CANADIAN CASL (ANTI-SPAM LAW) PRECEDENTS
Do you need a precedent or checklist
to comply with CASL (Canadian anti-spam law)?
We offer Canadian anti-spam law (CASL) precedents and checklists to help electronic marketers comply with CASL. These include checklists and precedents for express consent requests (including on behalf of third parties), sender identification information, unsubscribe mechanisms, business related exemptions and types of implied consent and documenting consent and scrubbing distribution lists. We also offer a CASL corporate compliance program. For more information or to order, see: Anti-Spam (CASL) Precedents/Forms. If you would like to discuss CASL legal advice or for other advertising or marketing in Canada, including contests/sweepstakes, contact us: contact.
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In a long anticipated announcement, or dreaded, depending on your perspective, the Federal Government announced earlier today that the coming into force date for most of Canada’s Federal anti-spam legislation (“CASL”) would be July 1, 2014.
Some portions of CASL, relating to the unsolicited installation of computer programs and software, will come into force slightly later on January 15, 2015. Also, apparently based on industry push back, the private right of action provisions of CASL will come into force on July 1, 2017 (so class action counsel will have to hang on for a further while before starting their spam-related civil suit engines). For my overview of the rules as they stood before the announcement today see: here (some updating will be needed, as there have been a number of changes and clarifications in today’s announcement).
The legislation, when it finally comes fully into force (there will be a three year transition period), will mean that a significant segment of “commercial electronic messages” or “CEMs” will require advance opt-in written consent before they may legally be sent and that CEMs comply with certain form (i.e., content) requirements, including sender ID information and prescribed unsubscribe mechanisms. CASL also addresses the installation of computer programs and expands the Competition Bureau’s jurisdiction over misleading online claims.
In making the announcement, Canada’s Industry Minister James Moore said:
“Our government does not believe Canadians should receive emails they do not want or did not ask to receive. … These legislative measures will protect consumers from spam and other threats that lead to harassment, identity theft and fraud. We are prohibiting unsolicited text messages, including cellphone spam, and giving Canadian businesses clarity so they can continue to compete in the online marketplace.”
While the legislation was originally passed in 2010, it has been stalled through a series of delays that have included significant industry opposition and multiple rounds of Industry Canada and CRTC regulation drafting and consultations.
Final Regulations & Regulatory Impact
Analysis Statement
Along with today’s announcement, the Government also issued final Industry Canada Regulations (CRTC Regulations have already been issued), a Regulatory Impact Analysis Statement and Explanatory Note (see the Government’s “fightspam.gc.ca” website: here). These final Regulations follow two prior drafts issued in July, 2011 and January, 2013.
The final Industry Canada Regulations, among other things: (i) define key terms for exceptions from the rules (e.g., the scope of personal and family relationships); (ii) set out categories of exempt business-to-business communications (e.g., sent within an organization or between organizations with an existing relationship); (iii) set out categories of exempt organizations (e.g., charities and political parties); (iv) the required nexus to Canada (messages sent from Canada or accessed in Canada); and (v) provide a consent exclusion for third party referrals, provided certain guidelines are followed.
Uncertainties & New Guidelines
There have been a significant number of uncertainties regarding the application and scope of CASL. As such, hopefully the CRTC and Industry Canada will issue more guidelines to clarify the new rules in the coming months (although a number of industry concerns are discussed and addressed in the Government’s Regulatory Impact Statement).
With respect to further guidance for topics not addressed today, the Government indicated that Industry Canada and the CRTC would work to issue guidelines clarifying certain aspects of the new rules (e.g., how referral marketing can operate under the new rules) and also said that new CASL FAQs would be issued. In announcing the CASL coming into force date, however, the Government cautioned that two CRTC Interpretation Bulletins issued to date are not legally binding.
With respect to one of the most important uncertainties of the new legislation, consents gathered prior to coming into force of CASL, the Government confirmed that express consents obtained before coming into force will be recognized as CASL compliant:
“Some stakeholders have argued that express consents obtained under the Personal Information Protection and Electronic Documents Act (PIPEDA) should be valid as consent under CASL. In some cases, where there is neither an exclusion nor any form of consent under CASL, some businesses that may have been compliant with PIPEDA when seeking consent to collect or to use electronic addresses to send commercial electronic messages may no longer be able to contact those addresses under CASL. Express consents, obtained before CASL comes into force, to collect or to use electronic addresses to send commercial electronic messages will be recognized as being compliant with CASL.”
The Government also emphasized that the “purpose of the three year transitional period is to obtain consent” for CEMs.
Impacts
As has widely written and commented over the past three years since the legislation was first passed, CASL when it finally comes into force will be one of the strictest anti-spam regimes in the world, subject to significant and detailed requirements and will impose additional regulatory costs on Canadian businesses.
While there had been some uncertainty and debate as to whether CASL would ever come into force, or would be allowed by the Federal Government to quietly slip away, any question on that front is now clearly gone.
The practical impact is that Canadian businesses, as well as international businesses marketing to Canadians through electronic communications, will unfortunately need to now more concretely turn their minds to complying with the now very impending new anti-spam rules.
While today’s Federal announcement was accompanied by a considerable amount of rhetoric about the evils of spam, I am not convinced and in my humble opinion the benefits of the new legislation are far outweighed by the regulatory cost and effort legitimate companies and marketers will now need to bear.
It is also far from clear to me that, even assuming spam requires this level of regulatory intervention, the new rules can or will be effectively enforced. On this note, one of the most common criticisms I hear when talking to industry groups is that the Government does not seem to be able to enforce Canada’s do-not-call rules (with a significant portion of telemarketing calls originating offshore), so why would anti-spam rules be any different?
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Tips For Complying With
CASL (Canadian Anti-Spam Law)
Canada’s federal anti-spam legislation (CASL) came into force in 2014. Since then, electronic marketers and their advisors have been working to comply with what remains a complex law with outstanding uncertainties in some key areas. Having said that, many of the core requirements of CASL are not overly difficult to comply with (though continue to be misunderstood in many cases).
The following are some key legal tips for complying with CASL:
Express Consent. If you cannot rely on any category of implied consent (e.g., an existing business relationship within two years of a purchase) or a CASL exemption, ensure that you have collected and documented express consent from recipients. Express consent requests must include all of the information set out in CASL and its regulations otherwise the consent will not be valid. Failure to correctly collect consent is the most common CASL compliance error we see and a key basis for CRTC enforcement. For more information, see: Anti-Spam Law (CASL), Anti-Spam Law (CASL) FAQs and Canadian Anti-Spam (CASL) Precedents.
Implied Consent. If you are relying on one or more categories of implied consent to send commercial electronic messages (CEMs) (e.g., an existing business relationship within two years of a purchase or six months of a product inquiry) ensure that all of the requirements of the particular type of implied consent are met. Remember that there is not a single blanket type of implied consent under CASL; rather, there are many different types of implied consent each with their own specific requirements. Also, as with express consent, CEMs that rely on implied consent must still include the prescribed sender identification information and unsubscribe mechanism. For more information, see: Anti-Spam Law (CASL), Anti-Spam Law (CASL) FAQs and Canadian Anti-Spam (CASL) Precedents.
Consent For Third Parties To Send CEMs. Under CASL, consent to send CEMs can be requested for a sender themselves, identified third parties (or multiple identified third parties) or unidentified third parties (i.e., entities whose identities are not yet known when consent is requested). Importantly, however, each type of consent request has specific requirements for the request and, in the case of consent requests on behalf of unidentified third parties, somewhat complex additional requirements. The failure of marketers to correctly request consent for third parties (e.g., partners, affiliates, co-sponsors in promotions, etc.) is another CASL-related error that we regularly see. For more information, see: Anti-Spam Law (CASL) FAQs and Canadian Anti-Spam (CASL) Precedents.
CASL Exemptions. Similar to implied consent, there is no single exemption from CASL but many types of exemptions. If you are relying on a particular exemption (e.g., the “business-to-business” exemption) it is important to ensure that all of the requirements of the exemption are met. Importantly, there is little or no case law interpreting many CASL exemptions. This means that there there may be more risk when relying on an exemption than express consent. Express consent is the strongest type of consent under CASL, considering that it does not expire unless a recipient unsubscribes.
Passive Consents. Remember that under CASL express consent or a category of implied consent is generally required to send CEMs unless a CASL exemption applies. As such, passive types of consents (e.g., language in general terms and conditions) will likely not be CASL compliant unless a sender does not need express consent (i.e., can rely on a category of implied consent or a CASL exemption).
Sharing Lists With Third Parties. Consider the potential risks of sharing e-mail or other electronic marketing lists with third parties. While this is certainly possible under CASL, marketers should be aware that there are specific requirements that must be met depending on who a list will be shared with (e.g., to expressly identify third parties with whom consent is being gathered on behalf of, including their contact information and other requirements for unidentified third parties). Marketers should also be aware that there is also potentially not only risk if they themselves violate CASL (e.g., send CEMs without consent), but also if they assist third parties that violate CASL. As such, it is often prudent for marketers that want to share electronic marketing lists with third parties to ensure that they have list sharing agreements in place with parties with whom they share e-mails. For more information, see: Anti-Spam Law (CASL) FAQs, Anti-Spam (CASL) Compliance Errors and Canadian Anti-Spam (CASL) Precedents. See also: Influencer, Co-Sponsor and List Sharing Agreements.
Sender Identification Information. Ensure that all CEMs include the prescribed sender identification information required by CASL unless an exemption applies. For more information, see: Anti-Spam Law (CASL) and Anti-Spam Law (CASL) FAQs.
Unsubscribe Mechanism. Ensure that all CEMs include a CASL-compliant unsubscribe mechanism. For more information, see: Anti-Spam Law (CASL) and Anti-Spam Law (CASL) FAQs.
Document Consent. Under CASL, the onus is on senders of CEMs to document consent. As such, it is important to document the type of consent (express or implied) or exemption being relied upon, evidence of consent (e.g., subscription logs, forms, dates and names/e-mail addresses), divide lists according to the type of consent or exemption being relied upon and to scrub lists after recipients have unsubscribed or the relevant time period for a category of implied consent has expired (e.g., two years after a purchase). Failure to adequately document consent is another CASL-related compliance error that we regularly see, including not documenting consent at all, not segregating distribution lists and inadequately documenting consents or types of implied consent. For more information, see: Anti-Spam Law (CASL), Anti-Spam Law (CASL) Compliance and Canadian Anti-Spam (CASL) Precedents.
CASL Compliance Program. Consider adopting a CASL compliance program, particularly if electronic marketing is a core aspect of your marketing strategy. The CRTC has issued guidance on CASL compliance programs including key recommended elements. For more information, see: Anti-Spam (CASL) Compliance and Canadian Anti-Spam (CASL) Precedents.
CASL and Specific Types of Promotions. Care should be taken in relation to specific types of promotions under CASL. Just one of many examples is friends and family type promotions (e.g., contests where entrants can gain more entries by sharing with or tagging a friend or family member). While there is an exception to the unsolicited CEMs section of CASL (section 6) for messages sent to a person with whom the sender has a personal or family relationship, these terms are narrowly defined. For example, “family relationship” is limited to spouses, common-law partners and parent-child relationships. “Personal relationship” is defined in a multi-factor and case-by-case fashion such that it is often impractical to rely on this exception for any broad “friends and family” type promotion. Marketers should also be aware that there is potential risk for both themselves and their clients in running friends and family type promotions if they cannot meet the specific definitions of “family relationship” and/or “personal relationship” under CASL for a promotion. For more information, see: Anti-Spam (CASL) Compliance Errors and Running a Friends-and-Family Promotion in Canada? Cruel, Cryptic CASL Strikes Again.
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SERVICES AND CONTACT
I am a Toronto competition/antitrust lawyer and advertising/marketing lawyer who helps clients in Toronto, Canada and the US practically navigate Canada’s advertising and marketing laws and offers Canadian advertising/marketing law services in relation to print, online, new media, social media and e-mail marketing.
My Canadian advertising/marketing law services include advice in relation to: anti-spam legislation (CASL); Competition Bureau complaints; the general misleading advertising provisions of the federal Competition Act; Internet, new media and social media advertising and marketing; promotional contests (sweepstakes); and sales and promotions. I also provide advice relating to specific types of advertising issues, including performance claims, testimonials, disclaimers, drip pricing, astroturfing and native advertising.
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