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CAN-SPAM ACT: A COMPLIANCE GUIDE FOR BUSINESS

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Do you use email in your business? The CAN-SPAM Act, a law that sets the rules
for commercial email, establishes requirements for commercial messages, gives
recipients the right to have you stop emailing them, and spells out tough
penalties for violations. The FTC enforces the CAN-SPAM Act and the accompanying
CAN-SPAM Rule.

Despite its name, the CAN-SPAM Act doesn’t apply just to bulk email. It covers
all commercial messages, which the law defines as “any electronic mail message
the primary purpose of which is the commercial advertisement or promotion of a
commercial product or service,” including email that promotes content on
commercial websites. The law makes no exception for business-to-business email.
That means all email – for example, a message to former customers announcing a
new product line – must comply with the law.

Each separate email in violation of the CAN-SPAM Act is subject to penalties of
up to $51,744, so non-compliance can be costly. But following the law isn’t
complicated. Here’s a rundown of CAN-SPAM’s main requirements:

 1. Don’t use false or misleading header information. Your “From,” “To,”
    “Reply-To,” and routing information – including the originating domain name
    and email address – must be accurate and identify the person or business who
    initiated the message.
 2. Don’t use deceptive subject lines. The subject line must accurately reflect
    the content of the message.
 3. Identify the message as an ad. The law gives you a lot of leeway in how to
    do this, but you must disclose clearly and conspicuously that your message
    is an advertisement.
 4. Tell recipients where you’re located. Your message must include your valid
    physical postal address. This can be your current street address, a post
    office box you’ve registered with the U.S. Postal Service, or a private
    mailbox you’ve registered with a commercial mail receiving agency
    established under Postal Service regulations.
 5. Tell recipients how to opt out of receiving future marketing email from
    you. Your message must include a clear and conspicuous explanation of how
    the recipient can opt out of getting marketing email from you in the future.
    Craft the notice in a way that’s easy for an ordinary person to recognize,
    read, and understand. Creative use of type size, color, and location can
    improve clarity. Give a return email address or another easy Internet-based
    way to allow people to communicate their choice to you. You may create a
    menu to allow a recipient to opt out of certain types of messages, but you
    must include the option to stop all marketing messages from you. Make sure
    your spam filter doesn’t block these opt-out requests.
 6. Remember that subscribers and members can opt out of marketing emails,
    too. Recipients of emails from a sender that runs a subscription service or
    membership program still have the right to opt out of marketing messages
    from you. While you don’t need to get members’ consent to send them
    marketing emails, subscribers and members don’t lose their ability to opt
    out of marketing emails from you simply because they have a subscription or
    membership. Before sending a message without an unsubscribe link to
    subscribers or members, be sure that the primary purpose of the message fits
    within one of the five categories of “transactional or relationship” message
    set out in the Act. If it doesn’t, you need to include a way for recipients
    to opt out of further marketing messages from you.
 7. Honor opt-out requests promptly. Any opt-out mechanism you offer must be
    able to process opt-out requests for at least 30 days after you send your
    message. You must honor a recipient’s opt-out request within 10 business
    days. You can’t charge a fee, require the recipient to give you any
    personally identifying information beyond an email address, or make the
    recipient take any step other than sending a reply email or visiting a
    single page on an Internet website as a condition for honoring an opt-out
    request. Once people have told you they don’t want to receive more messages
    from you, you can’t sell or transfer their email addresses, even in the form
    of a mailing list. The only exception is that you may transfer the addresses
    to a company you’ve hired to help you comply with the CAN-SPAM Act.
 8. Monitor what others are doing on your behalf. The law makes clear that even
    if you hire another company to handle your email marketing, you can’t
    contract away your legal responsibility to comply with the law. Both the
    company whose product is promoted in the message and the company that
    actually sends the message may be held legally responsible.



Need more information? Here are the answers to some questions businesses have
had about complying with the CAN-SPAM Act.


Q. HOW DO I KNOW IF THE CAN-SPAM ACT COVERS EMAIL MY BUSINESS IS SENDING?

A. What matters is the “primary purpose” of the message. To determine the
primary purpose, remember that an email can contain three different types of
information:

 * Commercial content – which advertises or promotes a commercial product or
   service, including content on a website operated for a commercial purpose;
 * Transactional or relationship content – which facilitates an already
   agreed-upon transaction or updates a customer about an ongoing transaction;
   an
 * Other content – which is neither commercial nor transactional or
   relationship.

If the message contains only commercial content, its primary purpose is
commercial, and it must comply with the requirements of CAN-SPAM. If it contains
only transactional or relationship content, its primary purpose is transactional
or relationship. In that case, it may not contain false or misleading routing
information, but is otherwise exempt from most provisions of the CAN-SPAM Act.


Q. HOW DO I KNOW IF WHAT I’M SENDING IS A TRANSACTIONAL OR RELATIONSHIP MESSAGE?

A. The primary purpose of an email is transactional or relationship if it
consists only of content that:

 1. Facilitates, completes, or confirms a commercial transaction that the
    recipient already has agreed to;
 2. gives warranty, recall, safety, or security information about a product or
    service the recipient bought;
 3. notifies the recipient about a change in the terms or features of a
    membership, subscription, account, loan or other ongoing commercial
    relationship; notifies the recipient of a change in their standing with
    respect to that ongoing commercial relationship; or provides regular,
    periodic account balance information to the recipient;
 4. provides information about an employment relationship or employee benefits;
    or
 5. delivers goods or services as part of a transaction that the recipient
    already has agreed to.

Keep in mind that the law views these categories narrowly. That means you
shouldn’t assume that any message you send to recipients who have an ongoing
commercial relationship with you – including subscribers or recipients who
participate in a membership program – are transactional or relationship
messages. Carefully consider the five categories of transactional or
relationship message listed above and ask whether a reasonable consumer reading
your email would understand that the message’s primary purpose fits in one of
those categories. If it doesn’t, the message needs to comply with all of the
requirements of CAN-SPAM.


Q. WHAT IF THE MESSAGE COMBINES COMMERCIAL CONTENT AND TRANSACTIONAL OR
RELATIONSHIP CONTENT?

A. It’s common for email sent by businesses to mix commercial content and
transactional or relationship content. When an email contains both kinds of
content, the primary purpose of the message is the deciding factor. Here’s how
to make that determination: If a recipient reasonably interpreting the subject
line would likely conclude that the message contains an advertisement or
promotion for a commercial product or service or if the message’s transactional
or relationship content does not appear mainly at the beginning of the message,
the primary purpose of the message is commercial. So, when a message contains
both kinds of content – commercial and transactional or relationship – if the
subject line would lead the recipient to think it’s a commercial message, it’s a
commercial message for CAN-SPAM purposes. Similarly, if the bulk of the
transactional or relationship part of the message doesn’t appear at the
beginning, it’s a commercial message under the CAN-SPAM Act.

Here are two examples:


MESSAGE A

TO:  Jane Smith
FR:   XYZ Distributing
RE:   Your Account Statement

We shipped your order of 25,000 deluxe widgets to your Springfield warehouse on
June 1st. We hope you received them in good working order. Please call our
Customer Service Office at (877) 555-7726 if any widgets were damaged in
transit. Per our contract, we must receive your payment of $1,000 by June 30th.
If not, we will impose a 10% surcharge for late payment. If you have any
questions, please contact our Accounts Receivable Department.

Visit our website for our exciting new line of mini-widgets!

MESSAGE A is most likely a transactional or relationship message subject only to
CAN-SPAM’s requirement of truthful routing information. One important factor is
that information about the customer’s account is at the beginning of the message
and the brief commercial portion of the message is at the end.


MESSAGE B 

TO:  Jane Smith
FR:   XYZ Distributing
RE:  Your Account Statement

We offer a wide variety of widgets in the most popular designer colors and
styles – all at low, low discount prices. Visit our website for our exciting new
line of mini-widgets!

Sizzling Summer Special: Order by June 30th and all waterproof commercial-grade
widgets are 20% off. Show us a bid from one of our competitors and we will match
it. XYZ Distributing will not be undersold. 

Your order has been filled and will be delivered on June 1st.



MESSAGE B is most likely a commercial message subject to all CAN-SPAM's
requirements. Although the subject line is “Your Account Statement” – generally
a sign of a transactional or relationship message – the information at the
beginning of the message is commercial in nature and the brief transactional or
relationship portion of the message is at the end.


Q. WHAT IF THE MESSAGE COMBINES ELEMENTS OF BOTH A COMMERCIAL MESSAGE AND A
MESSAGE WITH CONTENT DEFINED AS "OTHER"?

A. In that case, the primary purpose of the message is commercial and the
provisions of the CAN-SPAM Act apply if:

 * A recipient reasonably interpreting the subject line would likely conclude
   that the message advertises or promotes a commercial product or service; or
 * A recipient reasonably interpreting the body of the message would likely
   conclude that the primary purpose of the message is to advertise or promote a
   product or service.

Factors relevant to that interpretation include the location of the commercial
content (for example, is it at the beginning of the message?); how much of the
message is dedicated to commercial content; and how color, graphics, type size,
style, etc., are used to highlight the commercial content.


Q. WHAT IF THE EMAIL INCLUDES INFORMATION FROM MORE THAN ONE COMPANY? WHO IS THE
“SENDER” RESPONSIBLE FOR CAN-SPAM COMPLIANCE?

A. If an email advertises or promotes the goods, services, or websites of more
than one marketer, there’s a straightforward method for determining who’s
responsible for the duties the CAN-SPAM Act imposes on “senders” of commercial
email. Marketers whose goods, services, or websites are advertised or promoted
in a message can designate one of the marketers as the “sender” for purposes of
CAN-SPAM compliance as long as the designated sender:

 * meets the CAN-SPAM Act’s definition of “sender,” meaning that they initiate a
   commercial message advertising or promoting their own goods, services, or
   website;
 * is specifically identified in the “from” line of the message; and
 * complies with the “initiator” provisions of the Act – for example, making
   sure the email does not contain deceptive transmission information or a
   deceptive subject heading, and ensuring that the email includes a valid
   postal address, a working opt-out link, and proper identification of the
   message’s commercial or sexually explicit nature.

If the designated sender doesn’t comply with the responsibilities the law gives
to initiators, all marketers in the message may be held liable as senders.


Q. MY COMPANY SENDS EMAIL WITH A LINK SO THAT RECIPIENTS CAN FORWARD THE MESSAGE
TO OTHERS. WHO IS RESPONSIBLE FOR CAN-SPAM COMPLIANCE FOR THESE “FORWARD TO A
FRIEND” MESSAGES?

A. Whether a seller or forwarder is a “sender” or “initiator” depends on the
facts. So deciding if the CAN-SPAM Act applies to a commercial
“forward-to-a-friend” message often depends on whether the seller has offered to
pay the forwarder or give the forwarder some other benefit. For example, if the
seller offers money, coupons, discounts, awards, additional entries in a
sweepstakes, or the like in exchange for forwarding a message, the seller may be
responsible for compliance. Or if a seller pays or gives a benefit to someone in
exchange for generating traffic to a website or for any form of referral, the
seller is likely to have compliance obligations under the CAN-SPAM Act.


Q. WHAT ARE THE PENALTIES FOR VIOLATING THE CAN-SPAM ACT?

A. Each separate email in violation of the law is subject to penalties of up to
$51,744, and more than one person may be held responsible for violations. For
example, both the company whose product is promoted in the message and the
company that originated the message may be legally responsible. Email that makes
misleading claims about products or services also may be subject to laws
outlawing deceptive advertising, like Section 5 of the FTC Act. The CAN-SPAM Act
has certain aggravated violations that may give rise to additional fines. The
law provides for criminal penalties – including imprisonment – for:

 * accessing someone else’s computer to send spam without permission,
 * using false information to register for multiple email accounts or domain
   names,
 * relaying or retransmitting multiple spam messages through a computer to
   mislead others about the origin of the message,
 * harvesting email addresses or generating them through a dictionary attack
   (the practice of sending email to addresses made up of random letters and
   numbers in the hope of reaching valid ones), and
 * taking advantage of open relays or open proxies without permission.

In addition to civil penalties, you may be required to pay redress to consumers
under Section 19 of the FTC Act. Redress could include not only how much
consumers paid, but also the value of their lost time.


Q. ARE THERE SEPARATE RULES THAT APPLY TO SEXUALLY EXPLICIT MARKETING EMAIL?

A. Yes, and the FTC has issued a rule under the CAN-SPAM Act that governs these
messages. Messages with sexually oriented material must include the warning
“SEXUALLY-EXPLICIT:” at the beginning of the subject line. In addition, the rule
requires the electronic equivalent of a “brown paper wrapper” in the body of the
message. When a recipient opens the message, the only things that may be
viewable on the recipient’s screen are:

 1. the words “SEXUALLY-EXPLICIT:”; and
 2. the same information required in any other commercial email: a disclosure
    that the message is an ad, the sender’s physical postal address, and the
    procedure for how recipients can opt out of receiving messages from this
    sender in the future.

No graphics are allowed on the “brown paper wrapper.” This provision makes sure
that recipients cannot view sexually explicit content without an affirmative act
on their part – for example, scrolling down or clicking on a link. However, this
requirement does not apply if the person receiving the message has already given
affirmative consent to receive the sender’s sexually oriented messages.
 



About the FTC
The FTC works to prevent fraudulent, deceptive, and unfair practices that target
businesses and consumers. Report scams and bad business practices at
ReportFraud.ftc.gov. We also provide guidance at business.ftc.gov to help
companies comply with the law. Regardless of the size of your organization or
the industry you’re in, knowing – and fulfilling – your compliance
responsibilities is smart, sound business. Looking for a quick take on recent
cases and other initiatives? Subscribe to the FTC’s Business Blog.

Your Opportunity to Comment
The National Small Business Ombudsman and 10 Regional Fairness Boards collect
comments from small businesses about federal compliance and enforcement
activities. Each year, the Ombudsman evaluates the conduct of these activities
and rates each agency’s responsiveness to small businesses. Small businesses can
comment to the Ombudsman without fear of reprisal. To comment, call toll-free
1-888-REGFAIR (1-888-734-3247) or go to www.sba.gov/ombudsman.
 

[Note: Edited January 2024 to reflect Inflation-Adjusted Civil Penalty
Maximums.]

August 2023

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