I am planning to buy a web-domain for myself. I am looking for a particular word combination and in the process I notice many combinations are already taken up in .com TLD. If someone owns example.com (example is their company name), can I buy example.net if its available or is it illegal to use one?

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Assuming you wouldn't be infringing on an actual registered trademark or similar, if a domain is available for purchase, then it's up for grabs. (Even if it is an infringement, there's really nothing stopping you from buying the domain, but the owner may be able to file a claim.)

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