Federal anti-spam law passage is imminent

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After months of intense lobbying, President Bush could sign federal anti-spam legislation into law as early as this week. And the e-mail marketing community is breathing a collective sigh of relief.

The U.S. House of Representatives overwhelmingly passed the CAN-SPAM (Controlling the Assault of Non-Solicited Pornography and Marketing) Act of 2003 the week before Thanksgiving by a vote of 392 to five. In October, the U.S. Senate unanimously passed a similar version of the bill. Now the two bills, which require minor technical changes, are being reconciled and will advance to the president for his signature.

Pleased with the outcome

E-mail stakeholders said they were pleased with the legislative outcome.

"We’re very pleased to see a federal law against spam," said Trevor Hughes, executive director of the E-mail Service Provider Coalition. "We hope our industry will have a wonderful early Christmas present with the president signing off on this bill."

"It’s very good news," said Louis Mastria, director of public and international affairs at the Direct Marketing Association. "This is what we’ve been working for, which is a national standard on e-mail marketing."

Setting a national standard is by far the most important aspect of the federal bill, according to executives in the e-mail marketing industry, who said the current patchwork of 37 different state-level e-mail laws made compliance nearly impossible.

That concern was magnified in September when California passed the toughest anti-spam law in the country. The California law bans unsolicited business e-mails and gives recipients the right to sue for $1,000 per e-mail, up to $1 million. In addition, the law not only makes publishers liable for spam, it extends liability to e-mail marketers and advertisers whose messages are contained in, say, a publisher’s e-mail newsletter.

While CAN-SPAM contains a provision that preempts state laws, state attorneys general could still pursue clearly fraudulent and criminal behavior related to spam.

Provisions include opt-out

Another key provision in the reconciled federal bill is the inclusion of an "opt-out" option, which puts the onus for stemming unwanted e-mail on recipients. The bill also calls for $200 per spam e-mail, with a $2 million cap. This is double the penalty contained in the earlier Senate version.

The bill also gives the Federal Trade Commission the authority to establish a do not e-mail registry, but does not require the FTC to do so.

Many constituents in the debate have fought against a do-not-e-mail registry, including FTC Commissioner Timothy Muris. The provision mirrors the wildly popular National Do Not Call Registry, which now contains the phone numbers of more than 50 million people.

"It’s a different medium, and a different communication vehicle," said Leslie Grossman, co-founder of the Women’s Leadership Exchange. Her company, which provides resources for female business owners, depends heavily on e-mail marketing, and she staunchly opposes such a list.

A big difference

"There’s a big difference between being interrupted at the dinner table with a phone call and getting an e-mail that you may not read right now but choose to read later," Grossman said.

"It’s disappointing that the do not e-mail provision survived," said Hughes. He said ISPs, e-mail service providers, senders and the FTC have all expressed concern about the do not e-mail provision. They predict the most egregious spammers would ignore it. Worse, if the list ever fell into the hands of spammers, it would be an ideal source of confirmed e-mails.

Hughes said the E-mail Service Provider Coalition supports the FTC’s continuing to study the idea. Al DiGuido, CEO at e-mail marketer Bigfoot Interactive, said his company has actively supported the FTC’s position. But DiGuido expressed dismay that the government watchdog would need to plead its case anew.

"The fact that the FTC has to go back and look at the do not e-mail registry is something that has already been dealt with," he said.

Beyond legislation

"The idea that legislation by itself could solve all this is not where we’ve been," Mastria said. He said DMA continues to work with the Federal Bureau of Investigation on the law enforcement front, and is also working within the direct marketing industry on self-regulation practices that include a so-called "gold list" of reputable e-mailers.

A poll in September confirmed that most people believe a combination of legislation and technology will be the best solution to spam. About 59% said a combination of the two would be the best solution, compared with 27% who responded that technology would and 10% who said legislation.

Still, e-mail executives said the federal law was a good start. "Legislation never solves everything, but it helps," Grossman said.

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