Privacy rules are the single biggest threat to the growth of marketing in Canada – and Alberta businesses should be vigilant to ensure new government regulations don’t handcuff their ability to communicate with customers, says the head of the largest marketing association in Canada.

“This is not a war we are in any way going to win,” says John Gustavson, president of the Canadian Marketing Association. “It is an ongoing struggle to meet individuals’ expectations of a reasonable protection of their privacy rights and our ability to employ Canadians.”

Proposed privacy legislation in Ontario is a good lesson for Alberta on how inadequate consultation with business can kill the economy, Gustavson told a meeting of marketers and advertisers last week at the Fairmont Palliser Hotel in Calgary.

All provinces have been given the opportunity to draft their own privacy legislation to be enacted by January 2004. Otherwise, federal privacy laws – which now affect federally regulated areas such as banking, transportation and telecommunications, or any information transferred across provincial or international boundaries for commercial reasons – will apply.

Under proposed Ontario privacy rules first unveiled in February, businesses must obtain expressed consent from each customer to collect personal information, use it or disclose it to a third party. In essence, companies couldn’t resend catalogues to customers, communicate with them based on earlier information, or even invite them to make donations based on their previous record of giving.

Information collected can only be used for its original purpose, and selling or exchanging mailing lists would also require expressed consent.

Yet, under federal law, marketers dealing with non-sensitive personal data are able to communicate with customers based on implied consent – meaning it is reasonable to assume the individual would grant permission if approached. The CMA fears that if some provinces accept the federal model, and others draft their own laws, it will create an impossible patchwork of legislation across the country.

Jim Carter, president of the Calgary branch of the CMA, agrees the Ontario model will be “a huge litmus test” for the rest of the country.

“What’s proposed in this legislation is going to be very punishing to a massive industry and will affect a lot of people,” he said.

The CMA says marketing based on personal information employs an estimated 482,000 Canadians, including the fast-growing sector of customer relationship management. Gustavson says CMA’s 800 corporate members have a long history as responsible self-regulators, and abide by the organization’s compulsory privacy code.

But he admitted many consumers are fed up with irresponsible telemarketers who have failed to regulate themselves. The CMA does not condone practices such as the invasion of privacy at inappropriate times, automated calling devices which begin with several seconds of dead air before a message, and companies that make it difficult for consumers to get their names removed from phone lists.

“It’s an industry that has completely failed to self-regulate, has continued to act irresponsibly, and has completely shot itself in the foot,” he said.

The CMA supports federal privacy legislation to protect individual interests and help control personal information, but it can be flexible enough without harming responsible business, Gustavson added.

“Self-regulation is vitally important to our success in preventing unwarranted government interference in our marketplace.”