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CANADA'S NEW PRIVACY LAW TO TAKE EFFECT JANUARY 1, 2004

Posted on November 14, 2003

      On January 1, 2004 Canada's Personal Information Protection and Electronic Documents Act (PIPEDA) takes full effect. Under PIPEDA, businesses can no longer collect, use or disclose personal information without consent.

      Banks, insurers, telecommunications and transportation companies have been subject to the Act since 2001 but on Jan. 1, 2004, it will cover all commercial activity.

      PIPEDA states that every company must designate a privacy officer who is responsible for conducting personal information audits, ascertaining what personal information is collected and determining how it is used. For example, newspapers will no longer be able to sell names and home addresses of subscribers to third parties without the consent of subscribers.

      However, companies that sell goods or services to other businesses can still send customers marketing and promotional information. Even if businesses have the consent of consumers to send information, they must offer a "quick, easy and inexpensive" way to opt out or revoke consent, says Jill McCutcheon of Blaney McMurtry. PIPEDA also requires companies to safeguard private information.

      Based on information from the federal privacy commission, many industry associations have established guidelines their members can follow, says Carolyn Burke, of Integrity Incorporated. Ms. Burke points out that "there will be significant overhead" for small businesses which might include privacy consultants who will conduct privacy impact assessments, determine which policies companies need to change and produce privacy compliance road maps.

      There may also be additional costs as court decisions and case law have an effect on the nature of the legislation. However, Robert Parker of Deloitte&Touche says compliance should be viewed as an investment. "Privacy and trust are becoming business differentiators. Implementing and following a privacy policy is good for business."

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