Email Marketing: Before the Spam Act!

In its submission to the Federal Court, the Australian Communications and Media Authority (“ACMA”) stated that from 10 April 2004, Clarity1 and Mansfield sent at least 270 million emails to approximately 8,000,000 email addresses. Most were unsolicited and in breach of the Spam Act. Clarity1 argued that all emails contained an unsubscribe facility and of the 166,000 unsubscribe requests, all were acted upon by Clarity1. They also argued that if the recipients of the emails did not wish to utilise the unsubscribe facility, they had obviously consented to receiving the messages. Only 79 complaints had been made against Clarity1 during the same period.

The Federal Court rejected Clarity1’s arguments and found in favour of ACMA. The penalty was in our view, substantial and partly so to send a clear message to businesses and individuals that spam is taken seriously in Australia and a breach of the Spam Act carries hefty financial consequences. These consequences included Mansfield being ordered to pay a $1 million penalty out of his own pocket.

Two other recent examples where fines were handed out include:

1. Melbourne car dealer who collected mobile telephone numbers from newspaper classified advertisements and SMS messaged the unsuspecting advertisers with commercial messages; and

2. A company who used an agent offshore to send over 50,000 SMS messages promoting gambling software.

In an effort to increase its policing of Spam, the ACMA recently launched the new ‘one click’ spam reporting system, known as the ‘SpamMATTERS’ button. The ‘SpamMATTERS’ button is downloadable from the ACMA website and allows the user to simultaneously delete spam and report it to the ACMA in one simple click. With the predicted increase in the number of complaints, it can be inferred that the ACMA will prosecute an increasing number of businesses and individuals for breaching the Spam Act.

We therefore remind you to ask yourself whether:

1. your employees understand what is prohibited under the Act in relation to electronic messaging;

2. you have in place adequate written processes for ensuring that electronic messages are not sent without the express or inferred consent of the recipient;

3. any electronic messages adequately identifies your business;

4. any electronic messages contain a functional “unsubscribe” facility.

Exemptions to the Spam Act are available for government bodies, registered political parties, charities, religious organisations and educational institutions. Factual messages are also exempt if they have accurate identifying information. It is also important to note that the Act does not cover voice or fax telemarketing. The establishment of a national “Do Not Call Register” which is expected to be launched in May 2007 will cover spam through telemarketing.