CASL has been on the lips of fundraisers and non-profit leaders since it came out a few years ago. As the deadline around implied consent comes up on July 1st, what does this mean for all of us and our practices around the use of online communications?
I’m delighted that for this week’s blog, Anastasia Semenova from Gowling WLG, has agreed to share some answers to the questions I’ve been hearing over the past few weeks. Thank you Anastasia for sharing your expertise!
Anastasia, please remind us, what is CASL?
Canada’s Anti-Spam Legislation, known as CASL, is a law that came into force July 1, 2014. This law establishes a highly restrictive regime for the sending of marketing and promotional emails and texts (“commercial electronic messages” or CEMs). The term CEM is defined broadly to capture virtually all emails, texts or other electronic messages that are sent to an electronic address and which seek to promote commercial activity.
There are two key requirements of CASL:
(1) the requirement to ensure that there is prior consent to send a CEM to a recipient, and
(2) the requirement to ensure that the CEM contains prescribed information and an unsubscribe mechanism that functions in a particular way.
The categories of implied consent that may be relied on to send CEMs are narrow and time-limited. Express consent to send CEMs must be obtained in a prescribed format and the onus is on the sender of the CEM to prove that express consent was properly obtained.
So what’s changing on July 1st?
On July 1st, 2017, the three-year transition that allowed companies to rely on a particular form of implied consent based on a prior relationship and prior communications will come to an end. Organizations that wish to use this transition period to attempt to obtain express consent to continue to communicate with certain recipients only have a short time left to do so.
Under the transition period, consent was implied for 3 years if the organization had at any time prior to July 1, 2014 established a business or non-business relationship with the recipient in accordance with the criteria set out in those definitions, and that relationship was also characterized by a history of exchanging CEMs with the recipient, the organization could rely on the transition period in order to send CEMs.
- An “existing business relationship” arises from the purchase of goods or services or the acceptance of a business opportunity within the previous 2 years, or a written contract within 2 years of expiry, or an inquiry or application made by the recipient in the previous 6 months.
- An “existing non-business relationship” will exist where the recipient had made a donation or a gift within the 2 years prior to the message being sent, where the recipient has volunteered work or attended at a meeting organized by the person who sends the message, or where the recipient was a member of the sender’s organization within the 2 years prior to the message.
Another change that was about to come into force on July 1, 2017, but was temporarily suspended by the government is the Private Right of Action. The private right of action, had it come into force, would have allowed individuals who alleged they had been affected by a contravention of the law to bring an action seeking their actual loss or damages, and a penalty of $200 for each contravention, not to exceed $1 million for any day on which a contravention took place. Its suspension was as welcome news to businesses, many of which were concerned with the possibility of CASL-related class action law suits.
How does this affect charities and non-profits?
The definition of “commercial activity” is broadly defined, such that not-for-profit organizations are not automatically excluded from CASL’s application. However, note that only fundraising emails that are sent for the primary purpose of raising funds for a charitable organizations (as defined by the Income Tax Act) are exempt. Other revenue-generating activities of non-profit organizations and charities are not exempt. Not-for-profit organizations should be aware of CASL’s potential application to revenue-generating direct electronic communications sent to individuals and entities.
How does this affect fundraising?
Ensure that fundraising communications are separate from other revenue-generating communications if you want them to be exempt from the application of CASL.
So what do charities and non-profits need to do next?
Charities and non-profits who have made use of or wish to make use of the transition period should ensure they review their CASL compliance strategies and mechanisms, an ensure their staff receives appropriate training.
If you have electronically sent clients marketing and promotional materials prior to July 1, 2014 (when the law went into effect), then the transition period to keep emailing those clients will expire as of July 1, 2017. Prior to that expiry period, you would be permitted to email those individuals and ask them to give their express consent to continue to receive marketing and promotional emails. Please note that express consent must be requested in a particular way, and the email that is sent must comply with particular content requirements and have an unsubscribe mechanism.
Otherwise, from a general compliance perspective, companies should have a form of compliance program (education, training) in place but it can be put in place after July 1, 2014 (although the sooner, the better!).
Where can I look for more information?
See the government website “Canada’s Anti-Spam Legislation”: http://fightspam.gc.ca/eic/site/030.nsf/eng/home
See the following Gowling WLG articles:
- “CASL Three year transition period ends on July 1, 2017”, http://gowlingwlg.com/en/canada/insights-resources/casl-three-year-transition-period-ends-on-july-1-2017?utm_source=vuture&utm_medium=email&utm_campaign=vuture.
- “Canada hits the pause button on CASL’s Private Right of Action”, https://gowlingwlg.com/en/canada/insights-resources/canada-hits-the-pause-button-on-casl-s-private-right-of-action.
- “CASL’s Private Right of Action coming this summer: Are your corporate compliance policies up to the task?”: https://gowlingwlg.com/en/canada/insights-resources/casl%E2%80%99s-private-right-of-action-coming-this-summer-are-your-corporate-compliance-policies-up-to-the-task-.
Can we reach out to you for advice?
Yes, absolutely! You can reach me at firstname.lastname@example.org.
Thank you Anastasia!
Feel free to reach out to Anastasia if you have any questions about this article.
NOT LEGAL ADVICE. This blog is provided for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Please seek professional legal advice with respect to any specific legal concerns you may have.