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 is still a complex law with some outstanding uncertainties in key areas.
In providing CASL related legal advice to clients since CASL came into force in 2014, and over the past several years, I regularly see some of the same compliance errors being made, including by otherwise sophisticated marketers.
It is also relatively uncommon for me to see companies have a CASL compliance program in place or established processes to comply with CASL’s consent, sender identification, unsubscribe and documenting consent requirements.
One common CASL compliance error that I see is combining electronic marketing with a promotional contest or other type of promotion without consent for the additional marketing.
In general, CASL requires that marketers have consent (whether express or implied) to send commercial electronic messages (CEMs) to Canadians, unless they can rely on an applicable CASL exception.
In this regard, organizers of promotions (e.g., contests) commonly want to build electronic distribution lists in conjunction with a promotion.
The potential CASL issue, however, is that while consumers may have agreed to participate in a contest or other type of promotion, they may not have agreed to receive other types of CEMs.
Helpfully, there is an exception under the CASL regulations from the unsolicited CEMs section of CASL (section 6) for replying to requests or inquiries. This exception can be very helpful to, for example, send CEMs in relation to a contest or other promotion, where participants have entered the contest/promotion or otherwise inquired about a promotion (i.e., for marketers to respond to inbound inquiries that do not involve unsolicited CEMs).
This exception, however, is narrow and does not contemplate sending CEMs that are unrelated to the initial inbound inquiry.
As such, if marketers want to build distribution lists in conjunction with a promotional contest or other promotion, it is generally prudent to request and obtain express consents for CEMs that are unrelated to the primary promotion.
This can usually be easily done with a CASL-compliant express consent request included on contest landing pages or where consumers agree to participate in a promotion.
For more information about CASL, see: Canadian Anti-Spam Law (CASL), CASL Compliance, CASL Compliance Errors, CASL Compliance Tips and CASL FAQs.
For more information about CASL and contests, see: Contests & CASL.
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CASL PRECEDENTS/FORMS
In addition to our legal services, we also offer lawyer prepared CASL precedents and checklists that identify key consent, disclosure and other requirements for electronic marketing to Canadians with checklists and precedents to comply with CASL.
Our precedents and checklists are an excellent starting point to mitigate risk and avoid common CASL-related issues, including relating to express consent requests (including on behalf of third parties), sender identification information for CEMs, compliant 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 and to order see: Canadian Anti-spam Law (CASL) Precedents/Forms.
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KEY LEGAL TIPS FOR RUNNING
A PROMOTIONAL CONTEST IN CANADA
The following are some key legal tips for operating a successful and legal contest in Canada:
CRIMINAL CODE
Avoid the illegal lottery offences of the Criminal Code (e.g., include a bona fide “no purchase necessary” entry option and skill element, such as a time-limited, multiple-step mathematical question for potential winners as a condition of awarding prizes).
SHORT RULES (MINI RULES)
Include short rules / mini rules with all of the required Competition Act disclosure requirements for point-of-purchase materials (e.g., print and in-store marketing, social media and Internet sites, packaging and labeling, television and radio spots, etc.).
For more information, see: Canadian Contest Law Forms/Precedents.
LONG RULES (OFFICIAL RULES)
Ensure that precise long rules (i.e., the official contest rules) are included that reflect the details of the contest, anticipate potential contingencies (e.g., technical problems) and set out the terms of the contest as clearly as possible – for example, eligibility requirements, how to enter, prize descriptions, number and value of prizes, draws and award of prizes, odds of winning and indemnifying and releasing the contest sponsor and any co-sponsors or prize sponsors.
Contests are contracts, and so they should be as accurate, clear and precise as possible in the event issues arise.
For more information, see: Canadian Contest Law Forms/Precedents.
WINNER RELEASE FORMS
Consider using winner release forms for contest winners.
While not required by law in Canada, winner release forms are almost always used by contest sponsors to have winners confirm that they have complied with all contest rules and release the sponsor from legal liability. Signing and returning winner releases is also commonly included in contest rules as a condition of awarding a prize.
Winner release forms are particularly important for contests in which there may be higher risk (e.g., where the contest involves high value prizes or a trip prize).
For trip contests, sponsors are generally advised to use winner releases for both winners and any travel companions (and guardian releases for any minor companions).
For more information, see: Canadian Contest Law Forms/Precedents.
FALSE OR MISLEADING ADVERTISING
Ensure that advertising and marketing materials are not false or misleading (i.e., comply with the general civil and criminal misleading advertising sections of the Competition Act, under sections 74.01 and 52).
In this regard, contests in Canada must comply not only with stand-alone contest provisions of the Competition Act (under section 74.06) but also with the general misleading advertising sections of the Competition Act.
It is particularly important to ensure that the marketing materials also match the contest rules and that all material aspects of the contest (e.g., number and type of prizes, prize values, how to enter and win and any conditions/limitations) are accurately described in the short rules, long rules and marketing materials.
CANADIAN FEDERAL ANTI-SPAM LAW (CASL)
Comply with Canada’s federal anti-spam legislation (CASL).
CASL is often relevant when running contests in Canada, including if electronic distribution lists will be used to market the contest, the contest will include the collection of e-mails for marketing unrelated to administration of the contest, if entrants’ e-mail addresses will be shared with third parties (e.g., related entities or affiliate marketers) or entrants are either required or incentivized (e.g., through additional entries) to “share” the contest with friends or family.
Given the potentially severe penalties for violating CASL, which include AMPs of up to CDN $10 million, it is very important for contest sponsors to ensure that they comply with CASL for any electronic marketing related to promotional contests open to Canadians.
For more information about contests and CASL, see: Contests and CASL and CASL Compliance Errors.
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CASL Compliance Checklists and Precedents: For information about the CASL compliance checklists and precedents we offer, see: CASL Compliance Checklists and Precedents.
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SERVICES AND CONTACT
We are a Toronto based Canadian competition law and advertising law firm who helps clients in Toronto, Canada and the United States 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.
Our 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. We also provide advice relating to specific types of advertising issues, including performance claims, testimonials, disclaimers, drip pricing, astroturfing and native advertising.
For more information about our services, see: services
To contact us about a potential legal matter, see: contact
For more information about our firm, visit our website: Competitionlawyer.ca
