1. COMPETITION - McCarthy TÃ©trault

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gateways as extensions to their PABX systems or where companies' selfprovide termination services for their staff. However, other than for private use, the provision of GSM gateway services to third parties will remain unlawful under the WTA. The Radiocommunications Agency, which is the agency responsible for enforcing the WTA requirements until the new super-regulator, Ofcom, takes over at the end of 2003, has suggested that commercial GSM gateway providers come to a suitable, pragmatic arrangement with mobile operators allowing them to continue to provide the services, under the authority of the mobile operator's licence. There would appear to be little commercial likelihood of mobile operators consenting to this activity. Indeed, the gateway service provider, Floe Telecom Ltd, lodged a complaint with Oftel on 7 August 2003 against Vodafone, after the mobile operator periodically suspended Floe's access on the grounds that its gateway activities were unlawful. Floe has alleged that it has a valid contract in place with Vodafone that makes its gateway activities legal. Floe alleges that Vodafone's actions amount to an unlawful refusal to supply. For more information please contact: colin.long@olswang.com COMMENTARY FRANCE USE OF PERSONAL DATA FOR MARKETING PURPOSES By S. LIPOVETSKI (slipovetsky@kahnlaw.com) and F. PERBOST (fperbost@kahnlaw.com) The principal source of legislation regulating data protection in France is Law No. 78-17 of 6 January 1978 known as "Loi Informatique et Libertés" (the "Law"). The Law is expected to be amended to comply with the provisions of European Directive 95/46/EC of October 24, 1995 (the "EU Data Protection Directive"). The draft law implementing the EU Data Protection Directive (the "Draft Law") passed its first reading on 1st April 2003. At present, personal data may be used for marketing purposes if the purpose is identified in the filing with the French data protection authority (the "CNIL") and if the persons whose data are collected are informed or gave their consent. The Law only requires the consent of the data subject (i.e. opt-in) when automatic processing of sensitive personal data (as indicated above) is involved. In parallel, the Law provides for a general opt-out principle: the data subject may oppose the collection of his or her personal data for legitimate reasons. To enable the individual to exercise his or her right to object to the collection of personal data, the Law requires that persons whose data are being collected receive the following information: • whether their responses are mandatory or optional; • the consequences of their failing to provide a response; • persons (both individuals and legal entities) which will receive their data; and • their right to access their data and to obtain the correction of incorrect data. This information must be provided to the data subject at the time of collection of data and at a later date if the information changes. If the data subject is not informed of the persons who will receive his or her data at the time of collection of the data, he or she must be provided with this information prior to the transfer of the data to another person. The major innovation of the Draft Law is to establish a general opt-in system where all individuals must give their consent to the collection of data relating to them. Under the Draft Law, the following information shall be provided to the persons on whom the data are collected: • identity of the data controller, • purpose of the processing, • whether their responses are mandatory or optional; • the consequences of failing to provide a response; • persons (both individuals and legal entities) who will receive their data; • the right to access their data and to correct incorrect data, and the right to to oppose to the collection of such data; and • to prevent the transfer of personal data to any country that is not a State member of the European Community, if any. Often companies wish to use personal data to send to its customers unsolicited information about products or services. Most of the claims received by the CNIL deal with the exercise of the rights specified in the Law by persons on whom data are collected, and in particular, with the right to oppose receiving unsolicited mails. According to the terms of Article L 33-4-1 of the Posts and Telecommunications Code (inserted by Order n° 2001-670 of 25 July 2001, Article 16), it is prohibited to directly canvass, using automatic calling machines or fax machines, telecommunications network subscribers or users who have not consented to receiving such calls. It is also provided that operators or their distributors shall provide free of charge to those subscribers or users who so wish, the means to give their consent to receiving calls referred to in the above subparagraph. They shall make available to any person who so requests the list of these subscribers or users. At present, the means to give such consent are not determined. In addition, Article L121-20-5 of the Consumer Code (inserted by Order no. 2001-741 of 23 August 2001 art. 5 and art. 12) specifies that direct canvassing by a professional, by means of automatic calling machines or faxes, of consumers who have not expressed their agreement to receive such calls is prohibited. Distance communication methods other than those mentioned in the previous paragraph, involving personal communication, may only be used where the consumer has not raised an objection. The conditions under which the consumer expresses his/her agreement to receive the calls mentioned in the first paragraph, information that the professional must supply to the consumer regarding his opportunity to raise an objections as well as the conditions under which objection registers are kept are to be prescribed by a Council of State decree. Such Council of State decree has not been adopted. The sending of unsolicited e-mail is subject to the opt-out principle at present but should be subject to the prior consent of the persons who are solicited as soon as a French draft law ("Projet de loi sur l'économie numérique") is adopted. The last version of the draft law is a version dated June 26, 2003, modified by the French Senate and transmitted to the French National Assembly for its second reading. This draft law specifies that the use of automated calling systems without human intervention (automatic calling machines), facsimile machines (fax) or electronic mail for the purposes of direct marketing may only be allowed to subscribers who ISSUE 22 SEPTEMBER – OCTOBER 2003 16
have given their prior consent. Regarding electronic mail, the requirement to obtain prior consent applies if the person is registered with the Registry of Commerce and Companies. However the Projet de loi sur l'économie numérique provides that where 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, the same person may use these contact details for direct marketing of its own 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 contact details both when they are collected and on the occasion of each message in case the customer has not initially refused such use. A use of personal data for marketing purposes without informing the person on whom the data are collected of this use and not for the purposes specified in the data controller's filing with the CNIL, may give rise to criminal sanctions. According to the terms of Article 226-18 of the Criminal Code, the collection of data by fraudulent, unfair or unlawful means, or the processing of personal information relating to a natural person despite this person's opposition, where this objection is based on legitimate grounds, is punished by a fine of 1 500 000 euros (for companies). More specific sanctions should be adopted with respect to unsolicited communications by way of a decree. The Projet de loi sur l'économie numérique specifies that the CNIL will receive, by any means, including by electronic mail, claims relating to non compliance with the provisions regarding electronic advertising. At present, the CNIL can only give warnings or denounce to the prosecution department any violation of the Law. Its powers will be extended as it will be possible for the CNIL to order any person to stop unlawful processing or to order the interruption of the data processing for a three-month-duration. The CNIL will probably be entitled to impose fines not to exceed 150,000 euros (300,000 euros without exceeding 5% of the turnover in case of repeated breach within a five years period from the date of the previous fine). ISSUE 22 SEPTEMBER – OCTOBER 2003 17
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