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By Jay Cline, CIPP

Differing understandings of what "opt in" and "opt out" mean have stymied countless conversations between corporate marketers and privacy officers around the world. Similar confusion over definitions of "marketing" communications versus "administrative" communications have put the brakes on many creative marketing ideas. What are some possible solutions? The following glossary offers some starting points for your company's internal policy deliberations.

1.  "Opt in" = express, affirmative, or explicit consent

The gold standard in privacy-consent language is the so-called "opt in" consent. Regulators around the world tend to require this level of consent--alternatively called express, affirmative, and explicit--for collecting sensitive data and for using personal data in ways most individuals might not agree to. For example, the U.S.-EU Safe Harbor principles state: "For sensitive information, affirmative or explicit (opt-in) choice must be given if the information is to be disclosed to a third party or used for a purpose other than its original purpose or the purpose authorized subsequently by the individual." 

There are more complicated "opt-in" definitions than the Safe Harbor. The U.S. CAN-SPAM Act, for example, defines this higher level of consent occurs when "(A) the recipient expressly consented to receive the message, either in response to a clear and conspicuous request for such consent or at the recipient's own initiative; and (B) if the message is from a party other than the party to which the recipient communicated such consent, the recipient was given clear and conspicuous notice at the time the consent was communicated that the recipient's electronic mail address could be transferred to such other party for the purpose of initiating commercial electronic mail messages."

It's debatable whether requiring this level of consent is always good policy. What's not as debatable is lawmakers' intent behind this standard: that data subjects' clear and informed consent is required for exceptional uses of their data.

In practice, what should be examples that are widely understood to qualify as opt-in consent?

  • An unticked box on a Web page or paper form that says: "Send me promotional e-mail offers." If consumers tick that box, they've provided opt-in consent.
  • An unticked "I agree" box below a Web- or paper-based set of terms and conditions in which it is clearly and prominently stated that the consumer will receive direct marketing. If consumers tick that box, they've  also provided opt-in consent.
  • An optional field on a form that says "e-mail address," and nearby it says: "By providing your e-mail address, you may receive marketing e-mails from us." If consumers provide their e-mail address, they, too, will have provided opt-in consent.
  • A "subscribe" button on a Web site "shopping cart" page that, when clicked, uses information from the purchase to subscribe a consumer to a newsletter and use and disclose that information according to the terms of the privacy policy posted on the site.
  • An inquiry from a consumer who says or writes: "Please add me to your mailing list."
  • A business card that is dropped into a fishbowl that says: "Drop your card and win a free lunch and join our mailing list."

According to Andrew Serwin, chair of the Foley & Lardner LLP Privacy Security & Information Management Practice, in certain cases a "double" opt-in regime is used. "This occurs when a company needs to ensure that there is no issue regarding whether a recipient gave consent," says Serwin.

2.  Opt out = soft opt in, default opt in, assumed, deduced, deemed, or implicit consent

Even if consumers haven't explicitly checked an opt-in box, there still may be many situations where companies can assume they have appropriate consent to send direct marketing to their consumers. If it's usual and customary for companies in a certain industry in a certain country to send direct marketing to consumers at addresses listed in public directories or at the contact information provided during a sale, these companies may often be safe to assume they have obtained an appropriate level of consent.

Even the European Union, known for its more restrictive approach to privacy consent, accepts the legitimacy of this opt-out approach. In its Directive on Data Protection, the EU defines a data subject's consent broadly as 'any freely given specific and informed indication of his wishes by which the data subject signifies his agreement to personal data relating to him being processed.' The EU more directly provides for an opt-out approach to direct marketing in its subsequent Directive on Electronic Communications. Its section on unsolicited communications states: "[W]here a natural or legal person obtains from its customers their electronic contact details for electronic mail, in the context of the sale of a product or a service, in accordance with Directive 95/46/EC, the same natural or legal person may use these electronic contact details for direct marketing of its own similar products or services provided that customers clearly and distinctly are given the opportunity to object, free of charge and in an easy manner, to such use of electronic contact details when they are collected and on the occasion of each message in case the customer has not initially refused such use."

Canadian legislation similarly sanctions the use of opt-out consent. The Personal Information Protection and Electronic Documents Act (PIPEDA) states: "The knowledge and consent of the individual are required for the collection, use, or disclosure of personal information, except where inappropriate..." The form of the consent sought by the organization may vary, depending upon the circumstances and the type of information. In determining the form of consent to use, organizations shall take into account the sensitivity of the information."

3.  "Marketing" versus "administrative" communications

If consumers don't provide the necessary consent for companies to send them marketing communications--which are usually seen as secondary uses from the original purpose for which the data was originally collected--companies still want to be able to communicate with consumers about their accounts. In some cases, companies are required to communicate with consumers, such as to send them annual privacy notices and other types of administrative correspondence. According to Serwin, companies will often combine marketing material with administrative communications. As a result, debates have unfolded inside many companies over what qualifies as "marketing" communications subject to privacy permissions and what qualifies as "administrative," "transactional," or "service" communications not subject to the same permissions, and how to handle "hybrid" communications.

There are no commonly accepted guidelines for resolving these debates. For its part, the Federation of European Direct and Interactive Marketing defines direct marketing in a broad way as 'the communication by whatever means (including but not limited to mail, fax, telephone, on-line services etc...) of any [emphasis mine] advertising or marketing material, which is carried out by the Direct Marketer itself or on its behalf and which is directed to particular individuals.'

The U.S. CAN-SPAM Act more narrowly defines a "commercial electronic mail message" as any electronic mail message the primary purpose [emphasis mine] of which is the commercial advertisement or promotion of a commercial product or service. The Act also provides a detailed definition for "transactional" or "relationship" message as a message 'the primary purpose of which is (i) to facilitate, complete, or confirm a commercial transaction that the recipient has previously agreed to enter into with the sender; (ii) to provide warranty information, product recall information, or safety or security information with respect to a commercial product or service used or purchased by the recipient; (iii) to provide (I) notification concerning a change in the terms or features of; (II) notification of a change in the recipient's standing or status with respect to; or (III) at regular periodic intervals, account balance information or other type of account statement with respect to, a subscription, membership, account, loan, or comparable ongoing commercial relationship involving the ongoing purchase or use by the recipient of products or services offered by the sender; (iv) to provide information directly related to an employment relationship or related benefit plan in which the recipient is currently involved, participating, or enrolled; or (v) to deliver goods or services, including product updates or upgrades, that the recipient is entitled to receive under the terms of a transaction that the recipient has previously agreed to enter into with the sender.' 

What could be some possible rules of thumb to harmonize these international terminology variances? These definitions may be starting points for your organization:

  • "Marketing" communications are messages sent through any channel to an identifiable individual where the timing of the message, the majority of the content, or the topics of the subject headers have as their primary purpose influencing the consumer to make another commercial transaction.
  • "Administrative" communications are non-marketing messages whose purpose is directly related to the original purpose for which the individual's information was first collected.

Other key privacy terms that have acquired slightly different understandings in different regions include "customer" versus "consumer," what qualifies as an "existing business relationship," and what is a "privacy consent" versus a "privacy permission," "privacy preference," or "privacy choice." In all of these cases, a global harmonization of terms will be needed before any global privacy agreement can be successfully negotiated.

Jay Cline is president of Minnesota Privacy Consultants


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