Industry Committee on Sept. 30th, 2009

[Chris Warkentin, Conservative, Peace River, AB]

I'm very curious about this point. I would like to get a consumer's perspective on the whole issue of implied consent as well. Do you find that people often come back just for the same artist the second time?

[Paul Misener]

Absolutely, people buy within fairly narrow categories. They show they like a particular author. If, say, they bought three or four books by a particular author that they've just discovered who's written over the past decade and a half, and that author releases another work in 24 months or 19 months, we would not, under the current draft, be able to e-mail that consumer about the new release. But if they came out in 17 months since the last purchase, we'd be able to do it. That's why it's so arbitrary.

The producer cycles for an author can easily be four or five years. The product life cycle for things like computers, headphones, and such things that we also sell at Amazon.ca are not 18 months; they're more like 24, 36, or 48 months.

[Chris Warkentin, Conservative, Peace River, AB]

I appreciate that it's going to be different for many different industries. Realtors are going to tell us that they need 20 years because the chance of somebody buying a house may be 20 years.

I'm wondering, Ms. Reed or Ms. Bose, if you've taken any time to consider the issue of implied consent and what length of time you feel the consumer would be willing to accept. Have you had those discussions with broad groups of consumers?

[Geneviève Reed]

Thank you.

Let me reiterate what I said earlier, namely that there is nothing to stop Mr. Misener or anyone else from sending an email to his customer during the first 18 months of their relationship to see if he or she is interested in hearing from him in future. There is absolutely nothing stopping him from doing that. It is quite easy. We receive messages like that on a regular basis. As a consumer representative, I do not have a problem with that. Whether it is in connection with a purchase or a warranty, businesses can request a customer's email address. We already see that happening. We purchase all kinds of products, credit cards and the like, and when we do, we are asked if we want to receive messages in the future. I don't see why it would be any different within the framework of this bill or how costs would be a problem.

[Chris Warkentin, Conservative, Peace River, AB]

You describe the 18-month renewal of implied consent. What if it worked in reverse? If there was a pre-existing business relationship, consumers could click and say they didn't want to receive information any more. It might come two years afterwards, but when the communication came, the consumer would simply say, “Okay, no more. I'm done considering your offers.” I'm wondering if the consumer, from your perspective, would favour one over the other.

[Geneviève Reed]

Generally, speaking, consumers prefer to be asked if they want to “opt in“, rather than to have to “opt out“. That is the approach we favour.

[The Chair, Conservative, Michael Chong]

Thank you, Mr. Warkentin and Madame Reed.

Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Mr. Misener, in your letter you've encouraged the inclusion of language that would reverse the statutory punishment for an action such as using falsified headers. Maybe you could expand on this. As to the issue of a pattern of mistakes, you seem to think that if a mistake was made there would be absolute prosecution. Could you expand on that? We haven't gone very far into it.

[Paul Misener]

This act would prohibit some actions that are clearly intentional. No one accidentally falsifies a header, right? So if we receive e-mails from a source that looks just like RBC, that wasn't an accident—it was fully intentional. We think that in such cases it wouldn't make sense to force the prosecution or the plaintiff to show intent. Other actions could be honest mistakes. If you accidentally send an e-mail to a consumer who has asked you to stop sending more e-mails, there are serious market forces working against that kind of mistake—you don't want to annoy your potential customers. This is why we've suggested Senator Goldstein's language, which makes it clear that this would not apply if the contravention were due to an honest mistake. That kind of clarification would go a long way towards assuaging those concerns.

[Brian Masse, NDP, Windsor West, ON]

I want to make sure I've got this right. You're saying that in the header containing false or misleading information there's more intent to mislead than if we accidentally mail something to somebody. You're worried that this might result in an upside-down situation in respect of where the fines would go.

[Paul Misener]

Yes, sir. The suggestions that I humbly offer would go a long way towards fixing this situation. The honest mistake would not be punished. Punishment would apply only to actions wilfully undertaken.

[Brian Masse, NDP, Windsor West, ON]

Does anybody else have a comment on that situation?

I don't want it to seem like we're picking on the banks, but you have nine pages of issues. We had the Desjardins Bank in front of us the other day. Are they part of your association?

[Nathalie Clark]

No, they're regulated by provincial legislation.

[Brian Masse, NDP, Windsor West, ON]

You have suggested 31 days for unsubscription. I have a hard time believing it could take 31 days, especially from banks. For the most part, they are sophisticated organizations with strong communication websites. Tell me why it takes 31 days to unsubscribe. When I subscribe, I get something back within 24 hours. Being a CIBC credit card holder, I can tell you it doesn't take them long to get back to me.

[Nathalie Clark]

As you said, the banks have very sophisticated systems in place. That's why we are concerned that the 10 days would not allow the banks to proceed efficiently with the unsubscription. We feel that a bit more time would help to avoid errors, delays, and non-compliance.

Banks have some of the most sophisticated IT systems in this country. At the same time, when a change needs to be done, the banks want to make sure that it is done properly, with a minimum of errors. A complex system requires more time to adjust. It might take more than 10 days to do everything properly.

[Brian Masse, NDP, Windsor West, ON]

But if I went into my bank and wanted to be taken off the mailing list, I would expect that within a couple of weeks they could easily do that through regular, ordinary mail. I just find it hard to accept that, if the programs are that sophisticated, it wouldn't be easier--some of this is automated now--to take you off that subscription list.

It worries me that you have a system in place such that 31 days would be required. Maybe 10 business days might be more reasonable, but 31 days? That's a month.

And I don't know if that's 31 regular days or 31 business days. Can we clarify that?

[Nathalie Clark]

It's regular days.

[Brian Masse, NDP, Windsor West, ON]

Okay. So it's a full month.

Is there anything technically preventing the banks from being able to take people off in 10 days? Or is it just a matter of your not wanting to put in the resources to actually have either the program to do it or to have somebody do it through staffing?

[Nathalie Clark]

No. Again, the only reason why we provided comment on that specific item....

I don't want to overkill it, if you will, because the banks will comply with whatever will be the intention of the legislator. The comment is really in relation to the complexity of the system. Sometimes it takes longer than you would expect to make the change and to make it right, avoiding as much as possible any errors.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Masse.

Mr. Lake.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair.

Since this probably will be my last time to speak to witnesses who've come before the committee on this legislation, I do want to take the time to thank you; and not just you, but also, given the subject matter, all the people following this online.

I do want to thank all of the witnesses who have been before us over the time we've been studying this bill, because it is extremely important that we get this right. I know we've heard some suggestions through our hearings that we'll definitely be considering as amendments when we move forward here. So thank you for that.

In terms of some of the conversation today, I think it's important that we remember that as we talk about consumers and businesses in this context, it's not an oppositional discussion. In fact, many of the consumers, maybe even most of the consumers we're talking about in this context, are businesses in terms of the Internet.

It's been said that the cost to Canada of the problem that we're trying to solve here is upwards of $3 billion a year in terms of the effect of spam and some of the things we're trying to stop with this legislation. It's a very significant problem, a problem that renders e-mail communication in many cases almost meaningless as we clog the pipelines that transfer information back and forth.

I guess I want to get a comment from Mr. Copeland and Mr. Misener on the economic potential of the Internet. I think it's suitable to close with a big-picture conversation about the economic potential of the Internet and how this ECPA will affect Canadians' ability to use the Internet to our long-term economic advantage.

[Tom Copeland]

In general, what we hope will come from the ECPA is a renewed confidence in the Internet and Internet communications as a tool for communications, for marketing, for e-commerce.

A lot of my ISP customers are afraid to go online and do anything. They don't want to purchase things. They don't want to do online banking. They've seen those e-mails come through that purport to be from the TD Bank or the Scotiabank or wherever. They're quite literally scared witless to go online and do anything.

I'm not sure we can put a number on the potential, but we're certainly seeing people avoiding the Internet now because of the issues that the ECPA can help solve.

[Paul Misener]

Thank you, Mr. Lake.

I would briefly add that Amazon.com established Amazon.ca about seven years ago. The whole purpose was to be able to better serve our Canadian customers, featuring Canadian content, particularly Canadian authors, musicians, and movies.

We want to ensure that we're able to communicate with them efficiently. This bill, we believe, would go a long way to removing the chaff so that communications are better between businesses and our customers.

We applaud your efforts here, we really do. My suggestions are not an overall criticism of the approach with the bill itself but just a few tweaks to make it better. I honestly believe these would improve the bill, but you've got a great piece of legislation before you already.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Misener.

We'll have a brief question from Mr. Rota in clarification before we wind up the meeting today.

[Anthony Rota, Liberal, Nipissing—Timiskaming, ON]

Thank you very much, Mr. Chair.

My question is for Ms. Reed.

When you say that an individual or business can contact individuals to ask for their consent to contact them, it seems to me that we are inventing a new spam system. I think we are going to have some problems.

What kind of model do you have in mind? Could you describe it to us?