In December 2010 Canada’s new anti-spam legislation was passed (the “Anti-spam Act”) which will, when it comes into force, be one of the strictest anti-spam regimes in the world (see: Anti-spam Act). In general, the Anti-spam Act will require express or implied consent for the sending of “commercial electronic messages” or “CEMs” and also impose form (i.e., disclosure) and unsubscribe requirements for CEMs.
The Anti-spam Act is expected to have significant impacts on companies and individuals that engage in electronic marketing, including through the use of e-mail, text messaging, instant messaging and likely social media. The Anti-spam Act will also require express consent for some other practices, including altering transmission data and the installation of computer programs on other persons’ computer systems.
The Anti-spam Act will also broaden the Competition Bureau’s jurisdiction to regulate misleading advertising in the context of electronic communications – for example, misleading representations made electronically, such as in sender information, subject matter information, electronic messages or locators. In this regard, the Anti-spam Act includes amendments to the civil and criminal misleading advertising sections of the federal Competition Act (sections 52 and 74.01), as well as related penalty and enforcement provisions.
Failure to comply with the Anti-spam Act, once in force, will potentially expose individuals and companies to severe penalties of up to C $1 million (for individuals) and C $10 million (for companies). The Anti-spam Act also creates private rights of action, under which both actual and statutory damages may be awarded of up to $1 million per day of non-compliance. Class actions may also be commenced once the legislation is in force.
This is the third in a series of posts on the new Anti-spam Act, which will conclude with practical steps individuals and companies can take before the new legislation comes into force.
For Parts 1 and 2 see: here and here.
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EXCEPTIONS
The Anti-spam Act contains the following exceptions to the consent and form requirements for CEMs:
1. Personal or family relationships (both as defined by the draft Industry Canada Regulations).
2. Inquiries for commercial goods and services.
3. Interactive two-way voice communications (e.g., telemarketing), fax or voice recordings sent to telephone accounts.
4. Exceptions set out in the Regulations.
The draft Industry Canada Regulations contain definitions of “family relationship” and “personal relationship”.
One of the objections to the draft Regulations has been that “personal relationship”, likely one of the broadest and most important exceptions, is defined to require an in-person meeting within the past two years and two-way communication. On its face, this exception currently precludes meetings through, for example, online or social media forums.
The Anti-spam Act also sets out the following exceptions from the consent requirement for CEMs:
1. Providing a quote or estimate for products (i.e., goods or services) if requested by the recipient.
2. Facilitating, completing or confirming a commercial transaction previously agreed to by the recipient.
3. Providing warranty, product recall or safety information about a product the recipient uses (or has used) or has purchased.
4. Certain information relating to employment or benefit plans.
5. Exceptions set out in the Regulations.
Transitional Period
The Anti-spam Act contains a transitional provision that provides that consent is implied for three years from the coming into force of the CEMs section (section 6) for persons with existing business or non-business relationships (both as defined), unless consent is withdrawn.
ALTERING TRANSMISSION DATA
The Anti-spam Act also prohibits the alteration of transmission data in an electronic message, which results in the message being delivered to a different destination without express consent of the sender or recipient (e.g., causing an electronic message to be sent to a destination that is different than what the sender intended).
UNAUTHORIZED INSTALLATION OF COMPUTER PROGRAMS
The Anti-spam Act also prohibits the installation of computer programs on other person’s computers without the express consent of the owner or an authorized user of the computer system (e.g., an authorized employee).
MISLEADING REPRESENTATIONS IN ELECTRONIC AND ONLINE CONTENT
The criminal and civil misleading advertising provisions of the Competition Act, and related penalty provisions, have also been broadened to expressly include misleading representations made in the electronic and online environment.
For example, the Anti-spam Act amends the criminal misleading advertising provisions of the Competition Act to prohibit false or misleading representations made electronically, such as in sender information, subject matter information, electronic messages or locators.
Like the misleading advertising provisions of the Competition Act generally, it will not be necessary to prove that any person was actually deceived or misled. The general impression and the literal meaning will also be relevant in establishing misleading representations made in the electronic context.
UNAUTHORIZED COLLECTION OF PERSONAL INFORMATION
The Anti-spam Act also amends PIPEDA to prohibit the collection of personal information by means of unauthorized access to computer systems.
COLLECTION OF ELECTRONIC ADDRESSES
Finally, the collection of electronic addresses using computer programs or using such addresses without permission (“harvesting”) will be prohibited.
This may include the collection of e-mail addresses through the use of, for example, “web crawlers” (computer programs that scan websites, usenet groups and social media websites, trolling for electronic addresses) or “dictionary attacks” (where a computer program guesses real/live e-mail addresses by methodically trying various name variations within a particular group of common e-mail domains – e.g., Gmail, Hotmail, etc.).
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