Anti-spam law will catch small businesses unprepared: CFIB

Most small business owners aren't ready for a new anti-spam law that will restrict how they communicate electronically with clients and prospects after July 1, a spokeswoman for the Canadian Federation of Independent Business said Wednesday.

"I think this is going to be a pretty heavy-handed legislation and it's going to take a lot of time before many small businesses are even aware that they have some obligations under this legislation and the regulations that go along with it," CFIB vice-president Corinne Pohlmann said in an interview.

• Anti-spam legislation means headaches for small business

In three weeks, businesses will be required to obtain consent for sending "commercial electronic messages" to clients or prospective customers.

Specific information such as a mailing address and name of the business sending the message will have to be included in many cases, as well as an easy way for the receiver to unsubscribe from an electronic mailing list.

Our concern is those little businesses that probably only email on a sporadic basis don't even realize that this is something that they're not supposed to be doing- CFIB'sCorinne Pohlmann

The Canadian Radio-television and Telecommunication's Commission's chief compliance and enforcement officer, Manon Bombardier, said last month that the CRTC doesn't have the resources to police all infractions and it will focus on the most severe violations.

The government's website will also have tools for reporting spam.

Financial penalties possible

Responses to complaints will range from written warnings to court actions and financial penalties ranging up to $1 million per violation for individuals and up to $10 million for a company.

Pohlmann says an entrepreneur starting a new business or a renovation contractor, for example, would have to take several precautions before sending a customer reference by email and, even if all the required information is included, won't be allowed to send any more electronic messages unless the prospect gives consent.

"We would have liked to have been able to allow them to email more than once, because not everybody reads it the first time," Pohlmann said.

"I think that's one of the detrimental side-effects of this entire thing that could eventually drive people to less productive means of reaching out to new potential clients than otherwise would have been."

She also thinks that business owners won't realize they will need the consent even of current clients before sending commercial electronic messages and that they should keep a record of the consents they receive.

Keep records of consent

"The safest thing to do is to get express consent one more time prior to July 1," Pohlmann said.

What's now referred to as Canada's Anti-Spam Law, or CASL, was originally announced as a way to deter the most dangerous types of unsolicited electronic messages, such as fraudulent marketing and dangerous software that can be transmitted by email attachments or Internet links contained in the message itself.

Although there were months of consultation by the CRTC before it published regulations in 2012 and the agency has provided extensive online documents about how they may be interpreted, Pohlmann said the CFIB is working with the CRTC to provide simplified explanations appropriate to smaller businesses.

"Our concern is those little businesses that probably only email on a sporadic basis don't even realize that this is something that they're not supposed to be doing," Pohlmann said.

However, she said it's still not altogether clear what will be acceptable proof of consent.

"I suspect there's still a lot of blurry edges that will only, over time, become clearer as people challenge what that's all about."

Emails are one type of commercial electronic messages but the law also covers other forms of communications, such as automated software updates and text messages sent by mobile phone. So it has been a challenge for the federal agencies to come up with regulations that meet intent of the anti-spam law without disrupting electronic commerce.

"I suspect is that for the first year or two, the focus will be on the larger firms. Then, once that's done, it will be more on the smaller firms," Pohlmann said Wednesday.