Worldwide Regulatory Challenges
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February 2010 | Volume 28 / Number 9
On The Line

Worldwide Regulatory Challenges


By Tim Searcy
CEO, American Teleservices Association


Oftentimes in this column, I reference domestic regulatory issues. However, as the world becomes smaller and we see repatriation of contact centers and even foreign companies bringing offshore work to the U.S. for labor, it makes sense to look at a bigger picture. Like the U.S., worldwide regulation continues to be very active, particularly in the outbound marketing arena. When I am concerned about international trends in regulatory activity, I often turn to my friend, Ken Sponsler at CompliancePoint. As usual, Ken gave me the best perspective on what is happening, and much of this column should be attributed to him.

U.S.-based companies that are telemarketing to consumers outside the U.S. face a myriad of compliance challenges that
could ground marketing campaigns before they get started. Not only do corporations conducting global marketing face language barriers, but also a maze of regulations and very different personal data privacy regimes in each region of the world.

Non-compliance can mean heavy fines, negative publicity, and the possibility of criminal sanctions. It is critical that direct marketers remain pro-consumer and vigilant in the laws of each country where they are conducting marketing campaigns, both for the sake of the consumer and for the integrity of the direct marketing industry.In countries with more developed laws, it is easier to plan good compliant marketing campaigns. But in countries that lack distinct data protection laws, one inappropriate piece of direct marketing can lead to significant penalties.


Non-compliance with EU countries’ legislation could entail administrative fines up to €750 ($1,075.28) for each unsolicited
commercial call or e-mail. In France, criminal sanctions can be imposed up to a maximum of five years imprisonment and fines there can range from €15,000 ($21,505) to €300,000 ($430,110) and up to €75,000 ($107,527) to €1,500,000 ($2,150,550) for legal corporate entities.


There are dramatically higher fines for non-compliance with German laws as well, where companies calling private homes without consent could be fined up to €50,000 ($71,685) per violation, and telemarketers who do not display their phone numbers on consumer caller ID systems could be fined up to €10,000 ($14,337) per violation.


Tough legislation is also present in Australia, (where the Australian Communications and Media Authority recently issued two infringement notices in the value of $110,000 to Optus Networks Pty Limited for allegedly sending commercial electronic messages without accurate sender identification) and in New Zealand, where companies can face fines for violations of the Electronic Communications Act, sanctions can be up to 500.000 AUD ($443,867).


In countries where no specific law on direct marketing exists, companies must be even more cautious because penalties
may be inflicted on the basis of the civil or penal codes of the country where the marketing campaign is being conducted. This means that companies will confront a myriad of rules, spread out in all different kinds of laws, often not strictly
related with direct marketing activities. This is specifically the case in Malaysia, (where Section 233 of the Communications and Multimedia Act of 1998 states that a “person who initiates a communication using any application service, whether continuously, repeatedly or otherwise, during which communication may or may not ensue, with or without disclosing his identity and with intent to annoy, abuse, threaten or harass any person at any number or electronic address commits an offense”). This can also be the case in a number of Latin American countries and almost all Caribbean countries where there are no laws to guide direct marketing practices.


Companies need to know the law in each relevant jurisdiction as well as enforcers’ views on the application of the law to specific marketing programs. They also have an obligation to keep track of the consents received on a perconsumer,
per-country basis.


Recently, countries have been trending toward the expansion of preference lists (do not contact lists or “DNC”
or Robinson lists), which offer protection to consumers who do not wish to be contacted by companies for direct
marketing purposes with respect to mail, telephone, fax, e-mail and mobile mediums of communication. A company’s
requirement for accessing this data is different in every country and in many instances companies have to register as
marketers to have access. Being a member of the Department of Commerce’s Safe Harbor program can expedite data
access in some instances. Also, some countries, such as India and Australia, require companies to submit their calling
list to the government-run DNC list to be scrubbed. The scrubbed list is then transferred back to the direct marketer.


Although this is very detailed information, I think it is clear that the real issue is that each market has its own approach, and regardless of similarity, companies need to pay attention. There are additional trends on the international front, so in next month’s column, I will attack where we go from here. In the meantime, I am on the line.

If you would like to reach me, please contact me at tim@ataconnect.org. Ken Sponsler can be reached at ksponsler@
compliancepoint.com
.


 




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