Canada: CASL Overview

Last Updated: June 11 2014
Article by Christene Hirschfeld

On July 1, 2014, the bulk of Canada's Anti-Spam legislation will come into effect. If your business or organization sends electronic messages to communicate information, you need to be aware of this law.

Many people refer to the legislation as CASL. The provisions with the greatest application to your organization are the anti-spam provisions. There are provisions dealing with altering transmission data and installation of computer programs, but this update focuses on the anti-spam provisions.

Qualifications

The legislation is complicated. This note highlights the most important parts in a simple way. It does not cover all the details, so when you are thinking about how this new law affects you, please review the legislation and regulations in their entirety, and seek counsel, to ensure that you are in compliance. Our firm is ready to help, and Christene Hirschfeld, Q.C. is knowledgeable in this area.

Who do the anti-spam provisions affect?

CASL's anti-spam provisions affect anyone who sends commercial electronic messages ("CEMs") to, from or within Canada. A CEM is any electronic message that encourages participation in a commercial activity, regardless of any expectation of profit. The term is tech-neutral; in other words, it applies to emails, text messages, social media and other similar forms of communication. Unless exempt under the legislation, a sender must have the consent (either express or implied) of the recipient to send a CEM.

Why should you care?

It's never good when a business is reported to have breached a federal statute. Apart from the bad press associated with a violation of CASL, you should also be concerned about the penalties. The maximum penalty for a breach by an individual is $1,000,000, and for an organization, $10,000,000. Further, in 2017, there will be a private right of action. This means that the person who claims his or her rights were violated can sue you. Further, not only is the individual or organization sending the offending CEM accountable, so are the officers and directors of the organization, and employers are responsible for the actions of their employees. This means that any of these individuals may also be fined and, starting in 2017, sued.

Mandatory Content of CEMs

Subject to certain exceptions, each CEM must contain the following information:

  • The name, telephone number and email or web address of the sender, its affiliates and beneficiaries;
  • A physical mailing address which is correct for at least 60 days after the message is sent; and
  • An unsubscribe mechanism.

The unsubscribe mechanism must be able to be "readily performed". This means that it must easily and quickly accessible and be simple and easy to use.

The legislation requires that any opt-out or unsubscribe request be honoured "without delay" and, at a maximum, no later than 10 business days after it is received.

Exceptions

Unless you fit within one of the exceptions, you are required to have the recipient's consent before sending a CEM. There are two categories of exceptions:

  • Exceptions where neither consent nor mandatory content rules apply; and
  • Exceptions where mandatory content rules apply but consent is not required.

Exceptions to consent and mandatory content rules

You are exempt from the consent and mandatory content requirements if you are sending a CEM to:

  • One with whom you have a personal relationship;
  • One with whom you have a family relationship;
  • The CEM is sent solely as an inquiry or application regarding recipient's existing commercial activity;
  • The CEM is between employees, representatives or consultants of your organization regarding your organization's activities;
  • The CEM is sent to enforce a right; or
  • The CEM is sent by a charity and its primary purpose is fundraising.

Please note that this list is not complete, but it should cover all examples that are relevant for your purposes.

The factors to be considered in determining whether one has a personal relationship include:

  • direct, voluntary, 2 way communications;
  • shared interests, experiences, opinions and info;
  • frequency of communications;
  • length of time since the communication;
  • whether you have met in person.

According to the legislation, in order for a family relationship to exist, the parties must be related by marriage, common-law partnership or legal parent-child relationship, and must have direct, voluntary two-way communication. You will note that sibling relationships and relationships between grandparents and grandchildren, and aunts, uncles, nieces and nephews are not included in this definition.

Other exceptions to the requirements for mandatory content and consent include when the CEM is sent:

  • solely as an inquiry or application regarding recipient's existing commercial activities;
  • between employees, reps, consultants, franchisees of an organization re the organization's activities;
  • sent to enforce a right; and
  • sent by a charity AND its primary purpose is fund raising.

Exceptions where mandatory content does apply but consent is not required

  • You are exempt from the consent, but the mandatory content requirements continue to apply if you are sending a CEM to:
  • provide a requested quotation;
  • facilitate, complete or confirm commercial transaction that recipient previously agreed to enter;
  • provide warranty, recall or safety info about a purchase; or
  • provide info about existing employment relationship or related benefits.

In addition, if it is suggested that you contact someone, you do not require consent to send the first CEM if:

  • The referrer has an existing business (as defined below), existing non-business (as defined below), family or personal relationship with the person you are contacting; and
  • The CEM discloses the full name of the referrer; and
  • The CEM states that it is being sent as a result of the referral.

Express Consent

Unless you fit within one of the exceptions, you require the express or implied consent of the recipient in order to send a CEM. It should be noted that a CEM asking for consent is still a CEM; in other words, you need consent in order to send it.

Consent can be oral but only if it is verified by a third party or recorded. Consent must not be bundled with terms and conditions. This means that on your website, you cannot have the individual click to agree to accept the terms and conditions of, for example, membership in your club or use of your facilities and agree to receive CEMs. Further, the system requires that people opt-in and not opt-out. People must take an active step to signify their consent. This could include checking a box or typing in a word.

Implied Consent

Examples of implied consent include the following:

  • Existing business relationship – e.g.
    • Purchased services within the past 2 years;
    • An enquiry within the past 6 months;
  • Existing non-business relationship if in the last 2 years – i.e.
    • A donation or gift to or volunteer work for a charity or political party; or
    • Membership in a "club", "association" or "voluntary organization".
  • A club, association or voluntary organization is a non-profit organization organized and operated exclusively for the social welfare, civic improvement, pleasure or recreation or for any purpose other than personal profit, if no part of its income is payable to any owner, member or shareholder.

Enforcement

The new legislation will be enforced by the following Federal Government agencies:

  • CRTC – administrative penalties, spam, botnets, malware, network reorganization
  • Competition Bureau – false and misleading online representations
  • Office of the Privacy Commissioner – address harvesting, spyware

Organizations must take CASL seriously.

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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