Before reading this I was already familiar with what they are doing. To clarify, even if you do NOT host the domain at 1and1 your domain registration is classified by them as a so called "hosting package" meaning every domain reg'd at 1and1.com is considered by them to be hosted there though they are usually not hosted there.
A reason they do that appears to be so they can charge a yearly fee (currently minimum of $5.99 without hosting, host is more) which is mostly unrelated to the domain name and its expiration date. In other words, if you transfer a domain there which was paid say 5 yrs in advance at another firm they do not count that and immediately require a yearly fee every year with the first yr also paid in advance. When they auto bill you in year 1 it does not change the domain exp date at all, same for year 2, 3, 4, 5 in this example, but they will still charge you every year.
This means if you try to transfer away the only way to do it appears to be to cancel the unwanted 'host package' which in effect also automatically cancels the domain name. They also require very complex steps to transfer including hard copy signed papers to Germany.
I am sure many people lose their domains due to this practice by 1&1 Internet of assuming you are cancelling the domain name, which borders on fraud imo and should be banned by Wipo (but I doubt if they have done anything about it).





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