$1.1 million penalty under CASL offers few surprises

The moment that so many people have been waiting for arrived this morning when the Canadian Radio-television and Telecommunications Commission (CRTC) announced publicly for the first time that it has issued a Notice of Violation under Canada’s Anti-Spam Legislation (CASL), which includes a $1.1 million penalty.

The company on the receiving end of the Notice is Compu-Finder, a Montreal-based company that, according to its website “offers executives and managers access to new fields of knowledge inspired by the evolution of the realities of geoeconomy and geopolitics stemming from the phenomenon of market globalization.”

Apparently Canadians have been less than enamored with the company’s offers to train executives and managers on new fields of knowledge. According to the CRTC, complaints against the company account for 26% of all training-related complaints received by the Spam Reporting Centre. The Notice alleges that Compu-Finder sent commercial electronic messages without consent, and that unsubscribe mechanisms in some messages did not work.

It may be a bit of a surprise that the first publicized penalty is over a million dollars. That is significant. However, there are a few things about this Notice that are as expected.

First, there appears to be substantial evidence of multiple violations of CASL affecting many Canadians. Although the penalty is based on four violations, it seems that there could be many more. This is consistent with the situations in which the CRTC has issued penalties under the Unsolicited Telecommunications Rules (i.e., multiple, clear violations). This also seems consistent with the CRTC’s messaging in terms of its intended approach to enforcement of CASL.

Second, the company is based in Canada. It makes sense that, in the early stages of enforcement, the CRTC would want to issue a penalty against a Canadian company so that it has a better chance of actually collecting the fine (or putting the company out of business).

Just because the Notice involves what appears to be a clear case of spam does not mean that it is irrelevant to other senders, however. For example, the CRTC may take the opportunity to offer its views on what it means for a message to be relevant to a person’s “business, role, functions or duties in a business or official capacity“, which is a key factor in determining whether consent can be implied based on the conspicuous publication of an electronic address (or where the recipient has provided their electronic address to the sender). This could therefore result in important guidance for business-to-business marketers.

Compu-Finder now has 30 days to pay the penalty, make written representations, or  request an “undertaking” with the CRTC. Can Compu-Finder talk its way out of a $1.1 million dollar penalty? Stay tuned.

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