Ireland: Credit Reporting Update

Last Updated: 24 February 2016
Article by Orla O'Connor and Robert Cain

On 11 February 2016, the Central Bank published a Feedback Statement on its April 2015 Consultation on the introduction of a Central Credit Register (the Register) under the Credit Reporting Act 2013 (the Act). This Briefing gives an update on the status of the Register, and the Central Bank's plans to phase in credit reporting.

BACKGROUND:

The purpose of the Act is to establish the Register (to be managed by the Central Bank) which will hold information about credit applications, credit agreements and the parties to those agreements, and oblige lenders to report certain information on those applications and agreements.

The Act came into operation on 27 January 2014, but the Register is not yet up and running and the various regulations required under the Act have yet to be published. Now that the Central Bank has engaged a third party service provider to assist with the operational aspects of developing the Register, implementation is expected to progress quickly.

The Central Bank has emphasised, as regards preparing the various regulations, the importance of it conducting privacy impact assessments and consulting with the Data Protection Commissioner so as to balance the Central Bank's desire for a single borrower view to be available to lenders against the privacy rights of the borrowers concerned.

REMINDERS:

  • In-scope lenders: Lenders in scope include regulated financial services providers (such as banks, credit unions and retail credit firms), NAMA, local authorities and other persons who provide credit (including unregulated lenders). Purchasers of loans from one of these entities are also in-scope. Central banks and pawnbrokers are out of scope. The Central Bank expects more than 500 lenders to come within the credit reporting regime.
  •  
  • In-scope credit: Loans, deferred payment arrangements and other forms of financial accommodation are all in scope with certain exceptions (such as the provision of employee-only credit by an employer, intra-group credit, interest-free charge-free credit and credit provided in connection with the continuing provision of utilities). Where loan books are closed, or have been sold, the related credit agreements remain in scope. For the Act to apply, the borrower must be resident in the State when the application is made, or the governing law of the credit agreement must be Irish.
  • Lender obligations: Lenders will be subject to reporting obligations where the credit is at least €500. The information that they must report will differ depending on whether the obligor is an individual or a corporate, and whether it is a borrower or a guarantor. Where lenders receive a credit application for at least €2,000, they will also be obliged to check the Register prior to advancing credit.
  • Borrower rights: Borrowers will be able to check their credit records. They will also be able to ask for their record to be amended if it is inaccurate, incomplete or out-of-date, and may submit explanatory statements of up to 200 words to the Central Bank for inclusion on the Register beside their information.
  • Foreign credit: The Act provides that borrowers, if they have more than €5,000 outstanding under foreign credit agreements, must notify an in-scope lender when applying for credit.

FRAMEWORK:

While the Act sets out the framework for the new credit reporting regime, much of the detail will instead be set out in regulations to be made by the Central Bank (following consultation with the Minister for Finance and the Data Protection Commissioner). Those regulations will cover the type of personal information and credit information that must be provided (which is expected to differ as between different classes of applications, agreements, lenders and obligors (borrowers and guarantors)) and the form and content of credit reports. The Central Bank may also make regulations changing the monetary thresholds set out in the Act – the €500 and €2,000 thresholds mentioned above were the subject of much debate as the Act progressed through the Houses of the Oireachtas due to concerns that moneylenders could fall outside of scope.

The Register is expected to be self-financing, and the Central Bank will also issue regulations setting out what fees and levies will be imposed and whether these will differ depending on the type of lender.

IMPLEMENTATION:

Arising out of the Consultation and the Feedback Statement, the following points have been clarified:

  • Phased implementation: Implementation will occur on a phased basis (as expected) starting in September 2016.
  • Operational guidance: The Central Bank is expected to issue operational guidance shortly.
  • Implementation plans: The Central Bank is expected to seek implementation plans and progress reports from relevant lenders after it issues its operational guidance.
  • Phase 1 (consumer credit) and Phase 2 (business credit):
    • Timing: The initial focus will be on loans to consumers (in 2016), with business credit being dealt with after that (in 2017). The table at the end of this Briefing sets out key implementation dates.
    • Partnerships: A number of respondents to the Consultation indicated that there are significant challenges in capturing all of the relevant details for unincorporated entities such as clubs, partnerships and associations. The Central Bank has acknowledged that, because reporting on partnerships is likely to be complex, the second phase (business credit reporting) will require data on the partnership itself to be reported, but data on the individual partners will not be sought until a further, later, phase.
  • Moneylenders and loan authorities: Loans by moneylenders and local authorities will be dealt with in the second (business credit) phase.
  • Reporting credit applications: Apart from personal data, only a limited amount of information will be sought (i.e. type of product and amount of credit). The Central Bank does not intend to require lenders to keep the Register updated on the status of an application.
  • Reporting credit agreements: The reporting obligation is expected to arise on drawdown (or, in the case of overdrafts and credit cards, on the date that they are first available for use).
  • Foreign credit: The Central Bank is not proposing to deal with the requirement that information be sought and provided regarding foreign credit in excess of €5,000 in the initial implementation phase. This is because it received feedback that the requirement is impractical and overly-dependent on the honesty of borrowers and that it would be difficult to keep such data up-to-date.
  • Guarantors: The Central Bank does not intend to start collecting guarantor data until after the business credit phase has been implemented (so most likely not until 2018).

KEY IMPLEMENTATION DATES:

Footnotes

1 Reporting obligations for moneylenders and local authorities will also begin on this date.

2 This will also catch any in-scope credit provided by moneylenders and local authorities.

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.