Canada’s Anti-Spam Legislation – Application to Charities and Not-For-Profit Organizations

Canada is one of the last developed nations to enact anti-spam legislation however, effective July 1, 2014, that is no longer going to be the case when the law commonly referred to as Canada’s Anti-Spam Legislation (“CASL”) will come into force.

CASL is intended to promote efficiency in the Canadian economy by regulating all commercial electronic messages (“CEM”) being sent and received in Canada. CASL is widely considered to be the toughest commercial electronic messaging legislation in the world and, once in force, will have significant implications for not-for-profit organizations (“NPOs”) and registered charities. The act captures electronic communication well beyond what would usually be considered a spam e-mail. The definition of CEM casts a wide enough net to capture any means of electronic telecommunication including e-mails, text messages, instant messaging and social media.

CASL broadly prohibits the sending of any CEM that encourages participation in a commercial activity, regardless of any expectation of profit. CASL requires that all CEMs be sent only with the express or implied consent of the recipient and requires that CEMs contain specific content such as an unsubscribe mechanism. The consent and content rules within CASL, if not already convoluted enough, are subject to several exceptions.

Penalties for non-compliance are harsh and range up to $10 million for corporations or $1 million for individuals and include the possibility of personal liability for directors and officers.

The fortunate news for registered charities and NPOs is that CASL contains two provisions which may help facilitate the continued communication with a donor base or membership:

  • (a)    Fundraising by a Registered Charity: The regulations associated with CASL provide that a CEM sent for the purposes of fundraising is exempt from the consent and content requirements, regardless whether the recipient has previously donated to or volunteered for the organization. In other words, registered charities may continue to solicit donations via CEM, provided that the communication is primarily for the purpose of fundraising. However, all other CEMs sent for purposes other than to fundraise must comply with the consent and content provisions of CASL unless they too fall within an exception or the organization has consent from the recipient.
  • (b)   Communication with a Membership: CASL provides that an NPO (or a charity) has the implied consent to contact their membership about matters pertaining to the organization without first obtaining consent however, matters become more complicated about contacting former or prospective members. Be sure to include the required content in any CEM that goes out to the organization’s membership.  

There has been limited guidance from the Canadian Radio-Television Commission (“CRTC”) on the interpretation of CASL as it applies to registered charities and NPOs. The CRTC, however, is expected to issue a guidance statement and provide more information within the next few weeks – stay tuned.

Although at first glance the above exemptions may seem favourable, many CEMs sent by NPOs and registered charities which are not to the current membership or for the primary purpose of raising funds will still need to comply with the consent and content requirements of CASL. NPOs and registered charities should undertake a thorough examination of CEM policies and practices to ensure they are onside with CASL or risk being made an example of by the CRTC.

Jordan Morelli is a corporate and not-for-profit lawyer at Dale & Lessmann LLP in Toronto. He can be reached at jmorelli@dalelessmann.com or (416) 369-3813.

This blog post was prepared with the assistance of Lina Nikolova, Summer Student at Dale & Lessmann LLP.