On July 1, 2014, a law loosely known as the Canada Anti-Spam Law will come into effect. There are a number of provisions under which businesses may send email messages without violating the law. One is messages sent to individuals or companies with which there is an “existing business relationship.” Unfortunately, many commentators are misinterpreting this provision, which could lead to disaster for any online business following the incorrect interpretations. Let’s correct the mistake now.
Canada Anti-Spam Law
Once you determine you need to comply with CASL, the next step is to understand the details of the law. The CASL works off the basic foundational assumption that every email sent by a business is spam. A business cannot send a message to an individual unless it has the express consent of that individual. There are a number of exceptions to this rule, but this represents the fundamental framework of the law in relation to email messages. [There are other provisions for social media messages and software downloads.]
Existing Business Relationships
CASL contains an exception to the general spam rule. The carve-out exists where an existing business relationship exists with the person the company is sending messages at the time the law goes into effect on July 1, 2014. An example of an existing business relationship would be one where you have purchased a blender from me. I would be able to send you messages since you are a customer during a set three-year transition period under the law.
Unfortunately, commentators are suggesting this “existing business relationship” exemption gives you free rein to communicate with previous customers for as long as you like. It does not! The relevant section of the law reads:
“66. A person’s consent to receiving commercial electronic messages from another person is implied until the person gives notification that they no longer consent to receiving such messages from that other person or until three years after the day on which section 6 comes into force [July 1, 2014], whichever is earlier, if, when that section comes into force,
(a) those persons have an existing business relationship or an existing non-business relationship, as defined in subsection 10(10) or (13), respectively, without regard to the period mentioned in that subsection;
The relevant clauses of Section 10 then read:
(10) In subsection (9), “existing business relationship” means a business relationship between the person to whom the message is sent and any of the other persons referred to in that subsection — that is, any person who sent or caused or permitted to be sent the message — arising from
(a) the purchase or lease of a product, goods, a service, land or an interest or right in land, within the two-year period immediately before the day on which the message was sent, by the person to whom the message is sent from any of those other persons;
This language effectively means this exception only applies to customers that have ordered from you in the previous two years. For any customers obtained before that two-year period, the exception does not apply. Confused? Let’s look at examples:
- You sell books online. A customer buys a book from your site on February 22, 2013. This purchase is within the two-year period, so you can contact the customer without gaining consent from them first.
- You sell motorcycle accessories online. A customer buys a helmet from you on June 3, 2009. This purchase occurred more than two years ago, so you cannot contact them without first gaining consent to do so.
Still Need Consent?
Let’s assume you are within a two-year period with a customer purchase. Does this mean you can email them in the future without limitation? No. You can email them until the customer indicates he or she does not wish to be contacted or up until July 1, 2017. Given this, your goal should be to gain consent from the customers that qualify during this grace period.
Does the existing business relationship exception help online businesses comply with the new Canada Anti-Spam Law? Yes, but it is a temporary solution at best. Taking this into account is important because one can be held personally liable for CASL violations in certain circumstances.
Do you have questions about the new Canada Anti-Spam Law? Contact me today to make sure your online properties are in compliance.
Richard A. Chapo, Esq.