Canada: Don’t Call Me: Canada Moves Further Toward National Do-Not-Call List With CRTC’s July, 2007 Decision On Unsolicted Telecommunication Rules

Canadians will soon be able to register their phone numbers with a single operator to prevent the receipt of unsolicited commercial telephone calls. Currently, each telemarketer must maintain its own do-not-call list and consumers must register separately on each organization’s do-not-call list to avoid calls from that particular organization. The recent decision of the Canadian Radio Television and Telecommunications Commission (Telecom Decision CRTC 2007-48, July 3, 2007) now paves way for the creation of a single, national do-not-call list (a "National DNCL") by early/mid 2008. Telecom Decision 2007-48 should therefore be carefully examined by every organization engaged in telemarketing.

Background: Bill C-37

The Canadian Radio Television and Telecommunications Commission (CRTC) began reviewing the current telemarketing rules in March 2001. It issued Telecom Decision 2004-35 in May 2004, which introduced significant changes to existing telemarketing regulations, including stricter identification procedures and predictive dialling constraints. But enforcement was suspended that September following an application by the Canadian Marketing Association (CMA) to stay the decision until further review. Do-not-call legislation was contemplated by the CRTC at the time of issuing Decision 2004-35 but the Commission concluded it had no authority to implement a national list.

Parliament moved to fill the gap very quickly. Similar to successful legislation already in place in the US, Bill C-37 introduced Canada’s proposed do-not-call legislation in December 2004. Amending the Telecommunications Act, the legislation allows the CRTC to establish a national bilingual do-not-call list to which individuals not wishing to receive unsolicited calls could add their telephone numbers. Telemarketers who call individuals on the national registry will be committing an offence and subject to monetary fines ($1,500 for each infraction by an individual and $15,000 for each infraction by a corporation). Bill C-37 quietly came into force on June 30, 2006.

For its part, the CRTC launched its public consultation process to establish a National DNCL and to review existing telemarketing rules in early 2006. The CRTC received submissions from many interested parties, considered their comments carefully, and released Decision 2007-48 on July 3, 2007.

CRTC Decision 2007-48

In Telecom Decision 2007-48, the CRTC establishes a comprehensive framework for unsolicited telecommunications, including the creation of the National Do-Not-Call List Rules as well as updating the Telemarketing Rules and the Automatic Dialling Rules as necessary. The framework set out in the Decision is designed to ensure the protection of privacy and to prevent the undue inconvenience of unsolicited telecommunications while also permitting the use of legitimate forms of telemarketing communications. Under the Decision’s comprehensive framework, telemarketers will be prohibited from placing unsolicited calls to telephone numbers that appear on the National DNCL, although there are some notable exemptions to this general prohibition (as outlined below). The costs of operating the new National DNCL will be covered by subscription fees paid by telemarketers. Telemarketers will also be required to disclose certain information on the cover pages of faxes, including a phone and fax number of the employee and organization responsible for sending the fax and a toll-free number where do-not-call/fax requests can be processed.

How the National Do-Not-Call List Will Work

To register (or de-register) on the National DNCL, consumers will be able to call into a toll-free number, though registration will also be made available online. Registration will be free and effective for three years from the registration date, after which consumers will be automatically de-registered from the list. It will be up to consumers to re-register after the expiry of the three-year period.

If a consumer has registered for the National DNCL and still receives calls from organizations that are not exempt, the consumer will be able to file a complaint. The CRTC will investigate complaints received in order to assess whether a violation of the National Do-Not-Call List Rules has occurred. The CRTC will also retain the discretion to determine what the monetary penalty will be in the case of an infraction, up to the specified maximum. In its Decision, the CRTC determined that it will inform the public of violators of the Unsolicited Telecommunications Rules on the basis that such publication will deter others from possible violations.

Exemptions Available to Business

In its Decision, the CRTC granted telemarketers a 31-day grace period to update their lists. This means that telemarketers have 31 days from a consumer’s registration date to update their telemarketing lists in order to ensure compliance with the National DNCL Rules.

A telemarketer who is the subject of a complaint will have an opportunity to present a defence when issued with a notice of violation by the CRTC. Possible defences include due diligence in demonstrating that an unsolicited call resulted from an error and that steps have been taken to ensure compliance with the Unsolicited Telecommunication Rules. Alternatively, the telemarketer could provide evidence that it has in fact received a consumer’s prior consent to be contacted or that it has an existing business relationship with the consumer.

Before its passage by Parliament, Bill C-37 was amended to exempt calls to customers with whom the caller has an "existing relationship" and calls made by or on behalf of a "registered charity" as defined by the Income Tax Act. Also exempted are calls from political parties and calls made solely to conduct market research or to solicit a subscription to a newspaper of general circulation. The CRTC Decision provides clarification on the scope of these exemptions. To the delight of the CMA, Decision 2007-48 also adds a new exemption for organizations that make unsolicited telecommunications to business consumers (i.e. B2B calls). The Commission noted in its Decision that it has received little evidence of undue inconvenience of business consumers as a result of telemarketing communications; it is the CRTC’s view that, in general, business consumers do not experience the same inconvenience as residential consumers face when receiving unsolicited telemarketing calls.

Significantly, every person or organization that is exempted from the general telemarketing prohibition to consumers registered on the National DNCL is nonetheless required to maintain its own do-not-call list. Consumers in this way may still direct exempted organizations to refrain from calling. Businesses that experience inconvenience as a result of unsolicited telecommunications can thus opt to register on the do-not-call list of a telemarketer.

It should also not be overlooked that the CMA has set up and administered its own do-not-call list since 1989. Participation in the CMA’s registry became compulsory for its 800 corporate members in 1993. Non-members may participate on a voluntary basis. The do-not-call list contains about 340,000 names with approximately 7,500 additions each month.

Conclusion: Next Steps for The CRTC

The National DNCL remains a work in progress after Decision 2007-48, though the framework and rules are now in place. The CRTC is currently in the process of issuing a request for proposals to select an operator for the National DNCL. This process may take several months and the National DNCL is not expected to be operational until early/mid 2008. All businesses that use or plan to use telemarketing should be aware of these developments.

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 2007 McMillan Binch Mendelsohn LLP

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