If no, please explain

Refunds A clear, predictable, and equitable refund mechanism is critical to upholding the principles of fairness and cost recovery. The following refund-related issues require clarification and improvement in the Applicant Guidebook (AGB): A. Volume Refunds Should Be Opt-Out and Fully Distributed The current opt-in structure for volume refunds introduces unnecessary bureaucracy and, more concerningly, creates a loophole that allows ICANN to quietly retain unclaimed funds. This contradicts both the principle of cost recovery and ICANN’s role as a public-benefit organization. If ICANN has committed to refunding excess fees, it should do so without forcing applicants to jump through additional hoops. Retaining millions simply because applicants didn’t “check a box” is not just administratively lazy-it’s ethically indefensible. We recommend that: • Volume refunds be issued automatically using banking information already collected in the application process; • Refunds only be withheld in rare, documented exceptions (e.g., closed accounts or dissolved entities); and • The AGB clearly define refund triggers, timelines, and disbursement procedures to eliminate ambiguity. To illustrate: if 2,000 applications generate a $97 million surplus and 10% of applicants do not affirmatively claim their refund, ICANN would retain nearly $10 million-despite admitting those funds are excess and refundable. That’s not cost recovery. That’s windfall retention. Worse, it would mean that ICANN-a global nonprofit responsible for internet infrastructure-keeps funds it openly acknowledges are not needed for program execution. At a minimum, unclaimed funds should be used to reduce annual ICANN registry fees, benefiting the entire community and restoring credibility to the refund process. B. Application Withdrawal Refunds Must Not Be Discounted by Volume Refunds There is ambiguity in how volume refunds interact with application withdrawal refunds. Specifically, if an applicant withdraws, will their refund (e.g., 65% at Stage 1) be calculated from the original $227,000 fee, or from the post-volume-refund amount? Example Scenarios: Scenario Volume Refund Withdrawal Refund Total Refund Based on original fee $48,500 65% of $227,000 = $147,550 $196,050 Based on reduced fee $48,500 65% of $178,500 = $116,025 $164,525 Only the first approach upholds fairness and avoids penalizing applicants for receiving a refund they are entitled to. The Final Report (p. 71) explicitly supports this view: “If a volume discount or refund is applied, this must not negatively impact an applicant’s eligibility for other refunds (e.g., for voluntary withdrawal).” To ensure clarity: • ICANN should confirm that withdrawal refund percentages are based on the full, original application fee; and • The AGB should provide example refund calculations, including both percentages and actual dollar values, as in the 2012 Guidebook. C. Refunds Triggered by Underestimated Application Volumes If ICANN sets the application fee based on an estimate of 1,000 applications, but 1,500 are ultimately received, the per-application cost is significantly overstated. In such cases, ICANN should return these excess funds immediately to applicants once the actual number of applications exceeds the 1,000 volume threshold. Applicants should not bear inflated costs due to conservative modeling when real-world demand exceeds projections. This over collection contradicts ICANN’s own cost recovery mandate and undermines confidence in the program’s financial structure. As emphasized in the Final Report (p. 70): “There should be a clear and predictable mechanism for determining when and how excess funds are returned to applicants... The program must be self-sustaining and not generate surplus revenues.” To that end, the AGB should: • Provide example thresholds at which excess application volume triggers a downward revision in the cost model; and • Commit to issuing refunds to all applicants promptly once the actual application count exceeds the initial forecast of 1,000 applications This approach supports fairness, preserves trust, and prevents ICANN from holding surplus funds beyond what is required to operate the program. D. Refunds for Overcollection Due to Overestimated Implementation Costs If actual program implementation costs are lower than forecasted, ICANN must return excess funds to applicants. These refunds should not be delayed until program completion, but rather disbursed incrementally as financial certainty increases. To enhance transparency and predictability, ICANN should adopt a milestone-based refund schedule tied to the percentage of applications processed. This structure ensures applicants receive timely refunds while ICANN retains sufficient reserves to manage risk. As stated in Implementation Guidance 15.6 of the Final Report on the New gTLD Subsequent Procedures (1 February 2021, p. 66): “The disbursement mechanism must be communicated before applicants submit applications and fees... ICANN may establish a schedule for the disbursement of refunds upon the achievement of specified milestones.” Illustrative Refund Schedule Based on Processing Milestones: Milestone: Applications Fully Processed Total Refundable Excess Fees 25% 25% 50% 50% 70% 75% 90% 100% This model aligns with the Final Report (p. 68) principle that: “The program must be self sustaining without the need for funding from other sources and that the program should operate on a cost recovery basis with the goal of being revenue neutral” Geographic Names Review Fees Are Excessive and Opaque The proposed $18,000 – $25,000 fee for Geographic Name Review appears unjustified-particularly considering that the base application fee already includes a risk contingency component. This fee could deter geographic TLD applications, especially from non-profit and government entities with limited budgets. We recommend: • Absorbing Geographic Name Review costs within the base fee, where feasible • Providing a detailed justification of the cost structure • Referencing previous evaluations such as the Brand Evaluation, where a $10,000 estimate was ultimately reduced to $500 The Final Report on the New gTLD Subsequent Procedures (1 February 2021, p. 69) underscores: “ICANN should be fully transparent about how the application fee has been developed, explaining and documenting all cost assumptions.” This transparency is vital for maintaining applicant trust and avoiding perceptions of unnecessary cost barriers.