Analyst: U.S. telemarketing registry has major impact on Canada

Although Canada currently doesn’t have a mandatory do not call (DNC) registry, the impact of the legislation in the U.S. will hit Canadian call centres hard, both directly and indirectly, in coming months.

These comments were made by Ian Angus, president of consulting firm Angus Telemanagement Group in Ajax, Ont. during a teleconference hosted by Sprint Canada Inc. on Thursday. Angus said that adhering to the U.S.’s DNC registry is essential for Canadian call centres doing business south of the border.

He added that the registry – which has been mandatory since Oct. 1 – carries a price tag of US$11,000 per call for all call centre operators that don’t respect the DNC list.

Angus noted that the main reason legislation across the border is affecting Canadians is because of the high numbers of Canadian call centres doing business with the U.S.

He added that eight per cent of all in-house call centre agents in Canada and 42 per cent of all outsourced bureau agents in Canada focus on the U.S. market over the Canadian market.

“In the first nine months of 2003, there were 52 new deals signed to bring call centre work to Canada potentially creating 17,000 jobs here,” Angus said. “For those centres and for the many U.S.-focused centres that have existed for some time, complying with the U.S. DNC list is not optional.”

Angus warned Canadian call centres that if they don’t comply “rigorously above and beyond the letter of the law” they simply will not get U.S. business and their U.S. contracts will not be renewed.

“If an organization wants [a call centre] to call into the United States, to call U.S. consumers and doesn’t insist on compliance then [Canada] shouldn’t do business with them. They either don’t know what they’re doing, or they think that dealing with a Canadian call centre is a way of avoiding the U.S. law,” Angus added.

Angus said that the Canadian Marketing Association (CMA) – which hosts a voluntary DNC list for its members – until recently received an average of 5,000 new registrations per month. Since the U.S. registry began last June, however, the CMA is receiving an average of 5,000 additions per week.

According to a proposal made by the CMA to the Canadian Radio-television and Telecommunications Commission (CRTC) in November 2001 – which requested the CMA’s views on the subject of a Canadian DNC list – the CMA supports the idea of the commission setting up and monitoring a mandatory DNC registry in Canada.

Currently the CMA’s voluntary registry is only used by CMA members, so although consumers may have signed up to the CMA’s list, non-association marketers can still call them.

According to the CMA, its proposal to the CRTC includes the following conditions: the DNC list would be compulsory for all telemarketers in Canada; consumers would register for the service for a fee of $5 which would cover a three-year period; companies that subscribe to the program would be charged an annual fee ranging from $500 to $10,000; and the CRTC must develop an appropriate enforcement mechanism around the DNC service.

According to the CRTC, it will review the proposal made by the CMA and provide new guidelines and rules for telemarketers some time in 2003.

Currently, the CRTC’s rules on telemarketing say that telemarketers must maintain in-house DNC lists for both telephone calls and faxes and provide customers with a fax or telephone number where a responsible person can be reached within their organization.

Consequences that can be imposed today on telemarketers in Canada include having their telephone service suspended or disconnected.

Angus noted that he would be surprised if the CRTC doesn’t issue a “very strong decision” by the end of this year. He said that although new legislation will probably be required from the government, this shouldn’t be a problem.

“This is unlikely to be a major barrier because voters want it. If there is not action soon, I think it will be a platform issue for one or more of the parties in next year’s federal election,” he added.

Angus warned call centres during Thursday’s education session that although the fines for ignoring the U.S. registry are substantial, businesses that choose to ignore it have a lot more to lose than money.

“The fines are big but even bigger if you think about the management time, the legal bills and the bad publicity,” Angus said. “The cost of annoying a potential customer has just become very high indeed.”

Norwood, Mass.-based Gryphon Networks Corp. is already working with Sprint U.S. on offering the technology to enable Canadian businesses to comply with the new U.S. DNC legislation. Rick Frye, vice-president of corporate development for the company, said that it is essential for Canadian call centres to find ways to make sure that U.S. business interests are protected.

He added that this is because it is ultimately the U.S. clients that are liable for any infractions of DNC calls.

Frye said that although rolling the dice and hoping for the best may have been a viable solution for telemarketers 10 years ago, it is no longer a good option.

He added that companies may elect to develop and manage an internal solution.

“For 55 million telephone numbers on the (U.S.) national do not call list, if they were printed on eight by 11 paper in four single-spaced columns, the stack of printed output would be about 90 feet tall. So, the chances of manually looking up do not call numbers before the call is quite obviously going to be an ineffective solution,” Frye said.

On top of any restriction the CRTC may impose, Dan Bowles, vice-president of the regulatory department at Toronto-based Sprint Canada – a wholly owned subsidiary of Call-Net Enterprises Inc. – said that the U.S. can enforce rules indirectly on Canadian operators not complying with the DNC registry.

Bowles said the U.S. could seize any American assets of the company including accounts due from American clients and “perhaps even go after the telecom companies carrying the calling.”

Additional information can be found online at or The CRTC and the CMA can be found online at and respectively.

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