I think this can just add layers of bureaucracy that don't address the problem anyway.

In the early days of widespread internet use in Sweden it was quite difficult to register a .se web-address: not only were company documents needed, but the authority that granted use of the address also split your right to it geographically within Sweden, so that if you wanted the address to stretch across the whole country you needed to make multiple applications (using a subdomain system).

This process just made it almost impossible for a small personal startup to own a Swedish domain, and it was completely impossible to register a domain on a 'try-it' basis, to see if a nascent business idea would take-off.

In other words it just entrenched the dominant position of incumbents.

What happened instead, was that Swedes registered .com addresses, or .nu ('now' in Swedish), or other variations. And the same sort of thing would happen now: the international fraudulent sites would still be possible - just legitimate registrations would become much harder.

A little like what happens with pirating, where people using pirated software often have to jump through fewer hoops than legitimate users, who've paid for their installs, but need to constantly dial-up to be allowed to keep using the tools they've bought.

tldr; more bureaucracy for legitimate businesses, but doesn't address the core problem for end-users.