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Corporate, Information Technology

Government suspends CASL private right of action, but fines can still be issued

By Peter Murphy

On June 7, the federal government announced that it is suspending the implementation of the private right of action under Canada’s anti-spam legislation (CASL). The move was in response to concerns raised by Canadian businesses, charities and the not-for-profit sector.

The suspended provisions of CASL were scheduled to come into force on July 1, 2017 and would have allowed any interested person to file lawsuits for alleged violations of the legislation. 

The government has not stated how long this indefinite suspension will last. The legislation will be submitted to a parliamentary committee for review.

According to the press release issued by Innovation, Science and Economic Development Canada, “Canadians deserve an effective law that protects them from spam and other electronic threats that lead to harassment, identity theft and fraud. At the same time, Canadian businesses, charities and non-profit groups should not have to bear the burden of unnecessary red tape and costs to comply with the legislation.”

The government claimed it is committed to striking the right balance between protection from spam and Canadians’ reasonable use of electronic communication. It also said it “supports a balanced approach that protects the interests of consumers while eliminating any unintended consequences for organizations that have legitimate reasons for communicating electronically with Canadians.”

CASL came into effect on July 1, 2014. The law prohibits individuals and organizations from sending commercial electronic messages to Canadians without their consent. Penalties for the most serious violations of the legislation can be issued up to a maximum of $1 million for individuals and $10 million for businesses.

The private right of action promised to extend enforcement of CASL beyond government agencies to all interested persons. The suspended right would have permitted interested persons to file lawsuits, starting July 1, 2017, seeking actual and statutory damages for alleged breaches of CASL. Statutory damages would have amounted to $200 per occurrence, up to $1 million per day. It is widely expected that the CASL private right of action, if implemented, will lead to class-action lawsuits joining the recipients of infringing electronic messages into large group lawsuits.

Canadians should keep in mind that, despite the indefinite suspension of the private right of action, CASL remains in force and significant fines can still be issued for breaches. Since CASL came into effect, the CRTC (Canadian Radio-television and Telecommunications Commission) has issued numerous fines, including one case where the penalty exceeded $1 million.

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