Domain Name Conflicts in Germany – An Economic Analysis of the Federal High Court's Recent Decisions

Abstract

This article analyses three decisions of the German Federal High Court concerning the German country-code top-level domain ‘.de’ – mitwohnzentrale.de, shell.de and vossius.de. The analysis shows that the Court referred to economic criteria to justify its decisions in this field of law which is barely regulated by statutory law. The questions whether generic terms should be allocated to private persons as domain names (mitwohnzentrale.de) and whether courts should transfer domain names in the case of a conflict between two rightholders to the same domain name (shell.de and vossius.de) are analysed on the basis of economic criteria. The economic analysis of the first question offers two efficient solutions: (1) owners of generic domain names should be obliged to provide links to the websites of their competitors or (2) generic domain names should be administered by the official registrar, which should provide a portal for the whole branch of industry in question. The answer to the second question is that courts should engage in the transfer of domain names only in cases where bargaining between the parties fails due to a situation of bilateral monopoly with asymmetric information. If the courts decide to transfer a domain name, the original owner must be entitled to receive appropriate compensation.