27 February 2006

The Privacy Commissioner has renewed two credit provider Determinations for approximately six months while her Office conducts public consultations.

The first Determination " concerning assignees " facilitates credit reporting where a debt is 'assigned' from one business to another. The second Determination " concerning classes of credit providers " permits certain companies that allow consumers to defer payment for 7 days or more to access the credit reporting system. This second Determination also permits businesses that hire out goods for at least 7 days duration access to the credit reporting system under certain circumstances.

Renewing these Determinations for approximately six months will enable the community to be consulted on the effectiveness and appropriateness of these two elements of the credit reporting system.

Credit Provider Determination No. 2006-1 (Assignees) provides that a corporation which acquires the rights of a credit provider in respect to the repayment of a loan (whether by assignment, subrogation or other means) is to be regarded as a credit provider for the purposes of the Privacy Act.

By being granted credit provider status the assignee is able to conduct credit reporting, but only in relation to the assigned loan. In particular, it will be able to directly access an individual's credit report, held by a credit reporting agency in some circumstances. If it needs to, an assignee will be permitted to directly access a credit report held by a credit reporting agency in accordance with Part IIIA of the Privacy Act and the Credit Reporting Code of Conduct, for such purposes as: collecting a payment on the loan that is overdue; listing either an overdue payment or a serious credit infringement in relation to the loan; updating as paid an existing default listing in relation to the loan; and making corrections to information it, or the assignor, has previously reported in relation to that loan.

Credit Provider Determination No. 2006-2 (Classes of credit providers)provides that all corporations belonging to the following classes are to be regarded as credit providers:

• a corporation where, in relation to a transaction, it is considering providing or has provided a loan for the provision of goods or services on terms which allow the deferral of payment for at least 7 days; or
• a corporation engaged in the hiring, leasing or renting of goods, where, in relation to a transaction, no amount, or an amount less than the value of the goods, is paid as deposit for return of the goods, and the arrangement is for at least 7 days duration.

If it needs to, a business covered by the Determination will be permitted to directly access the individual customer's credit report held by a credit reporting agency in accordance with Part IIIA of the Privacy Act and the Credit Reporting Code of Conduct for purposes including: assessing the loan application; collecting a payment on the loan that is overdue; listing either an overdue payment or a serious credit infringement in relation to the loan; updating as paid an existing default or serious credit infringement listing in relation to the loan; and making corrections to information it has previously reported in relation to the loan.

These Determinations will be effective until 31 August 2006 and during this period the Office of the Privacy Commissioner will consult stakeholders regarding how these aspects of the credit reporting system have operated and about the terms of any new Determinations.

The Determinations and Explanatory Statements are available on the Office's website at www.privacy.gov.au and lodged on the Federal Register of Legislative Instruments located at www.frli.gov.au.