Nominet loses all three EGM votes
UK registry owner undermined by biggest shareholders
The extraordinary general meeting of UK registry owner Nominet this morning, which hoped to pass three restructuring resolutions, turned out to be just that - extraordinary.
Proposed changes to Nominet's Memorandum of Association and Articles of Association were designed to give the company greater freedom in the internet market. A third resolution would have altered the weighted voting system to give smaller members a greater say by capping any one member's influence.
All three resolutions put forward to members fell when two of Nominet's three largest members unexpectedly voted against them. No resolution reached even a simple majority thanks to a weighted vote system that gives disproportionate power to companies that have registered the largest number of .uk domains.
Nominet chairman Bob Gilbert told The Register he still doesn't know why both Pipex and Fasthosts voted against the moves. Neither company has been available for comment.
But the changes, devised by Gilbert, ran into trouble when members of Nominet's Policy Advisory Group claimed they over-commercialised the company.
A large number of the 30 or so members that turned up to the EGM in Oxford, were opposed to the changes and were hoping to gather the 10 percent of the vote needed to make the main resolutions fall.
However, Gilbert announced almost immediately that none of the resolutions would pass because "two of the major tag holders have voted against them" by postal vote, prior to the meeting.
Gilbert said Nominet would now discuss how to progress from here with its members.
A key reason cited for the opposition was the issue of communication with members, which Nominet board members recognised they would need to address. Members said they felt the changes were presented as a done deal rather than opened up to wider discussion.
A new set of proposals are unlikely to appear until mid-June.
Nominet's problems are greater than this, however. Only 11 percent of members actually voted, something Cowley said was very disappointing.
The problem lies in the fact that over 90 percent of Nominet's members only have one or two votes, compared to Pipex's 1,041.
The matter was further confused when Pipex's shares jumped nearly 15 per cent on Tuesday on rumours that it was subject to a takeover after a large shareholder had been bought out.
So, with Nominet's restructure plan in tatters, the executive team will be forced to go back to the blackboard, while at the same time pondering how to engage with the majority of its members, and how to prevent one or two companies vetoing the next set of proposed resolutions. ®