FCA Confirms CASL is Constitutional, but Limits Business Communications Exemption

  • June 21, 2020
  • Molly Reynolds, Ronak Shah, Andrew Bernstein and Saambavi Mano

In a recent decision, the Federal Court of Appeal dismissed CompuFinder’s appeals against two Canadian Radio-television and Telecommunications Commission decisions arising from one of the first enforcement actions under  Canada’s Anti-Spam Legislation’s (CASL.)[1] In addition to finding that CASL’s Commercial Electronic Message (CEM) provisions are constitutional, the FCA provided further clarity on the “business-to-business” exemption, conspicuous publication exemption, and unsubscribe mechanism requirements.

What You Need To Know

  • “Business-to-business” exemption:
    • Sender organizations must be able to establish that they had a relationship with the recipient organization, not just some employees.
    • Evidence of transactions with employees who can bind the recipient organization, while not required per se, can assist in meeting the evidentiary threshold for establishing a relationship between the two organizations.
    • CEMs need not be linked to the recipients’ core business operations in order to meet the exemption’s “relevance” requirement. Relevance can be established by showing the two organizations had a prior commercial relationship, or were planning transaction activity in the future.
  • An organization that relies on conspicuous publication of contact information as a basis for implied consent must be able to connect the business role or duties of recipients to the content of the message and explain the relevance of the message to those duties.
  • Having more than one unsubscribe link creates confusion and frustration among recipients - frustrating CASL’s unsubscribe mechanism requirements.
  • CASL’s CEM scheme was a valid exercise of the Federal government’s power over general trade and commerce.


In 2015, the CRTC, following an investigation, issued a Notice of Violation (“NOV”) against CompuFinder for three email marketing campaigns it used to promote its educational and training services to various recipients. The NOV alleged that CompuFinder sent 317 CEMs to recipients without their prior consent[2], and 87 of them contained two unsubscribe mechanisms, one of which was non-functioning. The NOV imposed a $1.1M penalty on CompuFinder. CompuFinder challenged the constitutionality of CASL and the amount of the imposed penalty before the CRTC.  In its two decisions[3], the CRTC determined that CASL is constitutional and confirmed CompuFinder’s violations of CASL. However, the CRTC reduced the penalty to $200,000. CompuFinder appealed the CRTC’s decisions to the FCA.