Direct marketing – new legal dangers
Opt In Out
In the context of this article, direct marketing means marketing contact that has not been requested by the target, write lawyers Mike Pettit and Tim Cook.
The legal background on direct marketing is set to change. The European Directive on Privacy and Electronic Communications ("Directive") focuses on marketing by email, SMS, fax and automated calling machines ("Electronic Direct Marketing").
The requirements of the Directive must be implemented within UK law by no later than 31 October 2003. Draft implementing regulations for the UK have been published but the provisions may change in the course of the consultation process.
A key purpose of the Directive concerns the requirements for anyone engaging in Electronic Direct Marketing to obtain consent from the target and whether a target must give prior explicit consent to Electronic Direct Marketing ("opt-in") or whether allowing a target to withdraw from Electronic Direct Marketing ("opt-out") is legal.
Currently it is legal (subject to some exceptions)for a business to send Electronic Direct Marketing to targets in the UK, without that target having given explicit consent, by allowing the target to "opt-out" of future contact.
Most readers will be familiar with seeing an option to unsubscribe on marketing emails (this adapted example is taken from a marketing email that the author received this morning... "If you prefer not to receive future marketing e-mail from our business then please reply to firstname.lastname@example.org").
Revisions to the British Code of Advertising, Sales Promotion and Direct Marketing ("Code") came into effect in March 2003 and were essentially made to cover Electronic Direct Marketing.
The Code reflects the legal requirements set out in the Directive. Although the Code is self-regulated (by the advertising industry) and not enforceable in law (except in extreme circumstances), the Advertising Standards Authority can investigate complaints about a breach of the Code. Therefore it is advisable for businesses to comply with the Code generally and also in preparation for implementation of the requirements of the Directive which will be enforceable in law.
The Directive requires those engaged in Electronic Direct Marketing by email to implement an "opt-in" approach to consent before sending Electronic Direct Marketing emails to a target, except where a target's electronic contact details are obtained during the course of supplying goods/ services to that target, in which case those engaged in Electronic Direct Marketing may adopt an "opt-out" approach to consent only in respect of marketing its own identical or similar goods/ services to that target.
Where the "opt-out" applies, the target must be given an easy, free of charge and clear opportunity to "opt-out" both when contact details are collected, and on all future Electronic Direct Marketing.
It is contrary to the provisions of the Directive to:
(i) conceal the identity of the sender, and
(ii) fail to provide a valid return email address for opting-out.
Consent - SMS, fax and automated calling machines
The Directive requires those engaged in Electronic Direct Marketing by SMS, fax and automated calling machines to implement an "opt-in" approach to consent before sending such Electronic Direct Marketing to a target.
Consent - other means of direct marketing
For businesses wishing to market by other means of electronic communication (e.g. non-automated telephone marketing) the Directive allows the UK to determine whether or not "opt-in" is required.
The draft UK Regulations currently provide that (subject to certain exceptions) a business may not market by non-automated telephone where the target has contacted the business and exercised its right to "opt-out" or if the target is listed on an "opt-out" register.
Review your direct marketing policies now
If your business engages in Electronic Direct Marketing then its policies will need to be reviewed in the light of the current legislation and the impending changes.
If your policies are in compliance with current legislation and, in particular, the Code then implementation of the impending changes will be more painless.
© Taylor Walton 2003. All Rights Reserved
Taylor Walton supplies a comprehensive range of commercial legal services. If you would like to discuss the content of this article or any other commercial matter, please contact Mike Pettit or Tim Cook. You can also telephone on 01582 731161