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Does Canada's Anti-Spam Law Really Stop Small Business From Using Email Marketing? No.

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Thursday January 31, 2013
The criticism against Canada's anti-spam legislation extends beyond absurd claims about restrictions involving family and personal relationships. Indeed, much of the discussion has focused on the impact of the law on small and medium sized businesses. Barry Sookman catalogs a wide range of supposed concerns, most of which appear to envision a world in which the only way for a new business to develop a customer base is to obtain marketing lists and send unsolicited commercial emails to potential customers.

It is true that the starting point of the law is that businesses must have consent before sending commercial emails. Canada is moving to an opt-in world that gives consumers greater control over their in-boxes and will ultimately provide businesses with higher quality lists of people who genuinely want to receive their messages. Notwithstanding the default requirement for opt-in consent, however, the law contains numerous exceptions that are available to businesses of all sizes and which allow small and medium sized businesses to engage in active (and likely more effective) email campaigns. The exceptions include:

Personal and Family relationships. Far from being limited to best friends, the personal relationship exception is extremely broad, covering a wide range of relationships. For businesses starting out, those personal relationships will often be important and the law allows for commercial emails in many of these circumstances.

Openly available email addresses. Almost anyone that publishes their email address without a clear statement that they do not wish to receive commercial messages is fair game. The law allows for implied consent (implied in this case because they have published their email address without the notice) where:

the person to whom the message is sent has conspicuously published, or has caused to be conspicuously published, the electronic address to which the message is sent, the publication is not accompanied by a statement that the person does not wish to receive unsolicited commercial electronic messages at the electronic address and the message is relevant to the person’s business, role, functions or duties in a business or official capacity;

In other words, claims that new businesses will not be able to identify potential business contacts and contact them via email are false. The law allows businesses to develop a list of contacts and to send them relevant email messages provided the email is published without the do-not-contact statement.

Third party referrals. The new regulations have added a third party referral exception that represents a huge loophole in the law. It will allow businesses to greatly extend their networks without the need for additional consents.

Business to business emails. The law includes a specific exception for business-to-business emails that remove the need for further consent. This ensures that existing business relationships are largely unaffected by the law. The business-to-business exception covers email:

to an employee, representative, contractor or franchisee of another organization if the organizations have a business relationship at the time the message was sent and the message concerns the affairs of the organization or that person’s role, functions or duties within or on behalf of the organization;

All emails sent in response to a request, inquiry or complaint.  The law includes an exception for inquiries or requests from customers exempting email "that is sent in response to a request, inquiry, complaint or is otherwise solicited by the person to whom the message is sent." This exception removes the need for further consent.

Existing business relationships. Consent is implied for existing business relationships, which includes everything from having purchased a product or service over the prior two years to instances where a consumer has merely made an inquiry within the prior six months. Moreover, this exception is effectively extended for three years from whenever the law takes effect, giving businesses nearly ten years from when the bill was first tabled to ask for explicit consent. Until the explicit consent requirement kicks in, businesses with a relationship will be entitled to rely on implicit consent.

Non-business relationships. The law also implies consent for a wide range of "non-business relationships." This covers donations to charities and political parties over the prior two years, volunteer work over the prior two years for a charity or political party, attendance at a meeting organized by a charity or political party, or membership in club, association, or voluntary organization. This exception is also extended for three years from whenever the law takes effect, giving those organizations nearly ten years from when the bill was first tabled to ask for explicit consent.

Purchase of existing business.  The law extends the existing business relationship even when a business is sold. In other words, if you buy a business all their contacts and customers may be used by the new owner.

This is a very long list of exceptions for businesses of all sizes and hardly the catastrophe that some suggest. While it will require some businesses to obtain express consent or to modify marketing practices that were based on sending large scale unsolicited commercial email, the result should be better, more effective online marketing for businesses and greater control over their in-boxes for Canadians.
Comments (11)add comment

Brian said:

Openly available e-mail addresses?
WTF does this mean? This looks to make the practice of "web scraping" of things like e-mail list archives, etc. perfectly legal.

This is a huge crock. Just because I participate in an open (i.e. where all participants see the conversation where the conversation might be publicly archived) conversation forum does not mean I want SPAM!
January 31, 2013

Neil Schwartzman said:

Executive Director, CAUCE
" This looks to make the practice of "web scraping" of things like e-mail list archives, etc. perfectly legal. "

the relevant phrase is :

" and the message is relevant to the person’s business, role, functions or duties in a business or official capacity;"

You can write to be at CAUCE to talk about issues related to our mandate. You cannot write to me offering bathroom tissues for our non-existant office facilities.
February 01, 2013

Richard said:

...
Openly available email addresses can attach "a clear statement that they do not wish to receive commercial messages", which resolves the toilet tissue issue.
February 01, 2013

Nola said:

...
I'm interested in this aspect, "Third party referrals. The new regulations have added a third party referral exception that represents a huge loophole in the law. It will allow businesses to greatly extend their networks without the need for additional consents."

Can anyone point me to more info on this? Thanks!
February 01, 2013

Bob said:

...
Seems to me that Sookman is basically correct, though, because it will prevent a new business from most of the initiatives previously used to build up mailing lists. You might decide that that's a good thing, but it doesn't mean Sookman was wrong.
February 03, 2013

Jones said:

...
@Bob Mr. Sookman is not right, in the sense that the long list of specific activities he claims businesses will not be able to do are actually permitted under the Act's several exceptions.
February 04, 2013

crade said:

...
1) Telemarketting and spam from small businesses is just as annoying and useless and an afront to our privacy as from large businesses.
2) The third party referals part means they might has well not bother at all.

February 07, 2013

Interested party said:

Curious
What about companies that collect data, e.g. a sign up process during an online purchase. These companies share the data with a list management company that will send commercial third party email marketing to the data (offer unrelated to the original source URL)? The law seems to require affirmative consent in this case, i.e. the consumer has consented to a privacy policy that discloses the data will be shared (perhaps even outside of CAN) for the purpose of third party commercial email marketing and either a disclosure or tick box at or above the Submit to cover affirmative consent. There are no exceptions for third party commercial email marketing. All data would require a purge if its not been obtained through affirmative consent. Thus for the list management company it would seem the three year grace period is not helpful because the data will require a purge if its not been obtained through affirmative consent. Thanks for the insights and comments.
April 16, 2013

Email services said:

Email marketing services
What matters in the end is the customer base that increases the popularity and reputation of an organization. Email can be considered as the first step towards that goal.
November 19, 2013

Rob Sheffen said:

...
There's a free Canadian Business Email Directory at http://sites.google.com/site/f...maillist/. Worth $799 (as stated). Website says small donation is optional...
January 11, 2014

Ron Boratto said:

Solicitor
What is missing in this "analysis" is the cost of compliance. Small business had a level playing field before and could compete with big business when it came to accessing new markets. Now only the large organizations will be able to support the necessary infrastructure to comply with the requirements. One mistake is all it takes to run afoul of this legislation and Ma and Pa are out of business. This draconian legislation attempts to swat an gnat with a sledgehammer. It is the most useless and punishing piece of garbage I have ever seen and I am in shock that there has not been a backlash against it. The entire matter could have been addressed in a far simpler and more straightforward way without the added cost to business of this nonsense. Harper's government wanted to show the world that they were tough - all they did was show they are stupid.

This is a huge mistake and typically like Canadians typically do we are swallowing the Kool Aid that this is somehow progress.
February 19, 2014

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