Industry released today draft regulations to Canada’s Anti-spam Legislation (CASL) which will now come into effect on July 1, 2014. An important exclusion that will be welcomed by registered charities is that the Act does not apply to an electronic message “(g) that is sent by or on behalf of a registered charity as defined in subsection 248(1) of the Income Tax Act and
the message has as its primary purpose raising funds for the charity”. Keep in mind that if a charity is sending a commercial electronic message and this or other exclusions do not apply, then CASL will apply to the registered charity. The exclusion “its primary purpose raising funds for the charity” was introduced to cover situations were a fundraising email involved some commercial activity such as the sale of a gala dinner ticket. However, if the email fits in the definition of a commercial electronic message but it has a number of purposes and raising funds is not the primary purpose and another exclusion does not apply the CASL applies. The key takeaway for registered charities is that they are not exempted from CASL and that they should try and ensure that they have express consent from as many people as possible.
Industry Canada notes specifically in its Regulatory Impact Analysis Statement with respect to charities:
“Charitable organizations argued that the Act would have a disproportionate impact on their activities since it would be more difficult for them to train volunteers, including directors and officers, on compliance with the Act and to implement internal controls. In addition, their activities as charities are already regulated. CASL provides that registered charities have implied consent to send messages to those who have volunteered or donated to them within the past two years, but they argued the Act would still restrict their fundraising abilities. To address these concerns, an exemption is introduced in these Regulations for fundraising messages sent by or on behalf of registered charities, regardless whether the recipient previously donated to or volunteered for the organization.”
You can read the full Regulatory Impact Analysis Statement.
Here is an Explanatory Statement from Industry Canada:
The Order fixes July 1, 2014 as the day on which all provisions of An Act to promote the efficiency and adaptability of the Canadian economy by regulating certain activities that discourage reliance on electronic means of carrying out commercial activities, and to amend the Canadian Radio-television and Telecommunications Commission Act, the Competition Act, the Personal Information Protection and Electronic Documents Act and the Telecommunications Act, (“the Act”), chapter 23 of the Statutes of Canada, 2010 come into force, other than sections 8, 47 to 51, 55, 68, 84, and 85, subsection 86(1), section 87, subsection 89(2), and sections 90 and 91 of the Act, and subsections 12(1), (3) and (4), section 12.1 and subsections 12.2(1) and (3) of the Personal Information Protection and Electronic Documents Act [as enacted by section 83 of the Act]. The Order fixes January 15, 2015 as the day on which section 8 of the Act comes into force. The Order fixes July 1, 2017 as the day on which sections 47 to 51, 55 of the Act come into force.
To bring into force legislation that is intended to deter spam and other damaging and deceptive electronic threats such as identity theft, phishing and spyware from occurring in Canada and to help drive spammers out of Canada, in a way that phases in the violations and enforcement mechanisms over a three year period.
The Act received Royal Assent on December 15, 2010. The Act is a culmination of a process that began with the Anti-Spam Action Plan for Canada launched by the Government of Canada in 2004, which established a private-sector task force chaired by Industry Canada to examine the issue of unsolicited commercial electronic messages. After a process of consultation with stakeholders and the public, the task force issued a report in May 2005 examining the spam situation in Canada, and recommended, among other measures, that legislation specifically aimed at combating spam be created.
The Act will involve several agencies in the regulation of commercial electronic messages and other electronic threats, namely the Competition Bureau, the Office of the Privacy Commissioner, and the Canadian Radio-television and Telecommunications Commission. In addition to establishing a regulatory framework to address spam and other electronic threats, such as identity theft, phishing, spyware, malware, and botnets in Canada, the Act gives these agencies the authority to share information and evidence with international counterparts.
Some sections of the Act were brought into force on April 1, 2011, amending the Personal Information Protection and Electronic Documents Act (PIPEDA) to provide exceptions to the Privacy Commissioner’s obligation to investigate every complaint filed and allow her to share information and evidence with her international and provincial counterparts.
The Act introduces new violations concerning sending commercial electronic messages and the installation of computer programs. To reduce risks to businesses affected by the provisions in the Act related to computer programs, the provision in the Act that introduces the new violation regarding the installation of computer programs (i.e. section 8)—as well as section 6 of the Governor in Council Regulations which addresses situations where there is deemed consent pursuant to section 10(8) of the Act—will come into force six months after the bulk of the Act comes into force, including the provisions related to sending commercial electronic messages.
The Act will be enforced both through regulatory measures such as administrative monetary penalties and through a private right of action. In order to ease the transition for businesses to this regulated environment, the sections of the Act that provide for enforcement through a private right of action (i.e. sections 47 to 51 and 55) will come into force three years after the bulk of the Act including the provisions related to sending commercial electronic messages comes into force.
Sections 68 and 90 and subsection 89(2) are provisions that would make the Act apply to unsolicited telecommunications currently regulated pursuant to the Telecommunications Act (e.g. the National Do Not Call List). As intended, these provisions will not be brought into force at this time and will only be brought into force by Order in Council if the Governor in Council determines that it is appropriate to do so.
Finally, section 91 states that sections of the Act will come into force on dates to be fixed by order of the Governor in Council. This section of the Act came into force on December 15, 2010 when Bill C-28 was adopted.
There are no financial implications to the Government associated with this Order.
Beginning with the 2004 Anti-Spam Action Plan for Canada and the 2005 report of the Task Force on Spam, there was extensive consultation on what type of legislative regime would best address spam in Canada in order to promote the efficiency and adaptability of the Canadian economy.
The Act was considered by the House of Commons Standing Committee on Industry, Science and Technology first as Bill C-27 in 2009 and then as Bill C-28 in 2010, and then by the Standing Senate Committee on Transport and Communications, with stakeholders representing business and consumer interests giving testimony on the legislation and its anticipated impact.
After it received Royal Assent, further consultation was undertaken through two processes of developing Regulations under the Act, including through written submissions and face to face meetings with stakeholders. The Act and this Order in Council’s phased-in approach to its enactment reflect the input of Canadians, businesses, and organizations, and balances the needs of businesses and consumers.”
Do you require legal advice with respect to Canadian or Ontario non-profits or charities?
Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.