Money & Business

As Canada's Anti-Spam Law Hits, Groups Warn of Side Effects

By / Jul 2, 2014 (iStock/Thinkstock)

A restrictive new law limiting the types of online communications that organizations can send to Canadian consumers went into effect Tuesday, and industry groups in the country say it could put a heavy new burden on Canadian marketers.

One of the more controversial new laws north of the border is now officially in effect. Industry groups say it brings headaches.

Canada’s Anti-Spam Law (CASL)—a set of new limits on marketing communications that, by the way, has plenty of side effects for American organizations—took effect July 1. Associations in the Great White North have a variety of concerns about the new bill, including:

Cost: The Canadian Chamber of Commerce warns that there could be a financial toll for many companies trying to abide by the new rules. “There is clearly an increase in administrative costs in doing this,” Scott Smith, the chamber’s director of intellectual property and innovation policy, told the Toronto Star. “Some businesses have said up to $10 million; smaller businesses have said $500 to $1,000. And that’s the cost of getting up to speed; it’s not the ongoing costs of staying up to speed.” Smith added that marketers’ inability to send messages asking customers if they’d like to opt in to marketing messages is problematic.

Prospecting challenges: The Canadian Marketing Association (CMA), meanwhile, suggested the new rules will make email marketing a tougher bet. “Prospecting for new customers is going to be a tougher environment,” the group’s Wally Hill told the Star. “In order to assemble a consent-based list that you can share with others, you will have to get express consent from someone to share their name with others.” On the other hand, Hill suggested some marketers may see this as a good thing because “you’ll [get] better lists.”

Awareness: Perhaps the most troubling issue, according to the Canadian Federation of Independent Business, is that the ample warnings that preceded the new rules haven’t reached many of its members. According to a letter CFIB sent to Canada’s minister of industry, James Moore, just 15 percent of its members were fully aware of the requirements. Another 15 percent hadn’t heard of the law at all, while the other 70 percent in the survey understood it to varying degrees. The organization also found that 62 percent of respondents had done nothing to comply with the law, while just 12 percent said they were fully compliant.

“Given that a small business’s capacity to comply with the rules will be far more limited than that of a large firm, proper government support is crucial. Feedback from our members suggests that [the Canadian Radio-Television and Telecommunications Commission], in particular, has not done as much as it could to aid compliance efforts,” CFIB President and CEO Dan Kelly and Executive Vice President Laura Jones wrote in the letter [PDF].

But at least one group seemed optimistic that its members were well prepared.

“Where necessary, banks will take steps to ensure that they have the consent of email recipients and that they give them the opportunity to unsubscribe from emails that they do not want to receive, as banks have been doing for some time,” Canadian Bankers Association spokesperson Kate Payne told the Financial Post.

Ernie Smith

Ernie Smith is the social media journalist for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. More »

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