Canada's anti-spam laws to make it harder for businesses to send emails to customers – Financial Post
Canada’s Anti-Spam Legislation might have a more negative impact on Canadian businesses and consumers than well-intentioned policy makers anticipated
Are you tired of being inundated with email for 100%-natural male enhancement pills and too-good-to-be-true software promising to clean your Mac or PC’s operating system for free? Well, take heart, because Canadians may finally enjoy new protection against unsolicited electronic messages and the spread of spyware and malware next year, when a long-awaited piece of legislation is expected to go into effect.
But some industry groups say Canada could lose more than spam when Bill C-28 comes into force.
They say Canada’s Anti-Spam Legislation (CASL), as it is more commonly called, might have a more negative impact on Canadian businesses and consumers than well-intentioned policy makers anticipated when they set out to shut down mass-mail Viagra spammers and malicious software developers.
“Immediately after the law comes into force, most businesses won’t be able to continue sending emails to their customers,” said Barry Sookman, a partner with McCarthy Tétrault, and the former co-chair of the firm’s Technology Law Group.
Unless proposed Industry Canada regulations receive significant changes, policy watchers and industry organizations have said, the ability for businesses in myriad industries to communicate with their customers – and even other businesses – could be severely hampered.
When CASL comes into effect after its regulations are finalized (possibly by next spring) the biggest change will be to how organizations are required to obtain consent before they can send a “consumer electronic message” (CEM) — anything meant to solicit business or engage with a customer or individual such as a newsletter, an upcoming sale or a plea for donations.
Organizations currently rely on a looser form of implied consent when they send a CEM. If a user does not explicitly opt-out of receiving messages, as indicated by the Personal Information Protection and Electronic Documents Act (PIPEDA), consent is implied.
Under CASL, everyone from not-for-profit organizations to large telecommunications companies will require a user to explicitly opt in before a message can be sent, or a piece of software installed.
Mr. Sookman believes the proposed regulations inflict an unnecessary level of red tape upon businesses, charities and non-profit organizations, and has referred to CASL instead as “Canada’s anti-speech law.”
The problem, industry groups claim, is that tracking all of these different types of implied and expressed consent – particularly for those who share consent with third-party groups – will be far more onerous than the opt-out systems currently in place.
CASL was drafted, in part, based on recommendations from Canada’s Task Force on Spam, formed in 2004. The task force was designed to consult Canadians on the best way to handle unauthorized or unwanted forms of electronic communication, which also includes spyware, malware and the installation of software programs.
However, it is generally accepted that the vast majority of online spam and malicious software originates from outside the country, causing many industry groups to question the feasibility of enforcing such legislation at all.
“Ultimately, it is not clear that CASL will solve the problem of nuisance/fraudulent messages or of nuisance/malicious software, which are generally initiated outside the jurisdictional reach of the CRTC,” wrote Scott Smith, the Canadian Chamber of Commerce’s director of intellectual property and innovation policy, in a submission to Industry Canada earlier this month.
The Ontario Nonprofit Network and the Canadian Chamber of Commerce, amongst others, are concerned that requiring organizations to “manage and maintain express and implied consent records across their complex databases and ever-changing community connections and relationships is not justified given their negligible participation in the generation of spam,” according to the Nonprofit Network’s submission to Industry Canada.
A number of organizations, including Magazines Canada and the Canadian Marketing Association (CMA), don’t see what can’t be achieved with CASL that isn’t already possible under PIPEDA.
A major concern is that email lists collected legally under PIPEDA would no longer be valid under CASL, and would require re-consent. Both groups have argued that guidelines for opt-out and unsubscribe mechanisms are already common place and well understood.
Magazines Canada’s submission goes so far as to recommend delaying the implementation of Industry Canada and CRTC draft regulations entirely, until such concerns can be worked out.
“We do not believe that this is what parliamentarians intended when this Act was created,” wrote Mark Jamison, CEO of Magazines Canada, in his group’s submission.
University of Ottawa law professor Michael Geist fears that the bill designed primarily to protect Canadian consumers is being modified to do just the opposite. As Mr. Geist sees it, lobbyists are attempting to turn CASL into something that protects the interests of businesses, rather than consumers.
The Coalition of Business and Technology Associations in particular has drawn Mr. Geist’s ire for requesting consent exemptions for software designed to “prevent, detect, investigate or terminate” activities that break Canadian laws, or subvert the security or privacy of a computer system or network.
“I must admit it was a shock when I saw it, and it really runs counter to what the legislation is trying to achieve,” Mr. Geist said in an interview last week.
He has categorized such shifts in anti-spam policy on his blog as “intense lobbying by business groups to water down the legislation.” For its part, the coalition’s submission called Industry Canada’s latest draft regulations “overly broad” and  said they will “limit an organization’s ability to protect and secure its networks, to protect customer data, and to combat fraud and cybercrime.”
Industry Canada published its second draft of proposed regulations on Jan. 5, in response to comments solicited last fall. A second request for comments closed on Feb. 4, and the department’s revised regulations are expected in the coming weeks.
The CRTC’s regulations – which are narrower in scope, and deal primarily with the content of CEMs – were finalized last March. Final regulations from both groups are required before CASL can go into effect.
Following a proposed three-year transitional period, organizations found to violate the proposed CASL regulations would be subject to a maximum penalty of $10-million.
Asked whether this would be the final round of submissions before  final regulations are issued, “This is what I hope,” said Industry Minister Christian Paradis in an interview with the Financial Post earlier this week.
“I think we’ll be able to strike a balance and finally move on.”
— With files from Christine Dobby
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