casl vs can-spam - canada’s anti‐spam law

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  • 1.Comparing CASL to CAN-SPAMCanadas Anti-Spam LawRaising the bar for online business communications in North AmericaMargot Patterson, Counselmargot.patterson@fmc-law.com Updated January 20131

2. Canadas Anti-Spam Law (CASL) CASL was enacted in December 2010 and is expected toenter into force in late 2013, or 2014 CASL is intended to promote e-commerce by deterring spam,identity theft, phishing, spyware, viruses, botnets, andmisleading commercial representations online CASL creates new offences, enforcement mechanisms andpenalties to address these online threats2 3. Canadas Anti-Spam Law (CASL) Canada is the last of the G-8 countries to introduce an over-arching law to combat spam, which continues to representabout 80% of all global e-mail traffic Canada has distinguished itself in making its legislation tough: Higher consent standards Detailed content requirements significant penalties: Canadas $10 million anti-spam law 3 4. Comparing CASL to U.S. CAN-SPAM Act: A Snapshot 4 5. Comparing CASL to CAN-SPAMSome Similarities both CASL and CAN-SPAM: Are aimed at unsolicited online communications, andunfair/deceptive online practices Require consent to send commercial electronic messages Directly impact business communications with customers,prospective clients, and subscribers5 6. Comparing CASL to CAN-SPAMKey Differences CASL has: Clear reach outside Canada CASL expressly applies to messages accessed from a computer system in Canada: message can be sent from outside Canada Higher standard for consent Opt-in (CASL) versus Opt-out (CAN-SPAM) Broader application CASL also applies to installation of computer programs Higher penalties $10 million maximum penalty for CASL contravention6 7. Comparing CASL to CAN-SPAM The Implications: More online activities will be caught by CASL More activities affecting Canadians will be caught by CASL,even if initiated outside Canada More steps will be needed under CASL to communicate online Greater exposure to liability under CASL7 8. Comparing CASL to CAN-SPAM Lets Take a Closer Look at: Objective of the legislation Scope: Who, What, Where Consent Disclosure (Message Content) Violations and Enforcement and Next Steps for Businesses8 9. The Objective9 10. The Objective: U.S. CAN-SPAM Act, 2003 U.S. Senator Ron Wyden (D-Ore.), October 22, 2003: "Today, the Senate has sent the message that the government isgoing on the offensive against kingpin spammers. Americansare tired of just watching and fretting over in-boxes clogged withunwanted e-mail, and this legislation is an important step towardgiving them more control." 10 11. The Objective: CASL, 2010 The Honourable Tony Clement, Minister of Industry, May 25, 2010: The proposed (legislation) is intended to deter the most damagingand deceptive forms of spam, such as identity theft, phishing andspyware, from occurring in Canada and to help drive spammersout of Canada.11 12. Scope: Who, What and Where 12 13. Scope: Who (Reach)CASLCAN-SPAM (For spam) senders of commercial (For spam) senders of commercialelectronic messageselectronic mail messages Potential vicarious liability: Directors, officers, employers not Expressly includes directors,referencedofficers, agents ormandataries of a corporation Expressly includes employersof employees acting withinscope of employment 13 14. Scope: What (Activities)CASLCAN-SPAM Spam Spam Malware, spyware, botnets Purely malicious spam (i.e. not Network re-routingprimarily commercial) not False or misleading coveredrepresentations online False/misleading transmission Installation of computer programs information (addresses aspects ofnetwork re-routing) Address harvesting Installation of computer programsnot covered Address harvesting14 15. Scope: What (Messages)CASLCAN-SPAMA commercial electronic message A commercial electronic mail messageis: is: An electronic message An electronic mail message including text, sound, email onlyvoice, image Sent to an electronic address including e-mail, IM, phoneor any similar account15 16. Scope: What (Messages)CASL CAN-SPAMA commercial electronic message: A commercial electronic mail message: Has as its purpose or one of its The primary purpose of which ispurposes commercial advertisement or considering message content, promotion of a commercialhyperlinks, or contact infoproduct or service to encourage participation in Including content on aa commercial activity:website operated for a transaction, act or conduct ofcommercial purposea commercial character whether or not in Excludes transactional orexpectation of profitrelationship messages 16 17. Scope: Where (Jurisdiction)CASL CAN-SPAM Activities outside Canada Activities outside U.S. Spam: computer system in Not expressly addressed in CAN- Canada used to send or access SPAM Act message Considered case-by-case Software installation: computer pursuant to conflict of laws rules system receiving the program in Canada (or if installer is in See: Facebook, Inc. v. Guerbuez, Canada, or operating under 2008 U.S. Dist. LEXIS 108921 (N.D. direction of person in Canada) Cal. 2008) [enforced by QuebecSuperior Court in 2010] Altering transmission data: computer system in Canada used to send/route or access message 17 18. Consent18 19. ConsentCASL CAN-SPAM CEMs can be sent if: CEMs can be sent unless: You have the express or The recipient opts out of implied consent of the future commercial email recipient (opt-in), OR if consent is not required under CASL19 20. ConsentCASL CAN-SPAM Exceptions to the consent requirement: Exception to consent transactional or relationship messages are not CEMs: Message between individuals with personal or family relationship Facilitating or confirming transaction that An inquiry or application to a personthe recipient already has agreed to; engaged in a commercial activity Warranty, recall, safety, or security Quote or estimate, requested by recipientinformation about a product or service; Facilitating, completing or confirming a pre- Information about a change in terms or existing transaction features or account balance informationregarding a membership, subscription, Warranty, product recall or safety/securityaccount, loan or other ongoing commercial informationrelationship; Factual information regarding subscription, Information about an employment membership, account, loanrelationship or employee benefits; or Ongoing information about recipients Delivering goods or services as part of a employment or benefit plan transaction the recipient already Delivering a product, good or service, agreed to including updates/upgrades, as part of a transaction the recipient already agreed to20 21. Consent See also Draft Industry Canada regulations for furtherproposed exceptions to the consent requirement:1. Limited Exemptions for Certain Types of Message (within businesses, between organizations in a business relationship, legal notices)2. Third-Party Referrals3. Clarifying What is Required where Sender is an Unknown Third Party4. Clarifying Membership in a Club, Association or Voluntary Organization5. Limited Exemptions for Protecting, Upgrading and Updating Computer Networks Comments on these Draft regulations due February 5, 201321 22. ConsentCASL CAN-SPAM Implied consent: Implied consent generally available for Commercial transaction with the unsolicited messages, where the recipient recipient ORhas not opted out of receiving them Business, investment or gaming opportunity with recipient within the previous two years Inquiry from the recipient in the previous six months about the above Written contract with the recipient, still in effect or expired within previous two years Recipient has conspicuously published his or her electronic address, and message is relevant to his or her business role or function Recipient has disclosed electronic address, and the message is relevant to his or her business role or function 22 23. ConsentCASL CAN-SPAM Getting express consent: No corresponding requirement Purpose for the consent since consent is generally Nameopt out Mailing address, and eitherphone number, e-mail or webaddress Statement that the person canwithdraw consent See CRTC Guidelines23 24. Disclosure (Message Content) 24 25. Disclosure (Message Content) CASLCAN-SPAM The message must: The message must: In message itself or via clear and prominent website link: Identify the sender (including Identify the sender (CAN-SPAM definessent on behalf of);who designated sender is) Include mailing address, and Include physical postal addresseither phone, email or web Include email address or other form ofaddress; and Internet-based communication to unsubscribe Include an unsubscribemechanism See CRTC Guidelines25 26. Violations and Enforcement 26 27. Violations and EnforcementCASLCAN-SPAM CRTC: primary enforcement FTC: primary enforcement agency,agency, including administrativeincluding administrative penaltiesmonetary penalties (AMPs) Each individual email in violation Maximum penalty is $10 millionof CAN-SPAM is subject to for an organization, per violationpenalties of up to $16,000 Relevant factors include purpose of penalty, nature & scope of violation, history, financial benefit, ability to pay May enter into compliance undertaking with CRTC27 28. Violations and EnforcementCASL CAN-SPAM Directors and officers liability / D&O and employers liability notEmployers liability expressly set out in legislation Importance of due diligence: No liability where due diligencetaken to prevent the violation28 29. Violations and EnforcementCASL CAN-SPAM Private Right of Action Private Right of Action For individual or organization No PRA for an individualaffected by a contravention: can PRA available to a provider ofobtain court order for compensationInternet access service, adversely Acts or omissions (e.g. spam-related)affected by a violation Remedies include compensation for Injunctive rel