Bracing for E-Marketing Legislation – Are your bases covered?

Beginning in 2013, strict e-marketing regulations will come in to effect that will significantly impact Canadian businesses. In an effort to reduce electronic spam arriving in consumer inboxes, Canadian policy makers have established the ‘Anti-Spam Law’.

The facts are as follows:

• The definition of spam applies to all electronic messages, including those sent through social media and text messages sent to a cell phone.
• The law does not just target spammers. The government website, fightspam.gc.ca, notes that the law will also address "… violations including:
  • Sending unsolicited commercial electronic messages
  • Unauthorized alteration of transmission data
  • Installing computer programs without consent
  • False and misleading electronic representations online (including websites)
  • Unauthorized collection of electronic addresses
  • Collection of personal information by accessing a computer system in contravention of an Act of Parliament
• The law has the support of three government agencies - the CRTC, Competition Bureau and the Privacy Commissioner of Canada - as well $700,000 a year budgeted for enforcement

The implications of the new legislation are severe. Business expert Julie King explains:

“Bill C-28 sets a very strict threshold for what messages can be sent, too high in my opinion, and the penalties for non-compliance are extreme. Corporations could be fined as much as $10 million if they violate the law, an amount that is absurdly high, especially for smaller firms that are more likely to run afoul of the new law. The government might as well have made the maximum $1 billion dollars… as they will be bankrupting companies that are charged if they go anywhere near the upper threshold.

The upper threshold of the penalties allowable under this law seems out of step with fines in other areas. A business could be charged $10 million for sending unsolicited emails. Yet in contrast, a farm that provided an unsafe workplace that resulted in serious injuries to a 15 year old boy was recently fined $48,000[1]. Where is the logic, and balance, in that?”

Though the anti-spam law is well intentioned – with a goal to decrease junk mail and fraudulent misleading emails from consumers’ inboxes – spam messages from primary offenders will not be prevented. According to a SecureList analysis of spammers, the United States and Canada combined had the second lowest level of spam by region globally in the first half of 2011, accounting for less than 2 per cent of all spam.

President of Informatica and co-author of the book The Canadian Privacy and Data Security Toolkit for Small and Medium Enterprises, Claudiu Popa explains:

"In our company, almost 100% of all spam originates in other geographic jurisdictions. This means that close to 100% of all reports will be of foreign origin and pretty much 100% of the agencies' work will be a complete waste of time and resources, since this system will do little to nothing in the way of punishing international emailers, fraudulent Facebook posters, spimmers, spitters or any other overzealous marketers."

The fact is: multinational corporations and international organizations operating outside of Canada will continue to utilize email and electronic messaging to market to Canadian consumers, without penalty.

The use of email marketing and electronic messaging for small to medium sized business can be extremely effective. According to BtoB Magazine, “59% of B2B marketers say email is the most effective channel in generating revenue.” Given the ability to reach numerous customers with ‘the click of a button’, email marketing is an affordable option that can be extremely effective for businesses – if done right.

To avoiding having your hands tied by CASL and ensure you’re able to compete by utilizing email messaging, we’ve prepared a readiness checklist for you.

OBTAINING CONSENT

• Inform subscribers about what they are consenting to receive (ie. “Please sign me up to receive your monthly newsletter”)
• On the subscribe page, provide a link to the sender’s Privacy Policy
• Use an opt-in mechanism, as opposed to an opt-out option (ie. leave the opt-in box unchecked, giving the recipient the option to opt-in if they’d like to receive)

DATABASE MAINTENANCE

• Details surrounding the provision of consent must be retained as proof if required
• Develop a plan and procedure to secure express permission from any implied consent records you currently hold (ie. current customers will need to express opt-in preferences in order to continue receiving electronic messages)

UNSUBSCRIBES

• Commercial email messages must include a functioning unsubscribe mechanism
• Unsubscribes must be processed as soon as possible – messages cannot be sent after 10 business days from the recipient requesting the unsubscribe

SENDER IDENTIFICATION

• Messages must clearly identify the sender
• Messages must include contact information or the sender (mailing address)
• The “From” address and name must be consistent with the branding presented when subscription was requested
• Ensure subject lines reflect the message content and are not misleading

Note: The above guidelines are only recommendations - The Personnel Department does not provide legal advice. Until legislations are finalized, we cannot identify specific guidelines that must be followed to comply with Bill C-28.

For local Canadian businesses, there is really only one option: protect yourself. Otherwise you could find your company on the unwelcome end of an investigation and administrative penalties that could literally put your business out of business.

To learn more about Canada's new anti-spam legislation, click here!

Featured Expert: Julie King

Julie King is the co-founder and president of Biz-Zone Internet Group Inc., a technology company that specializes in online publishing and website development for member-driven associations. She is also the co-founder and managing editor of CanadaOne.com®.

As the publisher of CanadaOne Julie is responsible for content and technical development as well as marketing and strategic partnerships. Julie King has always had a strong interest in technology and its impact on society. Her understanding of technical issues enables her to bridge the gap between technical and non-technical development teams.