The current Uniform Domain Name Dispute Resolution Policy (UDRP) offers a relatively quick and cost effective mechanism to independently resolve disputes that arise from the abusive registration of trademarks as domain names. Under the UDRP, a complainant must show that the domain name in dispute is identical or confusingly similar to its trademark, that the respondent does not have a right or legitimate interest in the domain name, and that the respondent registered and used the domain name in bad faith.
However, the UDRP is not without its share of problems. The first major problem of the UDRP is that it is only a curative solution, meaning it provides relief after a violation has already occurred. For example, a cybersquatter can register an IP owner's identifiers forcing the aggrieved owner to use the UDRP. In essence, the UDRP seeks to return the damaged IP owner to as good as a position as he was before the cybersquatting. Second, the UDRP has no preventative measure to protect trademark holders from cybersquatters. Theoretically, the only way IP owners can protect themselves as new gTLDs are introduced is by registering their entire trademark portfolio. In essence, IP owners compete with cybersquatters for their own trademarks. Third, no provisions exist to deal with the situation where IP owners want to protect their trademarks in sponsored gTLDs but are restricted because the TLD is reserved for those entities that qualify in the particularized and specialized space.