This is the fifth lecture in this mini - series.

1. Electronic Transactions Law
ADVERTISING AND MARKETING
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Department of Commercial Law
University of Cape Town

2. UNSOLICITED COMMERCIAL COMMUNICATIONS
(UCC)
 s 45(1) ECTA & s1 CPA
 Not directed at unsolicited non-commercial or bulk
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communication
S45(1) ECTA
 45. (1) Any person who sends unsolicited commercial
communications* to consumers, must provide the
consumer…
*broader than just email (see slide 15: forms)
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3. S1 CPA
‘‘direct marketing’’ means to approach a person, either in
person or by mail or electronic communication*, for the
direct or indirect purpose of—
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(a) promoting or offering to supply, in the ordinary course
of business, any goods or services to the person; or
(b) requesting the person to make a donation of any kind
for any reason
* s1: ‘‘electronic communication’’ means communication
by means of electronic transmission, including by
telephone, fax, sms, wireless computer access, email or
any similar technology or device
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4. FORMS OF UCC
 Via email (spam)
 Via telephone
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 SMS or text message
 Spim: spam based on MS instant Messenger
 Spit: VoIP spam
 Social networking: Facebook, Twitter,
 Mobile phone messaging services: Whatsapp, BBM
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5. ISSUES RAISED BY SPAM
*Invasion of privacy *Security risk
 Harvesting email addresses and  Spam can be used to spread
data can amount to an invasion computer viruses
of privacy
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*Loss of reputation to individuals
 Overloading mailboxes with and businesses
unwanted material can be a  If email address is spoofed
nuisance and an invasion of
privacy  If email is identified as spam and
blocked by ISP or businesses
*Cost of managing spam
*Danger to internet
 ISPs that have to cope with
traffic  Spamming campaigns can act as
a form of denial of service and
 Businesses whose information
slow internet
systems and employees waste
resources and time  My Doom virus acts in this way
 Individuals who waste time  Offensive content
deleting  Promoting illegal products
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6. REGULATION OF SPAM
 Legislation, various models -
 Opt-out
 Recipient can ask not to receive email
Electronic Transactions Law
 Any further email is illegal
 Opt-in
 Recipient must have agreed to receive email or sending email is
illegal
 Other ways to regulate spam
 Prohibiting sale and distribution of spam ware
 Enforcing ISPs’ anti-spam policies
 Blacklisting (legal status of blacklisting organisations,
defamation claims by blacklisted persons)
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 Common law – nuisance, privacy

7. S45 ECTA: SENDER DUTIES
(1) Any person who sends unsolicited commercial
communications to consumers, must provide the consumer-
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(a) with the option to cancel his or her
subscription to the mailing list of that person;
and
(b) with the identifying particulars of the source
from which that person obtained the
consumer's personal information, on request of
the consumer.
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8. PROBLEMS WITH SECTION 45(1)
 Opt-out scheme
 s 1: 'consumer' means any natural person who enters or
intends entering into an electronic transaction with a supplier
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as the end user of the goods or services offered by that
supplier’
NB excludes those who do not enter, or intend to enter, into an
electronic transaction with the sender
 what constitutes a proper opt-out?
 Important concepts not clearly defined – what is meant by
‘sender’, ‘unsolicited’ and ‘commercial’?
See Lance Michalson ‘The Law vs the Scourge of Spam’
September 2008 <http://www.michalsons.co.za/the-law-vs- 8
the-scourge-of-spam/1019>

9. S 45 & 89 ECTA
 s45 (2) No agreement is concluded where a consumer has
failed to respond to an unsolicited communication.
s45(3) Any person who fails to comply with or contravenes
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
subsection (1) is guilty of an offence and liable, on conviction,
to the penalties prescribed in section 89 (1).
 s45(4) Any person who sends unsolicited commercial
communications to a person who has advised the sender that
such communications are unwelcome, is guilty of an offence
and liable, on conviction, to the penalties prescribed in section
89 (1).
 s89(1) A person convicted of an offence … is liable to a fine
or imprisonment for a period not exceeding 12 months.
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10. CPA – S11
 S11(1) The right of every person to privacy includes the right to—
(a) refuse to accept;
(b) require another person to discontinue; or
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(c) in the case of an approach other than in person, to pre-emptively block,
any approach or communication to that person, if the approach or
communication is primarily for the purpose of direct marketing
 S11(2) a person who has been approached for direct marketing
purposes may demand the cessation of any further approaches (opt-out)
 S11(3) Establishment of registry for pre-emptive blocks by the National
Consumer Commission
 S11(4) A person authorising, directing or conducting any direct marketing
must implement appropriate procedures to facilitate the receipt of opt-out
instructions and ensure the discontinuation of communication after the
receipt of opt-out instructions or where a person has registered a pre-
emptive block
 S11(5) no fees may be charged by senders in relation to pot-out
instructions or registered pre-emptive blocks
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11. CPA –S12
 No contact at home during prescribed periods s12
 Consumer Protection Regulations GNR.293 of 1 April
2011: Regulations (Government Gazette No. 34180), Notice
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Prohibited time for contacting consumers
(1)(a) Sundays or public holidays contemplated in the Public Holidays Act, 1994 (Act No. 36
of 1994);
(b) Saturdays before 09h00 and after 13h00; and
(c) all other days between the hours of 20h00 and 08h00 the following day,
except to the extent that the consumer has expressly or implicitly requested or agreed
otherwise.
2. Direct marketing may not be timed to be delivered to the consumer during the prohibited
times referred to in item 1 above unless expressly, in writing, agreed to by the consumer.
3. A direct marketer is not in breach of item 1 if it has sent out the direct marketing within the
period provided for in item 1, even if the consumer received the direct marketing outside of
the aforementioned period, but the onus to prove that the direct marketing was dispatched
during the allowed period rests fully on the direct marketer.
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12. INDUSTRY BODIES
 Direct Marketing Association of SA: National opt-out
register (pre-emptive block)
established in 2007
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
 https://www.nationaloptout.co.za/
 ISPA in favour of opt-in provisions, clauses 14 -15 Code
of Conduct http://ispa.org.za/code-of-conduct/, see also
http://ispa.org.za/press-release/ispa-urges-opt-in-
approach/
 Wireless Application Service Providers’ Association
Code of Conduct clause 5; uses an opt-out approach
seehttp://www.waspa.org.za/code/waspa_coc_6.1.pdf 12

13. REFORM: PROTECTION OF PERSONAL
INFORMATION BILL S66: OPT IN
Unsolicited electronic communications
 s66. (1) The processing of personal information of a data
subject for the purpose of direct marketing by means of
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automatic calling machines, facsimile machines, SMSs or
electronic mail is prohibited unless the data subject—
(a) has given his, her or its consent to the processing; or
(b) is, subject to subsection (2), a customer of the responsible
party
 S66 (3) Any communication for the purpose of direct
marketing must contain—
(a) details of the identity of the sender or the person on whose
behalf the communication has been sent; and
(b) an address or other contact details to which the recipient
may send a request that such communications cease.
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14. SOME LEGISLATION FROM OTHER
JURISDICTIONS
 US: Can-Spam Act of 2003
 Directive on Privacy and Electronic Communications (2002/58/EC);
Article 13(1) requires prior consent for direct marketing email-opt-in
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 E-Privacy Directive: Directive 2002/58/EC Concerning the Processing of
Personal Data and the Protection of Privacy in the Electronic
Communications Sector, 2002 O.J. (L 201) 37
 E-Commerce Directive: Directive 2000/31/EC on Certain Legal Aspects
of Information Society Services, in Particular Electronic Commerce, in
the Internal Market, 2000 O.J. (L 178) 1
 Distance Contracts Directive: Directive 97/7/EC on the Protection of
Consumers in Respect of Distance Contracts, 1997 O.J. (L 144) 19
 Data Protection Directive: Directive 95/46/EC on the Protection of
Individuals with Regard to the Processing of Personal Data and on the
Free Movement of Such Data, 1995 O.J. (L 281) 31
 Australian Spam Act 2003
 For a useful overview see: L-Soft ‘Opt-In Laws in the USA and EU’
available at < http://www.lsoft.com/resources/optinlaws.asp> (accessed 4
August 2012) 14

15. CPA S29: RIGHT TO FAIR & RESPONSIBLE
MARKETING
A producer, importer, distributor, retailer or service provider must not market
any goods or services—
(a) in a manner that is reasonably likely to imply a false or misleading
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representation concerning those goods or services, as contemplated in
section 41; or
(b) in a manner that is misleading, fraudulent or deceptive in any way,
including in respect of—
(i) the nature, properties, advantages or uses of the goods or services;
(ii) the manner in or conditions on which those goods or services may be
supplied;
(iii) the price at which the goods may be supplied, or the existence of, or
relationship of the price to, any previous price or competitor’s price for
comparable or similar goods or services;
(iv) the sponsoring of any event; or
(v) any other material aspect of the goods or services.
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16. CPA S30 BAIT MARKETING
 S30(1) A supplier must not: advertise goods or services, alleging that they are
available at a specified price in a manner that may mislead or conceive about
the actual availability at the advertised price
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 S30(2) If a supplier advertises particular goods or services, states a price and
the advert states there is a limitation in respect of availability, the supplier
must make those goods or services available at that price, to the extent of the
expressed limits.
 S30(3) It is a defence to an alleged failure to comply with subsection
(1) or (2) if—
(a)the supplier offered to supply or procure another person to supply a consumer
with the same or equivalent goods or services of the kind advertised within a
reasonable time, in a reasonable quantity, and at the advertised price; and
(b)the consumer—
(i)unreasonably refused that offer; or
(ii)accepted the offer, and the supplier has supplied or procured another person
to supply the goods or services so offered and accepted
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17. S31 CPA: NEGATIVE OPTION MARKETING
 (1) A supplier must not—
(a) promote any goods or services;
(b) offer to enter into or modify an agreement for the supply of any
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goods or services; or
(c) induce a person to accept any goods or services or to enter into
or modify such an agreement, on the basis that the goods or
services are to be supplied, or the agreement or modification will
automatically come into existence, unless the consumer declines
such offer or inducement.
 (2) An agreement purportedly entered into as a result of an offer or
inducement contemplated in subsection (1) is void.
 (3) A modification of an agreement purportedly agreed to as a result of an
offer or inducement contemplated in subsection (1) is void.
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18. CPA: OTHER PROVISIONS
 s 34 Trade coupons and similar promotions
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 s 35 Customer loyalty programmes
 s 36 Promotional competitions
 s 38 Referral selling
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19. Electronic Transactions Law
Electronic Transactions Law compiled by Caroline B
Ncube is licensed under a Creative Commons Attribution-
NonCommercial-ShareAlike 2.5 South Africa License.
To view this a copy of this license visit
http://creativecommons.org/licenses/by-nc-sa/2.5/za/
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