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Baycorp Accepts Commerce Commission Report

Baycorp Advantage Accepts Commerce Commission Report on fees

Thursday, May 25, 2006 - Baycorp Advantage’s New Zealand Country Director, John Roberts, advised today that the findings of a Commerce Commission investigation report ([1]May 2006) had been implemented in mid-2004.

In 2004, the Commission investigated whether a fee of $5 introduced by Baycorp Advantage in 2001 for debt collection agencies lodging data on the Baycorp Advantage credit bureau constituted a breach under s.36 of the Commerce Act 1986.

“Baycorp Advantage’s first responsibility is to protect the accuracy and currency of data in our credit bureau. Baycorp Advantage believed in 2001 and we still believe there must be commercial incentives and disincentives to encourage organisations to exercise proper care and diligence, ensuring that data lodged with the bureau is truthful, accurate and is kept up to date.

Our response to the Commerce Commission concerns was to institute a fee waiver for all compliant companies,” Roberts said.

Baycorp Advantage introduced the fee waiver in August 2004. The waiver was developed in conjunction with Associated Credit Bureaux NZ Inc (ACB) and set minimum standards for debt collectors loading defaults.

Fees were waived for all debt collectors who agreed to meet certain technical and data quality standards.

Baycorp Advantage advised the Commerce Commission of its change in practice in 2004. The Commission’s 2006 report acknowledges this and notes the change of practice.

“Since August 2004, compliant debt collectors could load default information for free” Mr. Roberts added.

As custodian of sensitive personal credit information, Baycorp Advantage incurs costs in the management of the confidential data provided to the bureau by various parties. These costs rise disproportionately when incorrect or poorly maintained data is entered, as Baycorp Advantage has legal obligations as to accuracy of data.

“Bureau users who lodge faulty data or fail to update data are a major risk to the integrity of the credit data-base and a major cost to Baycorp Advantage. There must be commercial incentives to encourage people to do the right thing. We will continue looking into this and may need to examine user-pays systems for non-compliant clients,” Roberts concluded.

“If we need to review our practices further following the release of the Commerce Commission’s investigation report, we will” Roberts confirmed.

Baycorp Advantage will keep the Commerce Commission advised of any future user-pays proposals prior to introduction.

Roberts also advised that as at 1 April, 2006 debt loading fees could be waived across the board for businesses signing onto the revised subscriber agreement between Baycorp Advantage and its client group. The new agreement places more stringent data quality obligations on bureau users in line with the New Zealand Credit Reporting Privacy Code issued by the Privacy Commissioner.

Looking ahead, Baycorp Advantage believes that quality of data on credit files will be vastly improved as consumers engage more proactively with the management of their individual credit file.

Since April 2005, consumers can obtain a copy of their credit file on Fees are charged for express delivery.


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