The Appeal Court has upheld a prior ruling by the Commercial Court, denying the company Domen’s request for a contract extension to manage the “.me” domain. The original agreement, made with the Government of Montenegro in 2008, was set to expire at the end of March 2023. This decision solidifies the ruling, leading to expectations that the Ministry of Economic Development (MER) will initiate a new tender for the selection of a domain registration agent.
Domen’s previous call for bids was halted due to a temporary measure prompted by the company amid this legal dispute. The Ministry, under the leadership of Minister Nik Đeljošaj, is now tasked with clarifying details regarding the process for selecting a new agent and whether a new tender will be published.
The court’s decision came after Domen failed to provide a formal notice of intent to extend the contract in accordance with the terms outlined in Article 8 of the domain registration agreement. The Appeal Court stated that the email sent by Domen, which was described as a notification, was not connected to the contract or its activities.
Negotiations were conducted between the contractual parties prior to the contract’s expiration in March 2023, but these discussions did not lead to a binding agreement. Predrag Lešić, the director of Domen, asserted in court that he prepared a letter of intent to extend the contract, which was forwarded by Marko Miročević, director of the American Chamber of Commerce (AmCham), to Ilija Mugoša, an advisor to the Prime Minister, before the “Open with the Prime Minister” event.
Lešić clarified that they intended to raise the issue of contract extension during this meeting. When questioned by the court, he acknowledged that Prime Minister Dritan Abazović did not provide a clear response regarding the contract’s extension.
Government representatives contended that any notification of intent to extend the contract should have been directly submitted to the government, which was the contractual party involved.
During the legal proceedings, Abazović stated that he was unaware of the email’s content sent to Mugoša but acknowledged having discussions with representatives from Domen during the AmCham event. He indicated that better conditions for the state were necessary, especially given the significant increase in internet users, but he did not make any promises regarding the contract’s extension.
In his testimony, former Minister of Economic Development Goran Đurović indicated that his ministry conducted an analysis on the implications of the contract with Domen. After meeting with representatives from the company, he received a proposal for an annex that did not provide sufficient benefits for the state. He suggested that Domen showed a lack of serious intent to negotiate an extension.
The legal battle has unfolded over two separate proceedings in front of the Commercial Court. Initially, the Appeal Court overturned a ruling by Judge Nataša Bošković, who had also denied Domen’s request. Although she determined that Domen had timely notified the government of its intent to extend the contract, she ultimately deemed the contract’s extension provisions invalid.
The Appeal Court found this reasoning unacceptable, leading to a renewed examination of the case by Judge Darko Bulatović, whose ruling has now been confirmed. Bulatović determined that Domen’s method of communicating its intent to extend the contract through AmCham was not aligned with good business practices and contradicted principles of integrity.
Domen maintained that it had timely informed the government of its desire to extend the contract for an additional ten years, while the government disputed the manner in which this was done.
As this situation stands, the government has yet to proceed with the selection of a new agent for the “.me” domain, pending the outcome of the dispute. The decision to suspend the tender process was initially enforced by the Commercial Court, which ruled that allowing the government to select a new agent would interfere with the management of electronic communications and the national internet domain, a matter of public interest.
The court’s refusal to extend the contract has significant implications for the future management of the “.me” domain, an area in which the state has reportedly generated over 40 million EUR in revenue since Domen took over registration duties. In 2023, the budget received 3.14 million EUR from this arrangement, underscoring the economic stakes involved in the ongoing negotiations and legal proceedings.
