Council Minutes - 2 July 2004

Minutes InternetNZ Council
Held at L9, Exchange Place, Wellington
Friday, 2 July 2004 at 10.30pm.

Note - for links to papers etc, see the Agenda.

Status: Final, as adopted by Council at its meeting on 20 August 2004

PRESENTATION ON PEERING - Simon Blake

Definitions

Transit - is usually the method of paying to get data to or from other ISPs

Peering - is usually free or cheap data access to other ISPs

Simon Blake took the meeting through the structure of a multilateral peering exchange and presented a brief case study history of the TradeMe website hosting arrangements, and also what occurred during the Lord of the Rings premiere video-cast, and the specific connectivity and peering issues that arose.

Noted that when de-peering occurs, it usually forces additional costs onto other providers. This raises the possibility of extra charges being made to specific ISP customers, which is not a desirable outcome from InternetNZs perspective. Along with potential additional costs, data may be trunked internationally, which usually sees a considerable degrading of network speeds and complaints by customers.

Cr Farrar noted that the presentation has highlighted that a study is required, and getting people outside the industry to provide insight would be beneficial.

WELCOME FROM CHAIR

The President opened the meeting at 11.27a.m.

ATTENDANCE

Present

Keith Davidson (President), David Farrar (Vice-President), Chris Streatfield (Treasurer), Michael Wallmannsberger (Secretary), Bill Parkin, Simon Riley, David Harris, Michael Sutton, Grant Forsyth, Brendan Murray, Jennifer Northover, Jonathan Ah Kit, and Peter Macaulay (Executive Director).

In Attendance

• Frank March, Chair, NZOC (.nz Oversight Committee Report)

• Debbie Monahan, DNC (.nz Oversight Committee Report)

• Carol Stigley, (Chair NZRS),

• Colin Jackson

• Nick Griffin, Registry Manager NZRS (NZRS Report)

• Gale Blikshavn, Minute Taker

APOLOGIES

Apologies received from Nick Wallingford. Moved (Cr Streatfield/Cr Murray) THAT apologies be accepted.

Carried U

DECLARATION OF COUNCILLOR INTERESTS

Noted Officers remuneration agenda item is a conflict for all the Officers. Cr Farrar also noted a conflict of interest with the NZRS Directors fees item.

MINUTES OF THE PREVIOUS MEETING

MOVED (Harris/Treasurer): THAT the minutes of the Council meeting held on 24 April be accepted as a true and correct record. Cr Streatfield noted a minor change under ICOP report, first line gives Cr Streatfield should be President. Accepted with amendment

CARRIED

Abstained Bill Parkin

MATTERS ARISING FROM THE MINUTES
No matters arising.

RATIFICATION OF E-VOTES

PRESIDENTS REPORT

The President tabled InternentNZ fellows nominations papers The Council then went into committee. MOVED (President/Vice President) THAT: the four nominees are awarded fellowship. The President requested that the matter be confidential to Council until the AGM.

Carried U

MOVED (President/Vice President) THAT: the Presidents report be accepted.

Debbie Monahan joined the meeting.

NZOC Appointments

The Secretary advised Council that both the Appointments Committee and the Executive Committee were of the unanimous view that David Russell, Frank March and Richard Currey be re-appointed to NZOC.

MOVED (Secretary/President) THAT Frank March, David Russell and Richard Currey be appointed to the NZOC for a further term of 2 years commencing 1 July 2004

NZOC Report

The President welcomed Frank March, Debbie Monahan, and Colin Jackson to the meeting.

Frank noted that he formally stood down as chair at the end of the NZOC meeting on 28 June, as his term ended 30 June. The business of NZOC has settled down and working steadily through issues as per the work plan. It was noted it is very much business as usual which is extremely gratifying and the ccTLD management is working smoothly.

A revised zone transfer policy would soon be available. Once the practice note and form agreement is developed, NZOC will be seeking formal acceptance from Council via an evote.

The revised second level domains policy is expected to be tabled at the next Council meeting. Frank March noted thanks to the 2LD working group for their efforts. The roles and responsibilities policy is also currently being reviewed. The WHOIS policy review is planned and David Russell has agreed to be convenor for this review.

Frank March tabled a memo sent to the registry regarding DNSSEC. Some issues have arisen and NZOC has requested NZRS send a technical person to the next ICANN meeting to get further information on the zone walking issue and possible solutions to it.

DNC reported on her recent trip to Europe to visit Nominet, CENTR as part of her operational role and a report will be circulated. The meeting was briefly updated. The DNC reported that there are some useful domain name dispute resolution processes being used in Europe, and indicated a keenness for .nz to proceed with a UDRP.

Frank March concluded by thanking Council for reappointing the NZOC members, and that NZOC is operating extremely well. Frank confirmed that he will be willing to offer himself again as chair if that is what NZOC wants. He also acknowledged InternetNZ, noting a meeting held with Government agencies held the previous day.

Frank March is looking to engage with industry constructively and Government is becoming more and more involved and he noted the interest in establishing Antispam legislation. He also noted the importance of the technical committee as being very important for involvement in spam, peering and spyware issues.

Moved (Cr Northover/President) THAT: The NZOC report be accepted.

Carried U

Frank March, Debbie Monahan and Colin Jackson left the meeting.

The President welcomed Carol Stigley, Anne Urlwin and Nick Griffin to the meeting.

NZRS Reports

Carol spoke to the 4^th quarter report. She noted the Technical Committee discussed DNSSEC last evening and requested that someone from Technical Committee provide a debrief.

The next NZRS board meeting will be held on 22 July2004. Outsourcing is on hold working through on the RFP process and working out trade offs, so parked with mutual agreement at the moment.

The President inquired whether there had been any reaction to the price reduction, Noted there had been no response received thus far.

Company Plan

Carol Stigley spoke to the NZRS Company Plan. The President noted it was pleasing to see advance of timeframe. Cr Forsyth noted the there was no increase to the DNC management fee for the next three years and suggested that at least the CPI be taken into account. The DNC noted the general intent is that they are not a drain. Cr Sutton noted concern on the capital expenditure figures. The reply was that it is made up of a set of broad brush figures to cover any fresh technology that may be developed. Of course approval will be sought before any spending capital budget.

It was noted that the NZRS AGM this year will be short and that the dividend requirement will be paid in accordance with agreement. The President noted thanks to NZRS board and staff for being within budget.

Moved:(Treasurer/Cr Forsyth) THAT the NZRS quarterly report and Company Plan be received.

Carried U

Carol Stigley, Nick Griffin and Ann Urlwin left the meeting.

Vice Presidents Report

The Vice President noted the combining of his reports, which he spoke to. He updated the Council on the recent anti-spam workshop and the very positive feedback received. One of the issues on the legislation that had been suggested was to investigate, in some detail, with the spam task force, of the provision of an enforcement/education agency, government funded and industry run. He also noted there had been interest in a future conference on the technical aspects of anti-spam.

Cr Harris noted disappointed that the anti-spam taskforce werent involved with MED meeting however Executive Director noted that it was umbrella meeting not specific anti-spam, however contacts had been made and a meeting re anti-spam had been arranged for later in the day. Cr Harris noted the time spent with Australian representatives had been useful and that they were delighted with direction things are heading, which he noted was a very useful endorsement.

The Vice President noted he is returning officer for AGM and that we have only one nomination for Secretary and Treasurer, along with 8 nominations for Council. Action: The Vice President to note to members date and time for AGM as per constitution.

Council went into Committee.

President thanked the Vice President for all his work in particular organising the anti-spam event and handling the day so well - another positive day for InternetNZ.

MOVED (Vice President/President) THAT: the Vice Presidents report be accepted.

Carried U

Secretarys Report

The Secretary noted the use of laptops issue that had been raised and that it had been discussed in Exec Committee.

MOVED: (Secretary/Cr Harris):

THAT: the use of laptop computers during meetings is permitted.

THAT: Councillors are reminded that their behaviour during Council meetings must not disrupt the meeting.

THAT: where any Councillors finds the behaviour of any other Councillor during a meeting to be disruptive the matter is raised with the Chairperson by a point of order, in the first instance.

Carried U

MOVED(Secretary/Treasurer) THAT: the Secretarys report be received.

Carried U

Remuneration Review

The President advised the meeting that Officers would exempt themselves from participating on this topic, and requested the leave of the meeting to appoint the Executive Director as Chair for this session. After the paper was summarised the views round the table were heard the following motions were put.

MOVED (Cr Harris/Cr Parkin) THAT: officer's honoraria be increased to $7,000 for 2004/05 year.

Further discussion was held.

Not Carried

MOVED (Cr Harris/Cr Northover) THAT: Remuneration be increased to $5,000 for 2004/05 year

Carried U

MOVED (Cr Harris/Cr Northover) THAT: Presidents honoraria for 2004/05 year be increased from $12,000 to $22,500

Discussion was held.

Carried

5 for the motion

2 against

1 abstention

MOVED (Cr Riley/Cr Forsyth) THAT: Related issues outlined in Section 8 be referred to Exec Committee for further consideration. Specifically:

8.1 Best practice/accepted practice

8.2 Guidelines for Honorarium and fee setting for Officers

8.3 Officers Workload

8.4 Performance measurement / assessment

8.5 Review the level of honorarium for Chair of NZOC

Discussion was held

Carried U

The Officers rejoined the meeting and the President resumed the chair. The Executive Director advised the Officers of the resolutions passed. Cr Farrar noted that normally the change in honorarium commences from the date of the AGM, and not the financial year. Agreed.

Executive Directors Report

The Executive Director spoke to his report. He updated the Council of moving to SuSE Open Exchange and will be starting to load these tools for Councillors and configuration is in its final stages and gave a demonstration.

Cr Sutton noted a request for an SSL certificate as all information will go over the web unencrypted. It needs it own certificate.

Cr Forsyth questioned that the 1^st phase of Interop had concluded successfully, he noted a question on outstanding on budgets and payments, and had that been satisfied? It was noted NZTE have the final invoice and it will be paid, but it was an internal process that needed to be completed prior to payment. The Treasurer concurred that the budget, and all invoices had been correctly received and payments were appropriate.

Cr Harris offered an Internet 101 paper for staff and Cr Farrar noted it could be also be put as part of induction for new Councillors.

Cr Riley requested an update on the ICT strategy initiative. Executive Director noted meetings that had been attended and that he and Ernie Newman will be formulating how InternetNZ and TUANZ work together, he noted that these organisations would like an umbrella group to be established. The ICT strategy would shortly be available to Council. A consistent response needed to be formulated.

President noted that after reading the reports of President, Vice President and Executive Director that there was a large diversity of work being undertaken and thanked Peter for good work on many fronts, The Executive Director noted the involvement of Officers had been key to be able to do this.

Cr Forsyth spoke with regard to e-regions and was updated by Cr Riley and the Executive Director. Cr Forsyth inquired whether they were aware of the scale of funding? Cr Riley noted it was hugely ambitious. Cr Forsyth requested what was the InternetNZ external view/stance. Cr Riley suggested to Cr Forsyth that it was an organic process and where it stands at the moment it is not a high priority, but we are constructively engaging on a number of fronts. Cr Forsyth reiterated that then to date there is no public position regarding e-Regions.

It was noted the recent increase of work of committees and individuals in Government which has lead to several Government Departments seeking that InternetNZ has a role as a collector of information and a doer of work. It has been made very clear that we will not be a servant to Government, however it is accepted that we are closely aligned to Government departments and relevant Ministers There is now an opportunity for various committees to start engaging and building a relationship to undertake work.

Peter Dengate-Thrush joined the meeting and was welcomed. The Executive Directors session to continue after the International report.

International Committee Report

Peter Dengate-Thrush first wished to congratulate Cr Riley on the recent signing of UNESCO New Zealand and InternetNZ MoU. He also noted there is a lot of excitement around the upcoming meetings in Kuala Lumpur. As far as APTLD meeting there will be time available for a CCTLD meeting as it will be business as usual, developing outreach, tidying up rules.

He noted calls of interest for an APTLD secretariat meeting and whether Council think it is something that we could host in two years? It was noted there is $21/22,000 available for a part-time secretariat. The President noted it had been considered in the past and he thought it had been resolved as a good idea, with no contrary views received.

The question was raised whether there would be any compromise for Peter Dengate-Thrush if secretariat comes to New Zealand? He noted no apparent compromise and noted that he did not expect to be Chair of the International Committee the entire length of secretariat. It will be further considered in International Committee and report will come back to later Council meeting.

ICANN budget coming up, there had been a recent resolution to carry on with old budget. There was the issue of an obligation for .nz to pay ICANN. It was noted that in the past a donation had been made to administer the IANA function. International Committee to come back with recommendation. Cr Harris enquired whether the donation had made yet. The Executive Director noted he was still awaiting letter from International Committee. Cr Farrar noted a cheque needed to be taken to Kuala Lumpur.

Action Point - Office to ask Peter Dengate-Thrush for letter of authorisation to pay the donation. It was noted the amount will need to be verified with regard to exchange rates and amount of time money has been held.

Noted the due date for submissions to Annual report was Monday.

Cr Forsyth noted ICANN nominations request has been received. He noted on ccNSO that 3 positions were available on the council, and also allowed to appoint one person to the nominating committee. The President noted this is a topic for members to consider. Action Point: Executive Director to put up on members announce.

Cr Murray noted that Technical Committee had met the previous day and noted they were still not entirely sure what IAC requires regarding the APTLD technical contact. He inquired as to whether the Chair of Technical committee should attend some of the international meetings. It was noted that a politically active and savvy techie is required for this as they are looking for someone to stir up issues on ICANN Technical list. The President noted that the Executive Committee has agreed to sponsor attendance.

MOVED: (Cr Northover/Treasurer) that the International Report be received.

Carried U

ICANN Bid

The President spoke to the proposal for InternetNZ to host an ICANN meeting. Cr Farrar reported a few members had commented positively, Citylink would love to be involved as corporate sponsors, certainly no one against.

MOVED(Cr Forsyth/Cr Northover) THAT: the Council support communicating to ICANN the InternetNZ proposal.

Discussion was held.

Carried U

with applause

The President noted a time extension had been obtained from ICANN from the 30 June deadline for filing proposals but that the InternetNZ proposal will now be forwarded with all haste and those attending ICANN in KL to take copies. Action: The President to note in the bid that Project Team members are going to Kuala Lumpur and will be available to meet with the ICANN meetings committee as required.

Peter Dengate Thrush left the meeting.

Action: Executive Director to open a mailing list for ICANN-NZ including Debbie Monahan, Peter Dengate-Thrush, Keith Davidson, David Farrar and Peter Macaulay initially.

TREASURERS REPORTS

The Treasurer spoke to his report and noted they were now modified now to match the business plan. No questions.

MOVED: (Treasurer/President) THAT the for April Financial & variance reports; May Balance Sheet, Profit and Loss, Financial and Variance reports be received.

Carried U

Audit Committee

The Chair noted that the Audit committee papers werent included in the Council papers as requested. The Audit papers were tabled.

After a series of meetings to determine the best proposal a security audit conducted by Grant Thornton will commence on an unspecified date after 12 July. Their report would be confidential to Council, not for website. It was noted that Grant Thornton had been asked to look at the ISO standards and the Audit committees determination that they look at business continuity.

MOVED: (Treasurer/Cr Murray) THAT: the Audit Committee report be received.

Carried U

Governance and Constitutional Committee

The Treasurer Chair noted that the Governance & Constitutional paper for consideration was not circulated with Councils papers.

At the last Council meeting, there had been a request to table the previous report's recommendations. The G&C Committee had re-addressed the recommendations determined that they be re-put with some minor amendments. These had now been incorporated into the Remuneration Review. Cr Riley noted strongly that there are no circumstances that Councillors should be contracting for services and that the Councillor should stand down during contract and purporting that Councillors could contract is not acceptable. In reply the Secretary noted Cr Farrars work on the members poll and that it had been resolved that we would have this debate.

Cr Forsyth noted that it was correct that any recommendations will be pending on being put to the members. The Chair replied that yes, it may be that the members have a different view as to what sort of Society they want.

MOVED: (Treasurer/Secretary) THAT: the three recommendations be adopted:

1. We observe proper protocol around the person bidding for a contract where a conflict potential exists, i.e. they must be excluded from discussion and voting on all matters concerning awarding the contract, we do not find a need to extend the requirements to any additional levels of separation (including temporary suspension of membership of Council).

2. To ensure transparency, the affirmation of contract should be by Council vote. This to be in all instances regardless of contract size etc., and not e.g. limited to the Executive Committee.

3. Where the contracts are of a substantial size, in excess of $5,000, it would be prudent to obtain competing quotes/tender responses if only to benchmark the Councillor related one. Further, where the contract is very significant or long term it would be prudent for Council to consider whether to obtain additional approval from Members (and the contractor and associated parties are barred from participating in any vote).

Carried

Against Cr Riley

Abstained Bill Parkin

With regards to the auditors reports to Council it was noted a typo in reports of TextilesNZ. The Treasurer noted he was impressed with audit report and audit and financial controls. The Executive Director noted he was offered opportunity to respond. Thanks were extended for work undertaken.

MOVED: (Treasurer/Cr Harris) THAT: the auditors reports be received.

Carried U

It was noted that the Evaluation reports circulated with papers from Governance and Constitutional Committee were to be returned to the office for processing. Names were not required but can be noted if desired. It was noted that there was not a formal business plan last year to comment on. Cr Harris noted issue of asking Council about effective Council was, seemed a little skewed.

EXECUTIVE COMMITTEE REPORT

MOVED (Secretary/President) THAT: the Executive Committee report be accepted.

Carried U

EXECUTIVE DIRECTORS REPORT (continued)

INTEROP

The Executive Director presented his proposal on the way forward for the Interoperability Project and after significant and somewhat heated discussion involving Cr Forsyth, Cr Riley, Cr Northover, Executive Director and others the Council went into Committee for some time.

Cr Forsyth then noted he will support $5k to get the project plan but not comfortable in allocating $50k, Cr Northover concurred.

The President noted the expectation is we are looking at a maximum exposure of $50k and asked for assessment of risk, The Executive Director stated that InternetNZ has a 90% chance of recovering the funding.

MOVED(President/Cr Riley) THAT: Council approve $50,000 bridging expenditure towards the interoperability project.

Cr Riley noted if going to move it forward then Exec will have to work with Peter to get the detail on paper which is going to satisfy Exec committee and then distribute to Council with confidence, which included: 1) a proposal for funding from NZTE which is highly encouraged; and 2) would also allow us to engage with those other people who had put out indications of monetary support. Cr Riley noted there were too many questions without answers, it was not a comfortable situation but this has to be a team effort.

Cr Harris inquired if we dont provide funding or take it on then what happens? Cr Riley noted it will cause certainly some discomfort for InternetNZ. Concern was raised by Cr Forsyth/Cr Northover as to draft proposals, project management and invoicing.

The Executive Director strongly restated his position and sought clarification on issues surrounding the earlier interoperability project. The President noted that quantifiable statements were required. Cr Forsyth noted issues with first project in documentation and noted that people had worked/spent money with no approval. Cr Harris agreed, however that this was something that needed to be done but restated that this situation never happens again.

The Secretary stated that quite clearly this is one of the hardest decisions for him to make as a councillor and there are quite serious consequences either way.

Cr Sutton noted that he would not be supporting the motion. This was due to amount of time spent with Hilary Carlile, when he thought everything was going to go forward, however but arbitrary invoices are being sent then he would not support that.

Further discussion from around the table was undertaken. Cr Riley suggested an amendment to the motion.

Discussion on the wording of the amendment was held, including Exec Committee approving every invoice prior to payment. The President called for a break and the motions were written on the whiteboard.

Amendments to the motion were proposed:

MOVED(President/Cr Harris) THAT: InternetNZ reiterates its commitment to the principles of the Interoperability Project.

Carried U

MOVED(President/Treasurer) THAT: InternetNZ provide up to $50,000 bridging funding for the project definition and funding component of the InternetNZ Interoperability Initiative, provided that Executive Committee provides close oversight of all aspects of the project.

Carried

For: Crs Riley, Parkin, Wallmannsberger, Streatfield, Farrar, Harris, Ah Kit, Davidson

Against: Crs Forsyth, Northover, Murray

Abstention: Cr Sutton

MOVED: (President/Cr Harris) THAT: formal project documentation be provided to Council by 18 July to support the initiative.

Carried U

BYLAW AMENDMENT

The amendment had been circulated with the papers.

MOVED: (Cr Harris/Treasurer) THAT the wording of Bylaw 10.5 be amended as follows: 10.5 Funds approved for investment shall be managed in strict accordance with a formal Treasury Policy that has been approved and adopted by the Societys Council

Carried U

NZRS DIRECTORS APPOINTMENTS

This report had previously been circulated.

MOVED: (President/Treasurer) THAT: Anne Urlwin and Merv Delany be re-appointed directors of New Zealand Domain Name Registry Limited, for a period of 2 years from the expiry of their current terms.

Carried

Abstained

Vice President

NZRS DIRECTORS REMUNERATION REPORT

Cr Farrar was recused from this session of the meeting.

Cr Forsyth requested justification for an increase of 33% as the positions are not ones where hugely controversial or governance decisions are required and if this figure has just come out a framework then the framework is wrong. The President explained further background to the discussions between NZRS and the Executive Committee and that the Cabinet Guidelines proposed actually set the directors fees at a level lower than that anticipated by the directors, and considerably less than independent HR consultants had recommended.

1. This report be received.

2. That David Farrar's abstention from discussions and conflict of interest be noted.

3. That the principle of of directors fees be endorsed.

4. That directors fees for New Zealand Domain Name Registry Limited be set at the maximum of Level 5 for Management Boards as specified in the Department of the Prime Minister and Cabinets Fees Framework for members of statutory and other bodies appointed by the Crown.

5. That the directors of NZRS be authorised to apportion the fees for the Chair and individual directors at such a ratio as agreed by the directors.

6. That the fees level be reviewed by Council in two years time, for appropriateness and reasonableness, after the start-up period of the Company is concluded.

7. That the shareholder representative be authorised to approve directors fees of $80,400 for the 2004/05 financial year, at the New Zealand Domain Name Registry Limited Annual Meeting

Carried

Abstained

Cr Northover

Cr Farrar rejoined the meeting.

GENERAL BUSINESS

Cr Riley noted the inclusion of UNESCO / UNDP / InternetNZ MoU in Council papers, and requested approval to spend $10k for the PIGNET conference in Vanuatu.

MOVED: (Cr Riley/Treasurer) THAT: up to $10k be allocated for the PIGNET conference, covering $2.5K each for Andy Linton and the President who are both attending as speakers. The remaining $5k available for subsidising attendance costs for technicians working in the Pacific Islands. Noted that this is an expenditure item already noted in the Business Plan.

Carried U

OUTREACH COMMITTEE

Cr Riley raised the issue of the disbanding of the Outreach Committee for feedback. The President noted that anyone who has feedback send to the President prior to the next Council meeting. Action: Office to be asked to identify whether Don Hollander is a Society member.

The next Council meeting is scheduled 21 August.

The President noted this was the last Council meeting prior to the AGM, and as such he extended his thanks to all the Councillors and especially to the outgoing Councillors for all their work and contributions over the year.

Meeting closed at 4.36pm

Note - for links to papers etc, see the Agenda.