On September 1, 2016, the Canadian Radio-television and
Tele-communications Commissionannounced that Kellogg Canada Inc.
paid $60,000 as part of a voluntary settlement of alleged
violations of Canada's anti-spam legislation regarding the
sending of commercial electronic messages without consent.
Canada's anti-spam legislation (commonly known as
"CASL") creates a comprehensive regime of offences,
enforcement mechanisms and potentially severe penalties (including
personal liability for employers, corporate directors and officers)
designed to prohibit unsolicited or misleading commercial
electronic messages ("CEMs"), the unauthorized commercial
installation and use of computer programs on another person's
computer system and other forms of online fraud (such as identity
theft and phishing).
For most organizations, the key parts of CASL are the rules for
CEMs. Subject to limited exceptions, CASL creates an opt-in regime
that prohibits the sending of a CEM unless the recipient has given
consent (express or implied in limited circumstances) to receive
the CEM and the CEM complies with prescribed formalities (including
an effective and promptly implemented unsubscribe mechanism) and is
not misleading. An organization that sends a CEM has the onus of
proving that the recipient gave express or implied consent to
receive the CEM.
An organization is liable for CASL violations by the
organization's agents acting within the scope of their
authority, including independent service providers engaged by the
organization to send CEMs on the organization's behalf.
Violation of CASL's CEM rules can result in severe
administrative penalties (up to $1 million per violation for
individuals and up to $10 million per violation for organizations),
civil liability through a private right of action (commencing July
1, 2017) and vicarious liability on employers, directors and
officers. CASL gives the Canadian Radio-television and
Tele-communications Commission ("CRTC") regulatory and
enforcement authority regarding CEMs and other matters.
The CRTC investigation alleged that "Kellogg and/or its
third party service providers" sent CEMs to recipients without
consent during an 11-week period in late 2014. As part of a
voluntary undertaking (settlement), Kellogg Canada Inc. paid a
$60,000 fine, agreed to comply with CASL and ensure that
independent service providers it engages to send CEMs comply with
CASL, and agreed to review and update its CASL compliance program
(including written policies and procedures, employee training
programs, tracking of CEM complaints and subsequent resolution, and
implementing updated compliance monitoring and auditing
mechanisms). The voluntary undertaking fully resolved the
CRTC's investigation into alleged CASL violations by Kellogg
Canada Inc. and its subsidiaries during the period October 1, 2014
to the date of the undertaking.
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