15 June 2017
The Government of Canada (‘the Government’) announced, on 7 June 2017, that it had issued an Order in Council (‘the Order’) suspending the implementation of the private right of action under Canada’s Anti-Spam Legislation 2014 (‘CASL’), which regulates direct marketing, including the sending of commercial electronic messages (‘CEMs’). The private right of action, which would have allowed lawsuits to be filed against individuals and organisations for alleged violations of CASL, was due to enter into force on 1 July 2017.
Martin Kratz, Partner at Bennett Jones LLP, told DataGuidance, “Generally, the target of enforcement actions to date by the Canadian Radio-television and Telecommunications Commission (‘CRTC’) have been businesses that committed technical violations of CASL or had sloppy consent or record keeping practices. The concern of all organisations, whether businesses or non-profit, has been that we would see a large spike in class action litigation due to the private right of action. However, [as a result of the suspension], foreign and domestic businesses targeting Canadians with CEMs no longer face speculative litigation on the basis of alleged technical breaches of CASL.”
The private right of action would have allowed recipients of CEMs sent in violation of CASL to seek a court judgement for an amount equal to the actual loss or damage suffered or expenses incurred, alongside administrative penalties of up to CAN 200 (approx. €130) for each violation, not exceeding CAN 1,000,000 (approx. €673,000) for each day a violation occurred.
This appears to be a recognition by the Government that organisations require more clarity in the legislation and additional guidance from regulators before they are exposed to such private claims
Lyndsay Wasser, Partner at McMillan LLP, commented, “The Government has indicated that it delayed the implementation of the private right of action in order to ‘promote legal certainty for numerous stakeholders claiming to experience difficulties in interpreting several provisions of CASL while being exposed to litigation risk.’ This appears to be a recognition by the Government that organisations require more clarity in the legislation and additional guidance from regulators before they are exposed to such private claims.”
Nevertheless, organisations targeting Canadian citizens will still need to adapt to various provisions of CASL, including the end of the transitional period for implied consent on 1 July 2017. On this basis, organisations have been allowed to rely on implied consent to send CEMs to older customers irrespectively of when they carried out the last transaction, if there is an existing business or non-business relationship with the recipient or customer that was created before 1 July 2014.
Kratz explained, “With the end of this transitional provision, organisations will need to adjust their practices and databases to reflect that older contacts or customers, ie. with a last applicable purchase or transaction older than two years, may no longer be sent CEMs. The response of many organisations has been to contemplate undertaking a careful assessment of which messages are CEMs and hence prohibited unless current consent [has been obtained] or an exemption is in place. As such, organisations could consider deleting their older contacts from customer relationship management systems and/or assess older contacts to see if an exemption may be applicable or otherwise collect express consent.”
Kaveh Lahooti | Privacy Analyst