Franchise & Distribution Law

Heads Up: Canada’s Anti-Spam Legislation (CASL) Takes Effect July 1

casl[1]Once CASL takes effect, you will need express or implied consent before you (or your franchisees) can send a commercial electronic message (CEM). While franchisors are well aware of the pending impact of CASL and have been diligently ensuring that their organizations are ready, the bigger question that looms on the horizon is what are they doing to help their franchisees understand and comply with CASL’s requirements. Franchisors will typically be able to rely on implied consent under the B2B CASL provisions to communicate electronically with their franchisees. The bigger concern will be the B2C communications between franchisees and consumers. There is a lot of information on CASL available and while seemingly straightforward, the actual implementation for both franchisors and franchisees may prove to be more difficult. Ask yourself:

  1. Do your franchisees send CEMs?
  2. Do you know whether they are aware that they need to have consent to send CEMs?
  3. Do you know whether they understand the difference between implied or express consent to send CEMs?
  4. Do their CEMs satisfy the CASL content requirements?
  5. Do they know that the consents need to be recorded, in case they have to prove they had consent to send a CEM?
  6. Do you know if they have an unsubscribe mechanism for their CEMs?

Enforcement of CASL will be undertaken jointly by three regulators: the Canadian Radio-Television Commission, the Competition Bureau and the Office of the Privacy Commissioner. These enforcing bodies will have authority to impose a wide variety of sanctions on individuals and businesses that contravene CASL. While the regulators will probably be lenient initially, individuals may be fined up to $1,000,000 per violation and corporations may be fined up to $10,000,000 per violation. CASL also creates a private right of action, that takes effect in 2017 that permits an individual to take civil action against anyone who violates CASL. If your franchisees are not prepared for CASL, it is not the risk of significant fines that you should be worried about, but rather the potential backlash through social media.

This article is published to inform clients and contacts of important developments in the field of franchise and distribution law. The content is informational only and does not constitute legal or professional advice. We encourage you to consult a Dickinson Wright attorney if you have specific questions or concerns relating to any of the topics covered here.

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