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Get Ready for Canada's Telemarketing Regulations (eh?)

July 31, 2008

On September 30, 2008, Canada will flick the switch on a long-anticipated new set of tougher telemarketing regulations including a national Do Not Call (DNC) list.
 
The measures are intended to better enable the country’s 33 million+ consumers to limit unwanted telemarketing calls and to halt annoying practices such as ‘dead air’ from abandoned calls that had been made by predictive dialers.
 
The Canadian rules are largely based on US legislation, including the federal DNC list that went into effect five years ago this October. Canada has therefore had the benefit of learning from the US experience.
 
Here are the key features of these regulations, administered by the Canadian Radio-television and Telecommunications Commission (CRTC), Canada’s communications regulatory agency, along with how they differ from US federal laws:
 
*          Do Not Call List (DNCL)
 
Canadian consumers will be able to register on the DNCL any number: landline, wireless, or fax, up to three numbers at a time. The registration will be valid for three years and will expire automatically unless individuals re-register the numbers.
 
Canada’s DNCL has exemptions for firms that have existing business relationships (EBRs) with consumers, defined as 18 months from the last transaction and six months from the last interaction. There are also exemptions for registered charities, political parties (including candidates, nomination, and leadership contestants), polling, and newspapers.
 
Most organizations including those that are exempt must keep their own individual DNC lists for three years. The most notable exception is for those collecting information for surveys.
 
US Laws: Congress has now made the federal DNC list permanent; the federal government will now be responsible for ensuring the database is scrubbed of abandoned numbers. Consumers cannot register their fax numbers on the DNC.  Both the US and Canada have specific provisions in their regulations covering faxes.
 
Also, the EBR in the US from the last interaction is three months. Canada’s longer interaction period reflects the more defined seasons in most of the country that for example would otherwise prevent say lawn care firms that shut down in late October from calling their clients in March or April, when the ground begins to warm up.
 
*          Calling Hours
 
These are 9am to 9:30pm local time Monday-Fridays and 10am-6pm Saturdays and Sundays. Prior to these new rules Canada had these hours but only for faxes. They follow those set in the Canadian Marketing Association (CMA) Code of Ethics and Standards of Practice.
 
US Laws: the federal regulations set calling hours as between 8am and 9pm seven days a week.
 
*          Outbound Introductions
 
All calls must have either the real or fake names of the agents, the name of the marketer, and if being made by a third party e.g. a teleservices firm, that vendor’s name.
 
US Laws: there is no specific requirement for naming third parties.
 
*          Consumer Feedback
 
Telemarketers must have local or toll-free numbers. Calls from consumers must be answered either by a live agent or a voicemail system to take messages for the consumer, and be returned in three business days.
 
US Laws: there has to be some means of contacting consumers but the regulations do not spell this out.
 
*          Abandonment Rate
 
The predictive dialer abandonment rate is five percent, with abandoned calls defined as those that are not connected to agent within two seconds.
 
US Laws: The abandonment rate is no more than three percent.
 
*          Fees
 
The DNCL fees range from $55 per month for one area code to $11,280 for all area codes annually. Telemarketers also can obtain up to 100 individual numbers at $.50 per number per query session.

US Laws: Data for up to five area codes will be available for free. Beyond that, there is an annual fee of $62 per area code of data, with a maximum annual fee of $17,050 for the entire U.S. database.

*          Jurisdiction

There are no allowances for separate or supplementary provincial regulations. There is also only one federal agency, the CRTC, in charge of telemarketing legislation, unlike the US where it is split between the FCC and FTC (News - Alert). That means the Canadian DNCL and other regulations are a one-stop-shop, thereby simplifying compliance and enforcement.
 
US Laws: Individual states are allowed to have DNC registries, calling hours, and enforcement provisions.
 
(There is, however, telemarketer registration similar to that in many US states, which provinces are allowed to do as with any other business. So far British Columbia is the only province that requires it.)
 
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The CRTC will, as of Sept. 30 have fining authority for all telemarketing regulations that it did not have before. It will have a third party, that it is in the process of seeking, to investigate DNCL and other telemarketing complaints.
 
This firm will work closely with Bell Canada (News - Alert), the national DNCL operator and the CRTC to ensure that complaints are dealt with consistently and in a timely manner. All telemarketers, including those making exempt calls, will pay fees to the investigator to cover its costs.
 
Prior to this the CRTC relied on telcos to enforce individual DNC requests by suspending or disconnecting telemarketers. Consumers could then contact the CRTC if the telcos were not able to stop the unwanted calls.
 
The regulations did not prove effective as the telcos were often loath to go after businesses that were their customers.
 
“Telemarketing was far and way top source of consumer complaints to our organization,” reports Wally Hill, CMA Vice-President Communications & Public Affairs.
 
(Ed. Note: this article is for general information only. For specific details please contact the regulatory agencies or consult with attorneys who are well-versed on these laws and regulations)
 
Brendan B. Read is TMCnet’s Senior Contributing Editor. To read more of Brendan’s articles, please visit his columnist page.

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