CASL enforcement

As most people know, the Canadian Anti-Spam Law (CASL) went into effect July 1 of this year. This month, the CRTC concluded its first investigation.

A computer reseller based in Saskatchewan was placed under investigation by the CRTC after large numbers of complaints were made through the Spam Reporting Centre. The CRTC revealed that a server owned by the computer reseller sent millions of e-mail spam messages through Saskatchewan-based internet service provider, Access Communications. […] Exercising its discretion, the CRTC chose not to fine the business. CRCT Concludes First Enforcement

One of the biggest complaints about CASL was that innocent senders who just happened to inadvertently violate CASL would be hit with business ending fines. But the agencies tasked with enforcement have discretion. There are no minimum fines that they have to impose, they have discretion. Their first enforcement action demonstrates this. It would be easy for the CRTC to impose business ending fines on their initial case, as a warning to other senders. They didn’t do that.
CRTC has demonstrated they’re willing to work with businesses that violate CASL. That gives all senders a little bit of breathing room for the next 2.5 years. Come July 1, 2017, individual users can exercise their private rights of action against senders. The PRoA is really an unknown variable. How many Canadians are annoyed enough by unsolicited emails that they’re willing to take senders to court? I don’t really know.

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Who pays for spam?

A couple weeks ago, I published a blog post about monetizing the complaint stream. The premise was that ESPs could offer lower base rates for sending if the customer agreed to pay per complaint. The idea came to me while talking with a deliverability expert at a major ESP. One of their potential customer wanted the ESP to allow them to mail purchased lists. The customer even offered to indemnify the ESP and assume all legal risk for mailing purchased lists.
While on the surface this may seem like a generous offer, there aren’t many legal liabilities associated with sending email. Follow a few basic rules that most of us learn in Kindergarten (say your name, stop poking when asked, don’t lie) and there’s no chance you’ll be legally liable for your actions.
Legal liability is not really the concern for most ESPs. The bigger issues for ESPs including overall sending reputation and cost associated with resolving a block. The idea behind monetizing the complaint stream was making the customer bear some of the risk for bad sends. ESP customers do a lot of bad things, up to and including spamming, without having any financial consequences for the behavior. By sharing  in the non-legal consequences of spamming, the customer may feel some of the effect of their bad decisions.
Right now, ESPs really protect customers from consequences. The ESP pays for the compliance team. The ESP handles negotiations with ISPs and filtering companies. The cost of this is partially built into the sending pricing, but if there is a big problem, the ESP ends up shouldering the bulk of the resolution costs. In some cases, the ESP even loses revenue as they disconnect the sender.
ESPs hide the cost of bad decisions from customers and do not incentivize customers to make good decisions. Maybe if they started making customers shoulder some of the financial liability for spamming there’d be less spamming.

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