UK data reform: Direct Marketing

What changes could be on the horizon for direct marketing?

The UK Government’s consultation on data regime reform mostly focuses on proposals to amend UK GDPR requirements, but it’s worth noting some changes for direct marketing could also be on the cards.

Changes which could be particularly significant for political parties and charities.

Marketing emails, SMS and calls are governed by the Privacy and Electronic Communications Regulations (PECR) and some tweaking of these rules is being proposed.

Furthermore, in what would be a substantial shift, political campaigning could no longer even be considered to be direct marketing.

So what’s be proposed?

Extending scope of the ‘soft opt-in’

PECR requires consent for email and SMS marketing to consumers, i.e. a positive action (such as a tick in a box) to say they’re happy to receive communications. However, commercial organisations can rely on an exemption to consent when it relates to existing customers.

This exemption, known as the ‘soft opt-in’, says email and SMS marketing messages are permitted without obtaining consent as long as the following conditions are met:

• The contact details are collected during the course of a sale, or negotiations for a sale, of a product or service
• An opportunity to refuse or opt-out of the marketing is given at the point of collection, and again in every subsequent communication
• You only send marketing about your own similar products and services

At the moment not-for-profit organisations, such as political parties and charities, are not allowed to rely on this exemption and therefore must gain consent for email & SMS marketing. The Government is seeking views on whether this should be changed.

Clearly, this speaks to the difficulties organisations can face in trying to gain consent from people. The requirements necessary to make consent valid, were enhanced when GDPR came into force.

We all know from our own experience when buying products online that many commercial organisations rely on the ‘soft opt-in’, despite the Information Commissioner’s Office trying to push the message that consent is best.

To be fair, in research and testing we’ve conducted in the past, the general public perception is consent is much more open and honest. An opt-out can easily be missed and is often perceived as trying to trick people into being targeted with marketing.

But, I’m sure this move to extend permitted use of the ‘soft opt-in’ beyond the commercial uses would be very much welcomed by charities and political parties.

The big question though is will the public be happy with this move? A move which may also call into question the definition of ‘sale’ or ‘negotiations for a sale’. Would this only be permitted in certain situations where, for example, people had donated to a charity or political party or had purchased merchandise?

just to clarify the PECR rules on consent and the soft opt-in do not apply in the context of B2B marketing, where for example you are contacting individuals at their business email address. However, when relying on legitimate interests rather than consent you still need to fulfil transparency requirements and honour the right to object to direct marketing.

Removing political campaigning from ‘direct marketing’ rules

Another idea put forward in the consultation is to take things a step further for political parties…

Currently, political campaigning is included within the interpretation of the definition of direct marketing. The draft Direct Marketing Code states:

The DPA 2018 and PECR do not clarify what is meant by ‘advertising or marketing material’. However it is interpreted widely and covers any advertising or marketing material, not just commercial marketing. For example it includes the promotion of aims and ideals as well as advertising goods or services. This wide interpretation acknowledges that unwanted, and in some cases nuisance, direct marketing is not always limited to commercial marketing.

It’s pointed out in the Government’s consultation that case law has established communications from political parties which promote ‘aims and ideals’ should be classed as direct marketing and are therefore subject to the PECR rules.

The Government says this has never been debated in Parliament. I’d suggest this is just as well, as to my mind they’d have a skewed view!

The consultation is therefore being used to seek views on whether electronic communications from political parties and other political entities should be subject to the same direct marketing rules as other organisations and businesses.

Examples of ‘other political entities’ are given as ‘candidates and third-party campaign groups registered with the Electoral Commission’.

The Government believes relaxing the rules would give organisations more freedom to engage with prospective voters and this could lead to increased voter turnout.

However, it’s accepted people may not wish to receive electronic communications of this nature in the same way as not wanting to receive commercial marketing.

We’ll have to wait and see what views the consultation elicits on this.

Increased fines for breaking the marketing rules

The Government is proposing to raise fines under PECR, which are currently limited to a maximum of £500,000, to be in line with UK GDPR fines.

This would be a significant rise as the UK GDPR and DPA 2018 set a maximum fine of £17.5 million or 4% of annual global turnover – whichever is greater – for contravening the rules.

I suspect this is an element of the reform which will go through – so a clear warning for nuisance spammers, who seem to be the most common recipients of fines under PECR at this time.

What next?

For the time being nothing is carved in stone, and it will be interesting to see how things develop after the consultation closes on 19th November.
What’s clear is this has probably put the long-awaited final version of the current draft Direct Marketing Code of Practice, published in January 2020, on ice for a little longer.

Your views

If you would like to share you views on the above proposed changes, and other proposals in the UK data reform consultation take part in our survey.  The DPN will be submitting a formal response to the consultation, and we’d appreciate your thoughts.