Canada's new anti-spam legislation ("CASL") is expected to come into force later in 2013 and will have a significant impact on how not-for-profit organizations send email or other electronic communications.
On January 5, 2013, revised draft regulations (the "Regulations") were published in the Canada Gazette, bringing the legislation one step closer to coming into force. Regulations were first published in 2011 and these current revisions represent the government's response to the feedback it received from various stakeholders. The Regulations offer definitions for some key terms and concepts, and provide exemptions for certain business activities that were not meant to be subject to CASL. We are currently waiting for the Regulations to be finalized.
The key changes in the Regulations are:
- Club, Association and Voluntary Organization: CASL requires organizations that send any kind of commercial electronic message (a "CEM") to obtain consent from the recipients. Consent can be implied when a club, association or voluntary organization sends a CEM to its members. The Regulations define "club, association or voluntary organization" as a not-for-profit organization operated exclusively for social welfare, civic improvement, pleasure or recreation or for any purpose other than profit. No part of the organization's income can be paid to any member or proprietor (unless the member or proprietor is an organization promoting amateur athletics in Canada). The Regulations clarify that "members" means those persons who have been accepted into the organization according to its membership rules. These kinds of organizations can send CEMs to its members without obtaining their express consent. CASL already had additional exemptions for charities registered under the Income Tax Act (Canada) and the Regulations do not change those. Consent can be implied when a registered charity sends CEMs to persons who made a donation to the charity within the last two years. Implied consent also applies to persons who performed volunteer work for the registered charity within the last two years. It is important to note that these exemptions are time limited. Under CASL, a charity cannot imply consent from a person who made a donation over two years ago. In that case, the charity likely needs to obtain express consent before sending a CEM to that person.
- Family and Personal Relationships: CEMs that are sent between persons with a personal or family relationship are exempt from CASL. The definition of "family relationship" is consistent with that in the Income Tax Act, and includes blood relatives and relatives by marriage. A "personal relationship" is defined as direct, voluntary, two-way communications between two persons where it is reasonable to conclude the relationship is personal. The assessment of whether a relationship is personal is based on a non-exhaustive list of factors. In the initial draft of the regulations, personal relationships were defined as relationships where there has been communication in the past two years and the parties have met in person, which definition was criticized as being too restrictive. In the Regulations, a recipient can always "opt out" of receiving CEMs from someone with whom they have a personal relationship (although, interestingly, this does not apply to family relationships).
- New exemptions: New exemptions have been added
to address situations that were not intended to fall under the
scope of CASL:
- CEMs sent by employees, representatives and contractors within an organization or to another organization if the organizations have a business relationship, where the message concerns the business or that person's role, function or duties in the organization.
- CEMS sent in response to a request or complaint or that is otherwise solicited by the recipient.
- CEMs sent by a person or computer located outside Canada, about products or services provided outside Canada, to someone that the sender did not know and could not reasonably have known, would be received in Canada. This exemption is meant to apply to foreign business activities where the recipient happens to be visiting Canada at the time he or she receives the CEM.
- CEMs that are required by law or that are sent to enforce a legal right, such as product recall messages or electronic bank statements, or notices of a court order or judgment.
The Regulations did not change the provisions dealing with third party consents. These are CEMs sent by someone on behalf of a third party whose identity is unknown. The person who obtains consent on behalf of the third party is responsible for ensuring that the recipient can unsubscribe from messages and will be able to contact the sender to carry out that request. Industry Canada recognizes that this may require businesses to track consents as they are shared amongst different parties, but they regard this as a reasonable burden for businesses to bear.
This last point is important for the not-for-profit sector. It is common for organizations to outsource their email marketing to a third party provider. CASL requires the sender to obtain consent from the recipient and to track unsubscribe requests. Not-for-profit organizations should ensure that their service providers are aware of, and comply with the requirements of CASL.
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