Consumer data right – have your say

The Ministry of Business, Innovation and Employment is seeking feedback on a discussion document titled Options for establishing a consumer data right in New Zealand.  The discussion document was released on 5 August 2020.

A consumer data right describes a mechanism for consumers to securely share data that is held about them with trusted third parties.  This is particularly relevant when a consumer wishes to change its provider, and transfer its data to the new provider.  This is known as data portability.  The discussion document seeks feedback on whether a consumer data right is needed in New Zealand and, if so, how it should be designed.

The intention of a consumer data right is to give individuals and businesses access to a wider range of products and services, reduce search and switch costs, facilitate competition, encourage innovation and help build the digital economy.  It could also strengthen existing privacy protections by giving consumers greater choice and control of their data.

The release of the paper follows international developments where a number of jurisdictions are engaging in legislative reform to promote consumer data portability or strengthen existing privacy rights.  Australia, for example, launched its consumer data right on 1 July 2020, with the first tranche, an open banking-like regime, requiring financial services providers to share a customers’ data when requested by the customer.

While the New Zealand Government has previously allowed sector-led initiatives to lead the way, progress has been relatively slow and the paper suggests these initiatives are not delivering the full positive outcomes for consumers as yet.

Four options are considered in the paper, with each discussed in detail (including their respective pros and cons).  The four options are:

  • Status quo, i.e. continue down the sector-led initiatives path
  • Follow the Australian approach, overarching legislation with sectoral-designation as required
  • Provide for an economy-wide consumer data right
  • Take a sector-specific approach, i.e. legislate just for the particular sector.

The paper poses a number of questions around the purpose of a consumer data right and each of the options.  Submissions on the questions can be made by sending a Microsoft Word document to consumerdataright@mbie.govt.nz. The Ministry is calling for submissions by 5 October 2020.

How we can help

Lane Neave has a specialist technology and privacy law team. From start-ups and SMEs to large corporates, we are keen to work with you and your technology projects.  If you want to understand how we can help your business, or you would like assistance drafting submissions in respect of this proposed consumer data right, please get in touch.

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