The Committee of Advertising Practice, responsible for drawing up and publishing the recent 11th edition of the CAP Code, has demanded a right of reply to our recent piece criticising the new codes.
Mr Stephen Groom
26 Old Bailey
11 April 2003
I read with interest Osborne Clarke’s recent feature on the new CAP Code (marketinglaw.co.uk, March 2003).
In criticising CAP’s early adoption of the soft opt-in rule, and in questioning whether that rule change was fully thought through, it makes a few assumptions that I would like to address.
Taking the feature’s “four fundamental concerns” in order:
First, “the CAP Code is arguably for the very first time wandering into areas of ‘delivery’ as opposed to content”. The CAP Code has covered delivery issues in the areas of database practice and distance selling for 12 years. It has covered delivery issues for sales promotions since 1974. Moreover, CAP has been an “early adopter” before. It introduced the seven day cooling-off period for distance selling orders in 1991 – nine years before it became law via the Consumer Protection (Distance Selling) Regulations 2000.
Second, “CAP has unjustifiably jumped the gun and made life even more difficult and challenging for UK marketers”. There is nothing unjustifiable about CAP’s early adoption of soft opt-in. The entire marketing and non-broadcast media business is represented on CAP – including the Direct Marketing Association – and all supported the decision. They did so because they realised that if people were increasingly intolerant of unsolicited e-mail and SMS direct marketing it would become ineffective. People’s perception of direct marketing in general might also be affected. Set against that was the backdrop of increasing public complaints to the ASA. By way of example, the ASA received ten times as many complaints about SMS in 2002 as 2001. Many of the complainants objected to the unsolicited and intrusive nature of the communications.
Third, “the wording of the relevant parts of the new CAP Code offers no further assistance on issues which are currently unclear from the terms of the [Directive on Privacy and Electronic Communications (“the directive”)]”. It is because the issues are unclear that the new CAP Code does not offer assistance at this stage. It does, however, clarify a long-standing dispute concerning existing legislation: the Information Commissioner has long argued that opt-in is already required for SMS direct marketing under the Telecommunications (Data Protection and Privacy) Regulations 1999 on the basis that automated calling systems are used. The new CAP Code settles that matter. As for future assistance, guidance is provided to marketers, agencies and media by the CAP Copy Advice team and CAP Help Notes. Once the DTI’s consultation on the directive has progressed and we are all clearer on how it intends to implement it into UK law at the end of October, CAP may well produce such a Help Note to explain how soft opt-in is likely to work under the CAP Code. In the meantime, marketers should ring the CAP Copy Advice team for fast and free advice.
For the record, Copy Advice is currently taking a liberal view on the meaning of the term “existing customers” (in line with the DTI view expressed in its consultation). The example you provide of the distinction between “explicit” and “prior” consent should not therefore be a problem in practice. In any event, the difference between the two in law is far from clear. The directive requires that subscribers have “given their prior consent”. “Consent” is defined by reference to Directive 95/46/EC. This describes it as “any freely given specific and informed indication of his wishes by which the data subject signifies his agreement to personal data relating to him being processed”. Plainly this requires an active step by the data subject. In addition, recital 40 to the directive states that “for such forms of unsolicited communications for direct marketing, it is justified to require that prior explicit consent of recipients are obtained before such communications are addressed to them”. As we understand it, the “soft” bit is the “existing customers” exemption not a vague “prior consent” exemption.
Fourth, “[the Code] appears to be arguably tougher on marketers than the directive required”. I imagine this alludes to the absence of an exemption for non-natural persons. The new CAP Code does not clarify this point. A future Help Note may well. In the meantime, the Copy Advice team is advising enquirers that the new rule is likely to apply to e-mail and SMS direct marketing sent to people in their private capacity, including to their business addresses/numbers, but not when sent to individuals in their professional capacity. In that respect, the team’s advice may differ from the directive, though its advice neatly circumvents the thorny issue of how on earth a marketer is supposed to determine that a person is a “subscribing natural person” (i.e. is party to a contract but not a legal person/entity), as is apparently required by the directive.
Clearly, the introduction of a new soft opt-in rule will have an effect on marketers. E-mail marketers more than SMS marketers, as the vast majority of the latter already market on an opt-in basis. But neither the ASA nor CAP intends to be heavy-handed in administering or enforcing the new rule. UK marketers have just under two months left of the three month “period of grace” to effect a transition from old system to new. Many are using that time well.
I hope you will publish this reply to your feature.