Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection and Housing, to which was referred H.B. No. 1221, H.D. 2, entitled:

begs leave to report as follows:

The purpose of this measure is to prohibit the bad faith registration of domain names on the Internet.

Your Committee received testimony in support of this measure from the Lieutenant Governor, Verizon Hawaii, Hawaii Automobile Dealers Association, and Tony Group.

Your Committee finds that since its inception, the Internet has been a largely unregulated industry. As a result, many of the rights citizens take for granted are susceptible to intrusion by other parties. Cybersquatting, or the use of an individual's or business's name as a domain name with "bad faith intent", is one such intrusion.

Your Committee further finds that in the corporate arena, cybersquatting or cyber piracy exists to a greater extent than previously estimated. According to a recent study by a domain name consultant, 265 of the Fortune 500 companies own fewer of their own trade names online because other parties have registered those names.

Your Committee further finds that the federal government has passed related legislation to protect consumers, and a recent similar California law provides additional protection for California residents. The intent of this measure is to do likewise for Hawaii residents.

The amendments made by your Committee build on the base of House Draft 2, and are intended to clarify and strengthen, and to make more inclusive and specific the parameters of the prohibited acts. The amended measure more accurately reflects the intended purpose of enacting a cybersquatting law.

As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection and Housing that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1221, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1221, H.D. 2, S.D. 1, and be referred to the Committee on Judiciary.