Frequently Asked Questions (FAQ) on Anti-Spam Legislation On December 16, 2003, the President signed the CAN-SPAM Act of 2003 (S.877) into law, which went into effect January 1, 2004. Though the legislation ultimately targets the peddlers of pornography, false business opportunities, and body enhancing solutions and those that use fraudulent or deceptive practices, there are implications for the association community. ASAE is pleased to offer the following FAQ on the CAN-SPAM Act. (Please note that this information is based on ASAE s reading of the law. This information should not be taken as either legal advice or a legal opinion.) What is the definition of a commercial electronic mail message? The term commercial electronic mail message is defined as any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service (including content on an Internet website operated for a commercial purpose). What must senders of commercial e-mail messages do to comply with the rules of the legislation? The law establishes 3 criteria for e-mail when messages are commercial in nature: 1) Clear and conspicuous identification that the message is an advertisement or solicitation 2) An ability to opt-out electronically from future emails of this nature 3) A valid postal address of the sender Associations may allow message recipients to opt-out by replying to the message, or by providing a link to an Internet web page. Opt-out lists, which allow recipients the opportunity to select from among various types of messages that the recipient may or may not want to receive (e.g., conference messages, advertising messages, sponsorship messages, etc.) are allowed, as long as the list contains one option that allows the recipient to select not to receive any messages from the association (i.e., a select all option). Also note that once someone opts out of receiving future commercial e-mail messages, the new law prohibits the sender of the e-mail from transferring or releasing that opted out e-mail address to anyone for any purpose.
Additionally, the sender has 10 days from receipt of an opt-out request to remove the e-mail address from the appropriate e-mail lists. Are there any exceptions to this definition of commercial e-mail? Yes. The definition does not cover what has been termed transactional or relationship messages. These messages are deemed to be non-commercial in nature and are not subject to the requirements of the Act. A transactional or relationship message is defined in the CAN-SPAM Act as a message the primary purpose of which is to deliver goods or services that the recipient is entitled to receive under the terms of a transaction that the recipient has previously agreed to enter into with the sender. (Emphasis added.) Other messages, which fit neither the commercial or transactional or relationship categories, are referred to as non-commercial messages, which are not subject to CAN-SPAM. In comments to the FTC, ASAE took the position that a member of a nonprofit organization or association is entitled to receive the messages, information, and other materials sent to its members, and so such messages should not be covered by the Act. To view the full text of our comments, please visit the ASAE Web site at http://info.asaenet.org/pdf/ftc_spam.pdf. What is the Federal Trade Commission s primary purpose test for determining if an e-mail is commercial in nature or not? On December 16, 2004, the FTC published its final regulations on determining the primary purpose of a commercial e-mail. The CAN-SPAM Act required the FTC to issue regulations "defining the relevant criteria to facilitate the determination of the primary purpose of an electronic mail message." The FTC s final regulations are almost identical to the proposed regulations published earlier this year on August 13, 2004 in the Federal Register. ASAE submitted comments to the FTC on the proposed rules asserting that all e- mails from non-profits to members should be deemed "transactional or relationship" messages and therefore not commercial in nature. The FTC has, to date, been unwilling to carve out any exemption for messages sent by nonprofits and regardless of whether the message is sent to members or nonmembers.
In the Federal Register from August 13, the FTC proposed three criteria for determining if an e-mail message's primary purpose is commercial. These criteria are included in the final regulations that have been published: - If the e-mail's content solely advertises or promotes a product or service, it would be deemed commercial. - Should the e-mail contain both commercial content and also content that falls under the FTC's "transactional or relationship message" category, which is not deemed commercial by nature, then the e-mail would be considered commercial in nature if either a) the recipient deems from its subject line that the message advertises or promotes a product or service or b) the "transactional or relationship" content is not located at or near the beginning of an e-mail. - If the e-mail contains both commercial and non-commercial content, the e- mail would then be deemed commercial if a) from the subject line the recipient concludes that the e-mail advertises or promotes a product or service or b) if the recipient concludes from the text that the main purpose is to advertise or promote a product or service. One new addition included in the final regulations is that any message containing only transactional or relationship content will be deemed to have a transactional or relationship primary purpose. For more information, including December 16th register notice, feel free to visit http://www.ftc.gov/opa/2004/12/canspamfrn.htm. When do these new rules go into effect? The FTC s primary purpose rules will become effective on February 18, 2005. CAN-SPAM s requirements have been effective since January 1, 2004. Who enforces CAN-SPAM Act violations? The Federal Trade Commission, the States, and Internet Service Providers all have enforcement authority under the CAN-SPAM Act. Penalties may include injunctions and fines up to $6 million. CAN-SPAM does not provide a private right of action, so individual plaintiffs cannot enforce its provisions.
In ASAE s view, what effect does this test have on e-mails to association members? The FTC stated in its December 16 notice that it is possible or even likely that messages between a nonprofit and its members could constitute transactional or relationship messages. Though not providing a blanket exception for nonprofit organizations, this statement by the FTC makes it clear that the FTC considers messages from a nonprofit organization to its members to likely be transactional or relationship and thus not subject to the requirements of the Act. The FTC does point out, however, that if the recipient of the message deems the subject line to be an advertisement or promotion, or if the transactional and relationship content is not at the beginning of the message, the message would then be considered commercial in nature. However, ASAE believes that the FTC s statement noted above provides very solid support for the position that e-mails to members would be considered as transactional or relationship messages. This result would be enhanced by clearly noting in the subject line of the message that the message is being sent to association members, and also by including the transactional and relationship information at the beginning of the message. Associations should also be aware that no private right of action is provided under the Act to individuals, but only to the FTC, internet service providers, and state attorneys general. Associations that wish to avoid any legal uncertainty in messages to members could instead treat questionable e-mails as commercial and make sure to include the following three provisions on these e-mails: 1) Clear and conspicuous identification that the message is an advertisement or solicitation 2) An ability to opt-out electronically from future emails of this nature 3) A valid postal address of the sender As noted above, if any member decided to opt-out, the association would have to comply with that request, although a menu of items that could be selected for opting-out would be permissible (e.g., conference messages, advertising messages, sponsorship messages, etc.). The email addresses of any opting-out
members would then also have to be removed from directories and lists and no longer released. What about e-mails to non-members? Commercial e-mails to non-members are not subject to the exemption and would have to comply with the provisions of the CAN-SPAM Act, which include: 1) Clear and conspicuous identification that the message is an advertisement or solicitation 2) An ability to opt-out electronically from future emails of this nature 3) A valid postal address of the sender A non-member opt-out request would have to be respected and the nonmember s email addresses removed and not released, as discussed above. What about email messages from an association s for-profit subsidiary? ASAE contended in its comments that messages from an association s forprofit subsidiary should also be considered transactional or relationship, since members should be entitled to receive messages, information, and materials from all organizations in the association s family. Because the FTC did not address this, associations are advised to consult legal counsel, as with implementation of any actions under the CAN-SPAM Act. What happens to current and pending state laws on Spam? The CAN-SPAM Act generally pre-empts all existing and pending state laws on Spam. However, state laws concerning false and deceptive practices are still valid. Will there be a do-not-spam registry? The FTC had 6 months to report back with a plan on establishing a do-notspam registry, similar to the popular do-not-call registry, and reported its belief that e-mail does not lend itself to this type of registry.
End Notes If you have any other questions you feel should be added to this list, please contact Chris Merida, ASAE s Manager of Public Policy, at 202-626-2831 or by e-mail at cmerida@asaenet.org.