Email marketers beware. The Spam Act 2003 (Spam Act) has officially made a mark. On 27 October 2006 the Federal Court of Australia made an order in the case of ACMA v Clarity1 Pty Ltd against Perth based global email spammer Clarity1 Pty Ltd (Clarity1) and its managing director, Mr Wayne Mansfield, to the amount of $5.5 million for breaches of the Act.
Mansfield and Clarity1 were previously listed by the UK-based-international anti-spam watchdog, Spamhaus, as one of the world’s top 200 spammers. Notably, the top 200 producers of spam contribute to 80 percent of the world’s email spam.
The ACMA court submission states that from 10 April 2004, Clarity1 and Mansfield sent at least 270 million commercial emails which were mostly unsolicited and in breach of the Spam Act. Clarity1 had argued that all the commercial emails contained an unsubscribe facility and of the 166,000 requests by email recipients for removal from Clarity1’s email lists, all were acted upon. They also argued that if the recipients of the commercial emails did not wish to utilise the unsubscribe facility they had obviously consented to receiving their messages. Only 79 complaints had been made against Clarity1 for the same period. The Federal Court, in its decision of 13 April 2006, rejected Clarity1’s arguments and found in favour of ACMA, later making its penalty orders on 27 October 2006.
Other enthusiastic message marketers have also been penalised under the Act to a somewhat smaller extent. A Melbourne car dealer thought he had developed the ultimate marketing scheme. He had collected mobile telephone numbers from newspaper classified advertisements and SMS messaged the unsuspecting advertiser with commercial messages. Another company thought they would use an agent offshore to send over 50,000 commercial SMS promoting gambling software. It remains unclear as to whether the $13,200 penalty imposed on them is much of a deterrent.
However, the Australia Communications and Media Authority (‘ACMA’) is not making it easy for email marketers with the recent launch of a 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. A one year trial of the button has resulted in the report of over 880,000 spam emails. With the increase of reports one could assume an increase in the number of prosecutions by the ACMA. And with the above verdict in mind businesses are wise to reconsider their marketing strategies.
In light of the above, businesses should be asking whether:
their employees understand what is prohibited under the Act in relation to electronic messaging and the penalties that apply for failing to comply with the Act;
they have in place adequate processes for ensuring that commercial electronic messages are not sent without the express or inferred consent of the recipient;
the CME adequately identifies their business;
the CME contains a functional “unsubscribe” facility to allow recipients to opt out of receiving messages in the future; and
there is the existence of address harvesting, and if so to ensure that it immediately removed.
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 launch in May 2007 will put telemarketer son their feet.
Implementing the Spam Act in most businesses may seem like an easy task. However, since the Act came into force in April 2004 the ACMA has received almost 3900 complaints and issued approximately $20000 in fines and more then 520 warnings across Australia for spam-related incidents. Given the amount of Spam still entering my inbox on a daily basis we can only expect these numbers to increase.
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