Canada's new Anti-Spam legislation, commonly known as "CASL", establishes an "opt-in" regime by making it presumptively unlawful to send a commercial electronic message (CEM), unless the recipient has consented to receive it, and the sender includes certain information and an unsubscribe mechanism. CASL applies to anyone who uses email for any commercial purpose. Violators face heavy sanctions, including fines up to $10 million, and private damages actions. Most of CASL's provisions come into force on July 1, 2014.
What is a commercial electronic message?
A "commercial electronic message" is defined broadly as any electronic message whose purpose is to encourage participation in a commercial activity. This includes messages about buying or selling a product or service, or that promote a business or investment, as well as messages promoting a person in relation to commercial activities, such as a professional newsletter. The definition of a CEM is not based on whether the messages are sent in bulk. Emails that are individually drafted and sent are caught by CASL.
|Sending a CEM||
|Seeking consent to send a CEM||
What is consent?
There are two kinds of consent to receive a CEM:
- Express consent
- Implied consent
Express consent can be given orally or in writing. The person seeking consent must set out "clearly and simply":
- The purpose for which the consent is being sought
- The identity and contact information of the person seeking consent and of any person on whose behalf consent is sought
- A statement that the person whose consent is sought can withdraw their consent.
Consent is frequently sought and obtained through check boxes on web pages that toggle from checked to unchecked. These boxes should default to the unchecked state. Because electronic messages seeking consent are deemed to be CEMs, express consent cannot be sought by email, unless there is implied consent, or one of the exceptions applies.
Implied consent arises from three main sources:
- Existing business relationships: businesses can send emails to their customers. This implied consent expires after two years.
- Existing non-business relationships: donations, volunteer work, and club memberships give rise to implied consent. This consent expires after two years.
- Business cards and website contact information: consent is implied for people who have published their email addresses (for example, on a website), and for people who disclose their email address (for example, on a business card), unless the person includes a disclaimer that they do not wish to receive unsolicited commercial messages. This type of consent only applies if the CEMs are relevant to the person's business or job.
A transitional provision in CASL allows an initial three-year period before implied consents for existing business and non-business relationships expire. Implied consents arising from business cards and website contact information do not expire.
Information and contents that must be in CEMs
CASL requires that CEMs contain certain information, plus an unsubscribe mechanism. CEMs must contain information identifying the person or business sending the message, as well as their mailing address, and telephone number, email address or web address. If the message is sent by one person on behalf of another, the message must include the names of the person sending the message and of the person on whose behalf it is sent, but only the address of the person on whose behalf the message is sent. CASL also requires that every CEM have an unsubscribe mechanism that contains a link to an electronic address or web page allowing the recipient to unsubscribe from CEMs. The unsubscribe mechanism must be set out clearly and prominently, and must be able to be readily performed. Regulations made by the Canadian Radio-telephone and Telecommunications Commission (CRTC) allow the sender information and unsubscribe mechanism to be posted on a web page, with a link in the message, when it is not possible to include this in the CEM itself, for example, on text messages.
CASL and the regulations made under CASL contain several sets of exceptions. The first set consists of a list of particular circumstances in which CEMs can be sent without the need to obtain consent, but where the sender information and unsubscribe mechanism may still be required, including:
- A quote in response to a request
- Confirmation of a transaction
- Warranty and product recalls
- Factual information regarding an ongoing purchase, subscription or membership
- Information regarding updates or upgrades to services or products
- Fund-raising by registered charities or political parties
- One email following a referral, in limited circumstances.
Depending on the circumstances, some of the messages listed above may not be CEMs at all, and may thus be completely exempt from CASL. The second set consists of CEMs that are exempt both from the requirement to obtain consent and to include sender information and an unsubscribe mechanism in certain circumstances, including:
- Inquiries to a person in a commercial activity (for example, an email from a consumer to a merchant)
- Responses to requests, inquiries, or complaints (for example, the merchant's response to an email from a consumer)
- CEMs sent to satisfy or enforce legal obligations or rights
- Work-related CEMs among fellow employees, consultants, representatives, and franchisees
- Messages sent on electronic messaging services that provide an unsubscribe function and where the person consents to receive the message expressly or by implication (this exception could cover social media, depending on their terms of service).
Finally, CASL exempts CEMs between family members and individuals who have a "personal relationship" from the consent, sender information, and unsubscribe requirements. Whether a "personal relationship" exists is based on a number of factors, including previous direct communication. Telephone calls, faxes, and "robocalls" are also exempted from CASL. They are regulated by the CRTC through its "Do Not Call List". Voicemails are also likely exempt.
Other Prohibited Conduct
CASL contains a number of other provisions that are beyond the scope of this summary:
- CASL prohibits altering transmission data in an electronic message which results in the message being delivered to a different person
- CASL prohibits the installation of computer programs without consent
- CASL amended the Competition Act to address online false or misleading advertising
- CASL amended Canada's privacy law to prohibit using web crawlers to harvest email addresses.
Enforcement and Penalties
The CRTC is responsible for enforcing CASL. The CRTC investigates, prosecutes, and adjudicates alleged violations of CASL. The CRTC can order telecommunication service providers to preserve data about CEMs. It can order anyone to produce any document, information or data, including private emails and text messages. The CRTC does not need to obtain prior judicial authorization before issuing a production order. The CRTC can also apply to a court for search warrants. If the CRTC determines that a violation has occurred, it can issue a notice of violation and impose an administrative monetary penalty (AMP) of up to $1 million on an individual and $10 million on a corporation, without holding a hearing. It is up to the alleged violator to challenge the decision by proving either that the recipient of the CEM consented (expressly or impliedly), or that it exercised due diligence to avoid committing the violation. Parties found to have violated CASL can appeal to the Federal Court of Appeal. Persons who are affected by violations of CASL can sue to recover actual damages, plus up to $200 for each contravention, to a maximum of $1 million per day on which a contravention occurred. This private right of action is also available in cases of violations of the online false advertising provisions added to the Competition Act by CASL. Private actions under CASL will almost certainly be structured as class actions. The private action provisions come into force on July 1, 2017.
All Canadian businesses need to ensure that they comply with CASL. They also need to retain evidence that they are in compliance, because CASL applies a reverse onus. Compliance systems may include the following elements:
- Employee training
- Systems to obtain and document express consent
- Systems to track the type and scope of consents and when they expire or are revoked through an unsubscribe
- Systems to ensure that CEMs are not sent except where consent exists.
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.