Background of CASL
Canada’s Anti-Spam Legislation (CASL) has introduced new obligations relating to commercial electronic messages and other related matters. CASL came into force on July 1, 2014. Many businesses consider its requirements onerous, however the situation may become worse on July 1, 2017.
In broad terms if a business or organization sends commercial or electronic messages, such as emails promoting a product or service, the business must comply with CASL’s requirements to: obtain consent, provide identification information and include an unsubscribe mechanism in each message.
For businesses that install software or computer programs on other people’s computer systems, CASL’s prohibits the installation of a computer program (software) on another person’s computing device in the course of commercial activity without the express consent of the device owner or an authorized user.
The provisions of CASL are relatively complex and the government has issued guidelines dealing with a number of topics including requirements for installing computer programs, guidance on implied consent, guidance concerning keeping records and guidance concerning developing corporate compliance programs.
Since CASL was brought into force the Canadian Radio-television and Telecommunications Commission (CRTC) has been aggressive in enforcing CASL’s provisions by way of investigations and enforcement actions. Some significant administrative monetary penalties have been levied relating to noncompliance.
The Private Right of Action
On July 1, 2017 the provisions of CASL relating to a private right of action will be brought into force. Under these provisions anyone who alleges they are affected by an act or omission that:
- constitutes a contravention of the primary obligations set out in CASL;
- their electronic address has been obtained through data mining without their consent;
- personal information has been obtained by accessing a computer system without authorization under privacy legislation; or
- they have received an electronic message promoting directly or indirectly a business that is false or misleading in a material respect;
may initiate proceedings seeking damages for noncompliance.
The proceedings are brought by way of application initiated in the Federal Court or in a Superior Court of record of a province.
If, after the hearing of the application, the court is satisfied that a contravention has occurred, the court may order the person or persons responsible pay to the applicant:
- compensation in the amount equal to the actual loss or damage suffered or expenses incurred by the applicant; and
- a maximum of:
- in cases involving commercial electronic messages, $200 for each contravention not exceeding $1,000,000 for each day in which a contravention occurred;
- in cases involving alteration of transmission date or installation of computer programs contrary to CASL, $1,000,000 for each day on which a contravention occurred.
The amount of compensation awarded by the court is within the judge’s discretion but there are a number of statutory factors which must be considered.
Because the damages typically suffered may be relatively small, the concern is that a court will be inclined to grant statutory damages which can be significant. In addition, there is a concern that class actions will be brought on behalf of groups of affected consumers.
It is also possible that in some cases officers or directors of corporations found to be in breach of obligations under CASL can be personally liable.
This new source of potential liability is a concern to all those who send a significant number of email messages where there are issues concerning whether the sending of the emails contravenes the provisions of the Act.
John S. McKeown
Goldman Sloan Nash & Haber LLP
480 University Avenue, Suite 1600
Toronto, Ontario M5G 1V2
Direct Line: (416) 597-3371
Fax: (416) 597-3370
Email: mckeown@gsnh.com
These comments are of a general nature and not intended to provide legal advice as individual situations will differ and should be discussed with a lawyer.