Industry Committee on Sept. 28th, 2009

[David Fewer]

Absolutely. This is something that I've heard come up a few times, particularly the international competitive situation--not the legal comparatives, but the international competitive situation--so I want to try to unwrap some of that.

First, this bill does not outlaw electronic communications. It outlaws unsolicited electronic communications where there's no business relationship, where there's no consent to the communication, so let's not overstate the impact of this bill. What it tries to do is bring back control over electronic communications to the hands of the user, whether that's a consumer or a business. Let's not lose sight of the productivity gains that this legislation promises Canadian businesses. That's something that I just don't think is coming up in these discussions and that we really need to keep our eye on.

Second, on the international comparative on the legal front, I just want to say that I think this bill is a significant improvement over the U.S. legislation, the CAN-SPAM legislation, which, frankly, is a “do not hesitate to spam” bill or law.

[Voices]

Oh, oh!

[David Fewer]

It is not an anti-spam law. So if we were to move in that direction, I think we'd be really going.... This legislation is almost informed by the failure of the anti-spam legislation in the United States, so let's not lose sight of that. This bill is good. Let's keep that.

On the comparative front, from a competitive perspective, there are two points. One, nothing in this bill says it doesn't apply to foreign spammers where there's a real and substantial connection to Canada. We had this fight over our privacy legislation some time ago, and we've seen, just this past summer, the Canadian Privacy Commissioner flexing her muscles and bringing social networking under control, out of the wild west into the era of civilized privacy behaviour. With respect, I think this bill will have a similar impact. Through this bill, we can control foreign nations, foreign competitors, and foreign businesses that are spamming Canadians.

Second, this bill will provide Canadian businesses with a competitive advantage in the use of electronic communication tools that other nations haven't seen fit to give their businesses. When we talk about whether we are disadvantaging Canadian business, the real question is, are we advantaging Canadian businesses? I would submit that we are. We don't want to throw that out in responding to some of the legitimate concerns expressed by businesses that will be subject to this legislation

[The Chair, Conservative, Michael Chong]

Thank you, Mr. Fewer.

Madame Coady.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

I would like to hear from Mr. Fraser.

[The Chair, Conservative, Michael Chong]

Go ahead, Mr. Fraser.

[David Fraser]

Thank you very much.

I'm not sure that we have such a radically different philosophy or approach to it. I think there is a concern that if you're going to sanction administrative monetary penalities, civil damages, and things like that, you go after the appropriate targets. There is a distinction between unsolicited e-mail messages and unwanted e-mail messages. Having a categorical prohibition with exceptions that are extremely narrow and may not accord with what would necessarily be everybody's reasonable expectation can be problematic.

I agree absolutely with the interpretation of Mr. Fewer on foreign spammers. If there is a real and substantial connection to Canada, there's no reason why this piece of legislation could not apply theoretically. Whether or not one could sue in Canada and then enforce that judgment in another country would be a completely separate matter.

We also need to be mindful that we shouldn't fool ourselves; this isn't going to stop spam. Most of the spam that lands in your inbox originates from outside of Canada, and you have no way of identifying who it's coming from. This piece of legislation and the objectives that underlie it are very important, and I think we have broad consensus on that.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Fraser.

Thank you, Madam Coady.

Mr. Van Kesteren.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Thank you, Mr. Chair.

Thank you for appearing before us.

One of the questions I wanted to ask--it was answered by the Bar Association--is whether or not this legislation could be challenged by the charter. You've answered that question, or at least given us your interpretation. So I want to give the floor to Mr. Fewer and Mr. Israel.

You're both lawyers as well. Are they right? Can this be challenged in the courts? Will it be challenged in the courts, or will it stand?

[David Fewer]

It's an interesting debate. We're getting into paragraph 2(b) of constitutional law. I should highlight a change in our position, at least to a certain extent, around the appropriate scope of exceptions.

In our submission to the committee clerk earlier this summer, we suggested that we should carve out an exception for political speech, charities, non-profits, and those kinds of things. That was driven by a concern of one of our partners--with whom we were talking about partnering on some advocacy around this bill--who has a much stronger view of the scope we have to give freedom of expression from a United States first amendment perspective and not a Canadian perspective.

In the end, we decided to go our separate ways, at least to a certain extent, with respect to the advocacy we're going to do on this bill. Our view is that we wouldn't want to have an exception for political speech, charities, and non-profits, for the simple reason that communications from those organizations are in unsolicited e-mails when they have a commercial component. If they don't have a commercial component, then they're not captured by the legislation and can go through.

Our view is that the way the legislation is drafted, it is sufficiently tailored to survive a paragraph 2(b) challenge. We do view the legislation as proportional, and we don't think it will fail a minimal impairment challenge.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

So in layman's terms, do you think this will stand up in a court of law?

[David Fewer]

Yes, we feel the ducks got beaten and it will walk through fine.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

I confess I'm probably not up to the same speed as some of my colleagues when it comes to the Internet and use of the Internet. But somebody in the last group of witnesses suggested to me that the problems can lie with the company. Is there truth in that? Somebody else mentioned something about software and the fact that we have to give full disclosure on software. Is that part of the problem too? If you compare some of the companies--I'm going to say Microsoft and Apple--does one allows spam and not the other? Is that true?

[David Fewer]

I can't speak to the specific practices of those individual companies, but I want to make sure we understand that this legislation applies to all companies, and even the good companies that we like and are customers of will do bad things from time to time.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

I'm not talking about sending the spam. I don't quite understand, but when we were talking about spam somebody said to get an Apple. I'm not advocating any one product over another. Do certain products have filters for spam whereas others don't?

[David Fewer]

I think that's a market effect. Windows operating system is the biggest operating system in the world, and if you're a spyware or a malware developer, you're going to target that operating system because you get more bang for your buck. Apple and Linux are smaller market share and are less attractive to malware coders.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Finally, we hear a lot of the companies that would be affected by this saying it would adversely affect their business. Are there other methods? Are there other things that can be done if this legislation is enacted that could compensate for the inconvenience or possibly a change in business? Are there other methods that these companies can be using that nobody is really talking about, possibly using some other search engine or something so that you can log on to something and then become automatic subscribers?

[David Fewer]

I want to respond to this.

On something that we haven't heard a lot about or haven't heard come up, especially in the referral conversation, because I'm sensitive to that, my view is that there are other tools available to respond to referrals. When you get a referral, there's a customer out there who's giving you a referral. Nobody has said, “Well, can you ask your friend to e-mail me or send that to my website?” Nobody has talked about their website. You can have a sign-up form on your website. There are lots of mechanisms available to get consent. You can pick up the phone and call.

Somebody talked about going back to the world of Rotary meetings and what not; we don't have to go that far. But referrals did occur before the Internet and before e-mail. They'll go on.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Van Kesteren.

Mr. Vincent.

[Robert Vincent, Bloc, Shefford, QC]

Thank you, Mr. Chair.

Mr. Fewer, earlier you said that most spam originates from abroad. The majority does not originate from Canada, but outside Canada. You said that if we eliminate spam, productivity will go up.

What do you think about companies that decide to send all of their communications by mail? They have to be able to market their products. Do you think that our productivity will go up by sending letters? Everyone is going to do the same. How are we going to manage all of those letters? How will recycling centres, which will receive more and more paper, manage the situation?

We can answer the question displayed on the computer screen, we can delete the unwanted email and that is it; it is gone for good. But paper leaves from somewhere, is transported by someone, arrives in homes, is sent to recycling centres and is sent back for treatment.

Do you think that improves productivity? I would like to hear your thoughts on the matter. How will companies advertise?

[David Fewer]

One of the things I like about mail is that there is a barrier to sending it. There's a cost to sending it. What that does instantly is make sure that Nigerian scammers and businesses that are relying upon the economics of mass e-mail now have to--

[Robert Vincent, Bloc, Shefford, QC]

I have to stop you there. You mentioned cost, but have you considered how much this will cost companies or what they will have to do to stay in business if we add costs to their products?

[David Fewer]

If the unsolicited solicitation is worth making, then it's worth making on paper. It's worth making using mail. It's worth making using other traditional mechanisms of marketing. If the solicitation is so invaluable that the additional cost of going from hitting “send” to a million people to sending out flyers puts you off it, I'm not sure that the economy is hurt in a sufficient way, in a significant manner.

One of the things I like as well about junk mail--real junk mail as opposed to junk spam--is that I can set up systems within my office to make sure that it doesn't get to me or to make sure that it gets filtered before it gets to me. Only things that my administrative assistant, for instance, knows I'd be interested in make it up to me or my colleagues. With spam I don't have that option. I have to deal with each one that makes it through and decide if I care about it, if I've already contacted these people, why they are bothering me. How much time do I lose per day dealing with those kinds of unsolicited communications? It's not a huge amount, but it adds up over time, and it's multiplied across the economy.

[Kim Alexander-Cook]

Mr. Vincent, I beg to differ, first of all, with respect to Mr. Fewer's comments. I don't think there's any evidence whatsoever that you could point to that would suggest that business would not be harmed by the increased costs that would accompany being forced to revert back to using letter mail, if that's in fact what the result is.

To me, this really has the potential of throwing out the proverbial baby with the proverbial bathwater. Think of small businesses, so often cited as the major engine in our economy; we do not want them faced with very difficult competition where a large business may be able to afford to market where they can't.

The technology we have with electronic messaging or other aspects of our electronic life is something that I know Mr. Fewer takes seriously, but it should be seen as a very positive thing, and we should be very careful not to be doing harm when we are trying to do good. I think a lot of members here have been very sensitive to that in their questions.

If I may, I'd like to link back to a comment that Mr. Fraser made about the difference between unsolicited and unwanted e-mail. It's a challenge, it's fair to say, given what various stakeholders have been saying here, for the committee to be able to fashion a bill that does not, in a sense, throw out the baby with the bathwater.

By way of one example, if the bill doesn't get refashioned in such a way as to define bad conduct as that which is targeted, as opposed to all conduct with some exceptions, one possibility that I know we have discussed internally here has been to look at the implied consent, and instead of saying in the regulations that we'll define what else implied consent might be, let implied consent stand on its own. It's a strong concept. There really has to be implied consent.

Use regulations if necessary to say, for example, the existence of one or more of the following does not by itself establish implied consent, if you are concerned about that sort of thing. But implied consent can live on its own. I think the business community and the business culture will work out, along with the courts, what that really means.

[The Chair, Conservative, Michael Chong]

Thank you very much.

Mr. Lake.