Our previous post about Canada’s pending anti-spam legislation (CASL) mentioned a key exception for charities: commercial electronic messages that are sent by a registered charity and whose primary purpose is to raise funds for that charity are fully exempt from CASL.
However, there are some questions around that exception’s scope. First, what is required to make a message’s “primary purpose” the raising of funds?
Second, what does CASL mean by “raising funds”, and is that the same as the Canada Revenue Agency’s definition of “fundraising”? CRA’s Fundraising by Charities Guidance Document CG-013 states: “As a general rule, fundraising is any activity that includes a solicitation of present or future donations of cash or gifts in kind, or the sale of goods or services to raise funds, whether explicit or implied.”
It is not clear on CASL’s face whether “raising funds” per CASL is the same as “fundraising” per the CRA definition.
However, Imagine Canada now reports that Industry Canada has provided the following guidance on the fundraising question:
- Any activity that fits into the CRA “fundraising” definition will be captured by CASL’s “raising funds” exception. So long as an organization is a registered charity, it can send commercial electronic messages whose primary purpose fits into the CRA “fundraising” definition without express or implied consent, and without the content that CASL requires of most commercial electronic messages.
- Some other activities that do not fit into the CRA “fundraising” definition will also be covered by CASL’s “raising funds” exception. Apparently these include newsletters promoting fundraising events even if they mention (or presumably link to) corporate sponsors, promoting charitable activities with cost-recovery components, and promoting events and ticket sales whose proceeds go directly to the charity (e.g., by performing arts organizations).
CASL’s provisions regarding commercial electronic messages come into force on July 1, 2014, and this is indeed helpful and timely guidance for Canadian charities that are trying to comply by that deadline.