UK SMEs Likely To Be Disadvantaged By New EU Privacy Laws

by Robin Pilgrim, LawAndTax-News.com, London

12 August 2003

UK commercial law firm, Reynolds Porter Chamberlain has warned that the forthcoming EU Privacy and Electronic Communications Directive, set to come into force in the United Kingdom in October, is likely to have a devastating impact on the country's SMEs, many of whom rely on direct marketing in order to grow their business.

'Small companies do not have the option of communicating with their customers through TV or billboard advertising. They tend to rely almost exclusively on telephone and e-mail marketing to drive sales and growth,' Sarah Sherlock, speaking for RPC, explained.

She continued: 'Most companies are unaware of the impact these regulations will have on their marketing activities. Raising awareness of products and services will be much more expensive and difficult when this law takes effect.'

Under the terms of the Privacy and Electronic Communications Directive, businesses in the UK will be able to register with the Telephone Preference Service (TPS)- currently an option only open to individuals - and thus block direct marketing calls.

Unsolicited commercial e-mails sent from within the EU will require prior consent from October, although firms are likely to be permitted to send e-mails to existing customers relating to products similar to those that they have previously purchased.

However, Ms Sherlock suggested that this too could prove problematic for businesses in the UK:

'Will, for example, a travel company be able to inform a customer about a hotel if it has just sold that customer a flight?' she wondered, adding that:

'The DTI consultation on the DPEC, due to report in August, may provide guidance on this point, but until we see the first prosecutions it is likely to remain unclear exactly what 'similar' means.'

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