By Rick Cristol and Hugh Webster
Called the Canadian Anti-Spam Legislation (CASL), the new law requires anyone living in Canada to whom you wish to send a Commercial Electronic Message (CEM) to give you opt-in permission to do so. A commercial electronic message covers email, telephone, and possibly social media, such as through Facebook. A message will be determined to be a CEM based on: content of the message; any hyperlinks in the message to website content or a database; and/or contact information in the message. Relative to associations, a message would be considered a CEM if it includes an invitation for membership, meeting attendance, sponsorship, advertising or selling anything like communications programs or meetings services or a manual or logo item.
- You must have expressed or implied consent to send a message. In other words, the recipient of the CEM must authorize you to send commercial messages. Some of you may remember CANSPAM, the U.S. anti-spam legislation passed a number of years ago that requires you to put an opt-out option on all commercial email communications to individuals with whom you or your association have no established business relationship. This Canadian legislation requires just the opposite, an opt-in authorization. If challenged, records must be produced to show these authorizations were obtained. If you don’t have the individual authorization or an established business relationship with a Canadian contact, you may wish to request that authorization prior to the law’s effective date (see below). Otherwise a request for such authorization through an electronic message may be viewed as a violation.
- You must clearly and simply identify yourselves and anyone else on whose behalf the message is sent. Often individuals send messages for other individuals. Both names must appear in the CEM.
- In every message you send, you must provide a way for recipients to unsubscribe from receiving messages in the future. This opt-out option must be provided even though the recipient has given you previous authorization to send CEMs.
The CASL does provide for some exemptions to the law, including:
- Established business relationship: This is defined, in the context of the association business as the purchase or lease of a product, goods, or service, within the two-year period immediately before the day on which the message was sent, by the person to whom the message is sent. So it appears that a solicitation that did not result in a transaction does not qualify for this exemption.
- An inquiry or application, within the six-month period immediately before the day on which the message was sent, made by the person to whom the message is sent
- A message that is sent following a referral by any individual who has an existing business relationship, an existing non-business relationship, a family relationship or a personal relationship with the person who sends the message as well as any of those relationships with the individual to whom the message is sent and that discloses the full name of the individual or individuals who made the referral and states that the message is sent as a result of the referral.
There are also limited exceptions for commercial emails sent through certain messaging platforms, such as LinkedIn, where required identification and unsubscribe mechanisms are in place, and those sent to persons whose email addresses are "conspicuously published” such as on a company’s website or in a directory (unless there is a statement on the website or in the directory that commercial emails are not permitted).
The penalties for individual violation of CASL begin at $200 per occurrence (or CEM) and go up to a maximum of $1,000,000. The maximum for corporations is $10,000,000. And, directors, officers, and agents of a corporation can be liable, if they directed, authorized, assented to, acquiesced in, or participated in the commission of the violation.
The major provisions of the law became effective on July 1, 2014. However, there is a three-year transition period during which commercial emails may be sent to, among others, former members, former customers, and persons who have made an inquiry, without regard to the two-year or 6-month limitations referenced above.
In addition to monetary penalties that can be assessed by the Canadian government there is a private right of action provision in the CASL that becomes effective July 1, 2017. The private right of action empowers any Canadian citizen receiving an unauthorized CEM to sue for penalties. Some of you may be familiar with California Proposition 65, which does the same thing and over the past two decades has spawned an industry of class action litigators chasing huge fees to sue on behalf of consumers. Unlike CANSPAM in the U.S., which is enforced by the Federal Communications Commission, the opportunity for attorneys to recover big paydays is likely to encourage aggressive pursuit of violators.
Regarding the issue of Canadian citizen and government standing with respect to U.S. Courts, Jerry Jacobs, ASAE ‘s attorney confirmed that while there are some obstacles U.S. courts would likely assist in recovering damages. If you have additional questions about this law, please advise or you can go to the Canadian Radio-Television and Telecommunications website at www.crtc.gc.ca/eng/casl-lcap.htm.
It would be a good idea to look at your databases for Canadian listings to take the necessary action before the law takes effect to assure you are in compliance.
Richard E. Cristol is President of Kellen Company and Co-Chair of Legislative & Regulatory Affairs Task Force for the AMC Institute.
Hugh Webster, Esq., is a partner of Webster, Chamberlain and Bean and legal counsel to the AMC Institute.