Marketing law changes

2017-05-17 06:00
Damian Viviers

Damian Viviers

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Question:

I operate a cash loan business and to attract new clients we hand out flyers and send SMSs and emails to individuals whose contact details we obtain from a third party supplier.

Will I be able to market my services to potential clients once the Protection of Personal Information Act 4 of 2013 (Popi) comes into operation?

Answer:

Direct marketing practices are considered to be a legitimate business interest for many businesses worldwide and are used primarily for attracting new clients.

Certain do’s and don’ts apply when it comes to direct marketing practices in South Africa, which are regulated by the Consumer Protection Act 68 of 2008 (CPA) and the Electronic Communications and Transactions Act 25 of 2002 (Ecta).

In terms of the CPA, direct marketers may market their products and services to consumers until they choose to optout. The permission of consumers is not required for a business to contact consumers telephonically and send emails or SMSs.

Ecta, however, requires marketers to inform consu-mers of their right to optout of these communications.

When a consumer optsout and does not wish to be contacted again, the CPA obliges marketers to acknow- ledge that the consumer has optedout and keep a record to ensure the person is not contacted again.

The Protection of Personal Information Act 4 of 2013 (Popi), which aims to protect the privacy of consumers and their personal information, has been signed into law, but is not yet fully in operation.

Popi will alter the legal position in relation to direct marketing practices in South Africa, as it will repeal the sections of Ecta relating to direct marketing, and both the CPA and Popi will apply to the various facets of direct marketing.

Popi will apply to all direct marketing that takes place by electronic means. Popi will not apply to direct marketing through non-electronic means, such as registered post, flyers and telephone calls.

Popi distinguishes between existing customers and new customers when considering the requirement to obtain consent for direct marketing practices. Opt-out consent will be required for existing customers, while opt-in consent will be required for new customers.

The position in relation to direct marketing practices will be as follows once Popi comes into operation. The handing out of flyers will be governed by the CPA and you can distribute these to consumers until a potential client elects not to receive them again, at which point you will have to keep a record of the consumer’s refusal and refrain from contacting them again. This will also apply to telephone calls and communication via post or in person.

Sending SMSs, emails and other electronic communication to potential clients will require these persons to first consent to it being sent as required by Popi, before you may contact them.

If your business engages in direct marketing practices that make use of electronic communications, it may be necessary to approach a legal specialist to assist you with the drafting of proper consent forms, notices, privacy policies and e-mail banners to ensure that your direct marketing practices are in line with Popi.
– Damian Viviers, candidate attorney, Phatshoane Henney Attorneys

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