Insight Kenya Limited delayed to renew the domain name of one of its clients and in a couple of days it had been grabbed by another company.
The clientâ€™s, an Australian firm, domain is on auction because of its brand value.
Insight Kenya, an online company, is currently in a bidding war to get the name back or lose it to other bidders.
“When you donâ€™t renew the address upon its expiry you cease to have a legal backing, as far as the ownership of the name is concerned,â€ said Njeri Rionge, Insightâ€™s founder.
There are people lurking out there to take up these names if the owners fail to renew them on time. This is the group corporate raiders that have come to be known as cyber-squatters.
Cybersquatting is the process of registering a popular or anticipated Internet address, with the intention of selling it back to its rightful owner.
Independent ICT analyst and registrar Alex Gakuru says there are cyber-squatters out-there who have already registered popular names in Africa, especially Swahili names, waiting for locals to use them only to later propose to sell it to them or sue.
Business owners should register a domain name immediately they start operations to avoid cyber-squatters from registering the name under their details as as they wait for the business owner to approach them so they can demand payments. They are mainly known to target large organisations.
â€œAt the time of incorporating or launching your logo it is also important to register the domain name simultaneously,â€ said Mr Gakuru.
Companies are then required to make an annual payments to the registrars on time, preferably before the expiry date.
International copyright laws, as spelt out in the Internet Corporation for Assigned Names and Numbersâ€™ (ICANN) Uniform Domain-Name Dispute-Resolution Policy (UDRP), are also skewed in favour of foreigners, argues Mr Gakuru.
For instance, use of a local name with the same meaning as another in a different language could attract the latest user a suit if registered under copyright laws.
Deloitteâ€™s technology integration consulting director, Muchemi Wambugu, says one should register their company online immediately they are registered with the government.
â€œThe squatters normally follow big brands whose owners are either not keen to renew their addresses or have never bothered to take them online,â€ said Mr Wambugu, adding these cases are rampant in Kenya and South Africa, though he could not give examples.
He says most cyber-squatters are in developed countries and are taking advantage of the legal loopholes since most developing countries have no legislation and are, therefore, fully subject to international law.
People from these countries have kept names of popular things in the developing world in anticipation that upcoming companies will choose such names violating their copyrights laws.
They would then show up demanding to sell the names to the new companies or else take them to court for violating their copyright laws.
The international law now allows cyber-squatters to order the registrars of the local companies to shut down the websites. The registrars are bound by the same law or else they may faceÂ penalties under URDP.
Developing countries face a great risk as they increase consumption of Internet services, which is governed by foreign jurisdictions.
The lack of enough regulations locally also makes foreigners able to use foreign laws and enforce them on Kenyans, most of whom are unaware of them.
Those seeking to register their names should therefore look up their names on the website -Whois.net -to avoid taking up names that have already been used.
Most cyber-squatters use media reports and other public information to anticipate businesses likely to be registered. They quickly register the domain name and wait to cash in. They then demand for money to transfer the domain name to the business.
Cyber-squatters also buy domain names that have not been renewed on expiry, the situation Insight Kenya finds itself currently with its Australian client.
Some cyber-squatters are known to post comments harmful to the business owner in the domain name they have registered in a bid to force them to buy the domain address from them.