In the EU, it’s the opt in/opt out rules of the country of destination that apply to marketing by email or text. E-marketers should note, therefore, that Ireland has recently introduced significantly stiffer penalties for breaking the rules. Gemma Neylon of Mason Hayes & Curran, Dublin reports.
Topic: Email marketing
Who: Irish Minister for Communications, Energy and Natural Resources
When: December 2008
Where: Republic of Ireland
Law stated as at: 20 February 2009
What happened:
On 9 December 2008, the Irish Minister for Communications, Energy and Natural Resources signed the European Communities (Electronic Communications Networks and Services) (Data Protection and Privacy) (Amendment) Regulations 2008 (the “2008 Regulations”). The 2008 Regulations, which came into effect on 13 December 2008, send a strong warning to individuals and corporate bodies involved in direct marketing activities to comply with their legal obligations.
General overwiew
In Ireland, the sending of unsolicited marketing communications is governed by the EC (Electronic Communications Networks and Services) (Data Protection and Privacy) Regulations 2003, (the “2003 Regulations”) as amended by the 2008 Regulations (together, the “Regulations”). The Regulations set out the circumstances in which direct marketing by means of electronic communication, including phone, fax and email marketing, is permitted and the extent to which consent must be obtained before engaging in such direct marketing.
The first prosecution under the 2003 Regulations in Ireland occurred in September 2005, when the Data Protection Commissioner (“DPC”) prosecuted a company for sending unsolicited commercial text messages to mobile phone subscribers. In 2008 the Office of the DPC reported a dramatic increase in complaints in relation to unsolicited marketing communications, which rose from 66 in 2005 to 538 in 2007.
The general principle is that the prior consent of subscribers (an opt-in) is required before marketing to those individuals by email, SMS, fax or automated calling machine. A person is not entitled to “cold-call” for direct marketing purposes to subscribers who have notified the person that they do not consent to the receipt of cold-calls or who have recorded their objection to cold-calls in the National Directory Database.
Facts
Under the 2008 Regulations, the maximum potential fine on summary conviction has been increased from €3,000 to €5,000. Proceedings on summary conviction may be taken by the DPC.
The 2008 Regulations now provide for the possibility of an offence to be prosecuted on indictment by the Director of Public Prosecutions. The penalty for a corporate body convicted of such an offence can be up to €250,000 or 10% of the body’s turnover, whichever is greater. The penalty for individuals can be up to €50,000.
As the penalties are applicable to each unsolicited communication, email or phone call made in breach of the Regulations, the potential aggregate financial penalties are expected to be a significant deterrent to non-compliance with the Regulations.
Where an offence is committed by a body corporate, individual officers within the company (e.g. director, manager or secretary) may also be guilty of a separate offence if is proved that the offence was committed with the consent or connivance, or was attributable to the neglect, of the officer. In such a case, an officer of a body corporate may be proceeded against for the offence whether or not the body corporate has been proceeded against or been convicted of the offence committed by the body.
In addition to increasing the penalties for breaches of the direct marketing rules, the 2008 Regulations also place the onus on direct marketers to show that the consumers consented to receiving a direct marketing communication or call. Furthermore, where the DPC is investigating a complaint under the Regulations and is of the opinion that the circumstances relating to the complaint involve the commission of an offence, the DPC may bring and prosecute proceedings for the offence without attempting to bring about an amicable resolution of the complaint.
Why this matters:
The current stated policy of the Office of the DPC is to pay close attention to the whole area of unsolicited communications by telephone, fax, email and SMS messaging. The DPC has welcomed the introduction of the 2008 Regulations and stated that
“the new regulations, together with the serving of a considerable volume of summonses by my Office in the past fifteen months, serve to send a strong message to all involved in direct marketing about the necessity of compliance with the law”.
The potential for imposition of substantial financial penalties contained in the 2008 Regulations, together with the negative PR consequences which a conviction under the Regulations would necessarily entail, are expected to act as a significant deterrent to unsolicited direct marketing practices.
In light of these developments and the recent convictions secured by the DPC for unsolicited text marketing, companies and individuals engaging in direct marketing should be aware of the need to comply with their legal obligations under the Regulations. The DPC has highlighted the current prevalence of unsolicited direct marketing practices, stating that:
“Increasingly, in this period of economic downturn, my Office is receiving complaints about businesses making unsolicited contact with their past customers for marketing purposes … Ignorance of the law is not an acceptable excuse for non-compliance and I will have no hesitation in applying the full force of the new regulations to offenders”.
Gemma Neylon
Solicitor
Mason Hayes+Curran, Dublin
gneylon@mhc.ie
The content of this article is provided for information purposes only and does not constitute legal or other advice. Mason Hayes+Curran (www.mhc.ie) is a leading business law firm with offices in Dublin, London and New York.
