CASL: An Overview
On July 1, 2014 Canada’s Anti-Spam Legislation (CASL) came into effect in an effort to create a balance between protecting Canadian consumers from spam and fraud while still enabling a competitive business marketplace. Since July 1, 2017, CASL imposes strict consent requirements regarding marketing communications
Who does CASL apply to?
CASL applies to businesses or organizations sending Commercial Electronic Emails (“CEM”) for marketing or promotion purposes. Businesses or organizations are subject to CASL if they are based in Canada or based outside Canada and contact persons within Canada.
A CEM is any electronic message that encourages participation in a commercial activity, such as promotional emails or texts about sales. Electronic messages include e-mail, text messages, and social media messaging and text, sound, voice, or image messages. Distinguishably from commercial messages, operational messages that simply include hyperlinks to a website, provide general business information, or a confirmation of unsubscribing are not CEMs subject to CASL.
What does CASL say?
Under CASL businesses are prohibited from sending CEMs without the recipient’s consent. In order to send CEMs, businesses or organizations must meet three requirements: (1) Consent, (2) Identification, and (3) Unsubscribe.
Let’s look at each of those requirements:
Consent: Canadian and global businesses must receive consent from recipients before sending them CEMs. Consent may either be express or implied.
Express consent is explicitly granted permission, orally or in writing. The method of obtaining express consent must be an affirmative opt-in, as opposed to the U.S. CAN-SPAM Act of 2003, which assumes consent until the recipient takes steps to opt-out of messages. Acceptable methods of express consent include sign up forms and consent requests on landing pages. Express consent is the strongest and most recommended method of consent to guarantee CASL compliance, as it is valid until the recipient affirmatively unsubscribes.
Implied consent is limited, as it only applies where the recipient had made a purchase within the previous 2 years or made an inquiry within the previous 6 months before the CEM is sent. Once the applicable time period expires the implied consent is no longer valid and the recipient must provide express consent to continue receiving CEMs.
Identification: The business or organization must clearly identify themselves and the source sending the message in addition to providing their contact information.
Unsubscribe: Every CEM must have a clear and conspicuous option for the recipient to unsubscribe from future messages.
How do I comply with CASL?
Primarily, businesses must first determine whether the message is considered a CEM subject to CASL. Businesses and organizations should be aware of the delicate line between commercial and operational messages.
Second, businesses must look at the potential recipients to determine whether any of them are located in Canada and if express or implied consent has been obtained from those recipients. It is recommended that businesses keep a database of recipients tracking when and how consent was obtained to ensure that CEMs are not sent to recipients after implied consent has expired.
If the CEM will be sent to a recipient in Canada who has proper consent, the content of the CEM should meet the last two requirements.
To meet the identification requirement, CEMs should identify the sender along with their postal address and contact information.
To meet the unsubscribe requirement the CEM should provide a statement about how to unsubscribe. Additionally, the business or organization should respond to unsubscribe requests “without delay” and within 10 business days.
What happens if I violate CASL?
Non-compliance with CASL can result in the following penalties:
Maximum penalties of CAD 1 million against individuals, and CAD 10 million against businesses and corporations
Criminal sanctions under Canada’s Competition Act
The private right of action by individual recipients, which was also scheduled to be part of the remedies arsenal, was finally suspended by the Canadian federal government. It would have allowed organizations (as well as their officers, directors and agents) to be sued by anyone claiming to have been “affected” by an act or omission that violated CASL. Plaintiffs could claim both compensatory damages (for any actual losses or damages they may have suffered) as well as statutory damages, which in some circumstances could be up to $1 million per day, even where no actual harm was proven.
Additionally, the Canadian agencies may choose to contact other countries regarding CEM practices which could result in additional fines if the practices violate that country’s anti-spam legislation.
If your business or organization sends promotional or marketing content and is located in Canada or has recipients in Canada, contact us now. We can help you comply with the new legislation!
This article was written in collaboration with Monica Meiterman-Rodriguez