HG Alert: The Spam Act Shows its Teeth - 11 Mar 2010

In early February 2010, CommSec, the securities trading division of the Commonwealth Bank, was fined $55,000 by the Australian Communications and Media Authority (ACMA) for breaching the Spam Act 2003 (Cth). CommSec had sent commercial emails that did not allow people to opt out of the email service, and continued to send commercial emails to people who had already opted out.

This case is just one example of how ACMA is casting a wider net in its prosecutions against people and businesses who might not fit the image of a “stereotypical” spammer - those people who send out millions of emails trying to persuade you to buy physical “remedies”, adult products and replica watches.

In January 2010, a Wollongong-based real estate agent was found to have breached the Spam Act by sending commercial electronic messages without an unsubscribe facility. Chris Cheah, acting Chairman of ACMA, stated that:

“It is disappointing that some real estate agents do not appear to have taken the opportunity to understand the requirements for complying with the Spam Act”. He also said “Real estate agents should consider themselves to be on notice”.

The Spam Act sets out three core requirements for commercial electronic messages:

  • Consent: a commercial electronic message must be sent with the recipient’s consent.
  • Identification: a commercial electronic message must identify the sender of the message and contain information about how the recipient can contact the sender.
  • Ability to unsubscribe: a commercial electronic message must include some form of functional unsubscribe facility, which allows a person or business to opt out of further messages.

Commonly associated with emails, spamming actually encompasses all types of electronic messages, including SMS messages.

The Spam Act permits ACMA to take action against people who are said to authorise such electronic messages, which could potentially include, in addition to the company marketing its goods or services, advertising agencies and the creators of software which helps people send out spam emails.

In 2009, Optus was caught out sending SMS messages which failed to provide clear and accurate sender identification. Those messages advertised “OptusZoo services”, but only provided the sender identification “966”, which was a mobile keypad equivalent of the word “ZOO”. This identification was not considered sufficient and Optus paid a fine of $110,000.

These examples illustrate just a few situations where a person or business can be caught out. Seemingly innocuous electronic messages can result in severe punishments and businesses should be vigilant that their marketing campaigns do not contravene the Spam Act.

The Spam Act contains particularly harsh penalties for repeat offenders, and the Federal Court may impose potential penalties of up to $1.1 million per day for repeat offenders. The highest penalty to date in Australia is $15.75 million, which was handed down in Brisbane by the Federal Court in late 2009.

For more information about the Spam Act and its implications for your business, please contact HopgoodGanim’s Intellectual Property and Technology practice