Bill C-27 (Historical)

Electronic Commerce Protection Act

An Act to promote the efficiency and adaptability of the Canadian economy by regulating certain activities that discourage reliance on electronic means of carrying out commercial activities, and to amend the Canadian Radio-television and Telecommunications Commission Act, the Competition Act, the Personal Information Protection and Electronic Documents Act and the Telecommunications Act

This enactment establishes a regulatory framework to promote the efficiency and adaptability of the Canadian economy by regulating certain activities that discourage reliance on electronic means of carrying out commercial activities.
It enacts the Electronic Commerce Protection Act, which prohibits the sending of commercial electronic messages without the prior consent of the recipient and provides rules governing the sending of those types of messages, including a mechanism for the withdrawal of consent. It also prohibits other practices that discourage reliance on electronic means of carrying out commercial activities, such as those relating to the alteration of data transmissions and the unauthorized installation of computer programs. In addition, that Act provides for the imposition of administrative monetary penalties by the Canadian Radio-television and Telecommunications Commission, after taking into account specified factors. It also provides for a private right of action that enables a person affected by an act or omission that constitutes a contravention under that Act to obtain an amount equal to the actual amount of the loss or damage suffered, or expenses incurred, and statutory damages for the contravention.
This enactment amends the Competition Act to prohibit false or misleading commercial representations made electronically.
It also amends the Personal Information Protection and Electronic Documents Act to prohibit the collection of personal information by means of unauthorized access to computer systems, and the unauthorized compiling of lists of electronic addresses.
Finally, it makes related amendments to the Competition Act, the Personal Information Protection and Electronic Documents Act, the Canadian Radio-television and Telecommunications Commission Act and the Telecommunications Act.

Electronic Commerce Protection Act

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, I would first like to say that we support this bill. I see the committee chair nodding his head that, yes, it is an excellent bill. I must say, this bill is a good start. This new legislation specifically targets unsolicited commercial electronic messages. Citizens have been demanding such a bill for some time, and it is sorely needed. Not only are commercial emails sent with the prior consent of the recipient important to electronic commerce, but they are also essential to the development of the online economy.

By drafting legislation prohibiting spam and protecting personal information and privacy, as well as computers, emails and our networks, the proposed legislation is designed to allow individuals and companies to sue spammers and hold any businesses whose products and services are promoted using these means partially responsible for spamming activity.

As well, email marketers would be required to obtain informed consent from recipients to receive emails; provide an opting-out mechanism for further emails; and create a complaints system. That is the main purpose of the bill. Since most spam Canadians receive comes from other countries, international anti-spam measures are needed. The government should continue its efforts to harmonize anti-spam policies and encourage countries to work together on enforcing anti-spam legislation.

I would like to talk about this a bit longer. We know that spam comes from all over the world. That is one thing. But Canadian law applies only to Canada and Canadians, not to other countries. How might this affect us as consumers? What sort of commercial impact might it have? Businesses here in Canada will not be able to distribute advertising on the Internet using software or other ways of communicating with a computer.

The biggest problem is that because other countries are not subject to this law and their legislation is not harmonized with Canada's, they can keep on sending messages. If I have a business and I decide to send advertising over the Internet for doors, windows and other things, I cannot send a mass mailing. But a business in another country can.

We have to be competitive with industries around the world, because we are part of a global economy now. So what reason do we have to protect consumers? Protecting them against phishing or hacking is one thing, but we must not forget business. That was the committee's main concern. We must not prevent businesses here from continuing to make a profit. Eight billion transactions are carried out on the Internet. I believe that Canadian businesses should enjoy a share of this growth with all the people here in Canada.

It is vital that we ask ourselves whether we want to protect our industries or consumers. Should we let others continue to do business without our being able to participate? These are the questions that should be raised, and they have been raised. They have not received a full answer, but this bill is a major step, because it proposes a concrete measure within a timeframe. It took four years to come up with this legislation, because we wanted something better. As we know, things change much more rapidly with the Internet, where six months is an eternity.

So, fairly soon after this bill is passed, we will have to take time to see how things are unfolding and to make adjustments, as cyberpirates target us.

By the way, how do we define spam? Spam is any electronic commercial message, any text, audio, voice or visual message sent by any means of telecommunication—whether by email, cellular phone text messaging or instant messaging—without the consent of recipients. Therefore, it is reasonable to conclude that its purpose is to encourage participation in a new commercial activity, and that it includes electronic messages that offer to purchase, sell, barter or lease a product, good, service, land or an interest or right in land, or offer a business, investment or gaming opportunity.

I mentioned what spam is. It has to do with commercial activities, including offers to purchase, sell, barter or lease a product, good, service, land or an interest or right in land. All these are commercial activities that exist here. With this legislation, these people will no longer be able to use the Internet to send their messages.

What is left for these people to be competitive? Not much. They could use mail services. However, this can be costly, considering that, as I mentioned, such costs will not be incurred in other countries. We always hear—as one member said—that spam requires a lot of work. It takes someone to prepare these emails. If, all of a sudden, we prevent our industries from using the Internet to sell or rent all the products that I listed earlier, what are they going to do? As I just said, they will have to rely on mail services.

Just think how clogged up the system could get if every industry decided to send a mass mailing to all the other businesses, or to households. How much time would businesses spend opening mail, instead of emails? Of course, Canada Post would be pleased, since postal rates are exorbitant, but businesses would no longer be competitive, because of these costs. We should not forget that, because this is a significant economic consideration.

Having said what is considered spam, it is also important to point out what is not. What is not spam are messages sent by an individual to another individual with whom they have a personal or family relationship. For instance, I have no personal ties to you, Mr. Speaker. Imagine I send you a message, not as a member, since that is not allowed. So imagine that someone from outside the House sends you an email, he or she could be subject to fines, since this legislation no longer allows emails from one person to another. The bill reads:

—a message that is sent to a person who is engaged in a commercial activity and consists solely of an inquiry or application related to that activity.

Regarding commercial activities, witnesses came to testify that, initially, the bill required 18 months of contact with the other person. Let me give an example. I know that about every four or five years, family situations and incomes change, so people could be selling their house and buying a new one. With this new law, the real estate agent who sold me my house can no longer contact me after 18 months. In fact, he would be subject to a fine, if the 18-month time limit has passed. In committee, we were able to change that timeframe to 24 months. We would have preferred it to be even longer, to allow businesses and individuals to continue communicating with their existing clients.

As I said, the purpose of this bill was to restrict commercial activity, which is important here.

(a) that is, in whole or in part, an interactive two-way voice communication between individuals;

(b) that is sent by means of a facsimile to a telephone account; or

(c) that is a voice recording sent to a telephone account.

...

(c) that is of a class, or is sent in circumstances, specified in the regulations.

This bill will completely define the issue. There will surely be some flaws, as with any bill, whether it is good or bad. Since this is a new bill, there are always flaws because we forgot something or did not think to regulate something. Over time, we will have to re-examine the bill, more quickly than any other bill, to ensure that we have not left anything out.

The only circumstances under which spam could be sent would be if the person to whom the message is sent has consented to receiving it, whether the consent is express or implied. So, if I send a message and the individual agrees to receive it, a relationship has been established.

Let us take that same real estate agent, and let us assume that I heard from one of my colleagues that his brother-in-law has a house to sell. I would not be able to send that brother-in-law an email to let him know that his brother-in-law had informed me about the house for sale, or to tell him that I know someone who would be interested in buying the house. I could not do that.

I could only do it over the telephone. I could directly contact the individual via telephone or meet them in person. I would have to establish contact before doing business with this person.

So therein lies the problem. Anyone who wishes to establish a business relationship with another person must now do so via the telephone or mail, or meet the individual in person. They could not send a simple email.

We are setting limits. That is the message I want to get across. We are setting limits, but we cannot limit other countries in sending us these messages. We have to consider doing that and count on the goodwill of other countries such as the United States, Australia, France or other European countries. This type of legislation needs to be harmonized. Many countries do not have such regulations or laws. They can therefore do what they want because they are not subject to such legislation.

In addition to being in a form that conforms to the prescribed requirements, the message will have to make it possible to identify and contact the sender. The message must include an unsubscribe mechanism, with an email address or hyperlink, so that the recipient can indicate that he or she does not want to receive any further commercial electronic messages from the sender. If I send a message or an email, at the end of that message there specifically needs to be a box to check or a note explaining to the person how to stop receiving further messages.

I think this is the right approach, but in order for it to be successful inquiries would be necessary. The CRTC would have interesting powers. It could require a person to preserve transmission data, produce a copy of a document that is in their possession and prepare a document based on data, information or documents that are in their possession. It could also conduct a site visit in order to gather such information or, if necessary, to establish whether there was a violation.

Because it cannot do that itself, note that it will have to get a warrant from a justice of the peace prior to entering premises. It cannot do that by itself; the CRTC cannot do it by itself; the Competition Bureau has certain powers, but there again its powers are limited. Today, the Competition Bureau has no powers of inquiry. That is why there is Bill C-452, which will give the Competition Bureau three types of powers of inquiry: an exclusive power of inquiry, a power of inquiry to summon and protect witnesses, and a power to search. That is what is important.

How can agencies conduct inquiries and do the work for which they have been created if they have no power? I have introduced Bill C-452 to give the Competition Bureau this power so it can conduct inquiries and do the work we expect of it.

If the court believes that a person has violated any of those provisions, it may, which is not to say that it will have to, order that the applicant be paid an amount representing the loss or damages suffered, or any expenses incurred. If it is impossible for the applicant to establish those amounts, the court may order that the applicant be paid a maximum of $200 per contravention, up to a maximum of $1 million. I am choosing my words carefully: not “shall order”, but “may order”. That is very different.

As I said earlier, the CRTC, the Competition Bureau and the Office of the Privacy Commissioner must also consult one another, and they may share any information with one another in order to carry out their activities and responsibilities pursuant to their respective powers.

So there are three agencies: the CRTC, the Office of the Privacy Commissioner and the Competition Bureau. Together, they have certain powers under the bill. However, they must be capable of communicating with one another. We know that these agencies have their private preserves and they are not prone to disclosing information.

The Office of the Privacy Commissioner is another thing again. The Liberal member referred to this earlier. That Office is an important player in this regard.

Unsolicited commercial electronic messages are becoming a serious social and economic problem that undermines the personal and commercial productivity of Quebeckers. Not only do they hinder email use for personal communications but they also threaten the growth of legitimate e-commerce. As I mentioned earlier, when people are assigned to open these emails, time is lost and businesses become less competitive. That causes a problem.

I would like to point out something else. The minister, or another organization somehow involved in Bill C-27, has managed to ensure that a clause in this bill could jeopardize the National Do-Not-Call List (DNCL). A door has been opened because one of the clauses states that the DNCL—set up by this government and containing the telephone numbers of seven million people who do not wish to be unnecessarily pestered by telemarketers—could be deactivated. They have now made it possible, within one year, to eliminate a list that cost millions to set up.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I listened with great interest to my colleague's speech.

The issue that we are trying to deal with here, on all sides I would hope, is the need to ensure that innovation continues to happen, that we believe that the Internet is going to be more and more of a vehicle for not just economic innovation but for social, cultural and political discourse. Therefore, there has to be the issue of confidence.

When people go on the Internet and they respond to people they might not know, they have to have a fundamental sense of confidence that they can make those connections. Without those links that are being made from person to person, from business to business, major problems will occur in terms of impeding productivity and also undermining the fundamental revolutionary power of what is before us.

The issue of spam is not simply an issue of an irritant. It is not simply that it bothers us because we have to delete from our inbox everyday hundreds of useless irritating emails. The deeper issue is the underlying issue of spam that leads to fraud. There is such an interconnection between the misuse of Internet communication and international fraud rings. We see that Canada was alone in the G7 in terms of having any kind of plan for dealing with spam up until now and we are also one of the worst spam bases in the G7 and, in fact, the world.

Could my hon. colleague speak to the connection between fraud and spam, and the need to have an international standard because a spam artist knows no domestic boundary or border?

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, my colleague has identified the problem and its implications. Yes, it can be useful. There is spam, emails, and there are important things. There are things we can use every day. It is true that there has been fraud and that is why we have a bill. However, we must be careful. I can certainly understand how a great deal of spam can affect the productivity of some companies.

However, if we restrict people here and our businesses—those trying to make an honest living for themselves and their employees—if they can no longer use email and the Internet to sell and promote their products, what do they have left? As I was saying earlier, that leaves the postal service. This will hurt small businesses, who will not be able to keep up with big businesses. Larger big businesses will win out and smaller businesses will disappear. Is that what we want? It is one thing to protect our citizens. But we must also protect our businesses so that they can continue to participate in a given market.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, I am pleased to ask a question of my colleague today.

I am very concerned about the bill with regard to the cost and confusion the legislation might have for small businesses in the country. Oftentimes the government introduces legislation. Then, after it is introduced, it is quite a complicated process and expense communicating with small businesses and getting them up to speed on what the requirements are.

I can think of many initiatives in that area over the last several years. I just wonder if the member has any thoughts about how we should be proceeding with regard to that.

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, my colleague put his finger on the problem. Yes, we discussed it in committee. It would seem that businesses would continue for some time, because as for any other bill, we do not yet know what impact it will have.

That is why I said during my speech that this bill would have to be reviewed again as soon as possible after it is passed, to determine whether or not it presents a problem for our businesses. That is what should be done. Six months is a long time and a year is much too long, but we would have to look at the legislation again to determine whether it has affected our companies and our society directly.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, we have moved this legislation along to the point where it should be ready to be made law. However, then we look at the do not call registry which was made law.

I am sure most members of the House have received phone calls. I receive calls at home all the time telling me my credit card information is incorrect and I have to press 1 immediately to correct credit card information. I am getting those calls at home. I was not getting them before the do not call registry was established.

It seems to me that we can say whatever we want in the House about spammers. We can talk until we are blue in the face and yet the fraud and misrepresentation continues, and the lack of political will to get serious about this remains in place.

I would ask my hon. colleague, does he think, besides reviewing the bill and its effectiveness, we need to show our other competitive countries in the G8, which are actually serious on these things? We preach the gospel of change, but it seems that once something is implemented, the government goes back to being an agnostic on actually dealing with it.

In light of the failure of the do not call registry, would my hon. colleague like to perhaps guess where this is going to go?

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, yes, I will. A witness told us. That was our concern. We knew that the question would come up when a clause was put in the bill that could abolish the national do not call list.

The question did come up, and there was no mention in the answer of abolishing the list. The government wants to be able to replace this regulatory system in future if necessary.

I believe that they want to abolish this list. I do not know why, since they are the ones who introduced it. It cost businesses $5 million to comply with the list. This bill contains a clause that could abolish it. That is unfortunate, because the do not call list has been in place for a year and it is working.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, when the government brought in the do not call registry, individuals signed up so they would not be called. Then we found out that international scammers simply walked away with that list because internationally the registry is not respected. All the people, who put their numbers on the list so they would not be called, found themselves victimized by fraud artists and scammers.

There is talk about taking the existing registry and rolling it into Bill C-27. That is possible and I am open to the suggestion. However, my concern is this. Given the fact that the government showed absolutely no teeth in dealing with all of the scam artists in the Cayman Islands, and wherever else, who obtained the list of our citizens, how are we going to ensure that we are protected from international scammers who have no interest in what we proclaim in the House of Commons?

[The Deputy Speaker, Andrew Scheer]

The hon. member for Shefford has only 30 seconds left.

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, that is precisely the problem. The bill does not mention what is happening at the international level. It only makes reference to what is going on locally, here in Canada. Anything outside the country is excluded. We do not hear about it and we cannot pass an international law either. We would need the G7 or G8 to pass a law that would be respected and endorsed by all its members.

I want to go back to the do not call list. I personally put the question to the chairman of the CRTC, who told me that the list is working. Federal public servants use it. I do not know why they identified it and included it in this legislation. I do not have an answer to that.

[Alan Tonks, Liberal, York South—Weston, ON]

Mr. Speaker, I will be splitting my time with the member for Yukon.

I am pleased to speak to Bill C-27, the electronic commerce protection act.

I think that the last interchange is an indication that the legislation before us may have its shortcomings but the urgency with respect to bringing the legislation forward is undeniable. It is undeniable because of the invasiveness of spam and that people's lives can be turned absolutely upside down by those who use spam with the intent to defraud and to use information that is available through access to information. It has been pointed out that no technological firewall or router can act as a barrier and people are absolutely susceptible to those who have spent a huge amount of time thinking of how they can, through an email invasion, access information that will be used fraudulently.

This is not an issue over which the government or any particular party has proprietary rights. In this House we all share the responsibility to have in place a legislative regime that anticipates the nature of this invasion through electronic commerce with the intent to defraud or to put forward false information.

We all share the desire to develop the tools. This will not be the end. The committee has made amendments to original legislation that was put forward through a committee or a task force process. This bill will go through the Senate process. I would assure members of the House, and I refer in particular to the interchange that just took place, there will be other mechanisms undoubtedly, other tools that will be developed through the continuing process of developing the legislation.

I am sure there are people who are watching who only see bits and pieces of the debate. People do not always see the total context within which the debate on legislation is taking place. I would like to provide a chronology to put things in context.

Spam is a serious concern for individual Canadians and businesses. Back in 2004-05, the then Liberal government established a task force to look at anti-spam legislation. That task force brought forward recommendations which generally paralleled the bill before us. Those recommendations were aimed at prohibiting the sending of spam without prior consent as a first principle. The second principle was that it would be an offence to use false or misleading statements to disguise the origins or true intent of an email.

The task force led to a number of key recommendations. I think there were 22 recommendations in all. The government of the day established a series of round tables to seek input from the business community and the community in general.

At that time, the specific recommendations were to prohibit the sending of spam without prior consent as the first principle, to prohibit the use of false or misleading statements disguising the origins or intent of an email, and to prohibit the installation of unauthorized programs. Spam artists are so cunning that if a person does give clearance to a misleading and disguised email, information with respect to even the person's passwords can be made available, which gives access to the person's email content, websites, et cetera. The final principle that was established through that task force was to prohibit the unauthorized collection of personal information or email addresses.

This bill has all of the elements of those task force recommendations and looks to implement the recommendations of that task force. As I have said, this is not a Liberal approach or a Conservative approach; in fact, it appears that the bill has the support of all parties in the House.

There is one aspect of the bill that is different from the regime that was put forward back in 2004-05 under those recommendations, and that is with respect to fines and the implications with respect to what may happen if one is found guilty of violating the intent of the legislation. The fines for these violations can go up to a maximum of $1 million for individuals and $10 million for businesses. It establishes rules for warrants, for information, as was discussed by the last speaker and in questions, and in particular, that information being available through warrants during investigations and injunctions that can be sought on spam activity while under investigation.

The bill also establishes the private right of action, allowing individuals and businesses the ability to seek damages from the perpetrators of spam. That is a particularly important principle. We have talked about victims and victims' statements during criminal proceedings and recently with the bill that firms up the interventions with respect to parole and the ongoing communication with those who have been victimized with respect to how the provisions of parole are carried out.

This bill also attempts to err on the side of victims. It gives them the ability to seek damages from the perpetrators of spam, depending upon the nature of invasion of privacy and the activity that took place.

It was pointed out that the committee had some problems with flaws in this bill. Clause 6 seemed to be a little too broadly written and, as has been pointed out by other speakers, could suppress a very legitimate part of our application of technology and the whole sector. It could impose an adverse position with respect to those who are creative within the technology, the rules of the technology and so on. It was pointed out that the committee was not satisfied to that extent. However, amendments were made to the bill.

The bill also maintains a very strong and some have said heavy-handed position, but given the nature of the illegal activity going on, I think that all of the House would concur with the committee's intent to make those who are guilty suffer.

Generally speaking, those in the stakeholder groups were not satisfied with the original task force recommendations, and there may be some who are still not satisfied with the bill. However, as I have indicated, it has gone through the committee stage, amendments have been made and at this point I think we have to err on the side of those who use their email and other technology for positive and high value-added activity and go after those who would victimize those who are using the technology.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, I realize that there are certain provinces, I believe Quebec is one and Manitoba is another, that have class action legislation. Ontario might have it as well.

I wonder if the member could confirm that class action provisions might be applicable as far as the bill is concerned. It seems to me that if we are dealing on an individual basis, it is a much more positive approach if we could have the bill affected by class action lawsuits, whereby people could take action on the part of a whole group of people who were being victimized by certain types of spam activity.

I wonder if the member would comment on that and whether he has any ideas for improvements.

[Alan Tonks, Liberal, York South—Weston, ON]

Mr. Speaker, I know that the hon. member is a lawyer, and I very much respect his knowledge of not only this kind of legislation, but the recourse that innocents would have with respect to the law.

The bill leans toward the concept of victims' rights. If victims' rights can be characterized through class action, and in other aspects of law, both civil and criminal, then that can happen. This is embarking on new ground. There will be many who will be viewing the intent of the bill and the legislation. It may be contested through the courts, but certainly the provisions with respect to victims would leave the door open, I would say from a lay person's perspective, to class actions. That would mitigate the cost associated with an action. Also, with the kind of publicity that is entrenched in that approach it would do what the bill, in terms of its intent is trying to do. It would put those who would use spam for defrauding and other criminal purposes on notice that more than individual court proceedings could occur. Class actions are very costly. The repercussions could be serious and would act as a deterrent, I would think. However, I am sure that the member would have better suggestions than I would from a legal perspective.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, the hon. member is always very succinct and informative in his speeches.

In his speech he talked about the fines, which he said were slightly different from the original task force recommendations. What specifically was he getting at? I would like his opinion on that. Also, I think there needs to be a significantly large fine for huge corporations because some of them look at a small fine as the cost of doing business and just carry on. It does not have an effect.

[Alan Tonks, Liberal, York South—Weston, ON]

Mr. Speaker, there are those with legal experience who could probably give a better answer to that.

When I review the bill and look at fines of a maximum of $1 million for individuals and $10 million for businesses, it would seem that is a pretty serious step toward the objective the member has which I inferred from his question. In that there is not a regime that is that serious now, this would be a fairly substantive deterrent. These are very serious charges and very serious fines.

The whole process through the bill establishes a framework for investigation. The notion that there are rules to be established with respect to warrants, for information during an investigation and so on, certainly provides a framework which will make the bill a much greater deterrent, if it is fully understood, than exists at this time.