15 June auDA Board meeting Minutes

Meeting of the .au Domain Administration Board

15 June 2015 – 11.00am

auDA, 114 Cardigan Street, Carlton

Present:

Tony Staley (Chair), Chris Disspain, Erhan Karabardak, George Pongas, Graham McDonald, Joe Manariti, Josh Rowe, Julie Hammer, Kartic Srinivasan, Paul Levins, Simon Johnson, Stuart Benjamin

Observers:

Annaliese Williams (DoC - Items 1-8), Caroline Greenway (DoC - Items 1-8), Derek Whitehead (Items 1-3), John Higgins (Nexia Australia – Items 1-7), Robert Gregory (Maddocks - Item 9), Jo Lim (auDA), Jacki O’Sullivan (auDA–Minutes - Items 1-8)

Apologies:

Nil

1.    Continuous Disclosure

There were no matters to disclose.

2.    Confirmation of April 2015 Minutes

• The minutes of the 20 April 2015 Board meeting were noted as requiring amendments.  The minutes will be updated and recirculated for final approval.
• The Board agreed future minutes should include more specific resolutions, particularly on Financial and more important issues, and requested that where possible, formal proposals be submitted in writing for Board approval.

3.    2015 Names Policy Panel

• Derek Whitehead attended and summarised the Panel's activities to date.
• He advised that the Panel received 25 submissions and 193 survey responses to the Issues Paper.  Overall there is a high level of satisfaction with the current system with only a few areas of issue, mainly concerning direct registrations.
• Good discussions had been held with most Panel members keen to support changes depending on the model adopted.  The purpose of the next 2 meetings would be to review various models with a view to issuing draft recommendations for public comment in late August.

4.    Finance

The Board noted the May 2015 accounts.

5.    2015-16 Budget

• The Board considered the 2015-2016 budget which was endorsed by the Finance Committee.
• Motion (proposed G McDonald, seconded J Hammer): That the Board approve the 2015-2016 budget.
  Carried.

6.    CEO Report

• The CEO report was noted.
• Membership renewals and highlighting the benefits of membership were raised.  The CEO undertook to consider sending out additional reminder communications regarding membership benefits.
• G McDonald advised he had been involved in the judging process of ANZIA entries and noted the excellent standard of entry submissions this year.

7.  Board Committee Updates

Finance & Audit Committee:

• The Chair advised the Committee had met on 11 June 2015 and minutes would be circulated in due course.
• The Chair advised there had been confusion over what had been agreed at the last meeting in relation to Bond and Term Deposit Investments.  A separate minute was circulated to clarify the proposed changes to the investment strategy.
• Motion (proposed G McDonald, seconded J Hammer): That the Board agrees to increase the investment in Bond Funds from $2m to $3.5m, comprising additional Bond investment amounts of UBS Australian Bond Fund $300,000, UBS Diversified Fixed Interest Fund $200,000, PIMCO Australian Focus Fund $270,000, PIMCO Australian Bond Fund -$137,000 (reduction) and the new investment to PIMCO Diversified Fixed Interest Fund $600,000.  Carried.
• Subsequent to the Board’s decision at the April 2015 meeting to increase the Term Deposit investments from $3M to $5.5M, the Board discussed and agreed to consider investment amounts above the $250K Government Guarantee limit in the following institutions:  ANZ, Members Equity Bank, NAB, AMP, Bank of Queensland, St George and Westpac, with the CEO to implement on Nexia's recommendation.

Governance, Board Succession & Remuneration Committee:

• The Chair advised the Committee had met on 11 June 2014 and minutes would be circulated in due course.
• Legal advice from Maddocks had now been received regarding online & proxy voting.  The advice will be circulated with recommendations for consideration at the August Board meeting.
• The Committee agreed to engage Maddocks to conduct an audit of auDA’s compliance under the Accountability and Transparency Framework.
• There was no further update at this stage to the Board Performance Review.  Further information will be circulated in due course.

Strategic Risk Committee:

• The Chair advised the Committee had last met on 20 April 2015 and minutes had been circulated, approved and published.
• The Committee agreed at the April meeting that the Risk log should be split into Operational and Strategic risks.  Work has now been completed separating the risks and the logs will be reviewed at the next meeting on 15 June 2015.

8.    Membership

The following membership applications were approved in the classes indicated.

9.    Board Correspondence

Observers to the Board and G Pongas were not present for this item. Robert Gregory, Maddocks attended the meeting as legal adviser to the Board. All directors present in the room and by teleconference agreed to sign the Designation of Board Confidential Information form circulated prior to discussion of this item. It was confirmed that no director holds any financial interest in AusRegistry Pty Ltd, Bombora Technologies Pty Ltd or Neustar Inc.

The Board considered correspondence from AusRegistry Pty Ltd requesting that auDA consent to the sale of 100% of the issued share capital in its parent company Bombora Technologies, to Neustar.

The Board agreed to consent to the sale and change of relevant control of Bombora Technologies. In making its decision, the Board noted the following:

• auDA has never prohibited foreign-owned companies from being the registry operator
• clause 9.2 of the Registry Licence Agreement requires the registry operator to operate the registry in Australia; this includes the requirement that all employees and management personnel be located and resident in Australia, all administrative and operational functions be located in Australia, and the registry servers and backups to be located in Australia unless the technical specification requires otherwise
• Neustar is an established registry operator which runs a number of TLDs, and as a public company listed on the New York stock exchange, is subject to a raft of corporate governance controls
• any requirement for the sale to be approved by the Foreign Investment Review Board (FIRB) and/or the ACCC is a matter for AusRegistry and Neustar, and not a matter for auDA to consider.

Motion (proposed S Benjamin, seconded J Manariti): That in accordance with the request in the letter from AusRegistry Pty Ltd dated 15 June 2015, and pursuant to clause 30.3 of the Registry Licence Agreement (RLA), the auDA Board consents to Neustar Inc or a related entity taking relevant control of Bombora Technologies Pty Ltd (Bombora) and the Registry Operator, subject to:

1. Neustar Inc confirming in writing it is aware of and will comply with, and will cause Bombora and the Registry Operator to comply with, all of their obligations under the RLA; and
2. Adrian Kinderis remaining CEO of the Registry Operator for the remainder of the current term of the RLA, unless otherwise agreed by auDA.

Carried.

10.  Other Business

• Independent Director Fees:  Motion (proposed G Pongas, seconded J Manariti): That the Board approve the increase to Independent Directors Fees commencing 1 January 2015, as ratified at the 2014 AGM, in the amounts of $70,000.00 T Staley, $40,000.00 G McDonald and $40,000.00 J Hammer.  Carried.

11.  Next Meeting

The next Board meeting will be held on Monday 17 August 2015.