There have been a disappointing lack of publicly-reported
enforcement actions under Canada's Anti-Spam Legislation (CASL)
since it came into force in July 2014 – in fact, to date
there has only been one. Given the ambiguity and
complexity of the legislative scheme, combined with the potential
for very severe penalties, this is disappointing to the business
community that has sought to better understand the positions and
interpretations that the CRTC actually took in live enforcement
cases. Consequently, as an unfortunate result of the silence on the
enforcement front, some organizations have taken the view that the
CRTC has not been actively enforcing the legislation.
We understand that the CRTC has already received hundreds of
thousands of complaints under CASL, and the CRTC has necessarily
been involved in a substantial triage process. Given the
mandate and resources of the CRTC, and in particular its public
statements with respect to CASL enforcement, we are of the view
that further information on enforcement action will be forthcoming
and demonstrate to organizations that the law has teeth.
If your business or organization receives an enforcement notice
from the CRTC, you may wish to consider taking some or all of the
Review the notice. What has the CRTC accused
you of doing? What options has it given you? Is there a deadline
for your response?
Begin preparations immediately. Non-compliance
with CASL could cost your organization significant sums with the
potential for penalties in the millions of dollars. As with any
regulatory action, time is of the essence. Inaction is not a
Appoint an individual to be responsible for the
complaint. Preparing to defend your organization from
liability under CASL will involve assessing the facts and the
allegation, gathering records and documentation from a variety of
sources, and looking at them as a whole. Regardless of the size of
your organization, an individual will be needed to not only
coordinate searches for information, but to also understand the
application of those records in building a defense to the
Track your deadline for response. The
regulator may expect responses to the allegations by a certain
deadline. Keep that date in mind.
Involve your legal counsel. Engaging
experienced competent legal counsel, especially counsel familiar
with CASL, is essential to protect your rights and to navigate the
regulatory process, and may provide a claim of legal privilege for
your assessment. Legal counsel should review all communications
proposed with the regulator.
Gather evidence of compliance. The best
defence to an enforcement action under CASL is to prove that your
organization complied with its obligations. Due diligence is a
defense to such enforcement action. If you receive a complaint, you
should immediately begin to search for information that would
support such a defense.
Review your due diligence materials. In
anticipation of CASL, many organizations assembled a due diligence
"war-file," including policies, procedures, consent
tracking and other evidence of reasonable efforts to ensure
compliance with the law. Upon receiving a CASL enforcement notice,
revisit this file and assess its relevance to the complaint.
Remember, due diligence is another defence to CASL liability.
What did you learn? Your preparations should
help you to understand better how effective your compliance efforts
have been. If the compliance is found not to be as effective as the
law requires, then this is an opportunity to improve those
practices and be better prepared for the future.
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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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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