Introduction
It has been over a year since the first provisions of Canada’s Anti-Spam Legislation (CASL or the Act, 2010 S.C., ch. 23 (Can.)) dealing with the sending of commercial electronic messages (CEMs) have come into force, and the effects upon Canadian businesses have been profound. As one of the world’s most rigorous anti-spam legislation, CASL has caused Canadian companies to examine the way in which they send electronic messages, including texts, sound, voice, and image messages (particularly in the marketing realm) and embark on compliance programs.
An April 2015 study by Cloudmark, Inc. (Cloudmark study) found that there was a 37 percent reduction in Canadian-based spam over the past year, but CASL was also perceived (and many still perceive) as having a negative impact upon Canadian competitiveness. The same study found that more than 10 percent of the businesses surveyed have stopped sending commercial e-mail altogether, and another 30 percent have considerably trimmed their distribution lists. However, with potentially high fines, Canadian companies, or any global entity that does business with them, cannot afford to ignore this legislation.
This article provides a high-level overview of the CEM portions of CASL and its regulations in an effort to guide U.S. businesses seeking to ensure compliance with this legislation. Given that CASL is rather technical legislation and quite different from existing U.S. anti-spam laws, the article will go into some detail regarding particulars of the Act. The article will also discuss those CASL cases to date that deal with CEMs and will end with some “best practice” guidance.
CASL’s Structure
Although CASL first received royal assent in 2010, the first sections of the Act did not come into force until July 1, 2014, pending the creation of various clarifying regulations. Those provisions relating to the unsolicited installation of software came into force on January 15, 2015, and will not be discussed here. Lastly, the sections of the Act that create a private right of action against spammers will come into force on July 1, 2017.
Simply put, CASL prohibits the sending of CEMs and the installation of software on the computers of recipients/owners absent their prior consent. Except under limited circumstances, CASL requires individuals that are the intended recipients of CEMs to actively and expressly “opt in” to receive such e-mail, placing the onus on the sender to seek the recipient’s consent to receive CEMs before taking any further action.
The Act has also been clarified over the past several years by accompanying regulations. The first of these clarifying regulations were prepared by the Canadian Radio-television and Telecommunications Commission (CRTC). The Electronic Commerce Protection Regulations (the CRTC Regulations), CRTC SOR/2012-36 (Can.), available at http://laws-lois.justice.gc.ca/eng/regulations/SOR-2012-36/page-1.html, prescribe various content requirements for CEMs and requests for consent. Noncompliance with the CRTC Regulations content requirements exposes individuals and organizations to substantial liability, as discussed below.
Additionally, in response to concerns over the onerous obligations and restrictiveness of CASL, the Canadian Parliament and Industry Canada enacted an additional set of regulations. These Governor in Council Regulations, 81000-2-175 SOR/DORS, also called the Electronic Commerce Protection Regulations (the IC Regulations) limit the effect of CASL by providing various exemptions from the express opt-in regime or otherwise exclude certain CEMs altogether, some of which are discussed in greater detail below.
Risk of Noncompliance
CASL is legislation with teeth, particularly from a Canadian perspective where noncompliance typically does not result in high fines. Noncompliance with CASL can result in severe monetary penalties for both organizations and individuals. Once the Act is in full force, noncompliant parties will be subject to the following sanctions under sections 20(4), 47(1), and 51:
- maximum administrative penalties of $1,000,000 CAD ($781,311.04 USD) and $10,000,000 CAD ($7,813,110.40 USD) ordered against individuals and other “persons” (corporations), respectively, who fail to comply with CASL;
- a private right of action against any allegedly noncompliant party for an amount equal to the actual loss or damage suffered by the applicant/recipient of noncompliant CEMs (the maximum monetary awards that may be ordered pursuant to such actions vary, but in some cases may exceed $1,000,000 CAD ($781,311.04 USD)); and
- potential criminal sanctions – CASL amends the Competition Act (Canada), making prohibited conduct under CASL also reviewable under the Competition Act.
Furthermore, under section 31, officers, directors, or agents who acquiesce or participate in the violation of CASL will be held personally liable for such violations, regardless of whether an action is commenced against the organization on whose behalf the CEM was sent.
Commercial Electronic Message Prohibition
Section 1(1) of the Act defines CEMs as electronic messages that encourage participation in “commercial activities,” irrespective of any expectation of profit.
Commercial Activities
Consistent with the broad scope of CASL, “commercial activities” are broadly defined in section 1(2) to include not merely offers of purchase or sale, but also the advertising of offers, investments, and the promotion of persons who participate in such commercial activities. Thus, any form of communication that encourages participation in a commercial activity could ostensibly constitute a CEM. However, the mere fact that a message involves commercial activity or hyperlinks to a person’s website or business-related electronic address information does not make it a CEM under the Act. If none of its purposes is to encourage the recipient in additional commercial activity, it is not considered a CEM. Needless to say, there remains a certain amount of confusion as to the exact meaning of this term, which causes some compliance difficulties.
Request for Consent
In theory, individuals should begin their correspondence with other persons by first requesting consent from a proposed recipient in a manner that complies with CASL. This step must be taken in advance of sending what would otherwise be considered a CEM. Problematically, the legislation at section 1(3) treats a “request for consent” for the sending of CEMs as CEMs, so not all companies can immediately obtain express consent.
Consent
Under section 6(1) of the Act, no person may send CEMs, or cause or permit such messages to be sent, without first obtaining the intended recipient’s express or implied consent. Where a claim or allegation is brought pursuant to CASL, the evidentiary burden of proving that the consent was granted and that the sender complied with the Act lies with the sender of the CEM under section 13. Accordingly, consent, whether verbal or written, must be properly documented.
Express Consent
According to CRTC’s From Canada’s Anti-Spam Legislation (CASL) Guidance on Implied Consent, available at http://www.crtc.gc.ca/eng/com500/guide.htm (Implied Consent Guidance Document), “express consent” means that a person “has clearly agreed to receive a CEM, either in writing or orally.” The recipient must take proactive action to indicate their express consent (through an opt-in mechanism, such as signing up via a website). As indicated above, an electronic message that contains an express consent is also considered a CEM under CASL and is not a method through which express consent can be obtained.
Under section 10 of CASL, if a company does seek to obtain express consent, the sender is not merely required to outline the purpose for which consent is being sought or “clearly and simply” identify themselves and, if sending the message on another’s behalf, identify that other person. The identification obligations for the “request for consent” under sections 4(a)–(d) of the CRTC Regulations and section 11(4) of CASL additionally require the following:
- the sender must outline the name by which the person seeking consent carries on business;
- if the sender is seeking consent on another’s behalf:
a. the name by which that person carries on business; and
b. a statement indicating which person is seeking consent (i.e., the sender or the other named party); - the mailing address and either a telephone number or voice messaging system, e-mail address, or Web address of the person seeking consent; and
- the contact information must be valid for the period covered by the consent.
The purpose of incorporating these requirements in the original request for consent, according to section 6(2)(b) of CASL, is to enable the recipient of the message to readily contact the sender. This obligation to provide contact information, together with the requirement under section 4(e) of the CRTC Regulations that the request for consent include a statement informing the recipient that they can withdraw consent, ensures that the recipient is apprised of the right not only to opt in to the CEMs, but also to opt out at any time.
Implied Consent
Consent can only be implied in very specific circumstances and within strict timelines. In fact, according to section 10(9) of CASL, consent can only be implied where:
- there is an “existing business relationship” or “nonbusiness relationship” between the sender and recipient;
- the recipient’s electronic address is conspicuously published and the recipient has not indicated that he or she does not wish to receive unsolicited CEMs at that address (the Implied Consent Guidance Document also noted that, if that statement is not present, the message must relate to the recipient’s business role, functions, or duties in an official or business capacity); or
- the recipient has disclosed to the sender his or her electronic address to which the CEM was sent, without having indicated a desire not to receive unsolicited CEMs, and the messages are relevant to the person’s business, role, or duties.
In the event a business is sold, the Implied Consent Guidance Document noted that the purchaser can rely upon express consents obtained by the seller if the contract of sale of the business includes a provision transferring the list of e-mail addresses for which consents have been obtained as part of its assets. The new owner can continue to send CEMs to the recipients that gave express consent so long as other CASL requirements are met. The existing business relationships (as will be discussed below) are also now with the new business owner.
Implied Consent in Existing Business Relationships
The “existing business relationship” rule under section 10(10) of CASL requires that, in the two years preceding the sending of a CEM, the recipient:
- purchased, leased, or bartered for a product, good, service, land, or interest in land from the sender;
- accepted a business, gaming, or investment opportunity offered by the sender;
- entered into a contractual arrangement with the sender, and the contract is currently effective or had expired within two years of sending the CEM; or
- sent the sender an inquiry or application related to any of the aforementioned matters within six months of the CEM being sent.
Additionally, according to Industry Canada’s Regulatory Impact Analysis Statement (the RIAS), which was issued along with the IC Regulations and is available at http://fightspam.gc.ca/eic/site/030.nsf/eng/00271.html, notwithstanding the fact that a person has previously “unsubscribed” or “withdrawn” his or her consent to receive CEMs, “implied consent due to an existing business relationship is reinstated with every new or subsequent transaction” that satisfies the definition of “existing business relationship” above.
Implied Consent in Existing Nonbusiness Relationships
Alternatively, the recipient and sender will be deemed by section 10(13) of CASL to have been in an existing nonbusiness relationship where, in the two years prior to the sending of a CEM, the recipient has:
- made a donation or gift to the sender registered charity, political party, or a political candidate;
- volunteered for, or attended a meeting organized by, the sender that is a registered charity, political party, or candidate for political office; or
- held a membership in the sender, which is a club, association, or voluntary organization.
Where the sender and recipient are not in one of the aforementioned relationships, or where the conditions that would permit the implication of consent are no longer present, the sender must revert to the basic request for express consent rules of CASL.
Third-Party Referrals (TPRs)
According to section 4(1) of the IC Regulations, as a limited exception to the standard consent requirements of CASL, senders of CEMs are not obligated to seek consent in their first CEM to a recipient where that recipient was referred to the sender by a third party. To take advantage of the TPR exception, both the sender and recipient must be in an existing relationship (personal, family, business, or nonbusiness) with the third party. To ensure the recipient is aware of the origin of the message, however, CASL obliges the sender to include a statement in the CEM: (i) noting that the message was sent pursuant to a referral; and (ii) containing the full name of the referring third party.
As the TPR exemption applies solely to the first message sent, that message should include a “request for consent” containing the information discussed above to ensure compliance with CASL moving forward.
Three-Year Transition Period
Consents obtained prior to the enactment of CASL may satisfy the requirements of the Act. However, according to the RIAS, where the form of prior requests for consent fail to comply with the Act, or where no consent was ever documented, the senders of CEMs will have three years from the day the Act came into force to verify and confirm that they are CASL compliant. Accordingly, to the extent that a sender and recipient were in an existing business or nonbusiness relationship as of July 1, 2014, and the recipient has not expressly withdrawn his or her consent to receiving CEMs, consent is implied under section 66 of CASL until July 1, 2017, after which the two-year or six-month clock will start to run as described above.
Withdrawing Consent
Under section 6(2)(c) of CASL, all CEMs must incorporate an “unsubscribe mechanism” to protect a recipient’s right to control the messages he or she receives, notwithstanding his or her prior consent. This mechanism must, under section 11(1)(a), specify that the recipient may, at no cost, “unsubscribe” from further CEMs by indicating such intent by using either the same electronic means used to send the message or any other practicable electronic means. To further simplify the process, section 11(1)(b) requires that the sender provide an electronic address or link to which the indication may be easily sent. Under sections 6(3) and 11(2), this unsubscribe mechanism, like the sender’s contact information, must be valid for at least 60 days after the day on which the message was sent to ensure recipients have sufficient opportunity to readily terminate their subscription.
Once either the “unsubscribe” or the “withdrawal of consent” mechanism is triggered, the sender has 10 business days to give effect to the recipient’s intention under section 11(3). Failure to do so constitutes a violation of CASL, exposing the sender to substantial penalties. As will be discussed below, CASL jurisprudence to date indicates that the CRTC takes these form requirements very seriously.
Excluded Commercial Electronic Messages
In addition to the implied consent exception, CASL provides for a number of other exemptions that relieve senders from the burden of adhering to the legislation.
Business-to-Business Exemption
The IC Regulations at section 3(a) provide an exemption for CEMs sent by employees, representatives, consultants, or franchisees “within organizations or sent between organizations that already have a relationship,” where the messages concern the activities of the organization receiving or sending the message.
According to the RIAS, these exclusions were enacted in response to “the most serious concerns raised” in relation to the broad, and potentially undesirable, effects of CASL. The business-to-business exemptions, however, are intended to shelter businesses from the effects of CASL by excluding “ordinary, transactional business communications” and other “internal” communications concerning the “activities of an organization” from the scope of the Act.
Extra-Jurisdictional CEMs
The ambit of CASL extends to messages sent from, or accessed by, computer systems located in Canada, giving the Act extra-territorial application. According to the RIAS, CASL does not apply to CEMs that are simply routed through Canada.
According to the RIAS, faced with concerns that some businesses in Canada would be obliged to comply with both CASL and the laws of foreign jurisdictions, an exclusion was incorporated into the IC Regulations at section 3(f) and Schedule (Paragraph 3(f) explicitly exempting CEMs sent from Canada that a sender “reasonably believes” will be accessed in one of the prescribed foreign states (e.g., the United States, Spain, etc.). As a caveat to the use of the Extra-Jurisdictional CEM exemption, the IC Regulations at section 3(f) require that the CEMs sent from Canada must comply with the local laws of that prescribed foreign state. According to the RIAS, these particular IC Regulations were created to reduce the burden on businesses sending CEMs to recipients in prescribed foreign states by recognizing the existence of legislation in those states that regulates the conduct prohibited by CASL. Unfortunately, all businesses that operate in Canada, including U.S. subsidiaries or foreign-owned companies, must undertake this analysis to determine whether CASL requirements apply to their e-mail.
Registered Charities, Political Parties, and Candidates
The IC Regulations at sections 3(g)–(h) also exempt messages that are sent by or on behalf of registered charities, political parties, or candidates so long as the primary purpose behind such messages is fund-raising or soliciting contributions. Not-for-profit corporations, however, remain subject to CASL’s consent and content obligations.
Personal and Family Relationships
The rules at section 6(5)(a) of CASL regulating the transmission of CEMs relieve individuals that are in a personal or family relationship from having to comply with CASL. The IC Regulations at section 2(b) define “personal relationship” as a relationship where, taking into consideration any relevant factors such as the sharing of interests, experiences, and length of time the individuals have been communicating, it would be reasonable to conclude the individuals are involved in direct, voluntary, two-way communications as part of a personal relationship.
In contrast, to be exempt from CASL on the basis of a “family relationship,” the section 2(a) of the IC Regulations narrowly require that the parties be related to one another through “marriage, common-law relationship or any legal parent-child relationship.”
Enforcing Legal Rights
The RIAS also references an exemption for CEMs that are sent to “enforce legal rights.” Thus, according to the IC Regulations at section 3(c) where a message is sent to satisfy a legal or juridical obligation to give notice of or enforce such an obligation, court order, judgment, or legal right, the CEM need not comply with the consent and content requirements of CASL.
Additional Exclusions
The IC Regulations at 3(b) and (e) also contain exemptions for: (i) messages sent in response to a request or inquiry, or those otherwise solicited by the person to whom the message is sent; and (ii) messages sent over a limited-access secure and confidential account.
Other Exceptions to CASL
Additionally, the following CEMs are exempt from the consent requirements of CASL under sections 6(6)(a)–(f), although the form requirements remain:
- replies to requests by the recipient of the CEM for quotes or estimates for the supply of goods, property, or services;
- messages that facilitate, complete, or confirm commercial transactions in which the recipient is involved;
- messages that provide warranty, product recall, safety, or security information regarding products or services the recipient uses or has purchased;
- messages that provide factual information about products or services purchased by the recipient as part of an ongoing subscription or membership, or information about that subscription or account;
- messages pertaining directly to employment or benefit plans in which the recipient is involved; and
- messages delivering products, goods, services, or updates to which the recipient is entitled under the terms of a transaction previously entered.
Lessons Learned
Unlike the detailed legal analysis and findings provided by Canadian privacy regulators, to date the CRTC’s reasoning/analysis contained in its CASL undertakings and other CASL orders has been exceptionally sparse. Accordingly, the following section is based entirely upon the author’s own observations and analysis and should be read in this light.
Avoid Being a Tempting Target
The first notice of a CASL violation involved 3510395 Canada Inc. (d.b.a. Compu-Finder), who received an administrative monetary penalty (a fine) of $1,100,000 (CAD) ($859,442.14 USD) for repeatedly sending CEMs without recipients’ consent, as well as sending CEMs without a properly functioning unsubscribe mechanism. Between July 2, 2014, and September 16, 2014, Compu-Finder was found to have spammed potential customers with offers of unsolicited training courses, although the company had also received complaints for its marketing activities prior to the implementation of CASL. Compu-Finder was clearly acting very badly (“flagrantly violating the basic principles of the law,” in the CRTC’s own words) because they apparently accounted for 26 percent of all complaints submitted to the CRTC’s Spam Reporting Centre. It is therefore not surprising that the CRTC chose to make an example of them, and the company clearly proved to be a very tempting target. The moral here: if a company acts egregiously and draws too much attention to itself, it should not be surprised if it becomes a target for CRTC compliance and enforcement.
No Fish Too Small
In the second CASL case, PlentyofFish Media Inc. (PoF), the operator of the well-known Canadian dating website “Plenty of Fish,” voluntarily entered into an undertaking with the CRTC’s Chief Compliance and Enforcement Officer in order to settle several alleged violations of CASL. These included sending CEMs to registered users of its own website that contained an unsubscribe mechanism that was not set out “clearly and prominently” and was not able to be “readily performed.” PoF was fined $48,000 CAD ($37,502.93 USD), was obliged to comply with and ensure that any third party authorized to send CEMs on their behalf complies with CASL, and further agreed to implement a compliance and training program.
Many Canadian commentators found this second CASL case to be an odd choice on the part of the CRTC. After a rousing start against a bona fide spammer like Compu-Finder, it seemed strange that the CRTC was turning its big guns against such a small fry (pun intended) as PoF, a dating website that was mainly annoying its own members. Upon reflection, it seemed that this case was really about sending the Canadian business community several messages. First, in the interest of administrative fairness, the CRTC was making the point that CASL is not just a law that applies to large companies – even smaller ones should adapt their business practices and behavior to comply with the Act. The CRTC clearly expects every entity to be compliant, no matter how small. Second (and as will be discussed more fully below), if the CRTC does catch a company being noncompliant, assuming that the company is willing to admit its errors, publicly cooperate, and take active steps to ameliorate its practices, then the CRTC likely will show more leniency regarding the levying of fines, etc.
Cooperate or Else
It is no surprise that Compu-Finder was given a large fine by the CRTC, under its authority to encourage “changes of behavior,” while both Porter Airlines Inc. (Porter) and Rogers Media Inc. (Rogers), two large, well-known Canadian companies that voluntarily entered into undertakings in return for admitting their wrongdoing, were let off rather lightly in comparison. Lesson learned: cooperation with the CRTC buys a company goodwill, much lower fines, and even less public disclosure about what a company allegedly did to contravene the Act. So long as companies are willing to fall on their swords and publicly change their practices, the CRTC practices leniency, given that the marketing value in obtaining cooperation definitely outweighs and arguably offsets the value of levying large fines.
Porter also entered into a voluntary undertaking with the CRTC in a decision published in June 2015 (available at http://www.crtc.gc.ca/eng/archive/2015/ut150629.htm) after Porter was found to have sent CEMs to e-mail addresses for which it did not have proof of consent, as well as sending CEMs that did not provide complete contact information as required under the Act and CRTC Regulations. Other CEMs sent by Porter either contained no unsubscribe mechanism or one that was not set out “clearly and prominently,” and there was at least one instance where the unsubscribe mechanism was not given effect within 10 business days as required by CASL. It is also clear that Porter was also being punished for failing to obtain (and be able to evidence) proof of consent for each and every CEM that it sent. As Porter’s errors were considerably more serious than PoF, its fines ($150,000 CAD ($117,196.66 USD)) were naturally higher, although they still fell well short of those of Compu-Finder. Porter was obliged to take corrective measures, such as updating its mailing list and ensuring that its CEMs met form requirements, as well as implementing a compliance program.
Similarly, Rogers, a company related to Rogers Communications, one of Canada’s largest Canadian telecommunications and media companies operating in wireless communications, cable, telephone, Internet, mobile, and home monitoring, voluntarily entered into an undertaking with the CRTC in a decision published in November 2015 (available at http://www.crtc.gc.ca/eng/archive/2015/ut151120.htm). Rogers paid the CRTC an administrative penalty of $200,000 CAD ($156,262.21 USD) for failing to give effect to unsubscribe requests within 10 business days and for sending CEMs for which the unsubscribe mechanism did not contain an electronic address that was valid for a minimum of 60 days after the message was sent. Rogers also undertook to update and implement a compliance program, including measures such as the review and revision of its written policies, the development of training programs, and registration and tracking of all complaints related to CEMs and their resolution. Rogers also confirmed, in writing, the implementation of these measures to the CRTC within a specified timeframe and provided a written report of its compliance program annual review if requested.
Form Matters!
It is worth noting that every single one of these early CASL decisions involved violations of the CRTC Regulations pertaining to CEMs content (i.e., regarding information that must be set out in any CEM) and form (i.e., the requirement that the information be set out “clearly and prominently” and that the unsubscribe mechanism in each CEM be “able to be readily performed”). Porter was additionally chided, for example, for sending some CEMs that contained two unsubscribe links, one of which did not function properly (the CRTC determined this to be an unsubscribe mechanism that was not clearly set out because it was not apparent which mechanism was functional). It is also worth noting that the CRTC pounced on Rogers for failing to meet these form requirements beginning July 3, 2014, less than a week after the CEM aspects of CASL came into force. By referencing these violations, the CRTC is confirming and signalling the importance of these form requirements for CASL compliance and is again demonstrating that that companies of all shapes and sizes are still universally required to comply with them.
CRTC Decisions Make for Lean Reading
As indicated above, although one can try to read the CASL tea leaves, the Notice of Violations and Undertakings (available at http://www.crtc.gc.ca/eng/DNCL/dnclce.htm) that have been published by the CRTC regarding CASL so far have provided absolute minimum details about the alleged violations of CASL themselves. Citing bare facts, the decisions mainly reference which sections of CASL and its accompanying regulations, if applicable, were breached. As a practitioner, it would be helpful to know more about how a company was unable to provide proof of consent for some of its e-mail addresses. Was it a failure to purge an old database? When preparing for CASL compliance, did the company outsource these efforts to a third-party company that got it wrong? Without sounding ghoulish, more detail would be helpful so that legal practitioners and clients alike can at least reason by analogy as to best practices if the CRTC is not going to advise definitively.
More Guidance, Please!
Lastly and on a related point, there is still much that Canadian practitioners do not know about interpreting CASL, and the regulators are not making it easy. In contrast to the plethora of guidance documentation (interpretation bulletins, fact sheets, check-lists, tools, or other materials) published by the Office of the Privacy Commissioner of Canada and its provincial regulatory counterparts, the CRTC, for example, has only provided very minimal guidance documentation since the Act came into effect. In fact, the CRTC’s own FAQs remain quick to say that they are not meant to offer meaningful advice – even examples mentioned in their own Compliance and Enforcement Information Bulletins are not to be relied on. For example, when discussing Compliance and Enforcement Information Bulletin CRTC 2012-548, which, among other things, helps explain what information is to be included in a request for consent, the CRTC’s online FAQ reads that the examples used in that bulletin “may not necessarily be appropriate in every situation. Compliance will be examined on a case-by-case basis in light of the specific circumstances of a given situation.” Although this kind of language provides the CRTC with considerable flexibility, it does little to provide meaningful guidance to legal practitioners, individuals, or businesses that are just trying to navigate some very complex legislation. As one of the CRTC’s explicit goals is to “deter others who may be tempted to violate the law, so they understand what is required to comply and what the consequences are if they fail,” one would think that the CRTC would want to take steps to publish some meaningful commentary on the law to better achieve these ends. Accordingly, it is not surprising that the Cloudmark study found that more than 60 percent of respondents believe the CRTC has failed to provide small and medium enterprises with adequate information about the Act. Despite a round of information sessions, businesses still lack guidance on how to comply with the law.
Best Practices
Even though certain aspects of CASL interpretation remain a “work-in-progress,” in the past year and a half certain key CASL themes have emerged from the existing jurisprudence as described above. If you think that CASL applies to your organization, it is preferable to take steps even now to put in place remediation efforts after the initial compliance deadline. Accordingly, the following “best practices” to manage CASL requirements are recommended:
- Create a compliance team, whether the same person or people who look(s) after privacy compliance in your organization, but your marketing team should definitely be involved.
- Audit current practices by reviewing and categorizing what types of e-mails and electronic messages are currently sent and why they are sent. The purpose is to identify which are CEMs and which are not.
- Inventory existing databases for contacts who receive CEMs in Canada. Check all possible sources of electronic mailing lists in your organization – customers, business/association partners, suppliers, etc.
- Review all current electronic mailing lists and CEMs that are sent to determine:
a. whether there is an “existing business relationship” that would qualify for the three-year transition period in CASL;
b. what type of consent is required; and
c. what consent has been obtained. - Review your current express consent language and revise it to be compliant with CASL.
- Update documents and templates that may be used with external contacts so they include express consent. Include wording in terms and conditions of use, purchase orders, contracts, and other agreements to include express consent.
- Keep a database of implied consents so you can identify when an implied consent expires. The database must be able to have a “stop send” date where CEMs will no longer be sent to a contact who has given implied consent after the expiration of the two-year or six-month period. Also, if express consent is subsequently given, there must be a mechanism to update this information.
- Update your unsubscribe mechanism to ensure it is compliant with CASL in all respects (form, ease of use, speed (giving effect within 10 business days), and validity for a minimum of 60 days after the message was sent).
- Train all employees that send CEMs regarding CASL and its compliance requirements.
- Review compliance procedures with third-party service providers who have access to or utilize electronic addresses/contacts. Make sure these third-party suppliers are contractually obligated to comply with CASL. For example, if you purchase mailing lists, ensure the provider has obtained express consent. Do not assume all U.S. providers will be compliant with CASL. Require any contracts with such providers to contain warranties and indemnities in the event of any noncompliance.
- For new contacts, establish a mechanism to obtain express consent (not by CEMs).
- Scrub/purge contacts for whom you do not have express consent, implied consent, or for whom there is no exemption.
- Document your CASL policy, which will be very important to show due diligence – a defense for directors, officers, and employees. Literally days before the Act came into effect, the CRTC released guidelines for CASL compliance programs that are extensive and detailed (available at http://www.crtc.gc.ca/eng/archive/2014/2014-326.htm).
Lastly, if you plan to stop sending CEMs to Canada and resort to making cold-call marketing calls instead, you should know that the CRTC also has jurisdiction over telemarketing and unwanted calls and has established detailed Unsolicited Telecommunications Rules (available at http://www.crtc.gc.ca/eng/trules-reglest.htm) and a national do-not-call list. These telemarketing prohibitions are also enforced. For example, on March 10, 2016, the CRTC issued Notices of Violation to three Canadian-based companies and two Indian-based call centers with penalties totalling $643,500 CAD ($503,048.78 USD) for failing to respect the Unsolicited Telecommunications Rules. Thus, seek legal advice to ensure your compliance with these additional telemarketing requirements.
See also: “FAQs: About the Law”, Canada’s Anti-Spam Legislation, (January 20, 2013) http://fightspam.gc.ca/eic/site/030.nsf/eng/h_00050.html).