Anti-spam law set to hamstring Internet marketing

Canadian businesses have six months to comply with one of the world’s most stringent anti-spam laws

Flavio Marquez of Vancouver’s Snaptech Marketing Group fears email marketing companies like his could face fines for non-compliant email lists provided by clients

Starting July 1, 2014, Canadian companies that send emails or texts for commercial purposes without the consent of recipients could face fines of up to $10 million under the new Canada Anti-Spam Legislation (CASL).

Ironically, between now and then, Canadians can expect a blizzard of emails, as Canadian businesses scramble to ensure everyone on their email lists wants to be there, because after July 1, sending those emails could result in severe penalties.

“A request for consent to send marketing emails is, in and of itself, considered a marketing email, so you can’t send an email requesting consent,” said Laura Weinrib, a partner at Blake, Cassels & Graydon LLP.

In other words, Canada’s new anti-spam legislation may well create a spam bloom in the lead-up to CASL laws coming into force, as businesses rush to make sure everyone on their email lists have given their express consent to continue to be on email lists before the July 1, 2014, deadline.

“What we’re going to all see between now and July is our inboxes are going to be filled with reconfirmation campaigns,” predicts Robert Burko, president of Elite Email.

The new CASL regulations have been years in the making, so most large companies in Canada with in-house legal counsel are well aware of what they need to do to be CASL compliant.

It is small and medium-sized businesses that need to worry most, because they may lack legal expertise and could face draconian fines of up to $1 million for an individual or $10 million for a company.

There are some exceptions. For example, businesses that have had an ongoing business relationship with customers or other businesses within the previous two years can continue to contact those customers by email.

But to be safe, all businesses that use email for any commercial purpose should ensure that everyone on their email list has given their express consent to receive emails in the future.

“They need to start running those reconfirmation campaigns as soon as possible,” Burko said, “and they need to take a look at every part of their workflow that feeds into their mailing list.”

Starting in 2014, the government will handle prosecution under CASL, and the more egregious offenders will be targeted.

Starting in 2017, anyone will be able to bring a private action against a Canadian company for unsolicited email.

Due to concerns about the impact CASL could have on charitable fundraising efforts, non-profit organizations doing legitimate outreach by electronic communication are exempt.

But many Canadian businesses are upset because Ottawa has also decided to exempt political candidates and parties.

In other words, some of the politicians who are putting curbs on an important marketing tool are free to spam Canadians to get re-elected.

Flavio Marquez, co-founder of Vancouver’s Snaptech Marketing Group, said the new law will be onerous to deal with, both for email marketing companies like his and for the clients who use their tools.

Snaptech provides email marketing software.

Marquez fears companies like his could be subject to fines if the email lists that his clients provide don’t comply with CASL.

“Companies – legitimate businesses like us – are going to be the ones that are going to be prosecuted in a few years when this fully goes into effect,” Marquez said, “but it’s not going to solve the problem because the problem is somewhere else.”

As he points out, most spam in Canada doesn’t come from Canadian businesses.

It comes from either outside the country or from computers that have been hijacked by malware that turns computers into spambots.

Burko doubts that CASL will have any measurable impact on the amount of spam Canadians receive.

“Most Canadian businesses weren’t spamming customers anyway because customers don’t like spam,” he said.

Things you need to know about CASL

  • Cold calling. Emails that are publicly published – on a website, for example, or in printed material – and which do not explicitly forbid unsolicited emails, are exempt. Otherwise, sales people who use email to make initial contact with prospective clients need to be careful they have permission to make that initial contact.

  • Charities, politicians exempt. Due to public backlash, charities that use email campaigns to solicit donations are exempt from CASL regulations. So are political parties and candidates.

  • Web forms. Many e-commerce sites have web forms that are automatically checked, giving the company permission to send future marketing offers or product news by email. That will no longer count as expressed consent under CASL. Web forms that have an option for receiving future emails must be unchecked, so customers who want to receive future marketing offers by email must check the web form asking to be put on a mailing list.