CAN-SPAM: Is the FTC Poised For Major Changes?

The FTC has asked interested parties to address a wide variety of questions concerning its CAN-SPAM rules, including whether the rules provide any benefits at all to consumers.

Where might this lead?

HISTORY OF CAN-SPAM RULES

The  Controlling the Assault of Non-Solicited Pornography and Marketing Act (or “CAN-SPAM”) went into effect on January 1, 2004.  Since then, the FTC has promulgated rules for labeling of adult content, for determining the primary purpose of an email message, and clarifying terminology used in the law.

THE FTC’S QUESTIONS ABOUT CAN-SPAM

Now, however, the FTC is using its rulemaking authority to ask a number of questions that suggest that the agency is poised for a major revamping of its CAN-SPAM rules, including to possibility of eliminating those rules entirely.

In addition to asking whether the FTC’s CAN-SPAM rules are needed, and if they provide any benefit to the public, the FTC has asked a number of questions which suggest that, even if it retains the rules, a major retooling is a distinct possibility.

These questions include:

• What benefits, if any, has the Rule provided to businesses, including small businesses? What evidence supports the asserted benefits?
• What modifications, if any, should be made to the Rule to increase its benefits to businesses, including small businesses?
• What modifications, if any, should be made to the Rule to reduce the costs imposed on businesses, including small businesses?
• Should the Commission modify the Rule to expand or contract the categories of messages that are treated as transactional or relationship messages?
• Should the Commission modify the Rule to reduce the time-period for processing opt-out requests to less than ten business days?
• Should the Commission modify the Rule to specify additional activities or practices that constitute aggravated violations?

Some groups have used the occasion to urge the FTC to create a “do not email” list akin to its “do not call” list, but there is no evidence that the FTC is likely to impose such a cumbersome and costly new regime for marketing that simply is not as intrusive or unmanageable as telemarketing.  In addition, even the FTC’s “do not call” list has been unable to stop the recent surge in unlawful telemarketing by unscrupulous companies which lurk in the background and appear to be beyond the reach of enforcement.

BENEFITS FOR DIRECT MARKETERS?

It is unlikely that the FTC will scrap its rules entirely.  Indeed, CAN-SPAM is the law of the land unless and until Congress repeals it, and the existing rules provide much needed clarity for email marketers.

However, some of the questions raised by the FTC go to thorny issues that continue to nag direct marketers.  For example, an expansion of the definition of a transactional or relationship message could provide a much needed clarity for communications with consumers that now fall into a regulatory gray zone.  The agency’s apparent sensitivity to the business impact of the rules is also a positive development which may lead to a renewed focus on simplicity.

We’ll report back as soon as we learn more.