This is the first in a series of 3 articles that will summarise three of the key pieces of legislation that impact on your direct marketing activities.

Do you use direct marketing to advertise your business directly to customers? If yes, there are three key pieces of legislation that you need to comply with when you direct market:

• Spam Act 2003
• Do Not Call Register Act 2006
• Privacy Act 1988

This article covers the Spam Act.  Watch out for my upcoming articles on the Do Not Call Register Act and Privacy Act.

Here’s a quick guide to what you need to know about the Spam Act.

Spam Act

The Spam Act regulates your ability to send (or cause to be sent) commercial electronic messages to your customers.

Here’s a summary of what the Spam Act says:

• You must not send, or cause to be sent, commercial electronic messages to a recipient unless you have consent from that recipient.
  • A “commercial electronic message” is one where the message contains an offer by you to sell, or where you advertise or promote goods, services, investment or business opportunities or interests in property.
  • The Spam Act only applies to messages sent by Australian businesses, or by foreign entities on the instruction of an Australian-based business.
  • A “commercial electronic message” means emails and SMS messages. It could technically also include messages sent via social platforms, although ACMA hasn’t yet signalled any intention of using its enforcement powers in these areas.
  • The Spam Act applies to messages you send, as well as messages which you cause to be sent – including refer a friend type messages.  See below for more information about “refer a friend” messages.
  • You must have express consent or inferred consent to send messages.
    • Wherever possible, you should try to obtain express consent to send messages.  If you are using a tick box to provide that you have express consent, ACMA’s view (which I think is right) is that this tick box should not be pre-ticked.
    • Watch out for purchased email lists – does the person who you purchase the list from have consent to share those email addresses with you?  If not, you don’t have consent from the recipients to send them emails.
    • According to ACMA, inferred consent can occur:
      • via an existing business or other relationship, where there is reasonable expectation of receiving commercial electronic messages
      • via conspicuous publication of a work-related electronic address because it is accessible to the public, or a section of the public:
        • if the address is not accompanied by a statement saying no commercial messages are wanted; and
        • the subject of the message is directly related to the role or function of the recipient.
  • Electronic commercial messages must contain:
  • • The name and ABN (where applicable) of the sender.
    • Details of how the recipient can contact the sender.
    • An operative unsubscribe feature:
      • it must remain functional for at least 30 days after the original message was sent
      • it must allow the unsubscribe message to be sent to whoever authorised the sending of the message, not necessarily any third party that sent it on their behalf
      • unsubscribe instructions must be presented in a clear and conspicuous way
      • a request to unsubscribe must be honoured within five working days
      • unsubscribing must be at low cost, or no cost, to the user (for example, in the case of SMS unsubscribe facilities, a 1800-telephone number would be acceptable).
      • You must not use address harvesting software to generate customer contact details.

Watch out for “refer a friend” messages, which to my constant surprise are very commonly used.  These emails will generally breach the Spam Act because of the prohibition on causing unsolicited emails to be sent to recipients.  By offering a “refer a friend” or “share with a friend” mechanic, you are causing a commercial electronic message to be sent to the friend who typically will not have consented to receive messages from you.

Be very careful about asking your customers to give you their friends’ details, then using that information for direct marketing.  A friend cannot give consent on behalf of their friend to receive messages from you!

ACMA formally warned McDonald’s about this type of marketing 18 months ago, but appears to have taken no real enforcement action on the point since.  Given the prevalence of this type of marketing, and the stern commentary by ACMA at the time, it wouldn’t surprise me to see a prosecution for this type of marketing communication sometime soon.

Breaches of this legislation can result in prosecution and hefty fines.

If you need any assistance in managing your obligations under the Spam Act, you can contact us here.