Send­ing spam to be out­lawed

Bill aims to pro­vide pro­tec­tion for all the per­sonal in­for­ma­tion that is pro­cessed by pub­lic and pri­vate bodies

Business Day - Business Law and Tax Review - - BUSINESS LAW & TAX REVIEW - DANIEL BREIER & KA­TIA MEN­GEL

PAMMERS be­ware! Send­ing un­so­licited e-mails, SMSs and faxes could soon be il­le­gal if Par­lia­ment passes the Pro­tec­tion of Per­sonal In­for­ma­tion Bill 2009 into law. If passed, the law could have a sig­nif­i­cant ef­fect on the prac­tice of di­rect mar­ket­ing in SA — a cause for cel­e­bra­tion for those ha­rassed con­tin­u­ally by di­rect mar­keters and a cause for con­cern for those em­ployed in this labour-in­ten­sive in­dus­try.

The bill aims to out­law un­so­licited e-mails, SMSs and faxes, while at the same time pre­vent­ing call cen­tres from cre­at­ing and us­ing con­tact lists to reach po­ten­tial cus­tomers without their prior con­sent. Fol­low­ing in­ter­na­tional trends, the move is away from an “opt out” ap­proach to­wards an “opt in” ap­proach that re­quires the con­sumer’s con­sent be­fore con­tact is made. Since prior con­sent by def­i­ni­tion ex­cludes cold call­ing and spam it will lead to ma­jor changes in the in­dus­try.

As the law stands, di­rect mar­keters are en­ti­tled to send elec­tronic mes­sages, usu­ally SMSs and e-mails, to po­ten­tial cus­tomers. How­ever, th­ese mes­sages must in­clude in­for­ma­tion iden­ti­fy­ing their source and must al­low the re­ceiver to opt out of re­ceiv­ing fur­ther com­mu­ni­ca­tions. Un­so­licited tele­phone calls are al­lowed but are sub­ject to reg­u­la­tion in the credit and fi­nan­cial ser­vices sec­tors. The rules in th­ese sec­tors pre­vent ha­rass­ment, give re­ceivers an op­tion to opt out of

Sre­ceiv­ing fur­ther calls, and pro­vide a code of con­duct for call-cen­tre work­ers to fol­low. New con­sumer pro­tec­tion laws pro­vide for a cool­ing-off pe­riod, au­tho­rise fu­ture reg­u­la­tion as to per­mis­si­ble hours for di­rect mar­ket­ing, and pave the way for es­tab­lish­ing a na­tional “do not call” reg­istry.

The bill aims to pro­tect all per­sonal in­for­ma­tion that is pro­cessed by pub­lic and pri­vate bodies. It fol­lows sim­i­lar leg­is­la­tion in the UK and the Euro­pean Com­mu­nity. The bill con­tains a num­ber of pro­vi­sions reg­u­lat­ing the types of in­for­ma­tion that may be ob­tained and the man­ner in which it may be pro­cessed. For ex­am­ple, the bill pro­hibits, the pro­cess­ing of per­sonal in­for­ma­tion re­gard­ing a sub­ject’s race, ex­cept in nar­rowly de­fined cir­cum­stances.

Sec­tion 66 of the bill pro­hibits all un­so­licited elec­tronic com­mu­ni­ca­tions. This pro­hi­bi­tion cov­ers SMSs, emails, faxes and au­to­matic call­ing ma­chines ca­pa­ble of mak­ing out­bound calls with a recorded voice. Un­der sec­tion 66, all th­ese types of un­so­licited elec­tronic com­mu­ni­ca­tions will only be al­lowed when the re­ceiver has given prior con­sent or is an ex­ist­ing cus­tomer of the com­pany. Com­mu­ni­ca­tions can only be sent to ex­ist­ing cus­tomers when their con­tact de­tails were ob­tained through a pre­vi­ous sale of a prod­uct or ser­vice. Fur­ther, th­ese com­mu­ni­ca­tions can only be in the con­text of sell­ing a sim­i­lar prod­uct or ser­vice from the same com­pany. There­fore the prac­tice of sell­ing con­tact lists to other com­pa­nies will be il­le­gal. Adding to this, the ex­ist­ing cus­tomer main­tains the right to opt out at any stage.

While there is no pro­vi­sion in the bill that specif­i­cally pro­hibits mak­ing com­mer­cial sales calls, the gen­eral law re­gard­ing the pro­cess­ing of per­sonal in­for­ma­tion in sec­tion 10 of the bill only al­lows the pro­cess­ing of per­sonal in­for­ma­tion in a lim­ited num­ber of sit­u­a­tions. This would ef­fec­tively pre­vent a busi­ness from com­pil­ing and us­ing a data­base of num­bers of po­ten­tial cus­tomers un­less the busi­ness has al­ready ob­tained their con­sent to be con­tacted. Apart from dialling num­bers at ran­dom from a pre-ex­ist­ing printed or off­line elec­tronic tele­phone di­rec­tory, pro­cess­ing a data­base of con­tacts will prob­a­bly only be pos­si­ble for mak­ing com­mer­cial sales calls if it is shown to be “nec­es­sary for pur­su­ing the le­git­i­mate in­ter­ests” of the busi­ness on whose be­half the calls are made. It is un­clear at this stage whether “le­git­i­mate in­ter­ests” would in­clude a busi­ness’s de­sire to pro­mote its prod­ucts and ser­vices.

If the bill comes into force busi­nesses will be given a year to con­form. An of­fice of the in­for­ma­tion pro­tec­tion reg­u­la­tor will en­force com­pli­ance with the bill, and en­force­ment no­tices will be served on busi­nesses that fail to com­ply. Con­tin­ued non-com­pli­ance with an en­force­ment no­tice may lead to a fine or im­pris­on­ment for a max­i­mum of 12 months. A civil dam­ages claim may be avail­able to a con­sumer against an of­fend­ing busi­ness.

The Di­rect Mar­ket­ing As­so­ci­a­tion of South Africa (DMA) has made a num­ber of sub­mis­sions re­gard­ing the bill. At this stage the bill is be­fore the port­fo­lio com­mit­tee on jus­tice and con­sti­tu­tional af­fairs. It is not clear what fi­nal form the bill will take, but it is clear that a bal­ance needs to be struck be­tween com­pet­ing in­ter­ests. The frus­tra­tion of spam-filled e-mail and SMS in­boxes and the an­noy­ance of a din­ner be­ing in­ter­rupted by an un­so­licited sales call are com­mon ir­ri­ta­tions in the lives of many South Africans. Some may even feel that th­ese con­sti­tute an en­croach­ment on their pri­vacy.

On the other hand, the di­rect mar­ket­ing in­dus­try pro­vides em­ploy­ment for thou­sands of South Africans, and out­sourc­ing the call-cen­tre in­dus­try has great po­ten­tial for in­ter­na­tional growth.

It is hoped that the fi­nal piece of leg­is­la­tion will take into ac­count th­ese com­pet­ing con­cerns.


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