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Spam Smart Tip: Transition Period Balm for the Compliance Sting

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Transition periods for new legislation are often critical in taking the sting out of compliance costs. But some transition periods are better than others. In the case of Canada’s Anti-Spam Legislation (CASL), organizations should consider the transition periods – not only what the cover, but also what they don’t. There are definitely winners and losers.

When CASL eventually comes into force, there will be two separate transition periods. The first is for consent to commercial electronic messages (CEMs) and the other is for the installation of computer programs. This Spam Smart Tip examines the transition period for CEMs and existing business relationships.

Section 66 provides for implied consent to CEMs for the shorter of:

  • three years after the coming into force of the legislation; or
  • the recipient’s “unsubscribe” or indication that they no longer.

An organization may relied on the transitional implied consent to CEMs if:

  • the person has an “existing business relationship”; and
  • that relationship includes CEMs

What’s an “existing business relationship”? For the purposes of the transition period, the existing business relationships that will be applicable to most enterprises are ones that arises out of:

  • the purchase or lease of a product, goods, a service, land or an interest or right in land by the person to whom the message is sent from the person who sent the message or caused the message to be sent (the “purchaser / lease exception”);
  • the acceptance by the person to whom the message is sent of a business, investment or gaming opportunity offered by the person who sent the message or caused the message to be sent (the “investment / gaming opportunity exception”);
  • a written contract entered into between the person to whom the message is sent and the person who sent the message or caused the message to be sent (and that is not already covered by the purchaser / lease exception or the investment / opportunity exception);
  • an inquiry or application made by the person to whom the message is sent to the person who sent the message or caused the message to be sent regarding the purchaser / lease exception or the investment / gaming opportunity exception.

Usually, there is a sunset provision for an existing business relationship under CASL. For example, an existing business relationship in respect of an inquiry or application ends 6 months after the inquiry or application for the purposes of implied consent for any new relationships after CASL comes into force. But that isn’t the case for those existing at the time of CASL coming into force. The sender may rely on implied consent for three years.

This is a significant transition period. Three years is a long time to refresh consents for existing business relationships and existing non-business relationships. Organizations may wish to consider this in planning priorities in their compliance strategy.

However, the story isn’t uniformly a good news one. Organizations should also carefully review the scope of the relationships captured by the transition period. The definition of an existing business relationship certainly does not cover the field of relationships that enterprises may have with individuals to whom they send CEMs. Notably, the transition period may not be of assistance to professions or enterprises with very long lead times to make sales.