Industry Committee on Sept. 30th, 2009

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

So are you suggesting removing the ability for an individual to sue someone who sends him an e-mail or malware?

[Nathalie Clark]

I guess I would answer that question by saying that what really concerns the industry is that built into that private right of action is a possibility to have damages granted without a real proof of loss. That is really the issue we have with this regime. We think it's inappropriate to be able to grant damages when no real loss has been proven. In that sense, we don't support the private right of action as it is drafted in the bill currently.

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

I'm just trying to think this through. I'm on my computer and I'm working on a program or, let's say, an offer to someone I'm seeking business from. A piece of malware comes in through the e-mail. I open it up and it takes over my computer and shuts it down. Under what you're suggesting, I would have no recourse in regard to the person who caused the problem in the first place.

[Nathalie Clark]

Well, I think if the power is given to the regulator to monitor compliance with the act, you will have the possibility of bringing that issue to the regulator, and it will be for the regulator to enforce the act appropriately after a formal investigation.

So in that sense, I don't think it is true to say that you have no possibility of recourse. What we're saying is that the government should be dealing with any non-compliance with this legislation, and that it is appropriate that it be this way.

Do you have anything to add, Bill?

[William Randle, Assistant General Counsel and Foreign Bank Secretary, Canadian Bankers Association]

I would also say that our real concern was with the fact that they could pursue the right of action and the class actions on the private right of action. Put those things together in the development of class actions in this province and the costs for businesses, especially small and medium-sized businesses, can be quite significant in defending these actions.

Our focus was on that and the impact it might have, especially if there's no real need to establish a real loss. I think in the example you gave there was a potential loss, and that might be something for the committee to consider, but our concern is this sort of complete right of action simply because something happened to them that was a breach of the legislation.

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

It's wasted my time, and my time is precious; therefore, I can sue. That's the kind of stuff we're trying to stay away from.

[William Randle]

And as you say, Mr. Rota, we've all been faced with individuals who may have certain ways of dealing with things, and I think it's unfair to companies that.... In fact, as a number of the other witnesses have said, you could have an honest mistake that potentially would lead to a right of action in this bill.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Randle.

Monsieur Bouchard.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Thank you, Mr. Chair.

I too would like to mention the fact that it is International Translation Day. I want to thank the interpreters because I rely on great deal on their services.

I would also like to thank each one of the witnesses for coming here to testify this afternoon.

My first question is for Mr. Paul Misener. You can let me know if I am giving an accurate synopsis of your presentation. You stated that there should be no restrictions or limits on business-to-business emails and that between a business and a consumer or client, the period of implied consent for contact should be five years. Could you clarify this five-year period for me? Does the clock start when the file is opened, or when the last email or communication is sent?

Have you thought about this timeframe? Would the clock start running immediately on this five-year period you are proposing, or is there a transition phase to allow for the application of the provisions?

[Paul Misener]

Merci, monsieur.

My proposal here was to recognize that, in the context of when a consumer affirmatively goes and purchases something from a seller, there be implied consent for that seller to continue to communicate with that consumer and offer that consumer new products—perhaps a sequel to the book they purchased—and that an 18-month implied consent simply is not sufficient and it does not match consumer expectations, especially given that books aren't written every 17 months, new cars don't go bad every 17 months, and so forth. There is a real consumer benefit for a much longer period. I would argue for an indefinite period, but perhaps five years would be sufficient.

I'm sorry, what was the second question?

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

My second question concerns this transition. In so far as this five-year period is concerned, when exactly does the clock start running? How do you determine the point at which you start calculating?

[Paul Misener]

It's a great question, sir.

I'm not a statutory expert. I think that's probably the date at which the act would come into force. Presumably it would start these clocks, because if you recall, sellers are required to keep track of when a customer purchased something. All of a sudden there is going to be a clock associated with every customer, and the clock presumably would have to start running at the time the act comes into force, just so we could keep track of such things and not have to try to go back and determine where the clock is.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Thank you.

My next question is directed to Ms. Clark of the Canadian Bankers Association. You mentioned the possibility of a business or retailer contacting a person in advance to obtain his or her consent, and about the possibility of contacting that person once and from that moment on, having that person's consent.

Did I understand you correctly? What would justify that course of action?

[Nathalie Clark]

Yes, it is true that we would like to be able to contact a prospective customer or consumer initially to request his or consent at that time. Obviously, we are not suggesting that strict parameters be put in place to govern the initial contact, but rather that some provision be made for this contact in the legislation. That is what we are proposing. We feel that an amendment of this nature would enable us to carry out legitimate business activities, without compromising either the intent or aims of the legislation.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

I have a side question. Are you talking about a business communicating with existing customers, or about communicating in an effort to attract new customers?

[Nathalie Clark]

I'm talking about efforts to attract new or prospective customers.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

I see. What that means is that in the case of existing customers, you are not suggesting that there need to have been an existing relationship between the business and the client for a specified period of time.

Have you given any thought to the timeframe that could be applied in the case of implied consent? Earlier, we talked about five years. Should the period of implied consent be shorter? Should there be no limit set at all?

[Nathalie Clark]

We did not consider that point. I would first like to reiterate that we support this bill. However, we believe that a number of simple amendments could address some of our concerns about legitimate commercial activities. Clearly, it is important for us to be able to make that initial contact with a prospective customer.

As for our concerns about existing customers, let me just mention that we would not be allowed to refer an existing customer to another affiliate of the bank. We want to be able to do that. We also believe that we should be able to offer an existing customer of the bank the option of being referred to affiliates of the bank or to other banking services. That is our only concern with respect to existing customers.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

I would like to hear from the representative of Option consommateurs on this matter. As we can see, there is a fair amount of latitude in terms of communication opportunities. You seem to be saying that in order for a business to communicate with a consumer, prior consent of the consumer must be obtained. Is that correct?

[Geneviève Reed]

You are absolutely correct. That is what we recommended further to a research project carried out in 2004. We have always maintained this position. We favour the “opt-in“ framework, as do most of the Canadians we surveyed at the time, that is to say we believe prior consent must be given before a request for information is sent, if only for the fact that a person's email address is personal information.

I wonder how businesses will initially contact a consumer if there is no prior existing relationship. How will they access email addresses? That is what I would like to know.

[The Chair, Conservative, Michael Chong]

Thank you, Mr. Bouchard and Ms. Reed.

Mr. Lake.

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

Thank you, Mr. Chair.

I have a quick point in relation to Mr. Gray and Mr. Kee.

One of you mentioned some installation issues that you had, and we've heard similar concerns from other groups with the software that's on the computer needing to have things installed from time to time to allow it to run properly. I know that's something we'll be looking at with the amendments. We've identified that there may be an issue there.

Mr. Misener, in relation to your comments around clause 10 and the 18-month window, I'd make a quick clarification. The 18-month window applies only in the case of the implied consent, so the idea of this existing business relationship.... If you, through that existing business relationship, simply ask the person buying the book or whatever it might be that they're buying for express consent, then you have that consent forever.

Is that an unreasonable expectation that a company would simply ask for that express consent so they get it, and if a new book comes out four years later, they don't have to ask again because they've gotten the express consent at the time of the original purchase?

[Paul Misener]

Thank you, Mr. Lake.

It's potentially reasonable, but here we've already recognized that there is a consumer expectation arising out of a purchase. This is a transaction. This isn't simply a matter of visiting a website or just receiving an e-mail; this is someone going and actually making a purchase. There is an expectation now that consumers would want to maintain some sort of relationship. It could be argued that this ought to be entirely an opt-in bill, but it's not, and it should not be. I think consumers would expect that they wouldn't have to go through the friction of providing express consent at their first purchase. Otherwise, this implied consent section wouldn't be here in the first place.

All I'm suggesting is that if we're going to have an implied consent regime, which I think is entirely reasonable and matches consumer expectations, it ought to match their expectations on the back end as well, which is to suggest that at 17 and a half months, there's not a barrage of e-mails coming in by sellers trying to maintain their buyers, but rather that it more appropriately matches product cycles and product life cycles.

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

Right. And I understand the concern.

As a consumer myself, I just think that when I do purchase something, whether it be online or not, I actually don't expect that I will receive e-mails from the company that I purchased from for the rest of my life because I've made that one purchase. I think it wouldn't be that difficult for someone to actually ask me for my express consent at that time. Then if I do want to do it, I would simply put a check mark on the box, and then expect to receive the e-mails. That's just a point from personal use.

For Ms. Clark, I just want to clarify something. First of all, you pointed to the American legislation, in terms of an example, and said that it is different from other legislation in terms of the way it deals with things, and that it deals with some things harder than other legislation.

Now, David Fewer, who was here last meeting from the Canadian Internet Policy and Public Interest Clinic, said--and I'll quote him--that “this bill is a significant improvement over the U.S. legislation, the CAN-SPAM legislation”, which, frankly, he referred to as the “do not hesitate to spam bill”.

[Voices]

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