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January 2014

New CASL legislation

Hot Topics in Privacy Law - Topic 4 of 5

First presented at MB's Privacy and Investigations Seminar on December 17, 2013

a. Overview of rules and exceptions

Canada's Anti-Spam Legislation ("CASL") will finally be coming into force on July 1, 2014. CASL has been law for over three years now, but there have been various amendments and changes made to it over that time period. Here we will take a brief look at the main rules and exceptions under CASL, but it ought to be said up-front that CASL is one of the most stringent and restrictive set of anti-spam laws enacted globally.

Business owners ought to take special note of the CASL requirements, as the consequences of infringement can be steep (up to $1 million in fines for individuals, and $10 million for corporations — and once the private right of action provisions come into force, each offending communication can be worth $200 to the recipient in damages).

CASL has a far-reaching mandate, and applies to all forms of electronic communication — emails, text messages, instant messages — that promote or encourage commercial activity on the part of the recipient. While the initial aim of the legislation was to target and combat ‘spam,' the wording of the legislation is such that it will apply to all businesses and non-profit organizations, irrespective of whether their messages would traditionally or practically be viewed by the recipients as ‘spam.'

There are three key aspects to the new CASL law:

  1. Consent - Commercial electronic messages, such as emails and text messages, must be consented to prior to their being sent. This consent must be explicit or obtained on an opt-in, rather than opt-out basis. What this means is that consumers can consent by signing or ticking a box, but not by a disclaimer that indicates that silence will be interpreted as acceptance. Consent can be given verbally, but it would be wise for businesses to keep clear records to prove that such consent was provided if ever challenged. Further, the purposes for which the consent is being sought must be made clear to the consumer.

  2. Identify of Sender - Once sent, the message must contain information identifying the name of the sender and its contact information (email, address, telephone number, website, etc.); further, if the message is being sent on behalf of a company by a third-party, the third-party must identify on whose behalf they are sending the message.

  3. Unsubscribe - The message must contain a mechanism through which the recipient can, at no cost, ‘unsubscribe' from receiving future communications from the sender. Importantly, once the ‘unsubscribe' mechanism is engaged, the sender has 10 days in which to remove the recipient from its lists. The ‘unsubscribe' function must remain active for 60 days from the date the message is sent.

Exemptions - The following is a list of the kinds of electronic communications that are exempt from CASL's mandate:

  • Commercial electronic messages from family or friends;
  • Commercial electronic messages sent internally by an employee, representative, contractor, or franchisee of the business, concerning business affairs;
  • Commercial electronic messages sent between businesses with an existing business relationship, sent by an employee, representative, contractor, or franchisee that pertains to the business's or person's role;
  • Commercial electronic messages that respond to inquiries, requests, complaints, and other external modes of communication with the business;
  • Commercial electronic messages sent in order to satisfy a legal obligation; and,
  • Commercial electronic messages sent by registered charities that have the primary purpose of raising funds for that charity — note that this particular exemption requires the ‘primary purpose' of the message to be fundraising, therefore charities will need to be careful with the content of their messages before assuming that they fall under an exemption

Further, consent will be implied (therefore only leaving the identity and unsubscribe portions of the CASL requirements mandatory in the message) in the following circumstances:

  • Where the parties have had an existing relationship active within the last two years;
  • Where the recipient has freely made available their electronic contact information, and the content of the message pertains to that person's employment or business; and,
  • Where the recipient has enquired with the sender within the previous six months regarding a potential defined business or non-business opportunity

b. How it will affect marketing to clients and potential clients

What the implementation of CASL means is that businesses, including law firms, will need to be highly organized and motivated with their record-keeping systems, keeping detailed lists of who has opted in and who has opted out for the purposes of electronic marketing blasts.

Businesses will need to be diligent to ensure that lists are kept up to date and that the software used on the ‘unsubscribe' requirement is fully functional at all times.

Because business relationships that have been active in the past two years are exempt from requiring the opt-in consent to continue with commercial electronic messaging, all relationships should be scrutinized to determine which will need to be renewed under the new CASL requirements.

Templates that have been used in the past for commercial electronic messaging will need to be scrutinized to determine whether or not they contain the required information regarding the sender and the easily accessible ‘unsubscribe' option. If this information is not readily available on the template, it will need to be overhauled to ensure its compliance with the new laws.

Overall, the new CASL requirements will require vigilance and plans in place should anyone challenge the way in which commercial electronic messaging is being sent going forward.

Topic 1 - Ontario Privacy Laws for Lawyers
Topic 2 - Overview of PIPEDA
Topic 3 - Tort of intrusion upon seclusion (Jones v Tsige)
Topic 4 - New CASL legislation
Topic 5 - Key privacy cases for consideration



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