2008-2 Previous Version [Archived]

View the current policy proposal text.

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The following version was archived on 18 September 2008.

Policy Proposal 2008-2
IPv4 Transfer Policy Proposal

Author: ARIN Advisory Council

Proposal Version: 1.1

Date: 7 March 2008

Proposal type: modify

Policy term: permanent

Policy statement:

Replace the current NRPM section 8 with the following –

8. Transfers

[8.1. Transfers – retain as is:

Number resources are non-transferable and are not assignable to any other organization unless ARIN has expressly and in writing approved a request for transfer. ARIN is tasked with making prudent decisions on whether to approve the transfer of number resources.

It should be understood that number resources are not “sold” under ARIN administration. Rather, number resources are assigned to an organization for its exclusive use for the purpose stated in the request, provided the terms of the Registration Services Agreement continue to be met and the stated purpose for the number resources remains the same. Number resources are administered and assigned according to ARIN’s published policies.

Number resources are issued, based on justified need, to organizations, not to individuals representing those organizations. Thus, if a company goes out of business, regardless of the reason, the point of contact (POC) listed for the number resource does not have the authority to sell, transfer, assign, or give the number resource to any other person or organization. The POC must notify ARIN if a business fails so the assigned number resources can be returned to the available pool of number resources if a transfer is not requested and justified.]

[8.2 – remove the word “only”, and retitle to “Transfers as an Artifact of Change in Resource Holder Ownership”:

8.2. Transfers as an Artifact of Change in Resource Holder Ownership
ARIN will consider requests for the transfer of number resources upon receipt of evidence that the new entity has acquired the assets which had, as of the date of the acquisition or proposed reorganization, justified the current entity’s use of the number resource. Examples of assets that justify use of the number resource include, but are not limited to:
• Existing customer base
• Qualified hardware inventory
• Specific software requirements.]
[Renumber existing 8.3 to 8.2.1 and retitle to “Documentation Requirements for Transfers as an Artifact of Change in Resource Holder Ownership”:

8.2.1. Documentation Requirements for Transfers as an Artifact of Change in Resource Holder Ownership In evaluating a request for transfer, ARIN may require the requesting organization to provide any of the following documents, as applicable, plus any other documents deemed appropriate:
• An authenticated copy of the instrument(s) effecting the transfer of
assets, e.g., bill of sale, certificate of merger, contract, deed, or court decree
• A detailed inventory of all assets utilized by the requesting party in maintaining and using the number resource
• A list of the requesting party’s customers using the number resource.
If further justification is required, the requesting party may be asked to provide any of the following, or other supporting documentation, as applicable:
• A general listing of the assets or components acquired
• A specific description of acquisitions, including:
o Type and quantity of equipment
o Customer base
• A description of how number resources are being utilized
• Network engineering plans, including:
o Host counts
o Subnet masking
o Network diagrams
o Reassignments to customers]

8.3. Simple Transfer of IPv4 Addresses

After the exhaustion of the IANA IPv4 free pool (when IANA allocates its last unallocated unicast IPv4 address block), ARIN will also process IPv4 address transfer requests subject to the following conditions. These conditions apply only to Simple IPv4 transfers, not to transfers performed according to section 8.2.

8.3.1 Conditions on the transferor (the organization providing addresses
for transfer):
• The transferor resides in the ARIN service area.
• The transferor has signed an RSA and/or a legacy RSA covering the IPv4
addresses transferred.
• The transferor has no outstanding balances with ARIN.
• The transferor has not received any IPv4 allocations or assignments from ARIN (through ordinary allocations or assignments, or through this Simple Transfer policy) within the preceding 24 months.
• The transferor may not request any IPv4 allocations or assignments from ARIN (through ordinary allocations or assignments, or through this Simple Transfer policy) within the subsequent 24 months.

8.3.2 Conditions on the transferee (the organization receiving the
transferred addresses):
• The transferee resides in the ARIN service area and intends to use the transferred IPv4 addresses within the ARIN service area.
• The transferee has no outstanding balances with ARIN.
• The transferee’s need is confirmed by ARIN, according to current ARIN
policies, including but not limited to confirmation of utilization rate of any prior IPv4 allocations, assignments, or previously transferred IPv4 addresses held by the transferee.
• The transferee signs (or has previously signed) an RSA covering the IPv4 addresses transferred.
• The transferee has not provided any IPv4 addresses for transfer through this Simple Transfer process within the preceding 24 months.
• The transferee may not provide any IPv4 addresses for transfer through this Simple Transfer process within the subsequent 24 months, except in the case of business failure.
• The transferee may request and receive a contiguous CIDR block large enough to provide a 12 month supply of IPv4 addresses.
• The transferee may only receive one IPv4 address transfer through this Simple Transfer process every 6 months.

8.3.3 Conditions on the IPv4 address block to be transferred:
• The IPv4 block must comply with applicable ARIN requirements, including minimum allocation size (i.e. NRPM 4.2.2., 4.2.4., 4.3.2., 4.3.6.). However, an IPv4 allocation or assignment of /24 or larger, but smaller than the current minimum allocation size, may be transferred as a whole resource, but may not be subdivided.
• The IPv4 block must currently be registered for use within the ARIN service area, either as part of an address block assigned by IANA to ARIN, or as part of a legacy address block allocated within the ARIN service area.
• There must exist no dispute as to the status of the IPv4 block or regarding the allocation or assignment of such block to the transferor.
• The transferor may retain one contiguous address range out of their original allocation or assignment for their own use, and transfer the other contiguous address range. If the address range to be transferred consists of multiple non-aggregatable CIDR blocks, each may be transferred to a different transferee. The retained address range may not be further subdivided or transferred for a period of 12 months. Notwithstanding the preceding, the block may be subdivided as provided in section 8.3.6.

8.3.4 Fees
• Completion of a transfer requires payment of a transfer fee according
to ARIN’s schedule of fees.
• The transferee will be subject to all future ARIN membership and service fees according to the transferee’s total address holdings.

8.3.5 Pre-qualification

• An interested transferee must seek pre-qualification from ARIN to confirm its eligibility to receive a transfer (including satisfaction of need according to current ARIN policies) before making any solicitation for transfer. Upon pre-qualification, ARIN will provide the transferee with documentation of the pre-qualification, including the size (CIDR prefix length) of the largest IPv4 address block the transferee is eligible to receive, and the expiration date of the pre-qualification.
• An interested transferor must seek pre-qualification from ARIN to confirm its eligibility to offer a transfer (including lack of outstanding balances and having signed an RSA) before offering IPv4 address resources for transfer. Upon pre-qualification, ARIN will provide the transferor with documentation of the pre-qualification, including the network block and the expiration date of the pre-qualification.

8.3.6 Deaggregation when Permitted by ARIN

If ARIN determines that there is an inadequate supply of small blocks, ARIN may allow transferors to subdivide network blocks beyond the limited subdivision permitted under 8.3.3. ARIN will attempt to ensure an adequate supply of small blocks while minimizing deaggregation.

8.3.7. Safe Harbor for IPv4 Transfers through this Simple Transfer Process

When an IPv4 address resource is made available for transfer, it shall be deemed exempt from ARIN utilization audit until 90 days after its transfer pre-qualification or until the transfer is completed, whichever comes first.

In the event that a transfer is not consummated within the prequalification time period, the block may be immediately re-prequalified for transfer. Notwithstanding the current offered state of the address resource, however, the audit exemption period shall expire untolled 90 days after the expiration of the first pre-qualification period. After the expiration of any utilization audit exemption period, ARIN shall have 90 days in which to initiate a utilization audit. In no event shall non-exempt time be construed to extend the end of the next exemption period.

8.3.8. Simple IPv4 Transfers to or from Organizations Under Common Ownership or Control

If an IPv4 transferor or transferee is under common ownership or control with any other organization that holds one or more IPv4 blocks, the IPv4 transfer request must report all such organizations under common ownership or control.

When evaluating compliance with IPv4 Simple Transfer conditions, ARIN may consider a transferor’s transfer request in light of requests from other organizations under common ownership or control with the transferor. Similarly, ARIN may consider a transferee’s request in light of requests from other organizations under common ownership or control with the transferee. In evaluating requests from other organizations under common ownership or control, ARIN staff will consider the relationship between the organizations, the degree of coordination between the organizations, and the bona fide use of the addresses at issue to determine whether all appropriate conditions are met.

8.3.9. Record-keeping and Publication of Simple Transfers of IPv4 Addresses

ARIN will develop and operate a listing service to assist interested transferors and transferees by providing them a centralized location to post information about IPv4 blocks available from prequalified transferors and IPv4 blocks needed by prequalified transferees. Participation in the listing service is voluntary.

After completion of the transfer, ARIN will update the registration records pertaining to the IPv4 block at issue. ARIN will adjust its records as to the holdings of the transferor and transferee.

After the transfer, ARIN will publish WHOIS data that reflects the current allocation or assignment of the transferred block. ARIN will also make available information about any prior recipient(s) of such block. ARIN will also publish a log of all transfers, including block, transferor, transferee, and date.

Rationale:
The ARIN Board of Trustees asked the Advisory Council to consider a set of questions around the depletion of the free pool of IPv4 addresses, the transition to IPv6 for Internet address needs in the future, and ARIN’s possible role in easing the transition.

Over the past few years the AC has spent a great deal of time reflecting on these issues — as a group, as individuals, and in consultation with the community. One outcome of this process is this policy proposal, which the AC is submitting for consideration at the next meeting. We are proposing some changes to existing ARIN policy regarding the transfer of IP address block registrations between subscribers, which will allow for the emergence of trade in IPv4 address space, with ARIN to provide a listing service for address blocks available for transfer under the liberalized policy. We are aware that this proposal, if adopted, will mark a major change in ARIN’s role in the community and the Internet.

This policy proposal would create a transfer mechanism for IPv4 number resources between those who have excess resources and those who have a need, thereby allowing ARIN to continue to serve its mission after IANA free pool exhaustion. This proposal would also set conditions on such transfers intended to preserve as much as possible the existing policy related to efficient, needs-based resource issuance, and would leverage ARIN’s extensive control systems, audit trails, and recognized position as a trusted agent to avoid speculation and hoarding and diminish the likelihood and extent of an uncontrolled ‘black market’ where the risk and potential for fraud is immeasurably higher.

Many of the transfer conditions are self-explanatory, but some worth highlighting are that:
• To discourage speculation, a waiting period (proposed at 24 months) is required before a transferee (or ordinary resource recipient) can become a transferor, or vice versa.
• Transferees must qualify for IPv4 space (just as they do today when getting it from ARIN) before they can receive address space by transfer, or solicit space on a listing service.
• To discourage unnecessarily rapid growth of routing tables, an allocation or assignment may not be arbitrarily deaggregated. To allow a transferor to downsize within their existing space, they may split off a contiguous address range, once every 12 months, and transfer the resulting netblock(s), which are subject to ARIN’s minimum allocation size, to one or more transferee(s).
• A transferee may receive one transfer every 6 months, so they’ll be incented to transfer a block appropriately sized for their needs, which will further discourage deaggregation and keep smaller blocks available for smaller organizations.
The proposal would also have ARIN develop and operate a listing service to facilitate transfers and provide an authoritative central source of information on space available and requested for transfer. It would not prohibit private party transactions, but would require that potential transferors and transferees be pre-qualified first, so that neither party will encounter any unexpected surprises when they ask ARIN to process the transfer.

Timetable for implementation: Immediately, with most aspects of policy taking effect upon IANA exhaustion, per the policy text.

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The following version was archived on 7 March 2008.

Policy Proposal 2008-2
IPv4 Transfer Policy Proposal

Author: ARIN Advisory Council

Proposal Version: 1

Date: 26 February 2008

Proposal type: modify

Policy term: permanent

Policy statement:

Replace the current NRPM section 8 with the following –

8. Transfers

[8.1. Transfers – retain as is:

Number resources are non-transferable and are not assignable to any
other organization unless ARIN has expressly and in writing approved a
request for transfer. ARIN is tasked with making prudent decisions on
whether to approve the transfer of number resources.

It should be understood that number resources are not “sold” under ARIN
administration. Rather, number resources are assigned to an organization
for its exclusive use for the purpose stated in the request, provided
the terms of the Registration Services Agreement continue to be met and
the stated purpose for the number resources remains the same. Number
resources are administered and assigned according to ARIN’s published
policies.

Number resources are issued, based on justified need, to organizations,
not to individuals representing those organizations. Thus, if a company
goes out of business, regardless of the reason, the point of contact
(POC) listed for the number resource does not have the authority to
sell, transfer, assign, or give the number resource to any other person
or organization. The POC must notify ARIN if a business fails so the
assigned number resources can be returned to the available pool of
number resources if a transfer is not requested and justified.]

[8.2 – remove the word “only”, and retitle to “M&A Transfer Requirements”:

8.2. M&A Transfer Requirements

ARIN will consider requests for the transfer of number resources upon
receipt of evidence that the new entity has acquired the assets which
had, as of the date of the acquisition or proposed reorganization,
justified the current entity’s use of the number resource. Examples of
assets that justify use of the number resource include, but are not
limited to:

* Existing customer base
* Qualified hardware inventory
* Specific software requirements.]

[8.3 – retitle to “M&A Transfer Documentation Requirements”:

8.3. M&A Transfer Documentation Requirements

In evaluating a request for transfer, ARIN may require the requesting
organization to provide any of the following documents, as applicable,
plus any other documents deemed appropriate:

* An authenticated copy of the instrument(s) effecting the transfer
of assets, e.g., bill of sale, certificate of merger, contract,
deed, or court decree
* A detailed inventory of all assets utilized by the requesting
party in maintaining and using the number resource
* A list of the requesting party’s customers using the number resource.

If further justification is required, the requesting party may be asked
to provide any of the following, or other supporting documentation, as
applicable:

* A general listing of the assets or components acquired
* A specific description of acquisitions, including:
o Type and quantity of equipment
o Customer base
* A description of how number resources are being utilized
* Network engineering plans, including:
o Host counts
o Subnet masking
o Network diagrams
o Reassignments to customers]

8.4. Requirements for Simple Transfer of IPv4 Addresses

After the exhaustion of the IANA IPv4 free pool, ARIN will also process
IPv4 address transfer requests subject to the following conditions.

8.4.1 Conditions on the transferor:

* The transferor resides in the ARIN service area.
* The transferor has signed an RSA and/or a legacy RSA covering the
IPv4 addresses transferred.
* The transferor has no outstanding balances with ARIN.
* The transferor has not received any IPv4 allocations or
assignments from ARIN (through ordinary allocations or
assignments, or through this Simple Transfer policy) within the
preceding 24 months.
* The transferor may not request any IPv4 allocations or assignments
from ARIN (through ordinary allocations or assignments, or through
this Simple Transfer policy) within the subsequent 24 months.

8.4.2 Conditions on the transferee:

* The transferee resides in the ARIN service area and intends to use
the transferred IPv4 addresses within the ARIN service area.
* The transferee has no outstanding balances with ARIN.
* The transferee’s need is confirmed by ARIN, according to current
ARIN policies, including but not limited to confirmation of
utilization rate of any prior IPv4 allocations, assignments, or
previously transferred IPv4 addresses held by the transferee.
* The transferee signs (or has previously signed) an RSA covering
the IPv4 addresses transferred.
* The transferee has not provided any IPv4 addresses for transfer
through this Simple Transfer process within the preceding 24
months.
* The transferee may not provide any IPv4 addresses for transfer
through this Simple Transfer process within the subsequent 24
months, except in the case of business failure.
* The transferee may only receive one IPv4 address transfer every 6
months.

8.4.3 Conditions on the IPv4 address block to be transferred:

* The IPv4 block must comply with applicable ARIN requirements,
including minimum allocation size (i.e. NRPM 4.2.2., 4.2.4.,
4.3.2., 4.3.6.). However, an IPv4 allocation or assignment of /24
or larger, but smaller than the current minimum allocation size,
may be transferred as a whole resource, but may not be subdivided.
* The IPv4 block must currently be registered for use within the
ARIN service area, either as part of an address block assigned by
IANA to ARIN, or as part of a legacy address block allocated
within the ARIN service area.
* There must exist no dispute as to the status of the IPv4 block or
regarding the allocation or assignment of such block to the
transferor.
* The transferor may retain one contiguous address range out of
their original allocation or assignment for their own use, and
transfer the other contiguous address range. If the address range
to be transferred consists of multiple non-aggregatable CIDR
blocks, each may be transferred to a different transferee. The
retained address range may not be further subdivided or
transferred for a period of 12 months.

8.4.4 Fees

* Completion of a transfer requires payment of a transfer fee
according to ARIN’s schedule of fees.
* The transferee will be subject to all future ARIN membership and
service fees according to the transferee’s total address holdings.

8.4.5 Pre-qualification

* An interested transferee must seek pre-qualification from ARIN to
confirm its eligibility to receive a transfer (including
satisfaction of need according to current ARIN policies) before
making any solicitation for transfer. Upon pre-qualification,
ARIN will provide the transferee with documentation of the
pre-qualification, including the size (CIDR prefix length) of the
largest IPv4 address block the transferee is eligible to receive,
and the expiration date of the pre-qualification.
* An interested transferor must seek pre-qualification from ARIN to
confirm its eligibility to offer a transfer (including lack of
outstanding balances and having signed an RSA) before offering
IPv4 address resources for transfer. Upon pre-qualification, ARIN
will provide the transferor with documentation of the
pre-qualification, including the exact network address and size
(CIDR prefix length) the transferor is eligible to provide, and
the expiration date of the pre-qualification.

8.5. Safe Harbor for IPv4 Transfers through this Simple Transfer
Process

IPv4 address resources being made available for transfer shall be exempt
from ARIN audit until expiration of the transfer pre-qualification or
completion of the transfer. In the event that a transfer
pre-qualification expires, ARIN shall have up to 90 days to initiate an
audit prior to this exemption being reinstated through subsequent
transfer pre-qualification. This will not extend the end of the exemption.

8.6. Simple IPv4 Transfers to or from Organizations Under Common
Ownership or Control

If an IPv4 transferor or transferee is under common ownership or control
with any other organization that holds one or more IPv4 blocks, the IPv4
transfer request must report all such organizations under common
ownership or control.

When evaluating compliance with IPv4 Simple Transfer conditions, ARIN
may consider a transferor’s transfer request in light of requests from
other organizations under common ownership or control with the
transferor. Similarly, ARIN may consider a transferee’s request in
light of requests from other organizations under common ownership or
control with the transferee. In evaluating requests from other
organizations under common ownership or control, ARIN staff will
consider the relationship between the organizations, the degree of
coordination between the organizations, and the bona fide use of the
addresses at issue to determine whether all appropriate conditions are met.

8.7. Record-keeping and Publication of Simple Transfers of IPv4
Addresses

ARIN will develop and operate a listing service to assist interested
transferors and transferees by providing them a centralized location to
post information about IPv4 blocks available from prequalified
transferors and IPv4 blocks needed by prequalified transferees.

After completion of the transfer, ARIN will update the registration
records pertaining to the IPv4 block at issue. ARIN will adjust its
records as to the holdings of the transferor and transferee.

After the transfer, ARIN will publish WHOIS data that reflects the
current allocation or assignment of the transferred block. ARIN will
also make available information about any prior recipient(s) of such
block. ARIN will also publish a log of all transfers, including block,
transferor, transferee, and date.

Rationale:

The ARIN Board of Trustees asked the Advisory Council to consider a set
of questions around the depletion of the free pool of IPv4 addresses,
the transition to IPv6 for Internet address needs in the future, and
ARIN’s possible role in easing the transition.

Over the past few years the AC has spent a great deal of time reflecting
on these issues as a group, as individuals, and in consultation with
the community. One outcome of this process is this policy proposal,
which the AC is submitting for consideration at the next meeting. We are
proposing some changes to existing ARIN policy regarding the transfer of
IP address block registrations between subscribers, which will allow for
the emergence of trade in IPv4 address space, with ARIN to provide a
listing service for address blocks available for transfer under the
liberalized policy. We are aware that this proposal, if adopted, will
mark a major change in ARIN’s role in the community and the Internet.

This policy proposal would create a transfer mechanism for IPv4 number
resources between those who have excess resources and those who have a
need, thereby allowing ARIN to continue to serve its mission after IANA
free pool exhaustion. This proposal would also set conditions on such
transfers intended to preserve as much as possible the existing policy
related to efficient, needs-based resource issuance, and would leverage
ARIN’s extensive control systems, audit trails, and recognized position
as a trusted agent to avoid speculation and hoarding and diminish the
likelihood and extent of an uncontrolled ‘black market’ where the risk
and potential for fraud is immeasurably higher.

Many of the transfer conditions are self-explanatory, but some worth
highlighting are that:

* To discourage speculation, a waiting period (proposed at 24
months) is required before a transferee (or ordinary resource
recipient) can become a transferor, or vice versa.
* Transferees must qualify for IPv4 space (just as they do today
when getting it from ARIN) before they can receive address space
by transfer, or solicit space on a listing service.
* To discourage unnecessarily rapid growth of routing tables, an
allocation or assignment may not be arbitrarily deaggregated. To
allow a transferor to downsize within their existing space, they
may split off a contiguous address range, once every 12 months,
and transfer the resulting netblock(s), which are subject to
ARIN’s minimum allocation size, to one or more transferee(s).
* A transferee may receive one transfer every 6 months, so they’ll
be incented to transfer a block appropriately sized for their
needs, which will further discourage deaggregation and keep
smaller blocks available for smaller organizations.

The proposal would also have ARIN develop and operate a listing service
to facilitate transfers and provide an authoritative central source of
information on space available and requested for transfer. It would not
prohibit private party transactions, but would require that potential
transferors and transferees be pre-qualified first, so that neither
party will encounter any unexpected surprises when they ask ARIN to
process the transfer.

Timetable for implementation: Immediately, with most aspects of policy
taking effect upon IANA exhaustion, per the policy text.