Canada: B2B Business Relations And Consent Requirements Under The New Canadian Anti-Spam Law

Last Updated: January 13 2014
Article by Éloïse Gratton

Last month, the Minister of Industry announced that Canada's new Anti-Spam legislation ("CASL") will come into force on July 1, 2014. Industry Canada published the final version of its Electronic Commerce Protection Regulations ("IC Regulations") while the Canadian Radio-television and Telecommunications Commission had previously published its final regulations ("CRTC Regulations"). These two sets of regulations provide additional requirements for complying with CASL.

While most businesses understand that CASL provides for a stringent opt-in type of model, many are not so clear on what kind of impact this piece of legislation may have on businesses that conduct B2B activities. An electronic message that contains a request for consent to send CEM is considered to be a commercial electronic message covered under CASL.1 This means that an organization cannot contact a potential customer by email to obtain consent, unless there is a pre-existing relationship or the message is exempted under CASL. With the coming into force of CASL, can B2B businesses still contact other potential businesses by email as part of their business development efforts similar to what they have done in the past?

Type of Messages Regulated by CASL

For the purposes of CASL, an "electronic message" is broadly defined as a message sent by any means of telecommunication, including a text, sound, voice or image message,2 although the anti-spam restrictions in CASL do not apply to a commercial electronic message that is an interactive two-way voice communication between individuals,3 that is sent by means of a facsimile to a telephone account,4 or that is a voice recording sent to a telephone account.5 An "electronic address" means an address used in connection with the transmission of an electronic message to an electronic mail account, an instant messaging account, a telephone account or any similar account.6

A commercial electronic message (or CEM) is an electronic message for which it would be reasonable to conclude that it has the purpose of encouraging participation in a commercial activity (having regard to the content of the message, where it links to certain commercial content or contact information is contained in the message).7 Under CASL, "commercial activity" means any particular transaction, act or conduct or any regular course of conduct that is of a commercial character, whether or not the person who carries it out does so in the expectation of profit.8 CEMs include, for instance, a message that: offers to purchase, sell, barter or lease a product, goods, a service, land or an interest or right in land;

  • offers to provide a business, investment or gaming opportunity; or
  • advertises or promotes any person engaged in anything mentioned above (offer to purchase, to sell, offer to provide business, etc.).9

There are certain types of situations (such as when consent is implied) and certain types of messages which are exempted from the consent requirement which B2B businesses may use to support the position that they can contact potential business partners by email.

Scenario No 1: Implied Consent if Existing Business Relationship

Under CASL, it is prohibited for a business to send or cause or permit to be sent to an electronic address a CEM unless the person to whom the message is sent has consented to receiving it, whether the consent is express or implied.10 CASL states that consent is implied if the person who sends the message, the person who causes it to be sent or the person who permits it to be sent has an existing business relationship with the person to whom it is sent.11 An "existing business relationship" means a business relationship between the person to whom the message is sent (customer) and any person who sent or caused or permitted the message to be sent (sender), arising from:

  • the purchase or lease of a product, goods, a service, land or an interest or right in land, within the two-year period immediately before the day on which the message was sent12 or the bartering of any activity mentioned in this paragraph;13
  • the acceptance by the customer, within the two-year period immediately before the day on which the message was sent, of a business, investment or gaming opportunity offered;14
  • a written contract entered into between the customer and any of those other persons in respect of a matter not referred above [under the two bullets above], if the contract is currently in existence or expired within the two-year period immediately before the day on which the message was sent; or15
  • an inquiry or application, within the six-month period immediately before the day on which the message was sent, made by the customer, in respect of anything mentioned above (purchase or lease, business or investment or gaming opportunity etc.).16

For instance, if a potential business customer makes a request for information to a business for one of their products on January 5th, then the business can send to this potential business customer CEMs for a period of six months (i.e., until July 5th of the same year). If this business customer purchases something on April 14th, 2014, then the business has a new period of two years to send CEMs to this customer – i.e., it has implied consent to send CEMs until April 14th, 2016, unless the customer purchases another product within this timeframe, in which case the business has a new period of two years to send CEMs to the customer. This means that organizations must ensure that their databases of customers' email addresses keep track of when (the date) a transaction or a request for information last took place, in order to be able to benefit from the implied consent under CASL.

Scenario No 2: Implied Consent if the Business Contacted has Published or Disclosed an Email Address

CASL states that consent is implied if the person to whom the message is sent has conspicuously published, or has caused to be conspicuously published, the electronic address to which the message is sent (for instance, the email address is made available on his or her business website), the publication is not accompanied by a statement that the person does not wish to receive unsolicited commercial electronic messages at the electronic address and the message is relevant to the person's business, role, functions or duties in a business or official capacity.17 Similarly, CASL states that consent is implied if the person to whom the message is sent has disclosed (for instance, he or she has provided his or her business card at an industry conference), to the sender, the electronic address to which the message is sent without indicating a wish not to receive unsolicited CEMs at the electronic address, and the message is relevant to the person's business, role, functions or duties in a business or official capacity.18

The challenge with these types of implied consent provisions is to determine how "message is relevant to the person's business, role, functions or duties in a business or official capacity" will be interpreted. For example, my business email address is made available on McMillan's website and is not accompanied by a statement that I do not wish to receive unsolicited commercial electronic messages. I could also provide my business card to someone attending a privacy conference or an industry event. While a third party could probably legally contact me in to promote a conference pertaining to privacy law (which is my area of expertise), it is less clear whether a third party marketer could legally contact me to sell me or McMillan office furniture, business software products or provide me with discounts on business flights within Canada.

Scenario No 3: Exclusions for Employees and Business types of Email Messages

There are certain types of CEMs that are excluded from the application of CASL, as set out under the IC Regulations, including a CEM that is sent by an employee, representative, contractor or franchisee of an organization to another employee, representative, contractor or franchisee of the organization and that concerns the affairs of the organization, or to an employee, representative, contractor or franchisee of another organization if the organizations have a relationship at the time the message was sent and the message concerns the activities of the organization.19

This exemption will most likely support the view that B2B emails are acceptable in these types of situations, although, similar to what has been raised under option 2 above, there is certain uncertainty as to how the wording "if the organizations have a relationship" and "the message concerns the activities of the organization" will be interpreted by the CRTC or the relevant courts.

Scenario No 4: Referral Marketing

One last option that may be used by B2B businesses to avoid having to obtain an opt-in (express) consent will be to use the referral marketing provisions available under CASL. For instance, under the IC Regulations, there is no need to have prior consent to send CEMs in certain situations involving referral marketing, but this exception is limited to one single email. More specifically, the consent requirement does not apply to the first CEM that is sent by a person for the purpose of contacting the individual to whom the message is sent following any referral by any individual who has an existing business relationship with the person who sends the message, as well as with the individual to whom the message is sent; provided that the CEM discloses the full name of the individual or individuals who made the referral and states that the message is sent as a result of the referral.20 These individuals (making the referral) must have an existing business relationship (details on this notion are provided above) with the organization contacting the individual who has been referred to the organization.21

While there are various legal provisions that may be used by B2B businesses in order to make the case that they don't need an opt-in (express) consent prior to contacting certain potential business customers, there is still certain uncertainty on how some of these provisions will be interpreted by the CRTC and relevant courts. Therefore, businesses will need to use caution and may wish to contact their legal advisor if they want to benefit from these implied consent provisions or CEM exemptions in order to limit their legal risk and their potential liability under CASL.

1 CASL, s. 1(3).
2 CASL, s. 1(1).
3 CASL, s. 6(8)(a).
4 CASL, s. 6(8)(b).
5 CASL, s. 6(8)(c).
6 CASL, s. 1(1).
7 CASL, s. 1(2).
8 CASL, s. 1(1).
9 CASL, s. 1(2).
10 CASL, s. 6(1)(a).
11 CASL, s. 10(9)(a).
12 CASL, s. 10(10)(a).
13  CASL, s. 10(10)(c).
14 CASL, s. 10(10)(b).
15 CASL, s. 10(10)(d).
16 CASL, s. 10(10)(e).
17 CASL, s. 10(9)(b).
18 CASL, s. 10(9)(c).
19 IC Regulations, s. 3(a).
20 IC Regulations, s. 4(1).
21 IC Regulations, s. 4(2).

The foregoing provides only an overview. Readers are cautioned against making any decisions based on this material alone. Rather, a qualified lawyer should be consulted.

© Copyright 2014 McMillan LLP

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Blake, Cassels & Graydon LLP
Lindsay Kenney LLP
Blake, Cassels & Graydon LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Blake, Cassels & Graydon LLP
Lindsay Kenney LLP
Blake, Cassels & Graydon LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions