Evidence of meeting #77 for Industry, Science and Technology in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was businesses.
A recording is available from Parliament.
Liberal
Lloyd Longfield Liberal Guelph, ON
You're welcome. No sweat.
In the London Chamber of Commerce, Gerry Macartney is an awesome rock star in terms of policy. I was the president of the Guelph Chamber of Commerce. We did a lot of work together.
With the idea of e-commerce and how we compete in a global market, we have two things we're trying to balance here. One that's very hard for us to balance is the consumer's take on all this. We're getting businesses' take on it, but I want to try to find.... Maybe in future witnesses, we can get this.
Mr. Hill, I'll start with you on whether you have received any consumers' input on what they think of CASL from your organization.
Vice-President, Government and Consumer Affairs, Canadian Marketing Association
We receive complaints from consumers about marketers' activities. The principal concern that you hear from consumers is that they want to have control over the communications they're receiving.
Typically, the complaints that we will receive are situations where an unsubscribe request is being ignored. The example that was mentioned, Compu.Finder, fell into that category. That is what consumers really want, and it's a legitimate concern. They should be able to control the nature of the marketing communications they're receiving.
This is all about how you put together a structure to make that happen, that works for everyone, that doesn't become unwieldy for the businesses while allowing consumers to exercise choice. And that's why we're talking about the two-year and six-month rule, because the consumers don't need that. They have the unsubscribe option. They can unsubscribe. They can look after themselves. They don't need that provision in the law.
Liberal
Lloyd Longfield Liberal Guelph, ON
Thank you.
Turning to Mr. McLinton with the Retail Council, with respect to the relationship between the consumer and the retailer, when consumers get upset by anything, they can take their business elsewhere. Do you have any sense of the volume of consumer push-back on CASL? It has been very helpful today to get suggestions. We're not throwing CASL out, but there are some areas that maybe we could do better. Do you have anything from the consumer side of things on CASL?
Vice-President, Grocery Division and Regulatory Affairs, Retail Council of Canada
Yes. Thank you, Mr. Longfield.
I'd like to think that the Retail Council and its members can offer a unique perspective on this, in that our members have the direct interface with the consumers. From what I'm hearing from the members, the consumers' knowledge of the actual legislation is limited to non-existent. But as Mr. Hill has suggested, consumers want what they want and they want it now, and they don't want what they don't want and they want it gone right away. So it is not in our members' best interests to be doing marketing when the consumer doesn't want it. Just from a business self-interest perspective, it's about giving the consumers what they want.
I think what I'm hearing from the members is that today's consumers are more knowledgeable and more tech savvy than they have ever been before, and they want that kind of control. So maybe I'm repeating what Mr. Hill said, it's the ability to subscribe, and to refer to my earlier comments, by brand and by type of message, and to unsubscribe by brand and by type of message. That's what we're hearing they're looking for.
Liberal
Lloyd Longfield Liberal Guelph, ON
That's helpful. Thank you.
Mr. Schiestel, coming back to the global opportunities, as you were speaking, I was thinking of reversing things, of Canadian businesses exporting and how this legislation could impact our export opportunities, where we're trying to get SMEs to do more export. Maybe you could give us a piece on that, just from the business standpoint.
October 19th, 2017 / 12:05 p.m.
Founder, Lighten CASL Inc.
I don't know if I have anything material to add. I believe the act states that if a Canadian is sending a CEM to a company that has its own legislation, then essentially it needs to comply with that legislation.
Immediately to your question, I don't think I have anything material to add beyond that.
Liberal
Lloyd Longfield Liberal Guelph, ON
I didn't know about your not-for-profit business before now. How has CASL affected your business?
Founder, Lighten CASL Inc.
I have a for-profit company called tbk Creative, which is a web design and digital marketing company. Is that the one you're speaking about?
Liberal
Founder, Lighten CASL Inc.
How I got interested in this topic is that we build a lot of websites at our company. Back before July 2014, our clients were actually coming to us asking how to comply with CASL. I needed to understand the act, and that's when I realized we really have a problem here. It's a very complex act to be able to go and read. It costs a lot of legal money to figure out. That's how we got into it. A lot of businesses grapple with it on a regular basis, on how to build websites to properly comply with the act.
Liberal
Lloyd Longfield Liberal Guelph, ON
When legislation creates an industry unto itself, it's something that I always have questions with.
Thank you.
Liberal
The Chair Liberal Dan Ruimy
Thank you very much.
We're going to move to Mr. Jeneroux.
You have five minutes.
Conservative
Matt Jeneroux Conservative Edmonton Riverbend, AB
Thank you.
Thank you, guys, for being here today. It's an important topic. I know that taking time out of your day is also challenging, so I appreciate all of you coming up to the Hill.
I want to start with a question that I'll put to Mr. Elder, first of all, around the enforcement of the act. We know that in a lot of cases CRTC commissioners only become involved after a notice has been issued, and only if the company then elects to incur further expenses and appeals the notice. We've also heard that several companies have elected to settle with the CRTC staff and to pay the substantial fines just to avoid the issuance of a notice of violation. You talked about it a little bit indirectly through a number of other questions, but could you go into a bit more detail on how you think these issues should be addressed?
Special Digital Privacy Counsel, Canadian Marketing Association
Sure.
I think the point about staff that I was making and the allocation of the powers to staff without oversight directly from the CRTC is problematic when you have a new law with very vague provisions and very vague standards. You're putting it all on the shoulders of front-line staff to interpret that, to deal with the companies, to issue notices of violation. Even if there is a question that comes up, as it has in several of the investigations in which I've been involved on behalf of clients, there's a question of legal interpretation. Does the law really say that? Am I guilty of something? If I'm a business, before I want to settle, I want to know that I've done something contrary to the law. There can be a live question, and there's no mechanism. If staff doesn't agree with you, you're going to get a notice of violation, which has its own consequences in terms of adverse publicity, and there's no mechanism where you can even ask for a ruling on it from the commission, the appointed GIC members of the commission, so you can get a bit more certainty about how it's enforced. I think that's part of it.
The other part of it is the way it works. The CRTC tries to get undertakings. Under the act they can get an undertaking settlement essentially from an organization without having to issue a notice of violation. Organizations are in a situation where the CRTC staff approach them and say that they think they're guilty of this and the CRTC thinks they should pay a penalty of x and agree to the following things. If they don't agree with that, the CRTC staff are going to issue a notice of violation for x plus 25% or 50%. Companies are really in a bind, and they have to gamble about running the gauntlet and bothering to appeal it to the CRTC or just cut their losses, take their lumps, pay the fine and move on with life. In many cases, they're choosing the latter. In some cases, even for issues where it wouldn't have stood up, the law didn't apply in that way, the company just says it's worth paying a few tens of thousands of dollars to get out of it and have it done.
Conservative
Matt Jeneroux Conservative Edmonton Riverbend, AB
In follow-up to that, what about the ability to pay aspect of the law?
Rogers was in here recently and they said that because they have a higher ability to pay, they're fined a separate amount. Do you have any comments on that? Have you seen any of that?
Special Digital Privacy Counsel, Canadian Marketing Association
That is certainly set out as one of the factors to be taken into account when assessing fines. Properly applied, it makes some sense. If you have a violation for a single flyer publisher, which we've had one of, you're not going to fine them to the same amount as a multi-million dollar company. You're going to assess fines based on that. But it shouldn't mean that you automatically prefer going after the larger companies and that you hit them as hard as you can just because they're larger and they can afford to pay.
Vice-President, Government and Consumer Affairs, Canadian Marketing Association
Even in the finding in the Blackstone case, the initial fine was $650,000 or something. They had to appeal that to the commission. The staff hit them heavily. The commission reduced it to whatever it was, $25,000 or $50,000, a twelfth of the original.
That's some of what's going on. People are feeling they need to settle. But if there's absolutely no way you can afford it, then you're going to run the gauntlet.
Conservative
Matt Jeneroux Conservative Edmonton Riverbend, AB
Yes.
I have about 20 seconds left, Mr. McLinton, so just quickly, what type of businesses are you hearing from most in terms of CASL?
Vice-President, Grocery Division and Regulatory Affairs, Retail Council of Canada
I'm hearing from a range of members. What I'm hearing from the larger members is that their legal counsel is being very risk-averse, and is advising them to interpret the law in a very strict way. They're avoiding marketing campaigns, and campaigns to recipients that are probably legitimate, but—
Conservative
Vice-President, Grocery Division and Regulatory Affairs, Retail Council of Canada
All of them—grocers, hardware, and then large merchandisers.
What I'm hearing from the smaller members, though, from the hardware stores in the rural areas that Mr. Eglinski mentioned, is how can we possibly have the clerks trained to document this stuff? Where do we even hire someone to put a new database in place or buy a filing cabinet for this stuff? I'm hearing from the smaller members a lot of frustration about how onerous it is to demonstrate that they've gotten consent.
Liberal
Liberal
Majid Jowhari Liberal Richmond Hill, ON
Thank you, Mr. Chair.
Thank you to the witnesses.
I'll give a bit of a preamble, and then I'll ask a question about something that's been somewhat confusing to me.
In general, we've heard that CASL has worked by reducing the number of malicious communications. In general, we are also hearing that the legislation may have cast the net too wide. A number of concern areas have been identified, and over the last three or four sessions we've had some good recommendations. These recommendations specifically say what should be excluded from CASL, or how it should be clarified.
Here comes my question. We can start with Andrew, and then go to Jason and Wally. By excluding those areas of concern, do we by default address the issue that the intent of CASL was to go after those specific malicious communications, or do we need to make certain changes to be able to specifically do that? By implementing the recommendation, do we by default now clearly focus on those malicious communications or not?
Founder, Lighten CASL Inc.
It's a good question. I would look at identifying what are harassing communications—for example, ignoring unsubscribe requests, malicious spam, and cybersecurity threats—and go through a lot of consultation to really understand that. That's on one side. On the other side, look at what would be a reasonable situation in which a business would send out a commercial electronic message given the context—for instance, if somebody provides their information to the business, which in a lot of cases might not meet the current implied consent rules. Draft provisions around that. In other words, on the latter, loosen up when implied consent would be present. Then make sure that the act is still catching the malicious stuff.
