Law Times

Law Times • January 25, 2016 Page 9 www.lawtimesnews.com Anti-spam legislation confusing and may target wrong people, lawyers say BY YAMRI TADDESE Law Times M ore than a year af- ter the Canadian anti-spam legis- lation came into force, lawyers across the country say the legislation remains un- clear and it may be targeting the wrong people. "Unfortunately, we don't have more clarity over the last year and a half on the ambiguities in the act," says Martin Kratz, who leads the anti-spam practice at Bennett Jones LLP in Calgary. "The legislation itself was not well conceived. It didn't go through a thorough, broad-based consulta- tive process," he says. The vast scope of the legisla- tion, coupled with several un- clear exemptions, makes it com- plex, Kratz says, adding it doesn't help that it's being overseen by three different regulators — the Canadian Radio-television and Telecommunications Commis- sion, the Competition Bureau, and the Office of Privacy Com- missioner. "Initially, the CRTC sought to provide some clarification . . . [but] they've ceased to be provid- ing that guidance. Some of the provisions appear so broad that they result in ridiculous conse- quences," Kratz says. Legislation requires that companies obtain consent from recipients before firing off mass e-mails, but there are exceptions to this rule. For example, one provision makes an exception for business- to-business communication as long as the businesses have a relationship. But what exactly constitutes "relationship" is not defined, lawyers say. "Does that mean if an ac- counting firm works with a law firm that the law firm can send legal updates or promotional in- formation to the accounting firm or can the accounting firm do so to the law firm?" Kratz asks. "Those are pretty important con- siderations." "Clients want certainty and the difficulty we have is no court has yet interpreted some of these dif- ficult provisions and so we don't know what approach a court will take to interpretation," Kratz con- tinues. "In other words, where the act says you require consent, will they read that consent require- ment narrowly or . . . ought the exceptions [for consent] be read broadly and generously?" Jennifer Babe, partner at Miller Thomson LLP, says a lot of clients are still in a "stunned dis- belief phase" when it comes to the anti-spam legislation. "Some of them are still wak- ing up to this," she says, adding that American and European clients are more attuned to laws like this one. Many clients still mistakenly believe the law only applies to business-to-consumer commu- nications, Babe says. Meanwhile, others interpret some grandfathering provisions in ways that are broader than they were intended to be, she adds. Despite these ambiguities, the CRTC is aggressively issuing no- tices of violation and handing out fines to Canadian companies. In March 2015, the regula- tor slapped corporate-training company Compu-Finder with a $1.1-million penalty for send- ing out e-mail messages without consent and not honouring re- cipients' request to unsubscribe. Around the end of the year, the CRTC issued its first take- down of a command and control server in Toronto, which was part of the Dorkbot malware system that infected more than a million computers around the world. Several others have been handed fines as part of under- takings. In November 2015, Rogers paid $200,000 as part of an un- dertaking for allegedly having a faulty unsubscribing system in its e-mail communications. In March, the dating web site Plenty of Fish was fined $48,000 for the same alleged error. In June 2015, Porter Airlines paid $150,000 for allegedly not in- cluding unsubscribe mecha- nisms with some messages it sent out and not honouring requests to unsubscribe within the statu- tory time frame. "Most of the cases have been technical failures or administra- tive failures around unsubscribe mechanisms, and the act is par- ticularly prescriptive and diffi- cult in that it has hardwired dis- closure requirements and it has specific requirements in relation to how unsubscribe mechanisms must work, when they must be active, and how long they must be active," Kratz says. "We're see- ing that broad theme of compa- nies getting hit pretty hard based on what you might say were tech- nical mistakes." Tricia Kuhl, partner at Blake Cassels & Graydon LLP in Mon- treal, says the crackdown under the legislation is mostly targeting legitimate Canadian businesses. "The CRTC, rather than go- ing after necessarily the most egregious actors that continu- ously spam all Canadians, what they've decided to do is to go after Canadian businesses, le- gitimate business, who are easily identifiable in terms of location and company names," she says. "Most of the bad actors who are spamming Canadians are not in Canada. They're overseas — it's harder to locate them, to enforce actions against them." This approach to enforcement has been surprising, Kuhl says, adding lawyers had expected le- gitimate Canadian businesses that have made significant efforts to comply with the legislation would not immediately be sub- ject to fines. LT SKIMMING THE SURFACE IS FINE UNTIL A DEEPER DIVE IS REQUIRED. Start with Practical Law Canada. Whether you need a surface view or a deeper understanding of a legal issue, Practical Law Canada offers up-to-date, straightforward how-to guides, annotated standard documents, checklists, and more. For more information visit www.practicallaw.ca A lot of clients are still in a 'stunned disbelief phase' when it comes to anti- spam legislation, says Jennifer Babe. FOCUS

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