In July the Direct Marketing Association named Charles A. Prescott, formerly of The Reader’s Digest Association, as its first vice president of international business development and government affairs. Prescott will wear several hats in that position. One of the first issues he’ll deal with for the DMA is one he’s been involved in for nearly a decade: the European Community’s data protection directive.
Prescott, who for eight years was associate general counsel and vice president of legal in charge of Reader’s Digest’s Pacific group, has been following the directive since the white paper it grew out of was drafted almost 10 years ago. He also chairs the U.S. Council for International Business’s Working Group on Privacy and Transborder Data Flows.
Prescott says a growing number of DMA members in the United States are concerned about the directive, which requires (with a few exceptions) data from EC member countries to go only to those deemed to have “adequate” privacy protections. It’s unclear how the EC members will label the United States.
The directive does not create rights or obligations immediately; it instructs members to pass privacy laws. A number of European countries will not have implemented the directive by the October deadline. (By press time, only Greece, Italy, Sweden and the United Kingdom had passed such laws.)
Prescott says he believes the issue is normalizing on the part of European officials, who are much more aware that data traveling between countries is a complex matter. They see that a hard stand may not necessarily accomplish their objectives.
“There’s been a lot of reality testing and awareness happening over the course of the last year,” he says. “Many of those data flows are clearly permitted by the directive and will clearly be permitted by the local laws that have been passed. The British authorities recognize they can’t ask all of British business to change its system overnight, and they will not do that.”
He adds, “There are a number of exceptions which will permit data to continue to flow, regardless of whether the European Commission says we are inadequate.”
One example of increased moderation on the part of European officials is the growing reception to the idea of having a standard contract cover these data transfers (which the directive allows), a route that Prescott has been promoting. He is working with privacy guru Alan Westin and his group, Privacy and American Business, on drafting contracts for transborder data flow to help industry deal with the problem.
Such regulatory issues are not all Prescott will address in his new job. A major part of the post will be to promote the DMA around the globe. He will also bring in new members, act as the group’s point person for its international members and, especially, help U.S. companies do business internationally.
As direct marketing goes global, American companies will need assistance in identifying and overcoming the barriers to doing business in other countries.
These are the same issues-privacy, customs and tariffs, postal matters, sweepstakes regulation-Prescott dealt with in setting up Reader’s Digest in 12 countries. He sees the DMA’s job as giving its members “a road map” to doing business in other countries: identifying list brokers, fulfillment houses, call centers. One of his first projects will be to build a database of such resources in certain countries for members to use.
“We want to help our members who perhaps don’t have the huge resources of our biggest members to be able to address those issues effectively,” he says. “We felt there was a need that we could fulfill.”
Prescott sees his job as a natural extension of his stint at Reader’s Digest, where he was responsible for government affairs and all legal issues outside the United States. At the DMA he’ll be taking a broader view-for example, identifying why more U.S. catalogers aren’t mailing into Brazil (postal and tax issues and a “confusing” import system have already been identified as the culprits, he says).
And the DMA will help by representing direct marketers’ interests before multinational policy-making bodies. It will also work with direct marketing associations from other countries. This is another area where Prescott has had a lot of experience. As part of his work in “selling the little magazine abroad,” he helped establish direct marketing associations in Taiwan, Malaysia, Hungary, the Czech Republic and Poland.
Prescott says the DMA’s international council and general membership will soon decide which geographic regions to zero in on first. He thinks the initial focus will be on Europe and Latin America.
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