Trade Compliance

GHY discusses changes to international trade regulations and explores cutting-edge compliance strategies.

Canada’s New Anti-Spam Law Goes Into Effect July 1, 2014

Posted June 13, 2014

Ten years after the CAN-SPAM Act went into effect in the United States, on July 1, 2014, the Canadian Anti-Spam Law (CASL) goes into effect which forbids almost all unsolicited commercial electronic messages (CEMs). The new legislation will be one of the strictest anti-spam policies in the world and unlike the U.S. CAN-SPAM Act that allows for opt-out, the CASL is an opt-in for consumers – a fact which could significantly impact how companies (both in Canada and the U.S.) communicate with their Canadian customers.
No Spam
The CASL specifically:

  • prohibits the sending of commercial electronic messages without the prior consent of the recipient and provides rules governing the sending of those types of messages, including a mechanism for the withdrawal of consent.
  • prohibits other practices that discourage reliance on electronic means of carrying out commercial activities, such as those relating to the alteration of data transmissions and the unauthorized installation of computer programs.
  • provides for the imposition of administrative monetary penalties.
  • provides for a private right of action that enables a person affected by an act or omission that constitutes a contravention under that Act to obtain an amount equal to the actual amount of the loss or damage suffered, or expenses incurred, and statutory damages for the contravention.

CASL defines “commercial activity” as follows:

… any particular transaction, act or conduct or any regular course of conduct that is of a commercial character, whether or not the person who carries it out does so in the expectation of profit, other than any transaction, act or conduct that is carried out for the purposes of law enforcement, public safety, the protection of Canada, the conduct of international affairs or the defense of Canada. 

The CASL with respect to CEMs is not limited to email since the Act defines “electronic address” to mean that which is used in connection with the transmission of an electronic message to:

  1. an electronic mail account;
  2. an instant messaging account;
  3. a telephone account; or
  4. any similar account.

There are exceptions to the new rules. For example, if a company has an existing business relationship with a client, it is allowed to continue to send that client messages – on the basis of having “implied consent” – for up to two years.  Implied consent refers to an existing business or non-business relationship between you and the recipient of the CEM or that the means for direct communication has been indirectly expressed.

If a sender is not in compliance, penalties can reach a maximum of $10-million for each violation. The amount is determined based on several factors set out in the legislation and there does not appear to be any grace period — the CASL website notes it is enforceable and compliance is required as soon as the regulation comes into effect.