San Francisco—In an important victory for thousands of public interest groups around the world, a proposal to sell the .ORG domain registry to private equity firm Ethos Capital and convert it to a for-profit entity was rejected late yesterday by the Internet Corporation for Assigned Names and Numbers (ICANN).

The Electronic Frontier Foundation (EFF), which worked hand in hand with Access Now, NTEN, National Council of Nonprofits, Americans for Financial Reform, and many other organizations to oppose the sale, applauds ICANN’s well-reasoned decision to stop the $1.1 billion transaction from moving forward. In a statement, ICANN said rejecting the deal was the right thing to do because it lacked a meaningful plan to protect the interests of nonprofits and NGOs that rely on the .ORG registry to exist on the Internet and connect with the people they serve.

The sale would change Public Interest Registry (PIR), the nonprofit operator of .ORG, into an entity bound to serve the interests of its corporate stakeholders, not the nonprofit world. ORG is the third-largest Internet domain name registry, with over 10 million domain names held by a diverse group of charities, public interest organizations, and nonprofits, from the Girl Scouts of America and American Bible Society to Farm Aid and Meals On Wheels.

“We’re gratified that ICANN listened to the .ORG community, which was united in its opposition to the sale,” said EFF Senior Staff Attorney Mitch Stoltz. “Under the deal, .ORG would be converted to a for-profit entity controlled by domain name industry insiders and their secret investors. Nonprofits are vulnerable to the governments and corporations who they often seek to hold accountable. The public interest community rightly questioned whether an owner motivated by profits would stand up to demands for censorship of charities who rely on .ORG so that people can find and rely on their vital services.”

“The sale of .ORG was announced, without .ORG community input, not long after price caps on registration fees for domain names were lifted and PIR acquired new powers to allegedly ‘protect’ the rights of third parties,” said EFF Staff Attorney Cara Gagliano. “It was obvious to many that .ORG registrants could face higher operating costs and degradation of service as Ethos sought to increase fees and seek profitable arrangements with businesses keen to silence nonprofits. This concern grew after it was revealed that the transaction required taking on a $360 million debt obligation.”

If PIR wishes to press forward, it still must seek approval from courts in the state of Pennsylvania, where PIR is incorporated.  As part of that process, the Pennsylvania state Attorney General may weigh in. EFF urges both to follow ICANN’s lead and reject the transaction. This will pave the way for a transparent process to select a new operator for .ORG that will act in the interests of the nonprofits that it serves.