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LEGAL REPORT/IT & E-COMMERCE Spam's big hammer Aiming to fight rogue operators, anti-spam regulations open the door for fines and private action even against legitimate businesses. BY ANDI BALLA act also opens the door for private action, which could lead to damages in court per message sent. If it becomes a class action, the numbers would grow proportionally. But while the government says Bill C-28 is intended to fight the worst spam- mers, the anti-spam regulations clearly open the door for high penalties against legitimate businesses, causing concern for some. It is a particularly big change for Canadian companies that engage in electronic marketing, says David Elder, a privacy lawyer with Stikeman Elliott LLP. "The anti-spam legislation essentially prohibits commercial electronic messages without consent, and in most cases, the consent that would be required would be an explicit consent," he says. "So it is very broadly cast. This legislation says it is an opt-in, so companies will need to make sure that it is either within one of the exceptions, or they do have the recipient's consent. That's going to be a big change." The important exceptions include B y the time the Canadian government decided it needed to get tougher on unsolicited marketing via electronic messages in 2008, the country had earned the dubi- ous distinction of being the world's fourth-largest originator of spam. Canada was also the only G8 country to have no anti-spam legislation. Add to the mix an Internet infrastructure that makes it one of the most wired countries in the world, and Canada had the potential to be the perfect breeding ground for more spammers. That potential did not go unnoticed in Ottawa, which vowed to act to "drive the spammers out," introducing Bill C-28 that is now one of the strictest anti-spam and electronic protection laws in the world. It received Royal assent on Dec. 15. The bill survived a prorogation of Parliament and tough political discussions — so much so there wasn't even agreement on an official name for the act — the "fighting internet and wireless spam act" is just what every- one calls it colloquially. Now law, Bill C-28 mandates electronic marketing messages cannot deceive the receiver in any way. It also makes receiving messages an opt-in affair, which means permission will be needed to send an e-mail, though there are some important exceptions. Coming into full force in September, the law empow- ers the Canadian Radio-television and Telecommunications Commission to issue fines of up to $10 million for com- panies and $1 million for individuals. The existing business relationships, which under the law means if a company has done business with an individual in the past two years, then consent is implied. But obviously compliance with the law means companies are now going to have to keep track of when they last did business with the receiver and continu- ally update that list, adds Elder. These new compliance measures and the potentially hefty penalties that come with the new law worry businesses that now face a new playing field. "We are spending an increasing amount of time navigating the compliance issues with the act, given that the potential penalties for non-compliance are so significant," says Adam Kardash, a partner with Heenan Blaikie LLP. Kardash says while there are excep- tions for implied consent, the risk is high enough that many organizations will need www.CANADIAN Lawyermag.com M A RCH 2011 43 hUAn trAn