Less than two weeks remain for credit providers to provide their
comments on the draft Credit Reporting Code (CR
Code) to its creator, the Australasian Retail Credit
Once approved by the Office of the Australian Information
Commissioner (OAIC), the CR Code will replace the
existing Credit Reporting Code of Conduct that has operated since
1996, and will form part of the privacy protection regime set out
in Part IIIA of the Commonwealth Privacy Act 1988 as
amended in December 2012.
The CR Code will take effect on 12 March 2014 along with other
major reforms to the Privacy Act.
Submissions on the CR Code will be accepted by ARCA until
5 May 2013. Late submissions will not be
considered unless prior arrangements have been made with ARCA.
Key features of the CR Code
The CR Code is designed to supplement and clarify obligations
under the new Part IIIA of the Privacy Act. It is intended to be
binding on all credit reporting bodies (CRBs) and
Credit Providers (CPs) as well as affected
information recipients (other persons who are entitled to receive
disclosure of information about credit in certain circumstances set
out in the Privacy Act e.g. mortgage insurers and trade
The CR Code is not voluntary and will have regulatory force.
Breaches of the CR Code will be considered a breach of the Privacy
Act and can attract penalties of up to $1.7 million.
Key features of the CR Code include:
additional disclosures required to be made by CPs to
individuals when collecting personal information
changes to complaints handling procedures for CPs and CRBs
CPs and CRBs must be a member of a recognised external dispute
additional rules about an individual's right to access and
correct their credit reporting information or eligibility
restrictions on CPs from providing information to CRBs when an
individual has submitted a hardship application to a CP
CRBs will be obliged to audit the compliance of CPs to ensure
they are complying with their Part IIIA obligations
individuals will be granted a 5 day grace period before CPs can
report a missed repayment on an individual's credit history to
prescribed details of what must be included in the notice of
refusal of credit given by CPs to individuals
additional restrictions on when CPs can request credit
reporting information from CRBs.
In December 2012, OAIC requested ARCA to develop the CR Code and
to apply to the OAIC for its registration.
ARCA have set out in their CR Code consultation paper that the
draft code has been prepared with the aim of providing the OAIC
with a Code that represents a 'balanced' approach –
meeting the reasonable expectations of industry, of consumers and
of the regulator – rather than an industry preferred
ARCA states that the CR Code has been designed to:
address expectations in Part IIIA or the Explanatory
replicate current Credit Reporting Code of Conduct obligations
that continue to be relevant given that this Code will be replaced
by the CR Code
make credit reporting work from a practical perspective
provide some assistance to individuals to understand and
interact with the new systems
address industry uncertainty as to how to interpret aspects of
Part IIIA in the interests of consistency of approach within
The CR Code does not encompass all aspects of Part IIIA and so
compliance with the CR Code alone will not achieve full compliance
with Part IIIA.
Timeline for finalising the CR Code
The OAIC requires the draft CR Code to be submitted for approval
by 1 July 2013.
The table below sets out the current timetable for the
finalisation of the CR Code:
Draft CR Code released for public consultation
Submissions due on public consultation
Analysis of issues and redrafting completed by ARCA
ARCA Board meeting - to consider redrafted CR Code
5 June - 12 June
Refine draft CR Code in light of ARCA Board decisions
Final review of draft CR Code
Lodge draft CR Code and application with OAIC
Release detailed Explanatory Notes for public consultation
August / September
Finalised Explanatory Notes provided to OAIC
Credit providers will need to review current processes and
procedures to ensure that the changes to be brought about by the CR
Code are actioned appropriately within their organisation. The CR
Code is a key component of the reforms and it will be critical for
credit providers to consider the CR Code in detail, when it is
ultimately finalised by ARCA and approved by the OAIC.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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