December 2, 2019

Performing Due Diligence before IPv4 Address Trade

IPv4 trade involves being very careful to complete the transaction safely and successfully. That is why it is recommended to sign a mutual confidentiality agreement as soon as you start the trade discussions with the other party. No matter whether you are looking to buy IPv4 address blocks for your company or sell the unused ones in your possession, you should always conduct due diligence before the trade.

Performing Due Diligence When Buying IPv4 Addresses

If you were the buyer, due diligence for you would start as soon as you acquire the specific designation of the available IPv4 addresses from the seller or intermediary agent. To start, you should verify the seller’s good standing and assess the reputation of the company. You should also check the credit ratings of the organization and review their recent SEC filings if it is a publicly-traded company.

It is also your responsibility to assure that the seller is actually the present registrant of the IPv4 address or a legal successor of the registrant. You can do that by checking the RIR registration records for the IPv4 address block. Similarly, you should also ensure that the broker you are dealing with is authorized by the seller to act on their behalf.

You should also ask a few questions regarding the IPv4 address usage before buying. For instance, you should inquire whether any of the IPv4 numbers are currently in use, if any third party has claimed to control the IPv4 address block, or if there are any inaccuracies in the RIR registration records. Likewise, you should also assess the reputation and previous usage of the IPv4 addresses that you are buying.

Performing Due Diligence When Selling IPv4 Addresses

Due diligence for you would be less intensive if you were the seller, but it is still necessary. The trade would affect your reputation in the IPv4 market, which is why you should make sure to do business with an organization that has compatible values. For that reason, it is important to check the standing of the buyer before moving ahead with the IPv4 trade. You can even set up some specific criteria as well to sort potential buyers and find the best one to sell IPv4 address to.

It is imperative that you check the potential buyer’s ability to complete the payments as per the terms they agreed to in the contract. In fact, a thorough financial assessment would be very helpful to determine whether you would need any upfront payment or security deposit from the buyer. At the same time, you should also make sure that the individual you are dealing with is authorized by the buyer to represent them.