Australia: The Spam Act casts its net over e-marketing – prevent yourself from getting caught

Last Updated: 10 February 2010
Article by Cameron Abbott, Dudley Kneller and Mark Feetham

The Act that regulates all e-marketing campaigns has a misleading name - the Spam Act 2003 (Cth) (Spam Act).

The Spam Act - more than just "spam"

Although its name might not suggest it, the Spam Act captures more than just traditional email "spam". In fact, it regulates all types of commercial messages that are sent electronically, including by email, SMS or instant message.

Since the inception of the Spam Act 7 years ago, the Australian Communications and Media Authority (ACMA) has taken an increasingly hard line against companies that do not comply with the Act.

ACMA casts its enforcement net widely

More recently, it has taken enforcement action against parties involved in organising or facilitating the sending of messages that breach the Spam Act, including:

  • the company (or the owner of the product) that is the subject of the advertisement
  • the advertising company that arranged for the message to be sent
  • the company that provided the software to send out the messages
  • the telecommunications company that sent the messages.

Prior consent

Commercial messages that are sent without the prior consent of the recipient may breach the Spam Act. In late 2009, the Federal Court imposed a total of $22.25 million in penalties against the companies and individuals involved in sending SMS messages without the consent of the recipients in relation to premium SMS chat services.[1]

But prior consent isn't everything...

The majority of ACMA's recent enforcement actions have been in relation to emails sent with the prior consent of the recipient. The emails used in these campaigns failed to comply with other requirements of the Spam Act, including failing to provide the recipient with:

  • the ability to unsubscribe from further messages; and/or
  • the contact details of the company sending out the information with the message.

In 2009 Optus sent SMS messages to its customers advertising its "OptusZoo" service, with the sender listed as "966", on the basis that "966" is the telephone keyboard representation of "ZOO". ACMA fined Optus $110,000 for sending these messages without clear and accurate sender information.[2]

Expanding those captured by the Spam Act

ACMA may take action against individuals or companies that send, "cause to be sent," or are "knowingly concerned in" the sending of commercial messages that breach the Spam Act. The recent enforcement actions taken by ACMA in relation to a particular marketing campaign illustrate that ACMA is targeting all companies involved in organising and facilitating the sending of messages that breach the Spam Act.

In one campaign, SMS messages advertising a drink were sent to the customers of a telecommunications provider. These messages breached the Spam Act as they did not contain a functional unsubscribe facility and did not include accurate sender information.

As a result of these breaches:

  • the drinks company was issued with a formal warning
  • the advertising company which arranged for the messages to be sent on behalf of the beverage company was fined $22,000
  • the company that provided the software to send out the messages was required to undertake to pay compensation to any recipients of SMS messages that breached the Spam Act that are sent using their service over the next 12 months
  • the telecommunications company that sent out the messages was fined a total of $110,000 in relation to this particular campaign and two other campaigns.[3]

Consequences of breaching the Spam Act

ACMA has very broad enforcement powers in relation to commercial messages that breach the Spam Act. At a minimum, it can issue a formal warning which can have a huge impact on the reputation of the company involved. It can also issue infringement notices, usually in conjunction with an enforceable undertaking to be provided by the sender.

ACMA has previously agreed enforceable undertakings with companies requiring the company involved to pay compensation to any future recipients of messages that breach the Spam Act[4] and to pay for comprehensive staff education and training programs to ensure compliance with the Spam Act.[5]

The message is clear and consistent. ACMA has broad powers under the Spam Act and is not afraid to use them. Don't be caught out! Ensure your e-marketing campaigns and any related activities don't fall foul of the Spam Act.

Protect yourself - learn how to deal with complaints made to ACMA

On Friday 26 March 2010 an Executive Luncheon will be hosted in Melbourne by Middletons' Technology & Communications Group. This event gives you the opportunity to participate in an executive briefing with Ian Boylan, General Counsel of MYOB, a provider of accounting software, payroll software and business solutions. Ian has experience dealing with ACMA on spam related issues including negotiating favourable settlement outcomes. Please click here for further details and to register for this event.

[1] ACMA media release 151/2009 - 23 October 2009 ; ACMA media release 179/2009 - 16 December 2009

[2] ACMA media release 5/2009 - 14 January 2009

[3] ACMA media release 158/2009 - 10 November 2009

[4] For example, ACMA - Enforceable Undertaking under section 38 of the Spam Act

[5] For example, ACMA - Enforceable Undertaking under section 38 of the Spam Act

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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