Thrush apologises for only having five minutes for a quick briefing on the ICANN Shanghai meeting, and asks that the briefing not be recorded.
PoR 13:16
PoR 13:45
The Secretary thanked Peter for his briefing.
Peter Dengate Thrush departs 13:46
- Moved Into Committee at 13:47 to continue item 8. Restructuring Session
- Moved Out of Committee at - 13:40
Motions arising from In Committee session on Restructuring
02/112 MOVED (Secretary/Treasurer) "THAT Council receives the attached briefing paper on progress to date, job description, performance contract, proposed policies and revised job descriptions for Officers and Councillors."
CARRIED UNANIMOUSLY
02/113 MOVED (Secretary/Treasurer) "THAT Council confirms the title of the senior position as Executive Director."
CARRIED
Abstention: Teernstra
02/114 MOVED: (Secretary/Treasurer) "THAT Council confirms that the job description and performance contract set out with reasonable accuracy the overall purpose of the job, major accountabilities, functional relationships and person specification, and an appropriate rationale for performance assessment."
CARRIED UNANIMOUSLY
02/115 MOVED: (Secretary/Treasurer) "THAT Council authorises the Administration Committee to proceed with recruitment, using the process and timetable set out in the Administration Committee papers to Council, and approved by Council on September 28."
CARRIED UNANIMOUSLY
02/116 MOVED: (Secretary/Treasurer) "THAT Council adopts as a draft the proposed Governance Policy."
CARRIED
Abstention: De Salis
It was noted that Council will review the draft policy at its next meeting in December 2002.
02/117 MOVED: (Secretary/Treasurer) "THAT Council adopts the proposed Relationships Policy."
CARRIED
Abstention: Teernstra, Parkin
02/118 MOVED: (Secretary/Treasurer) "THAT Council adopts the proposed Internal Audit Policy with the deletion of line 8, pg 45."
CARRIED
Abstention: Parkin, De Salis
02/119: MOVED (Secretary/Treasurer) "THAT Council adopts the proposed job descriptions for the President, Vice-President, Secretary, Treasurer and Councillors."
CARRIED
Abstention: Teernstra
The Secretary thanked everyone for their work on this issue.
11. .nz Oversight Ctte Report
a. Supplement to .nz Oversight Committee Report (Council Only - Commercially Sensitive)
Moved Into Committee at 13:49
DNC arrives 1350
Cr Forsyth departs 1405.
Moved Out of Committee at 14:35
Statement arising from In Committee session: The NZOC and DNC are no longer interested in the issue and will leave responsibility to Domainz.
Bob Gray, Derek Locke, Cr De Salis depart 14:35; Cr Riley leaves meeting
b. .nz Oversight Committee Report
Frank March spoke to the published reports.
- He also tabled his GAC report, noting that he would take questions at this stage even though it sits under International.
- He noted that the Council had dealt with Item 2 - SRS Stabilising Registrar Agreement - in the In Committee session.
- The NZOC will meet on November 25. On the Agenda are the issues surrounding International Affairs, and will invite the IAC Chair and the Executive Director to participate. Will set agenda for selves to review where NZOC sits in relation to overall International activity. Undertaking to Council to have this completed by start of next financial year. The Budget will be looked at separately and will determine what should be administered by the DNC and if anything should be referred back to the Executive Director, i.e., whether budget is split or not. Underlying issue is what NZOC is responsible for and what is Council's responsibility.
- NZOC will be looking at priorities for Policy review - creating a workplan for next 12 months. Three clearly on the table: 2LDs, UDRP, and IDN (Internationalised Domain Names) policy as per Executive Director report.
Cr Riley returns 14:40
The DNC noted that she has authorised the first three Registrars today: InterSpeed (Web-address), 2Day.com, and I-serve - more to come. Total about 14,000 names; all contracts are uniform.
The Secretary thanked to Frank March and to NZOC for their work.
02/120 MOVED: (Secretary/Treasurer) "THAT Item one from NZOC supplemental report be referred to Solicitor for legal advice."
CARRIED
Against: Teernstra
Abstention: Riley
02/121 MOVED: (Secretary/Treasurer) "THAT the reports of NZOC be accepted"
CARRIED UNANIMOUSLY
10.b INTERNATIONAL AFFAIRS COMMITTEE (Part 2)
- GAC Report
Frank March tabled his published report on the Government Advisory Committee (GAC) Meeting in Shanghai, noting it has a link to GAC Communiqué.- Frank thanked Council for sending him as the New Zealand Government Representative to GAC as he found it very worthwhile and money well spent
- he will be suggesting that Goverment establish permanent representation.
- he noted that ICANN and GAC have 'moved up a notch' in relations, as have the ccTLDs and ICANN
- he noted that .nz 's new structure is unique and will be recommending it is sent out as a Best Practice.
DNC, Cr Carter and Frank March depart, 14:49
Executive Director's ICANN Report
- The Executive Director spoke to her eight Recommendations in the published report . The Report gives the rationale for each recommendation. (A minor amendment was made to 02/126 to increase clarity.)
02/122 MOVED: (Northover/Secretary) "THAT Council review InternetNZ's ICANN participation - scope, policy, representation."
CARRIED UNANIMOUSLY
02/123 MOVED: (Northover/Secretary) "THAT Council run a Summit on International Issues to obtain feedback from the LIC as early as possible in 2003."
CARRIED UNANIMOUSLY
02/124 MOVED: (Northover/Secretary) "THAT Council recommend to NZOC that it immediately document the current status quo UNICODE usage in .nz registrations."
CARRIED UNANIMOUSLY
02/125 MOVED: (Northover/Secretary) "THAT InternetNZ bid for an ICANN meeting in 2004."
CARRIED UNANIMOUSLY
02/126 MOVED: (Northover/Secretary) "THAT InternetNZ make input into ccTLD Secretariat ToR review."
CARRIED UNANIMOUSLY
02/127 MOVED: (Northover/Secretary) "THAT InternetNZ determine whether to bid for Secretariat or to support trusted party's bid once the ToR are amended."
CARRIED UNANIMOUSLY
02/128 MOVED: (Northover/Secretary) "THAT Council appoint a representative/encourage NZOC to appoint a representative to the new ccTLD Service Level Agreement Working Group."
CARRIED UNANIMOUSLY
02/129 MOVED: (Northover/Secretary) "THAT Council approve airfare to Fiji and accommodation for Andy Linton to present on IPv6 at Pacific INET."
CARRIED UNANIMOUSLY
12. SOCIAL IMPACT COMMITTEE
Cr Carter tabled the published report .
02/130 MOVED: (Secretary/Northover) THAT the report of the Social Impact Committee be received"
CARRIED UNANIMOUSLY
13. GENERAL BUSINESS
- Treasurer Reports
Time being short the Treasurer tabled the September Financial Reports and asked for questions.
Variance Report
September Report
Profit and Loss
Balance Sheet
Executive Director Report
- The Executive Director tabled her report and asked for a brief in committee session.
Moved Into Committee - 14:55
Moved Out of Committee - 15:19
02/131 MOVED: (Secretary/Treasurer) "THAT the Treasurer's and Executive Director's reports be received"
CARRIED UNANIMOUSLY
Technical Committee
- Cr Bourne circulated the Minutes of the Technical Committee Meeting
Foreshadowed Motion: Amendment to the ByLaws for Next Council Meeting
MOVED: Cr Riley/Cr Bourne That the Section 6.1 of the ByLaws:
" 6.1 The meeting shall be chaired by the President. In the absence of the President the Vice-President shall chair the meeting and if both are absent or stand aside then any other Elected Council Member elected by the Meeting."
be amended to read
"6.1 The meeting shall be chaired by the President. In the absence of the President the chair moves to those Officers present in the following order: Vice-President, Secretary, Treasurer; and if all Officers are absent or stand aside, then any other Elected Council Member elected by the Meeting."
Meeting closed 1523
Note - for links to papers etc, see the Agenda.
© 2001 InternetNZ
Last updated 26 November 2002
