Intellectual Property Law

New Rule Provisions for the U.S. CAN-SPAM Act

By Martha L. Arias

On May 12, 2008, the U.S. Federal Trade Commission (FTC) approved new rule provisions that clarify the CAN-SPAM requirements and considered 3 years of public comments.  The new rule provisions were already published in the U.S. Federal Register and will become effective 45 days after their publication. The United States CAN-SPAM Act of 2003 is the federal law regulating commercial e-mail advertisement.  It establishes the rules for commercial e-mails, typifies the practices that constitute spam, sanctions spammers, and provides consumer rights regarding unsolicited e-mail advertisement.  Special provisions within the CAN-SPAM Act introduce rules on e-mail marketing of adult content sites. 

Within a broad-spectrum, the U.S. CAN-SPAM Act has effectively regulated commercial e-mail advertisement in the U.S.  However, some original advertisement practices, not envisioned by the legislator, challenged the CAN-SPAM rules.  For instance, in commercial e-mail messages including multi-company advertisement, recipients could not assert who the actual sender was; thus making the opt-out option meaningless.    Like this, other topics related to commercial advertisement defied assertive application of some CAN-SPAM rules.  
The FTC newly approved provisions for the CAN-SPAM concretely addressed four areas that were demanding revision:  the definition of sender was modified; post office boxes were included as valid physical address under the Act; definition of the term 'person' was added; and rules regarding the opt-out option were explained.

One of the main goals of this clarification effort for the CAN-SPAM was to elucidate who is a sender within the meaning of the Act.  Recipients of e-mail advertisement sometimes could not identify its sender; for example, advertisers of travel packages included advertisement for hotels, airlines, car-rentals, etc.  In these cases, recipients were unclear about what company was to receive their opt-out message.   The FTC newly approved provisions clarified the term 'sender,' provided options to determine who the sender is when multiple-company advertisement is received; and determined what party is responsible for complying with the opt-out requirements in multiple party's advertisement.    For example, the new rule requires that commercial e-mails with multiple companies' advertisement must identify a 'designated sender.'  This 'designated sender' will honor recipients' opt-out requests, not matter how many companies or e-mails appear on the advertisement.  The designated sender must be identified as the 'sole' sender of the message in the 'from' line of the e-mail.

Another important point clarified by the FTC new rule provisions for CAN-SPAM relate to the physical address to be included in any e-mail advertisement.  CAN-SPAM rules require e-mail advertisers to include a 'valid physical postal address' in the U.S. within any commercial e-mail message.  The new provisions allow commercial advertisers to include a U.S. post office box (PO box) or private mailbox to satisfy this requirement. 

The CAN-SPAM Act frequently used the term 'person' but it did not provide a legal definition.  The FTC new rule provisions defined 'person' as "an individual, group, unincorporated association, limited or general partnership, corporation, or other business entity."   FTC considered that the term 'person' should not be limited to a natural person; this is a wise position from the FTC and one that extirpates loopholes.   

Lastly, another relevant topic addressed by the FTC provisions relates to the opt-out request from recipients of commercial e-mails.  Senders of commercial e-mails still have 10 days to process opt-out requests (the 3 days initially proposed by the FTC was criticized by the commentaries to the rules); yet, it was clear from the new provisions that the sender must process those requests within reasonable time.  Also, senders cannot request from recipients any further information (only recipients' e-mail address) or any type of fee in order to process the opt-out request.  

Full post as published by IBLS Internet Law Blog on June 15, 2008 (boomark / email).