Recommended Draft Policy ARIN-2019-10

Inter-RIR M&A

Status: Recommended for Adoption
Shepherds: Kerrie Richards, Rob Seastrom

Current Text (21 May 2019)

AC Assessment of Conformance with the Principles of Internet Number Resource Policy:

This Recommended Draft Policy is technically sound and is fair and impartial number policy. The intent of the draft policy is to clarify handling of mergers and acquisition transfer processing between RIRs who have compatible transfer policies. The proposed change would not be a change from present practice but the policy change would make ARIN implementation of the current policy clearer.

Problem Statement:

Merger, acquisition, or reorganization activity sometimes results in a restructuring where company resources, the management of number resources, or the use of number resources are concentrated outside the ARIN service region. In this case it may be desirable for the current legal entity or a legal entity that is a parent, child or sister to move the servicing of the number resources to a different RIR.

Example:

Imagine a case where a global company has decided to discontinue service in the ARIN service region (shuttering ARIN region offices laying off ARIN region employees, and canceling ARIN region customers) and repurpose the network resources and number resources in the rest of its global footprint.

Imagine a case where a global company has decided to divest its service in the ARIN region (selling all ARIN region offices, all ARIN region network assets, all ARIN service region customers, all number resources used in the ARIN (associated with previous noted sale of network and customers), but retaining ARIN issued resources in use outside of the ARIN service region.

Policy Statement:

Add to section 8.2:

When merger, acquisition, or reorganization activity results in surviving legal entity that is incorporated outside the ARIN service region, or focused outside the ARIN service region, or is merging with an organization that already has a relationship with another RIR, then resources may be moved to another RIR in accordance with the receiving RIR’s policies.

Timetable for Implementation: Immediate

Summary (Staff Understanding)

Staff understands the intent of the draft policy is to clarify handling of mergers and acquisition transfer processing between RIRs who have compatible transfer policies. The proposed change would not be a change from present practice but the policy change would make our implementation of the current policy clearer. It is understood that IPv6 would be excluded since this refers to Inter-RIR transfers in which IPv6 is not permitted to be part of the transfer.

Comments

ARIN Staff Comments

ARIN staff would like to suggest that this change be made in section 8.4 due to the fact that it is an inter-RIR transfer and would better align with present processing. Section 8.4 should be generalized to read “8.4. Inter-RIR Transfers” and adding “Merger and acquisition and reorganization recipients must meet the transfer requirements as defined in section 8.2.” as a condition on the recipient of the transfer. There are two other suggested edits as below:

Change to the third bullet in section 8.4 for Conditions on source of the transfer to read:

Source entities within the ARIN region must not have received a transfer, allocation, or assignment of IPv4 number resources from ARIN for the 12 months prior to the approval of a transfer request, unless either the source or recipient entity owns or controls the other, or both are under common ownership or control. This restriction does not include transfers completed under section 8.2 Mergers, Acquisitions and Reorganizations.

And add Specified as the first word in the second bullet in section 8.4 Conditions on recipient of the transfer so it reads:

Specified Recipients within the ARIN region must meet the transfer requirements as defined in section 8.5

Another very important reason to keep this in section 8.4 Inter-RIR transfers is the “Inter-regional transfers of IPv4 number resources and ASNs may take place only via RIRs who agree to the transfer and share reciprocal, compatible needs-based policies” clause in 8.4. This makes it very clear that IPv6 is not included in this policy.

ARIN General Counsel – Legal Assessment

While ARIN staff has been handling these situations successfully, the proposed policy change would not materially increase ARIN’s legal risk and should be considered if consistent with the community’s intent for ARIN’s handling of these requests.

Resource Impact

Implementation of this policy would have minimum resource impact. It is estimated that implementation would occur within 3 months after ratification by the ARIN Board of Trustees.

The following would be needed in order to implement:

  • Updated guidelines and internal procedures
  • Updated documentation on website
  • Note that this is current practice under existing policy

Proposal/Draft Policy Text Assessed: 22 July 2019 Version

History and Earlier Versions

History
Action Date
Proposal 9 April 2019
Draft Policy 21 May 2019
Recommended Draft Policy 24 September 2019

Board of Trustees

ARIN Public Policy Meetings