RSM South Africa

POPI and its impact on direct marketing

We live in a period where technology allows consumers to be contacted at any time via e-mail, phone calls and even through social media. Section 1 of the Consumer Protection Act (“CPA”) defines the term “direct marketing” as an approach to a person, either in person, or by mail or electronic communication, for the direct, or indirect purpose of promoting, offering to supply, in the ordinary course of business, any goods or services or to request a donation of any kind.

The Protection of Personal Information Act 4 of 2013 (POPI) was signed into law by the President on 19 November 2013, and gazetted on 26 November 2013, and particular matters have been addressed in POPI which will have substantial impact on direct marketing.

The purpose of POPI

POPI was enacted with the purpose of giving effect to the constitutional right to privacy, by safeguarding personal information when processed by a responsible party, subject to justifiable limitations, aimed at balancing the right to privacy against other rights including, but not limited, to the right of access to information. POPI also regulates the manner in which personal information may be processed, by establishing conditions, in harmony with international standards that prescribe the minimum threshold requirements for the lawful processing of personal information.

Direct marketing and the right to privacy

Section 14 of the Constitution provides that everyone has the right to privacy. In terms of section 11 of the CPA, the right of every person to privacy includes the right to refuse to accept any approach or communication to that person, if the approach or communication is primarily for the purpose of direct marketing. Although the right to privacy is an important right in the Bill of Rights, it has to be balanced against other rights such as the right of access to information. Limiting the right to privacy by relying on the right of access to information requires that the access to information be requested for reasons of the protection or exercise of any established rights. An example in this instance would be the right to freedom of trade, occupation or profession. Every citizen has the right to choose their trade, occupation or profession freely. The practice of a trade, occupation or profession may be regulated by law. Direct marketing is regulated by the CPA and POPI. Provided the direct marketing is conducted in a manner that is not contrary to any of the provisions of the aforementioned acts, then the right to privacy may be limited by relying on the right of access to information and the right to freedom of trade, occupation or profession.

Rights of data subjects regarding direct marketing by means of unsolicited electronic communications, directories and automated decision making

Section 69 of POPI provides that the processing of personal information of a data subject for the purpose of direct marketing by means of any form of electronic communication, including automatic calling machines, facsimile machines, SMS’s or e-mail is prohibited unless the data subject has given his, her or its consent to the processing; or is a customer of the responsible party who gave their personal information to the responsible party in the context of a sale for the purpose of direct marketing, and has been given a reasonable opportunity to object, free of charge and in a manner free of unnecessary formality. POPI does not prohibit direct marketing, it merely regulates the way in which information should be received from data subjects. It is, therefore, essential that any business making use of direct marketing ensures that they clearly and unambiguously inform the data subjects when requesting personal information and what the purpose of requesting such information is.

In terms of the CPA, consumers must always have the option to opt-out free of charge and a cooling-off period of five days was introduced for any transactions concluded a result of direct marketing. Section 69 of POPI on the other hand, offers consumers an opt-in option, as consent is an absolute requirement from the consumers. However, the direct marketer can only contact the consumer only once to obtain such consent.

Conclusion

POPI does not aim to stop the free flow of information, nor does it necessarily aim to restrict the collection of personal information. It does, however, set strict guidelines on how to obtain the information and in the process, balancing the interest of businesses that make use of direct marketing and the data subjects’ right to privacy.

Ntombi Moloro

Legal Assistant, Johannesburg

If your business needs assistance with POPI compliance, please feel free to contact our Legal Department here.


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