Canada has passed new Anti-Spam Bill (the “Act[1]“) which is expected to come into effect later this year and is going to affect how Canadian businesses conduct themselves in their online communications.  The Act prohibits sending commercial electronic messages[2] [3]without the prior consent of the receiver.  This includes a variety of online media such as e-mails, instant messaging, text messaging and social media postings.  The underlying purpose of the Act is to cut down on the amount of electronic spam received by business and consumers alike.

In order to stay compliant with the Act businesses must ensure that they have “prior consent” from the recipient of their commercial electronic message before sending it.  The burden of proof is on the sender to prove that consent has been granted by the recipient and businesses will need to keep records of consent from recipients who receive their electronic communications.

There are several exceptions to the requirement for obtaining prior consent, they include if the communication provides a quote or estimate, facilitates a commercial transaction that the recipient has previously agreed to enter into, provides warranty, recall, safety or security information about a product or service or delivers information related to an employment relationship or benefit plan which the recipient is a member of.

In addition consent is deemed to have been implied in situations where there is an existing relationship and where the recipient has conspicuously published their email address online without indicating that they do not wish to receive unsolicited commercial electronic messages.

Violations of the Act could be met with stiff penalties, the penalties for individual violations can be up to as much as $1,000,000 per violation and the penalty for other persons can be up to as much as $10,000,000 per violation.  Another interesting factor is that private individuals have the power to commence proceedings under the Act, should they feel that the Act has been breached.

The Act is going to affect the way Canadian businesses conduct their electronic communication and specifically how they conduct their promotional activities.  The costs involved in compliance with the Act are going to be significant in regards to monitoring, record keeping and storage. Outsourcing promotional activities could be a cost effective solution to compliance.  Although care has to be taken with outsourcing as persons can also be liable for agent actions in cases of violations.

[1] An Act to promote the efficiency and adaptability of the Canadian economy by regulating certain activities that discourage reliance on electronic means of carrying out commercial activities, and to amend the Canadian Radio-television and Telecommunications Commission Act, the Competition Act, the Personal Information Protection and Electronic Documents Act and the Telecommunications Act.

[2] An  “electronic message” is defined to include any “message sent by any means of telecommunication, including a text, sound, voice or image message.”

[3] A “commercial electronic message” is a message where it would be reasonable to conclude that its purpose is to “encourage participation in a commercial activity”  including offers to purchase, sell , barter or lease a product and advertising or promoting any product, person, goods, service, land, business, investment or gaming opportunity.