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Submission of The Canadian Bankers'…
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Language: english
Created: Mon Sep 13 11:42:45 2004
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Submission of The Canadian Bankers' Association
Re: CRTC File: 8662-C131-200408543
Canadian Marketing Association's Part VII Application
Review and Vary Telecom Decision CRTC 2004-35; Review of Telemarketing Rules
I. Overview
1. The Canadian Bankers' Association (the "CBA") is a professional industry association
that provides its members the chartered banks of Canada - with information, research
and operational support and contributes to the development of public policy on financial
services. All chartered banks are eligible for membership and currently all domestic and
virtually all foreign banks doing business in Canada are members of the CBA.
2. Both nationally and internationally, the CBA actively co-operates with other
organizations in developing industry standards and conventions to enhance the efficiency
and soundness of the financial services system.
3. The CBA filed comments in support of the Canadian Marketing Association ("CMA")
application for a stay in respect of the implementation of telemarketing rules pursuant to
Telecom Decision CRTC 2004-35 (the "Decision"). The CBA has reviewed the CMA's
Part VII application and concurs with the concerns expressed by the CMA. The CBA's
members and their financial institution affiliates represent many different sectors of the
Canadian economy that utilize some form of telemarketing in the conduct of business
operations. The banking sector is highly regulated in Canada and is mandated to conduct
ongoing communications with consumers. Much of that communication is by means of
telecommunications, primarily in the form of voice telephone calls. In this brief, the
CBA has assessed the potential impact of the telemarketing rules on its members and on
consumers and businesses.
4. The Commission's power to regulate the conduct of telemarketing, pursuant to Section
41 of the Telecommunications Act, is circumscribed. The Commission is empowered to
"prohibit or regulate the use by any person of the telecommunications facilities of a
Canadian carrier for the provision of unsolicited telecommunications to the extent that the
Commission considers it necessary to prevent undue inconvenience or nuisance, giving
due regard to freedom of expression".
5. The CBA submits that its members' current telemarketing practices do not constitute
"undue inconvenience or nuisance" with respect to consumers and businesses. The CBA
respectfully requests the Commission to exclude banks and their financial institution
affiliates from the application of the Decision or, in the alternative, vary certain aspects of
the Decision.
Part VII Final 1
II. The Decision
6. In the Decision the Commission imposed new limitations on all companies and
individuals who conduct telemarketing in Canada. The Commission broadly defined
telemarketing in Decision 2004-35 to mean: "the use of telecommunications facilities to
make unsolicited calls for the purpose of solicitation where solicitation is defined as the
selling or promoting a product or service or the soliciting of money or money's worth,
whether directly or indirectly and whether on behalf of another party."1
7. The Commission did not clearly define what it considers to be "unsolicited calls for the
purpose of solicitation", which has created concerns as to the scope of application of this
decision. The CBA is particularly concerned about the possible impact of this decision
on the ability of banks to provide financial services and advice to their clients.
III. The Request
8. The CBA does not believe that it is the Government's policy or the intention of
Parliament for restrictions to be imposed under telecommunications legislation that
would purport to unreasonably restrict the ability of banks to provide financial services
and advice to their clients. The CBA submits that Telecom Decision 2004-35 should be
varied and the Telemarketing Rules should be modified in order to clearly exempt certain
marketing practices of the banking sector.
9. The specific requests made by the CBA in this regard are set out in further detail in
paragraphs 60 to 64 of this submission, under the subheading "Order Sought".
IV. The Banking Sector
10. By virtue of their key role as financial intermediaries in the Canadian economy, banks,
unlike most other companies, are subject to some form of government regulation or
supervision over virtually every aspect of their activities, including their interaction with
their customers.
11. The rationale for this regulatory oversight has been set out by the Government on several
occasions, including in its 1999 white paper entitled Reforming Canada's Financial
Services Sector:
Strong, efficient and profitable financial institutions are vital to Canada's
economic success. Over and above their important direct contribution to
economic activity, financial institutions are in some way involved in
virtually every transaction in the economy: processing payments, pooling
savings, financing investment or managing risk.
1
Paragraph 12 Decision 2004-35.
Part VII Final 2
The men and women who work in Canada's financial institutions are the
people Canadians turn to for financial services and advice, and the success
of each institution depends on them.2
....
Given that financial services are a necessity of everyday life and that
consumers and financial institutions do not have the same information,
understanding or bargaining power, it is critical that consumers be treated
fairly in their dealings with financial institutions.3
12. Several key facts can be extrapolated from the above:
· financial services are a necessity of everyday life;
· consumers lack information on financial products and services; and
· consumers want to receive financial advice from their banks.
13. This unique and important role of banks and other financial institutions has caused the
Government to set out extensive requirements and obligations in the Bank Act and other
statutes relating to the interaction between financial institutions and their customers. For
certain types of information (e.g. service charges and interest rates), banks are in fact
under a regulatory obligation to disclose this information to customers (e.g. the
Disclosure of Interest (Banks) Regulations).
14. In addition, certain types of communication between a bank and its customers over the
phone (e.g. the types of information required to be provided by the bank to a customer at
the time of opening of an account over the telephone) are also subject to express
regulation under the Bank Act through the Disclosure on Account Opening by Telephone
Request (Banks) Regulations.
15. In addition to regulatory requirements, the Financial Consumer Agency of Canada is
mandated to work with banks to ensure that adequate information is provided to
customers on banking products and services (e.g. low fee accounts) and that broader
educational initiatives are undertaken to help Canadians better understand the financial
products and services available to them. Beyond the strict regulatory obligations, banks
and their employees have a professional obligation to advise and update their clients on
the full range of financial services and products that best suit their financial needs. Other
financial institutions also operate under similar regulatory and professional obligations.
16. Based on the above, it is the view of the CBA that regulatory restrictions in the area of
telecommunications that purport to impose unreasonable constraints on the ability of
banks4 to contact and advise their clients would be inconsistent with the Government's
2
Department of Finance Canada, June 25, 1999. Reforming Canada's Financial Services Sector: A Framework for the Future, at page 9.
3
Department of Finance Canada, June 25, 1999. Reforming Canada's Financial Services Sector: A Framework for the Future, at page 46.
4
It should be noted that these comments also apply in many respects to other financial institutions.
Part VII Final 3
broader financial sector policy and with the professional responsibilities owed by banks
to serve their clients.
V. Background on Decision 2004-35
17. In March 2001, the Commission published Public Notice CRTC 2001-34 ("Public Notice
2001-34") on its website and in the Canada Gazette soliciting comments with respect to a
review of existing telemarketing rules. In Public Notice 2001-34, the Commission did
not set out specific regulations or restrictions which it was at the time considering with
respect to telemarketing. The Commission posed only seven general questions
concerning telemarketing conducted by means of live voice telephone calls, facsimile
broadcasting and automatic dialer devices and invited the public to comment on those
questions and "other points parties wish to raise."
18. In Public Notice 2001-34 the Commission generally defined telemarketing as
"unsolicited communications for the purposes of solicitation".5 The Commission also
referred generally to telemarketing activities carried on by "businesses and non-profit
organizations who solicit for money or money's worth".
19. Based upon the wording of the public notice and the generality of the questions and
description of telemarketing, one might not have reasonably discerned the range of
restrictions on telemarketing that the Commission would eventually adopt. The
Commission conducted the enquiry without public hearings, through a process involving
only written submissions. The Commission and its staff did not hold public meetings or
consult directly with Canadian businesses that utilize telecommunications in everyday
commerce. The Commission did not disclose the rules to the public for comment in draft
before implementing them, nor seek public comment; this is standard procedure for many
regulatory agencies and assists in preventing impractical, costly and unreasonable rules.
The CBA and its membership were not consulted by the Commission with respect to the
possible impact of the new telemarketing rules on existing business activities.
20. The major participants in the written proceeding were telecommunications carriers, along
with a few advocacy groups and a limited number of organizations representing business
interests. The CBA did not participate in the proceeding, as Public Notice CRTC 2001-
34 did not reveal the full scope of the regulatory action that the Commission would
eventually adopt.
21. Although the proceeding closed on 17 September 2001, for nearly three years the
Commission did not issue any decisions or rulings, policy statements or draft regulations
concerning telemarketing. On 21 May 2004, the Commission issued Decision 2004-35
entitled "Review of Telemarketing Rules". The Commission, in Decision 2004-35,
determined that the majority of complaints from the public6 concerning telemarketing
5
Paragraph 1 Public Notice Commission 2001-34.
6
Complaints measured 1996-2000
Part VII Final 4
practices originated from consumers who had received unsolicited facsimile broadcasts or
had received calls from telemarketers who employed automated dialing machines
(ADADs) where such automated devices had engaged the consumers' telephone lines and
there had been what the Commission described as "dead air". The minority of
complaints involved what is termed "live voice" telemarketing calls. The Commission
also noted in Decision 2004-35 that a significant percentage of complainants to
telecommunications companies were unaware of the existence of "do not call" lists, or
the ability to be removed from the lists of telemarketers. Further, many complaints
originated in respect of what the Commission described as "small telemarketers" who
were themselves unaware of existing telemarketing restrictions. It is evident from
reading Decision 2004-35 that there was very little tangible evidence put before the
Commission by parties who may have advocated a curtailment of "business-to-business"
telemarketing practices or to have calls to existing customers curtailed in some fashion.
22. Statistical evidence which was submitted to the Commission by the telecommunications
carriers demonstrated that there was a relatively small number of complaints received by
telecommunications carriers relative to the total number of telemarketing calls placed in
Canada over a period of years. Based upon millions of calls undertaken annually, the
number of complaints nation-wide involving live voice calls was relatively insignificant.
In the case of banks, which make millions of outbound telemarketing calls each year, the
number of complaints received by them is miniscule. The regulatory restrictions
undertaken by the Commission in respect of live voice calls is disproportionate to the
evidence of any abuse by telemarketers on the public record.
23. There are inequities in the Commission's decision. Market and survey research calls are
exempt from the new rules. The Commission determined that there wasn't "compelling
evidence to demonstrate that any undue inconvenience or nuisance" resulted from such
calls. Calls made for purposes of collections were also exempted from the rules.
Although calls made for purposes of collections encompass a portion of the calls
undertaken by the financial services industry, many other calls undertaken by the banking
industry appear to be "caught" by the new rules.
VI. The Impact of the Decision 2004-35
24. In Decision 2004-35 the Commission imposed new requirements on all companies and
individuals who conduct telemarketing in Canada. The Commission broadly defined
telemarketing in Decision 2004-35 to mean: "the use of telecommunications facilities to
make unsolicited calls for the purpose of solicitation where solicitation is defined as the
selling or promoting a product or service or the soliciting of money or money's worth,
whether directly or indirectly and whether on behalf of another party." 7
25. The Commission did not clearly define what it considers to be "unsolicited calls for the
purpose of solicitation". This has created considerable ambiguity as to the intended
scope of application of the decision.
7
Paragraph 12 Decision 2004-35
Part VII Final 5
26. There are four key elements of Decision 2004-35 that the CBA is concerned could
potentially impact and restrict the ongoing business operations of financial institutions in
Canada:
Element #1: Identification Requirements
27. A caller who conducts telemarketing must identify himself or herself as well as the
organization on behalf of whom he or she is calling. The new CRTC rules also require
that if an agency is calling on behalf of a client the name of the agency must be disclosed,
that the telemarketer must provide a toll-free telephone number that the recipient of the
call can access for questions or comments, and that this information must be provided
before any other communication, including asking for an individual by name, can be
made. These new requirements are unnecessarily cumbersome, especially the
requirement that the information needs to be disclosed upfront to the person who answers
the phone, not the person being called. These requirements will result in many lost calls.
Furthermore, the information may never be relayed to the intended recipient of the call.
28. Pursuant to the new rules, the person answering the telephone (rather than the intended
recipient of the call) will receive the foregoing information. The person answering the
telephone may have the right to request the caller to have the telephone number placed on
a "do not call" list and the person answering the telephone must be instantaneously issued
a unique identification number for the de-listing of the telephone number from future
telephone calls from the party which placed the call. Technically it is the telephone
number of the household or business called that is placed on a "do not call" list, rather
than the intended recipient of the telephone call.
29. The methodology of administering the "do not call" list is highly problematic. In many
households (or businesses) there are multiple parties who share a single telephone
number, but are individually customers of banks. Each person within that household may
have a separate bank account and may separately purchase financial services (from the
same institution). One interpretation of Decision 2004-35 suggests that a single member
of a household could preclude the bank from contacting any customer residing within the
household at the (common) telephone number by having that telephone number placed on
the "do not call" list regardless of the fact that other customers of the bank (within the
household) did not revoke their consent to be contacted by telephone. In order to fairly
and effectively administer "do not call" lists the obligation should exclusively reside with
the customer who is being contacted to request addition of his or her name to the "do not
call" list at a particular telephone number. Banks should retain the right to continue to
contact other parties at that number who have not "revoked" their consent to be called.
30. Ironically, the intended recipient of the call may never know that an attempt had been
made to contact him or her by telephone for any proper business purpose. For example if
a child answers the call and becomes confused with the "identification procedure", or
another member of the household who receives the call asks to have the telephone
number placed on a "do not call" list, there is the possibility that the nature of call will
not be passed along to the intended recipient. Under the current wording of the "do not
Part VII Final 6
call" provision, the person who initiated the call will then be precluded from calling back
the intended recipient of the call at that telephone number.
31. Given the fact that the lengthy "disclosure procedure" must take place prior to the caller
reciting the name of the intended recipient of the call, there is the potential that the
disclosure procedure may confuse people who do not speak the language of the caller and
this will result in terminated calls. In summary, there is a much greater potential that the
intended recipient of the call will never receive a message from the caller, regardless of
an ongoing business relationship between the consumer and the business that initiated the
call.
32. There is a further aspect to the new "disclosure procedure." Under the new telemarketing
rules, an individual at a local bank branch placing a call to a customer's residence or
place of business, may have to disclose that she or he is calling from the particular
financial institution and may be required to disclose that information to anyone casually
answering the telephone at the residence or business premises of the customer before
asking for the customer by name. The CBA believes that the disclosure of this
information is not only unwarranted, but may needlessly disclose personal information
about the existence of a relationship with a bank.
Element #2: Unsolicited Calls
33. The Commission stated in Decision 2004-35 that the new rules apply to all "unsolicited
calls made for the purpose of solicitation". The Commission has also determined that,
regardless of the prior relationship between a service provider (caller) and a customer,
there is no implied consent to be called. In Decision 2004-35, the Commission stated
that it: "considers that when a consumer purchases a service or product from a company,
or donates to a particular charity, there is no "implied consent" as a result of that
purchase to receive future solicitations. The Commission is of the view that explicit
consent should be obtained before a future solicitation is presumed to be acceptable."8
34. In view of the fact that the Commission has concluded that there is no "implied consent"
from an existing customer to receive future solicitations by telephone, the CBA believes
that many long-standing relationships with customers could be affected by the
telemarketing restrictions. For example, the Commission's definition appears to capture,
as "telemarketing", calls to existing customers of financial institutions to apprise
customers of forthcoming mortgage renewals, or renewals of (existing) financial
instruments such as term deposits, Guaranteed Investment Certificates or notification of
changes to financial services. Likewise, calls to remind an existing customer of the
deadline to make an RRSP deposit, where there is an existing account in place, may be
caught by the new telemarketing rules, based upon the Commission's determination that
there is no implied consent from an existing customer.
35. Many calls involving renewals of mortgages are made by employees in the local bank
branch, who have an ongoing relationship with the customer. Customers expect these
8
Paragraph 111 Decision 2004-35
Part VII Final 7
kinds of telephone calls as these calls are provided as an integral service of the bank.
Therefore these are not nuisance calls and not within the mandate of the Commission to
regulate pursuant to Section 41 of the Telecommunications Act. In establishing the new
rules, the Commission appears not to differentiate between "cold calls" and calls that are
made to a party who has an existing relationship with the business placing the call. When
a customer of a bank initiates a relationship with the bank, the bank discloses to the
customer how it proposes to enhance the relationship by drawing the customer's attention
to other products and services of the bank and its financial institution affiliates that it
feels may be of benefit to the customer, and obtains the customer's consent to market
such products and services to the customer in the future. Customers have the ability at
any time during their relationship with the bank to opt out of receiving future marketing.
In the banks' experience the percentage of customers opting out is in the single digits.
The Commission should not by this decision be able to overrule such customer consent
and should not disrupt an existing effective process.
36. It is submitted that, as currently crafted, there is a risk that the telemarketing rules could
significantly limit a primary method by which financial institutions communicate with
their customers, which in the view of the CBA is not consistent with the Government's
broader financial sector policies or with the intention of Parliament. It is submitted that
the restriction placed on contacting existing customers by means of live voice telephone
calls is unwarranted and would also constitute an infringement of the Canadian Charter of
Rights and Freedoms.
Element #3: Requirement for Live Operators
37. The Commission has required every business which engages in telephone marketing to
maintain a toll-free number answered by live operators during each business day. There
must also be an interactive voice mail system after regular business hours to receive calls.
Given that Canada has six time zones, the staffing requirements will necessitate a
significant investment by businesses regardless of the nature of the telephone calls that
are placed to customers. As noted above, many calls by financial institutions are made
by local branch personnel to customers. Nevertheless, the financial institution will be
required to maintain a live operator during all business hours and the customer will likely
interact with someone outside of their community.
Element #4: Requirement for Unique Registration Numbers and Agency's Do Not
Call List
38. The Commission decision calls for each company that markets by telephone to create
unique registration numbers in relation to the maintenance of their "do not call" lists.
The Commission decided not to implement a national "do not call" list which has been
adopted in the United States. Unfortunately the Commission's telemarketing review took
place in 2001, several years before the development of a national "do not call" list in the
United States. The Commission's flawed registration system "remedy" appears to be
badly out of date even before implementation. As business operates in a North American
and global context, it is short sighted for the Canadian regulatory agency to have adopted
a dated and costly registration system. This new requirement also appears to be a solution
Part VII Final 8
in search of a problem as there is no evidence that there have been a large number of
complaints based on unheeded "do not call" requests.
39. The creation of this new Canadian registration system will be expensive and cumbersome
for businesses. In fact, tens of thousands of businesses will each have a different,
unrelated registration system, which will likely add to consumer confusion. Although the
Commission considers that this registration system will allow effective tracking of
consumer complaints, there is no evidence to suggest that telecommunications
companies, which ultimately receive telemarketing complaints from (their) subscribers,
will be able to identify a business which has issued a registration number, since there is
no unified national registry or cross-reference system being put in place. The
Commission has required businesses to implement the registration number system by 1
October 2004. This implementation date is unrealistic given the systems changes that
would need to be completed.
40. The Commission decision also requires that when an agency calling on behalf of clients
receives a "do not call" request during a call, it must ask the requesting party if the name
and number should be removed from only the client's list, only the agency's list, or both.
An agency may represent numerous clients and may be bound by confidentiality
requirements not to reveal the names of their other clients. If a consumer is not provided
with the list of companies that the agency represents, it would be very difficult for the
consumer to make an informed decision regarding being placed on the agency's list. The
consumer may unwittingly preclude himself from receiving calls from organizations from
which he wants to hear.
VII. The Penalty for Non-Compliance
41. On the basis of a consumer's complaint to a telecommunications carrier, a company or
individual which undertakes telemarketing calls in contravention of the Commission's
rules may have its telecommunications services suspended or terminated with minimal
prior notice. The process for suspension of telecommunications services is badly flawed
and does not adequately provide for review or remedial action. A telephone subscriber's
unsubstantiated allegations could lead to termination of telephone services of businesses.
Termination of telecommunications services provided to banks pursuant to Decision
2004-35 would cause serious economic harm to Canadian businesses, the Canadian
economy and consumers.
VIII. Decision 2004-35 Infringed the Canadian Charter of Rights and Freedoms
42. Pursuant to Section 41 of the Telecommunications Act, Parliament authorized the
Commission to impose limited restrictions on unsolicited telecommunications to prevent
"undue inconvenience or nuisance", provided that the Commission does so in a manner
that has "due regard to freedom of expression":
The Commission may, by order, prohibit or regulate the use by any person of the
telecommunications facilities of a Canadian carrier for the provision of
unsolicited telecommunications to the extent that the Commission considers it
Part VII Final 9
necessary to prevent undue inconvenience or nuisance, giving due regard to
freedom of expression.
43. The CBA submits that the Commission failed in its obligation to have due regard to the
right of freedom of expression when it implemented the telemarketing rules in Decision
2004-35.
44. The right to freedom of expression is outlined in section 2(b) of the Charter as follows:
Everyone has the following fundamental freedoms:
(b) freedom of thought, belief, opinion and expression, including freedom of the
press and other media of communication.
45. The effect of the new Commission rules, on those who utilize the telephone for purposes
of communicating with customers or the public at large, may be to impose the following
requirements:
· To identify themselves, their organization, their toll-free numbers prior to
determining whether they have reached their intended party.
· To maintain "do not call" lists of households or businesses where addition to such
lists may be determined by a party other than the customer or the party whom the
marketer actually intended to call.
· To prohibit them from calling the "listed" household or business, regardless of
whether the actual customer has consented to be called, once any individual has
answered the telephone and asked to be placed on the "do not call" list. (A "do
not call" request could be made by a casual visitor to a residence rather than the
telephone subscriber.)
46. The foregoing requirements arbitrarily dictate to marketers what they must say, how they
must communicate and to whom they must not speak or otherwise communicate by
means of telephone. It is submitted that the Commission has over-stepped Parliament's
intent, as set forth in the Telecommunications Act and the Charter of Rights and
Freedoms.
IX. Privacy Compliance
47. The banks have a long-standing reputation for and have consistently been leaders in
protecting the privacy of their customers' information. Protection of the privacy and
confidentiality of customers' personal information is the key to the relationship of trust
between a bank and its customers.
48. The banking industry's 1991 model privacy code was the first industry privacy code
which went beyond a statement of principles, setting out detailed requirements for
protecting customer personal information. Individual banks subsequently issued their
own codes based on the CBA model.
Part VII Final 10
49. The banking industry participated fully with representatives of consumer groups,
government (including Department of Finance officials) and other business groups on the
Canadian Standards Association Technical Committee on Privacy over a five-year period
to develop the national privacy standard for the Canadian private sector, the Canadian
Standards Association Model Code for the Protection of Personal Information
(CAN/CSA-Q830-96) (CSA Code). This forms the basis, and an excerpt is included as
Schedule 1, of the Personal Information Protection and Electronic Documents Act
(PIPEDA) which came into effect in January 2001 (pre-dating the Commission's
telemarketing review) overseen by the federal Privacy Commissioner and governs the
banks' handling of personal information.
50. Examples of the banking industry's good privacy practices include:
· Disclosure to the customer of any proposed uses of personal information,
including marketing other products and services of the bank and its financial
institution affiliates, at the time of account opening and obtaining customer
consent for these proposed uses at that time; and
· Policies not to sell customer lists to third parties banks collect personal
information to serve their customers better.
51. Taking into consideration the extensive work that has been completed by the sector in
addressing privacy issues in a specific financial sector policy context and the solid
legislative coverage of banks in terms of privacy practices, the CBA believes that neither
the government nor Parliament intended to impose telecommunication rules in this area
(e.g. requiring the disclosure of the bank's identity to whomever answers the phone) that
would be inconsistent with this broader framework. Additional rules governing the
banks' use and management of personal information are unnecessary.
X. Redress Processes
52. It is important to emphasize that banks currently maintain their own "do not call" lists,
which are carefully maintained and updated to ensure that the wishes of persons who do
not wish to be contacted are respected.
53. Beyond the "do not call" list, banks also have systems in place designed to resolve
complaints quickly and to prevent problems from recurring. The vast majority of
complaints are resolved at the branch level, on the spot or within a few days if an
investigation is needed. Banks also have a complaint resolution group that further
investigates complaints not resolved at the business-unit level.
54. In 1996 the industry established a two-tiered, formalized ombudsman system to
investigate complaints that were not resolved by the banks' branches or complaint-
handling units. Under the ombudsman system there is an internal ombudsman at each
institution that provides impartial and independent resolution of complaints based on
fairness and industry best practices.
Part VII Final 11
55. If customers are unable to resolve complaints to their satisfaction through the bank's
internal ombudsman they can contact the Ombudsman for Banking Services and
Investments (OBSI). OBSI is an independent body that investigates complaints from
individuals and small businesses about products and services provided by bank financial
groups. Its objective is to provide impartial and prompt resolution of complaints, free of
charge.
Part VII Final 12
XI. Failure of the Commission to Consider Existing Banking Industry Standards
56. The net effect of the Decision 2004-35 could be to impose a new highly restrictive tier of
regulation over an industry that has taken a key leadership role in the protection of
privacy rights and the voluntary resolution of consumer complaints. Unfortunately, the
Commission's new telemarketing rules are out of step with the proactive policies
implemented by the banks to protect the rights of consumers.
57. Beyond privacy issues, as noted earlier, banks are under legal and broader professional
obligations to provide ongoing advice and services to their clients. In the case of the
marketing activities conducted by banks, it is submitted that the Commission did not
consider whether the rules which it has imposed at large on all marketers have taken into
account these considerations and are truly "necessary to prevent undue inconvenience or
nuisance". To the contrary, it appears that the Commission has imposed a "one size fits
all" solution on all marketers without due regard as to whether their existing marketing
activities actually constitute "undue inconvenience or nuisance".
58. The fact that the Commission did not disclose, in a comprehensive fashion to the
Canadian population the actual rules which it intended to enact pursuant to Section 41 of
the Telecommunications Act and thereby permit informed and reasonable comment
thereupon gives further credence to the fact that the Commission did not fully evaluate
the (potential) impact of its actions, giving "due regard to freedom of expression."
Consequently, the Commission's telemarketing rules infringe the Charter of Rights and
Freedoms and exceed the ambit of Section 41 of the Telecommunications Act.
59. In view of the foregoing, it is respectfully submitted that the Commission should vary
Decision 2004-35 in the manner specified below:
XII. Order Sought
60. The CBA respectfully requests the following:
I. Exemption of Banks from the Decision
61. The CBA respectfully submits that banks and other financial institutions are subject to a
comprehensive regulatory framework under the Bank Act and other statutes that
encompasses a wide range of issues, including consumer protection and communications
with customers. Banks have an exemplary record on key issues such as privacy
commitments, maintenance of "do not call" lists and complaint resolution mechanisms.
62. Taking into account these considerations, the CBA respectfully requests that the
Commission exclude banks and their financial institution affiliates from the application
of Telecom Decision CRTC 2004-35. Recognizing the potential concerns of the
Government in this area, banks are committed to work closely with the appropriate
regulatory officials to assess whether changes to the legislative and regulatory framework
or voluntary practices applicable to banks and their financial institutions affiliates are
required to address the concerns that form the basis of the Commission's decision.
Part VII Final 13
II. Clarification of the Application of the Decision
63. In the alternative to the request in Section I above, the CBA respectfully submits that the
ambiguity of certain elements of Telecom Decision CRTC 2004-35 could lead to the
imposition of unreasonable limitations on the telecommunications activities of banks.
For the reasons noted earlier in this submission, the CBA believes that such a result
would not be consistent with broader Government policies in this area.
64. The CBA requests that Commission rescind or vary elements of Telecom Decision CRTC
2004-35 "Review of Telemarketing Rules". The Commission should reconsider and/or
clarify the following:
(a) paragraphs 101 and 1029 of the decision do not apply to any calls between a
bank10 and persons with whom it has an existing relationship;11
(b) paragraphs 101 and 102 of the decision do not apply to any calls between a bank
and a business enterprise;12
(c) paragraphs 101 and 102 of the decision do not require a bank to self-identify and
provide a customer support number before any other communications are made to
the person receiving the call;13
(d) paragraphs 101 and 102 of the decision do not apply where the person has agreed
to be contacted;14
(e) paragraph 102 does not require that the toll-free telephone number be manned
during business hours;
(f) paragraphs 93 and 9415 of the decision (creation of unique registration numbers)
do not apply to a bank;
(g) under no circumstances would the decision permit an individual who answers the
telephone at a residence or a business (who is not the intended recipient of the
call) to unilaterally revoke the right to contact the bank's customer by telephone
by making a "do not call" request;
9
Paragraphs 101 and 102 of the decision stipulate the manner in which a caller must self-identify and provide a toll-free telephone number for
complaints.
10
Note that for the purposes of this section, a reference to "bank" includes a reference to a "bank and its financial institution affiliates and agents".
11
Note that in compliance with the Personal Information Protection and Electronic Documents Act, banks enter into consent agreements with
their customers allowing them to communicate with their customers regarding their products and services and to promote other products and
services.
12
Note that consumer protection types of provisions have generally not been extended to businesses due to both policy reasons and to
administrative/compliance complexities.
13
Note that there is no objection to providing the information in the decision after the identity of the person who is being contacted has been
appropriately verified.
14
Note that there are instances where a company may provide a bank with a list of customers who have consented to the promotion of third party
products and services. In this respect, these customers are similar to existing customers of the bank.
15
Paragraph 93 imposes an obligation on companies to create unique registration numbers in relation to the maintenance of their do-not-call lists.
Part VII Final 14
(h) under no circumstances would the decision apply to any telephone contact
between a bank and its customers in the event of a mail disruption.
XIII. Stay of Telemarketing Rules
65. The CBA wrote to the Commission in an earlier phase of this Part VII proceeding in
support of a request by the CMA for a stay of the implementation of the telemarketing
rules. The CBA respectfully submits that the Commission suspend the implementation of
the requirements contained in the Decision until such time as it has ruled on the Part VII
Review and Variance application.
Part VII Final 15