As Canadian and foreign companies that do business in Canada continue to struggle with the complexities of Canda's Anti-Spam Legislation compliance, some organizations are tempted to just reach for their phones instead and do some old-fashioned "cold calling," believing themselves immune from legal censure.
However, they do so at their peril, because the same
organization overseeing the enforcement of CASL, the Canadian
Radio-television and Telecommunications Commission, also enforces
rules against "unsolicited telecommunications,"
specifically telemarketing phone calls targeting consumers for the
purpose of selling or promoting products and services.
In Canada, telemarketers must comply with the Telecommunications
Act and the Unsolicited Telecommunications Rules, which consist of
the National Do Not Call List Rules and Telemarketing Rules. And
unlike CASL, which has been the subject of very few notices of
violations to date, the CRTC appears to be actively enforcing the
Unsolicited Telecommunications Rules, and levying fines with
rigour.
Most recently, on March 10, the CRTC issued notices of violation to
three Canadian-based companies and two Indian-based call centres
with penalties totaling $643,500.
The notices allege the five companies failed to respect the
Unsolicited Telecommunications Rules, failed to have valid
registrations with the National DNCL Operator or purchase a
subscription to the list, failed to provide appropriate information
in a clear manner, and did not display the originating telephone
number or an alternate telephone number where the telemarketer
could be reached.
Even worse, these anti-virus software telemarketers allegedly
falsely identified themselves as representatives of Microsoft Inc.,
the U.S. Department of Homeland Security, or officials from the
Canadian government and tried to gain remote access to home
computers under the pretext of removing viruses and other malicious
software.
The Canadian companies have 30 days to either pay the penalty or
file representations to the CRTC. (Click here for more information).
If past practice is any guidance, 2016 will see even more of this
activity from the CRTC. In 2015, the CRTC's notices of violation page described more than 20
organizations that had to pay penalties for failing to comply with
the Unsolicited Telecommunications Rules.
So what do telemarketers have to do to meet these
requirements?
The rules include (i) the National Do Not Call List Rules; (ii) the
Telemarketing Rules and the Automatic Dialing-Announcing Device
Rules. I will discuss the first two sets of rules.
The National Do Not Call List Rules
If a company plans to engage in "telemarketing," it
must, prior to making any telemarketing calls, (i) subscribe to the
National Do Not Call List (a list of telephone numbers of consumers
who have chosen to register their numbers on the National DNCL in
an effort to reduce unsolicited telecommunications); and (ii) pay
all applicable fees to the National DNCL operator (the person who
has delegated powers from the CRTC to administer databases,
administrative, or operational systems).
The telemarketer cannot call phone numbers that are on the DNCL,
unless the company has express consent or has an existing business
relationship with the proposed customer (sounds familiar,
doesn't it?).
Express consent can be provided through: (i) written consent signed
by the consumer; (ii) oral consent (as long as it can be verified
by an independent third party or an audio recording of the consent
retained by the company); (iii) electronic consent through the use
of a toll-free number; (iv) electronic consent via the Internet; or
(v) consent through other methods so long as there is a documented
record of the consumer's consent created by the consumer or an
independent third party.
A telemarketer can also call an individual whose phone number is on
the DNCL if the telemarketer has an existing business relationship
with this individual, and this individual is not listed in the
company's own do not call list. An organization is considered
to have an "existing business relationship" with an
individual if this individual has:
- Purchased, leased, or rented a product or service from the company some time within the previous 18 months before the call;
- Has any written contract with the company still in effect or expired some time within the last 18 months before the call; and/or
- Has inquired or made an application to the company about a product or service some time within the six months before the call (I told you that this really sounds familiar).
Like CASL, a consumer can withdraw his or her express consent at
any time by advising the company either in written, oral, or
electronic form. The onus is always on the company to prove the
consumer provided valid express consent. Once the "existing
business relationship" time periods have passed, the
telemarketer cannot call the individual if his or her number is on
the DNCL, unless this individual has given express consent.
Telemarketers that seek to comply with the National DNCL Rules must
keep proof of their subscription to the DNCL and proof of payment
to the DNCL operator for a period of three years from the date the
record is created.
They must also keep records relating to express consent and
sufficient proof (including beginning and end dates) of existing
business relationships. Telemarketers can only use the National
DNCL to comply with applicable statutes, such as the Unsolicited
Telecommunications Rules, including the National DNCL Rules and
Telemarketing Rules, and the Telecommunications Act and cannot
sell, rent, lease, publish, or disclose the National DNCL.
Organizations must ensure they use updated versions of the DNCL
— obtained from the DNCL operator no more than 31 days prior
to the date of the telemarketing phone call.
Lastly, it is worth noting that if an organization engages a
third-party telemarketer to conduct activities on its behalf, it
can be vicariously liable for the violations conducted by the
telemarketer.
Telemarketing Rules
In addition to the National DNCL Rules, organizations should be
aware that they also have to comply with the Telemarketing Rules
regardless of whether the telemarketing communication is exempt
from the National DNCL Rules.
Telemarketers must further: (i) register with the National DNCL
operator; (ii) provide certain information to the DNCL operator as
requested; and (iii) pay the applicable fees charged by the
complaints investigator delegate (the person who has delegated
powers from the CRTC to investigate violations of the National DNCL
Rules).
The fees vary depending on the number of area codes and the monthly
period chosen by the telemarketer.
Similar to the above, any prospective telemarketer must keep
detailed records for three years from the date that the records are
created as proof of the telemarketer's registration with the
DNCL operator and the payment of fees made to the complaints
investigator delegate.
While organizations may have heard of the national DNCL, many
don't realize they have an entirely separate legal obligation
to maintain their own internal do not call list.
This list must include the names and phone numbers of consumers
that asked not to receive any subsequent phone calls from the
organization. The organization must process and give effect to the
consumer's request at the time of the phone call and then add
the consumer's name and number to the company's own
internal do not call list within 14 days of the request.
The organization must keep a consumer's name and phone number
on the list for three years and 14 days from the date of the
request. Organizations are strictly prohibited from calling
consumers who are (or should be) on their internal do not call
lists and must ensure they use current versions of their lists
— updated no more than 31 days prior to the date of the
telemarketing call.
The Telemarketing Rules also prescribe detailed codes of conduct.
For example, when making a telemarketing call, the telemarketer
must provide the company name and the name (or fictitious name) of
the company's employee making the phone call in a clear manner
to the call recipient.
If requested, the telemarketer must provide (i) a phone number the
consumer can use to access an employee or other representative of
the company to ask questions, to make comments about the phone
call, or to make or verify a request to be placed on the
company's internal do not call list; and (ii) a name and e-mail
address or a postal mailing address that the consumer can use to
write to an employee or other representative of the company to ask
questions, to make comments about the phone call, or to make or
verify a request to be placed on the company's internal do not
call list.
The phone number provided to the consumer must be local or
toll-free and must be answered either by a live operator or by a
system that takes messages. The voicemail system's message must
inform the consumer that his or her call will be returned within
three business days and the company must return the call
within three business days.
The company must ensure the e-mail addresses, postal mailing
addresses, and local or toll-free phone numbers provided to a
consumer are valid for a minimum of 60 days after the telemarketing
phone call was made.
Telemarketers are also restricted to making calls during certain
hours: (i) 9 a.m. – 9:30 p.m. local time of the recipient
Monday to Friday; and (ii) 10 a.m. to 6 p.m. on Saturday and
Sunday.
Random dialing is permitted, except to phone numbers registered on
the National DNCL, emergency lines associated with health-care
facilities, and on the company's own internal do not call
list.
Telemarketers are expected to keep written records of their
compliance activities regarding the Unsolicited Telecommunications
Rules in the same manner and format as they keep their other
records in the regular course of business (i.e., in their regular
place of business, and readily accessible). If requested, the
telemarketer must provide its records to the CRTC within 30 days of
such request.
Failure to comply with the CRTC's Unsolicited
Telecommunications Rules can be costly. Individuals that have been
found to contravene these rules are subject to fines of up to
$1,500 per violation, while corporations are subject to fines of up
to $15,000 per violation.
So, the next time a client intends to pick up the phone and call
consumers on an unsolicited basis in an effort to "keep things
simple" and avoid CASL, tell them to think twice and remind
them of their telemarketing obligations — it's the
prudent thing to do.
Originally published on Canadian Lawyer Online - IT Girl Column
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