"that all *.UK domains have to be held by a UK resident or entity"
No chance. Why hit your own revenue stream? Who cares about the opportunities for fraud while there are names available to be flogged?
When the internet was conceived (without a mercenary incentive) a logical hierarchical structure was created for domain names that allowed them to be parsed and verified. Progressively, we have had that dismantled so we are now faced with a heap of random structures and particles that nobody can validate - and all in the name of filthy lucre, as is the UK complaints procedure, whereby it costs a fortune to challenge obvious abuse of one's domain name with no certainty of success.
Biting the hand that feeds IT
