Legal panel at DOMAINfest Global says think twice before moving your domain names or forming your business offshore.
Tuesday afternoon at DOMAINfest Global in Los Angeles, a panel of lawyers suggested that moving domain names to offshore registrars or forming your domain company offshore may not be the panacea it seems. In fact, Derek Newman of Newman & Newman said you may actually be hurting yourself by setting up an offshore corporation to hold your domain names.
Newman said that companies — and often times judges — assume that you’re trying to hide something if you set your domain names up in an offshore company. This may also apply to moving your domains to an offshore domain registrar.
Other lawyers on the panel generally agreed. They said that just because your domain names are in an offshore company or at an offshore domain name registrar doesn’t mean you are outside of United States’ jurisdiction.
Here are some things to think about:
1. Is your web host or server based in the United States?
2. Does your domain name parking company have a presence in the U.S.?
3. If your domain parking company is outside the U.S., does it use a U.S.-based ad feed such as Google or Yahoo?
Johnny says
Wow…..what about just for the sake of keeping all you assets from being taken from you, that is, not a case that involves a conflict over a domain name, but maybe a judgment against you for a bar fight, car accident, or whatever?
How then is one to protect against those scenarios, like many wealthy people do already, to limit losses?
Andrew Allemann says
Johnny – that’s what you create an LLC or corporation for. However, sometimes that protection isn’t perfect.
Richard Meyer says
A corporation (or LLC) does not protect a person from lawsuits from TM infringement.
Andrew Allemann says
@ Richard – correct. And I should have thought more on my prior statement — if you get sued personally, your business is an asset and could be taken.
Mario Koch says
Ridiculous decisions regarding foreign property like Cuba travel or Casino sites (Kentucky) sending out a signal to keep your online property away from US registrars or hosts.
fred says
I think the panel misses the point.
Dluzional says
Interesting subject and content, and quite timely given the earlier discussion about domains and offshore registrar’s.
What would be also interesting is for whomever knows the legal ins and outs of offshore domain registration would actually state:
1…”why” offshore domain registration isn’t a good idea….
It’s one thing to say it’s not a good idea, and provide fodder as in the original posters commentary, but to just put it out there that it’s a bad idea, without any reasons leaves things open to a lot of interpretation doesn’t it?
I’d like to find out exactly what the process “could be” or “would be” generically of course how the offshore domain registry, or the offshore company that host’s and registers domains/sites would be brought into a US court.
Is ICANN really about to get involved and pull the registrar status of a company because the US court system says so?
Flip the coin over and explain the process, along with the ramifications of bowing down to the US court system flexing it’s muscle where it shouldn’t be.
Discuss amongst yourselves.
domain guy says
i saw on 60 minutes a 20 minute segment of a man that bought the smallest country in the world and was landing there by helicopter. he and a reporter were shown landing on an abandon registered oil rig some where out in the middle of the ocean.this guy stated he just bought this registered country with the intention to build high power servers to host controversal websites. and since this country was outside us jurisdiction he/records could not be suponea
ed from the usa.i saw this about 5 yrs ago.
2. frank schilling seems to have zero problems out there in the cayman islands earning 20 million a year on his portfolio.
3. a corporate “vail” can easily be pierced for personal monetary liability..just look at kozolaski he’s in jail and his personal assets ie6k umbrella stand was seized.
4. on the island of antiguia they offer gambling liscense for 10k.i
read there are
a couple of hundred website operators on the island operating gaming websites.all their customers do not reside in the us. the us forbides this action with a 60 yr old law using wired networks.
Richard M. says
“3. a corporate “vail” can easily be pierced for personal monetary liability.”
That is true.
Also, officers and corporate owners can be found liable for TM infringements.
Too Many Secrets says
Hello everyone!
As someone who lives in an “offshore” country and has managed an “offshore” data center since 2001, I’d like to shed some light on a few things.
1. Doing something “offshore” simply means going to another county. i.e. sending your programming work to India or Romania is “offshoring”. So in the same context, if you do business in the USA, moving to an offshore registrar or hosting company could mean moving the business to the UK, Germany, Bahamas, you get the idea.
2. Many people (especially USA lawyers) still presume that anyone doing any business “offshore” are tax cheaters. This is simply not true, people hold software, web sites, domains in offshore locations to diversify and protect themselves from possible litigation. AND they pay their taxes each year like any other honest citizens.
3. If you are considering moving your domains to another registrar or hosting company, do your due diligence very thoroughly. Many non-USA registrars, hosting and parking companies actually have offices in the USA or host their entire business in the USA. Just because these companies have a head office in the UK, Germany, Australia or India doesn’t mean they are offshore. There are plenty of cases where the US government has simply gone after the USA assets of foreign companies to go after their clients.
Although I run an offshore data center, this isn’t a sales pitch. 🙂 Take my advice and consider your offshore registrar and hosting options, with whomever you chose.
And if you are doing shady stuff don’t bother looking at offshore options because you’ll get shut down sooner or later anyways. Just stop doing the shady stuff!
– Richard
newtrends tech says
Domains Offshore is a False Hope is not rite in my opinion because I think offshore programming is a way of innovation.