Summary Proceedings (Credit Reporting of Fines) Regulations 2011

2011/399

Coat of Arms of New Zealand

Summary Proceedings (Credit Reporting of Fines) Regulations 2011

Rt Hon Dame Sian Elias, Administrator of the Government

Order in Council

At Wellington this 31st day of October 2011

Present:
Her Excellency the Administrator of the Government in Council

Pursuant to section 92I of the Summary Proceedings Act 1957, Her Excellency the Administrator of the Government makes the following regulations, acting—

  • (a) on the advice and with the consent of the Executive Council; and

  • (b) on the recommendation of the Minister for Courts made in accordance with section 92I(2) of that Act.

Contents

1  Title

2  Commencement

3  Interpretation

Part 1
Recognised users and access to information about default balances

Status as recognised user

4  Agencies in specified class have status as recognised users

5  Criteria for authorising agencies as recognised users

6  Termination of status as recognised user

Cancellation of access codes

7  Circumstance when access code may be suspended immediately pending proposed cancellation

8  Procedure for cancellation of access code

Part 2
Process for disclosure of information about default balances

Subpart 1Submission of fine status queries

Collection of certain information for fine status queries

9  Collection of driver licence number and driver licence card number

Retention of certain information for fine status queries

10  Restriction on retention of driver licence number and driver licence card number

11  Keeping of consent record

Subpart 2Processing of fine status responses

Comparing information for fine status responses

12  Criteria for assessing whether query subject's identifying particulars correspond with those of recorded defendant

13  Verification of driver licence number and driver licence card number

14  Corresponding identifying particulars: individual

15  Corresponding identifying particulars: non-individual

Combining information for fine status responses

16  Combining identifying particulars with fines enforcement records

Subpart 3Disclosure and use of fine status responses

17  How fine status response may be disclosed to recognised user, etc

18  Disclosure and use of fine status response by recognised user

Part 3
Monitoring and audits

19  Recognised users must keep fine status queries for audit purposes

20  Recognised users must submit report to chief executive annually

21  Recognised users must make other records available for audit purposes

22  Timing of audits


Regulations

1  Title
  • These regulations are the Summary Proceedings (Credit Reporting of Fines) Regulations 2011.

2  Commencement
  • These regulations come into force on 13 February 2012.

3  Interpretation
  • (1) In these regulations, unless the context otherwise requires,—

    code means the credit reporting code of practice (as defined in section 92A(1) of the Act)

    recorded defendant means a defendant who is recorded in the fines enforcement records as having a default balance

    relevant particulars, for a recorded defendant, means the following identifying particulars of the recorded defendant:

    • (a) full name:

    • (b) former names and aliases (if any):

    • (c) date of birth:

    • (d) current address:

    • (e) previous addresses (if any):

    • (f) driver licence number (if any) as defined in the code.

    (2) Unless the context otherwise requires, a term that is defined in the Act and used, but not defined, in these regulations has the meaning given to it by the Act.

Part 1
Recognised users and access to information about default balances

Status as recognised user

4  Agencies in specified class have status as recognised users
  • (1) The purpose of this regulation is to—

    • (a) specify a class of persons that come within paragraph (b) of the definition of recognised user in section 92A(1) of the Act; and

    • (b) identify agencies that are members of that class as recognised users.

    (2) The class referred to in subclause (1) is the class of persons—

    • (a) that—

      • (i) are subscribers under the code; or

      • (ii) could have credit information disclosed to them under rule 11(2)(b) of the code if they enter into a subscriber agreement required by the code; and

    • (b) that require information contained in a fine status response in order to assess the creditworthiness of any person.

    (3) Agencies that are members of the class specified in subclause (2) are recognised users for the purposes of sections 92A to 92I of the Act.

5  Criteria for authorising agencies as recognised users
  • (1) The purpose of this regulation is to prescribe the criteria that, under paragraph (c) of the definition of recognised user in section 92A(1) of the Act, the Minister for Courts must take into account in considering an application from an agency (the applicant) to be authorised as a recognised user.

    (2) The criteria are as follows:

    • (a) the applicant requires information contained in a fine status response in order to assess the creditworthiness of any person:

    • (b) the applicant has appropriate measures in place for ensuring compliance with the Privacy Act 1993:

    • (c) the applicant is not an undischarged bankrupt or subject to subpart 4 of Part 5 of the Insolvency Act 2006:

    • (d) the applicant has not been convicted of a crime involving dishonesty (as defined in section 2(1) of the Crimes Act 1961) or of a crime committed overseas that, if committed in New Zealand, would be a crime involving dishonesty:

    • (e) the applicant has not, within 5 years before the date of the application, been found, in the opinion of the Privacy Commissioner, to have breached the Privacy Act 1993:

    • (f) the applicant has not, within 5 years before the date of the application, breached—

      • (i) any provision of the Act relating to credit reporting; or

      • (ii) any provision of these regulations; or

      • (iii) any provision of any other regulations made under section 92I of the Act:

    • (g) if the applicant was previously authorised as a recognised user, the applicant has not, within 5 years before the date of the application, failed to comply with any conditions or restrictions relating to access codes imposed under section 92C(2) of the Act.

6  Termination of status as recognised user
  • (1) The purpose of this regulation is to provide for an agency's status as a recognised user to be terminated by the Minister for Courts in specified circumstances, even though that agency comes within the definition of recognised user in section 92A(1) of the Act.

    (2) The Minister for Courts may terminate an agency's status as a recognised user if—

    • (a) the Minister is requested to do so in writing by the agency:

    • (b) the access code issued to the agency is cancelled for any reason and the cancellation continues for a period of more than 6 months:

    • (c) the agency—

      • (i) is an individual and ceases to carry on business; or

      • (ii) is not an individual and is wound up, liquidated, dissolved, or otherwise ceases to exist:

    • (d) the access code issued to the agency is suspended under regulation 7 and is later cancelled.

    (3) If the Minister for Courts terminates an agency's status as a recognised user, he or she must give a written or an electronic notice of the termination to the agency.

    (4) The termination of an agency's status as a recognised user does not affect the agency's obligations under these regulations that exist immediately before the termination (for example, the obligations relating to the retention or use of information contained in fine status responses).

    (5) If an agency's status as a recognised user is terminated under this regulation,—

    • (a) any access code issued to the agency, if not already cancelled, is cancelled as at the date of the written or electronic notice referred to in subclause (3); and

    • (b) the agency must, within 20 working days after the date of that notice, submit to the chief executive the report required under regulation 20.

    (6) For the purposes of subclause (5)(b),—

    • (a) regulation 20 applies as if references in that regulation to the applicable period were references to the period beginning on 1 July after the year on which the latest report under that regulation was required and ending on the date of the written or electronic notice referred to in subclause (3); and

    • (b) the following are the persons who must ensure that the report referred to in subclause (5)(b) is submitted:

      • (i) if the agency is an individual who is not deceased, that individual; or

      • (ii) if the agency is an individual who is deceased, the executors or administrators of the estate of that individual; or

      • (iii) if the agency is a partnership that has been dissolved, each member of that dissolved partnership; or

      • (iv) if the agency is a company that has been wound up or liquidated, every person who was an officer of that company at the time it commenced winding up or liquidation.

Cancellation of access codes

7  Circumstance when access code may be suspended immediately pending proposed cancellation
  • (1) The purpose of this regulation is to prescribe the circumstance when an access code may be suspended immediately pending its proposed cancellation under section 92C(3) of the Act.

    (2) The circumstance is where the chief executive has reasonable grounds to suspect that a recognised user has breached section 92F of the Act (which sets out restrictions on the disclosure and use by a recognised user of information contained in a fine status response).

    (3) If the circumstance in subclause (2) exists, the chief executive may suspend the access code issued to the recognised user immediately.

    (4) If the chief executive decides to suspend the access code immediately, the chief executive must give the recognised user a written or an electronic notice of the suspension that—

    • (a) specifies the reason for the suspension; and

    • (b) states the date on which the suspension takes effect.

8  Procedure for cancellation of access code
  • (1) The purpose of this regulation is to prescribe, for the purposes of section 92C(3) of the Act, the procedure for the cancellation of an access code if the chief executive has reasonable grounds to suspect that a recognised user has—

    • (a) breached any provision of the Act relating to credit reporting or of these regulations or any other regulations made under section 92I of the Act; or

    • (b) failed to comply with any conditions or restrictions imposed under section 92C(2) of the Act.

    (2) The procedure for the cancellation of an access code referred to in subclause (1) is as follows:

    • (a) the chief executive must give the recognised user concerned a written or an electronic notice of the proposal to cancel the access code issued to the recognised user; and

    • (b) the notice must—

      • (i) specify the chief executive's reason for proposing to cancel the access code; and

      • (ii) state that the cancellation takes effect on a specified date unless the recognised user makes, within 10 working days after receiving the notice, written or electronic submissions to the chief executive as to why the recognised user's access code should not be cancelled; and

    • (c) the chief executive must take into account any written or electronic submissions made by the recognised user within the 10-working-day period referred to in paragraph (b)(ii) in deciding whether or not to cancel the access code; and

    • (d) if the chief executive decides to cancel the access code, the chief executive must give the recognised user a further written or electronic notice that—

      • (i) specifies the reason for the cancellation; and

      • (ii) states the date on which the cancellation takes effect; and

      • (iii) summarises the effect of section 92C(4) of the Act (which states that the chief executive may issue to the recognised user another access code if the chief executive is satisfied that the access code should not have been cancelled or that any breach on the part of the recognised user is unlikely to recur).

    (3) If the chief executive decides not to cancel the access code issued to the recognised user, the chief executive must give the recognised user a further written or electronic notice of that decision.

Part 2
Process for disclosure of information about default balances

Subpart 1Submission of fine status queries

Collection of certain information for fine status queries

9  Collection of driver licence number and driver licence card number
  • (1) A recognised user that is a credit reporter must take all reasonable steps to ensure that a subscriber complies with the requirements in subclause (2) when the subscriber collects an individual's driver licence number from the individual for disclosure to the recognised user.

    (2) The requirements referred to in subclause (1) are as follows:

    • (a) the subscriber must make it clear to the individual that the provision of the driver licence number is voluntary; and

    • (b) if the individual provides his or her driver licence number, the subscriber must—

      • (i) also collect the individual's driver licence card number; and

      • (ii) disclose both the driver licence number and the driver licence card number of the individual to the recognised user; and

      • (iii) take all reasonable steps to ensure that the individual is the individual shown on the driver licence if the individual attends in person at the time he or she provides the driver licence number and driver licence card number.

    (3) If a recognised user collects an individual's driver licence number from the individual, the recognised user must take all reasonable steps to comply with the requirements in subclause (4).

    (4) The requirements referred to in subclause (3) are as follows:

    • (a) the recognised user must make it clear to the individual that the provision of the driver licence number is voluntary; and

    • (b) if the individual provides his or her driver licence number, the recognised user must—

      • (i) also collect the individual's driver licence card number; and

      • (ii) disclose both the driver licence number and the driver licence card number of the individual to the chief executive; and

      • (iii) ensure that the individual is the individual shown on the driver licence if the individual attends in person at the time he or she provides the driver licence number and driver licence card number.

Retention of certain information for fine status queries

10  Restriction on retention of driver licence number and driver licence card number
  • (1) A recognised user—

    • (a) may retain a driver licence number and driver licence card number only for the purpose of disclosing them to the chief executive; and

    • (b) must not enter the driver licence number and driver licence card number into any database (whether in a written or an electronic form).

    (2) As soon as practicable after a recognised user has disclosed a driver licence number and driver licence card number to the chief executive, the recognised user must dispose of them.

    (3) Nothing in this regulation prevents a recognised user that is a credit reporter from retaining any information derived from the driver licence number and driver licence card number as credit information under the code.

11  Keeping of consent record
  • A recognised user must keep each record evidencing the consent given by a query subject to the submission of a fine status query for a period of not less than 2 years after the date on which it was given.

Subpart 2Processing of fine status responses

Comparing information for fine status responses

12  Criteria for assessing whether query subject's identifying particulars correspond with those of recorded defendant
  • The criteria for assessing whether, under section 92E(1)(c) of the Act, the identifying particulars of a query subject in a fine status query correspond with those of a recorded defendant are as follows:

    • (a) if applicable, the query subject's driver licence number and driver licence card number have been verified in accordance with the code or with regulation 13; and

    • (b) the query subject's identifying particulars in the fine status query and the recorded defendant's relevant particulars shown in the fines enforcement records correspond in the manner described in regulation 14 or 15 (as the case may be).

13  Verification of driver licence number and driver licence card number
  • (1) This regulation applies if—

    • (a) the chief executive receives a fine status query that includes a query subject's driver licence number and driver licence card number; and

    • (b) the driver licence number and driver licence card number have not been previously verified in accordance with the code in respect of that fine status query.

    (2) The chief executive must take all reasonably practicable steps to verify that—

    • (a) the driver licence number relates to a licence issued by the New Zealand Government; and

    • (b) the driver licence number does not relate to a licence that has been recorded on the national register as lost or stolen; and

    • (c) the driver licence card number is the most recent driver licence card number for the licence.

    (3) The chief executive must hold a query subject's driver licence number and driver licence card number separate from fines enforcement records.

    (4) In subclause (2)(b), national register means the national register of all driver licences maintained under section 199 of the Land Transport Act 1998.

14  Corresponding identifying particulars: individual
  • (1) For the purposes of section 92E(1)(c) of the Act, the identifying particulars of a query subject that is an individual included in a fine status query may be taken to correspond with those of a recorded defendant if, in a case where the details of the defendant's driver licence are not recorded or do not match,—

    • (a) either of the following applies:

      • (i) the query subject's full name corresponds with the recorded defendant's full name, former name, or alias:

      • (ii) the query subject's former name or alias corresponds with the recorded defendant's full name, former name, or alias; and

    • (b) the query subject's date of birth corresponds with the recorded defendant's date of birth; and

    • (c) one of the following applies:

      • (i) the query subject's current address corresponds with the recorded defendant's current address:

      • (ii) the query subject's current address corresponds with any of the recorded defendant's previous addresses:

      • (iii) any of the query subject's previous addresses corresponds with the recorded defendant's current address:

      • (iv) any of the query subject's previous addresses corresponds with any of the recorded defendant's previous addresses.

    (2) For the purposes of section 92E(1)(c) of the Act, the identifying particulars of a query subject that is an individual included in a fine status query may be taken to correspond with those of a recorded defendant if, in a case where the details of the defendant's driver licence are recorded,—

    • (a) the query subject's driver licence number matches exactly the recorded defendant's driver licence number; and

    • (b) either of the following applies:

      • (i) the query subject's full name corresponds with the recorded defendant's full name, former name, or alias:

      • (ii) the query subject's former name or alias corresponds with the recorded defendant's full name, former name, or alias.

15  Corresponding identifying particulars: non-individual
  • For the purposes of section 92E(1)(c) of the Act, the identifying particulars of a query subject that is not an individual included in a fine status query may be taken to correspond with those of a recorded defendant if—

    • (a) either of the following applies:

      • (i) the query subject's full name corresponds with the recorded defendant's full name:

      • (ii) the query subject's trading name corresponds with the recorded defendant's full name; and

    • (b) one of the following applies:

      • (i) the query subject's current address corresponds with the recorded defendant's current address:

      • (ii) the query subject's current address corresponds with any of the recorded defendant's previous addresses:

      • (iii) any of the query subject's previous addresses corresponds with the recorded defendant's current address:

      • (iv) any of the query subject's previous addresses corresponds with any of the recorded defendant's previous addresses.

Combining information for fine status responses

16  Combining identifying particulars with fines enforcement records
  • (1) For the purposes of section 92G of the Act, the chief executive may treat the identifying particulars of a query subject as diverging particulars under that section if—

    • (a) identifying particulars of the query subject correspond with those of the recorded defendant under regulation 14 or 15 (as the case may be) or under subclause (2) or (3) (as the case may be); but

    • (b) 1 or more of the identifying particulars of the query subject diverge from those of the recorded defendant.

    (2) The identifying particulars of a query subject that is an individual included in a fine status query may be taken to correspond with those of a recorded defendant if—

    • (a) either of the following applies:

      • (i) the query subject's full name corresponds with the recorded defendant's full name, former name, or alias:

      • (ii) the query subject's former name or alias corresponds with the recorded defendant's full name, former name, or alias; and

    • (b) the query subject's date of birth corresponds with the recorded defendant's date of birth.

    (3) The identifying particulars of a query subject that is not an individual included in a fine status query may be taken to correspond with those of a recorded defendant if either of the following applies:

    • (a) the query subject's full name corresponds with the recorded defendant's full name:

    • (b) the query subject's trading name corresponds with the recorded defendant's full name.

Subpart 3Disclosure and use of fine status responses

17  How fine status response may be disclosed to recognised user, etc
  • (1) The purpose of this regulation is to prescribe, for the purposes of section 92E of the Act, how the chief executive may—

    • (a) send a fine status response to a recognised user that states that a query subject has a default balance and the amount of that balance; or

    • (b) send a fine status response to a recognised user that states that the identifying particulars of a query subject do not correspond with the relevant particulars of a recorded defendant; or

    • (c) notify a recognised user that a fine status query cannot be processed and ask the recognised user to submit another fine status query.

    (2) The chief executive may do any of the things set out in subclause (1) in writing or electronically.

18  Disclosure and use of fine status response by recognised user
  • (1) A recognised user that is a credit reporter must, in complying with the requirement in regulation 19 for the retention of information contained in a fine status response for audit purposes,—

    • (a) hold that information separate from any other information; and

    • (b) not combine that information with any other information (whether in a written or an electronic form in a database).

    (2) If a recognised user or a credit reporter discloses information contained in a fine status response under section 92F(1)(a) or (2) of the Act, the recognised user or, as the case may be, the credit reporter must include the date of the fine status response in the information to be disclosed.

Part 3
Monitoring and audits

19  Recognised users must keep fine status queries for audit purposes
  • (1) For the purposes of section 92H of the Act, a recognised user must keep each fine status query that the recognised user submits to the chief executive for a period of not less than 2 years after the date on which it was submitted.

    (2) However, a recognised user may dispose of every fine status query retained under subclause (1) after the earlier of—

    • (a) the date on which the period referred to in subclause (1) expires; and

    • (b) the date on which an audit under section 92H of the Act is completed in respect of that fine status query.

    (3) Nothing in this regulation prevents a recognised user that is a credit reporter from keeping any identifying particulars contained in a fine status query as credit information under the code.

20  Recognised users must submit report to chief executive annually
  • (1) For the purposes of section 92H of the Act, a recognised user must submit to the chief executive a report by no later than 30 September in each year for the period beginning on 1 July of the previous year and ending on 30 June of the year the report is submitted (the applicable period).

    (2) The report must provide a reasonable assurance to the chief executive that, for the applicable period, the recognised user—

    • (a) had policies, internal procedures, and controls in place to give effect to the provisions of the Act relating to credit reporting, and of these regulations and any other regulations made under section 92I of the Act, and relating to any conditions imposed under section 92C(2) of the Act in respect of the issue of access codes; and

    • (b) provided information and training to its staff to ensure compliance with the policies, internal procedures, and controls referred to in paragraph (a); and

    • (c) undertook monitoring activities to ensure its reasonable compliance with the provisions of the Act relating to credit reporting, and of these regulations and any other regulations made under section 92I of the Act, and relating to any conditions imposed under section 92C(2) of the Act in respect of the issue of access codes, including the following:

      • (i) the recognised user followed the policies, internal procedures, and controls referred to in paragraph (a); and

      • (ii) information held by the recognised user was protected by reasonable security safeguards; and

      • (iii) the recognised user can demonstrate that the method for satisfying itself that the query subject consented to the submission of a fine status query is based on informed consent; and

      • (iv) if the recognised user is a credit reporter, the recognised user can demonstrate compliance with section 92F(2) of the Act when disclosing and using information contained in a fine status response; and

    • (d) investigated a breach of any agreement, or the policies, internal procedures, and controls referred to in paragraph (a) if the recognised user identified the breach during its systematic reviews, monitoring activities, or as a result of a complaint and, if appropriate, took prompt remedial action for the breach; and

    • (e) took prompt remedial action, if appropriate, if a deficiency was identified in the previous year's report.

21  Recognised users must make other records available for audit purposes
  • For the purposes of section 92H of the Act, a recognised user must provide all or any of the following to the chief executive if requested to do so by the chief executive:

    • (a) records evidencing the consent given by query subjects to the submission of fine status queries:

    • (b) records of identifying particulars (except those disposed of in accordance with regulation 10(2)):

    • (c) fine status queries:

    • (d) fine status responses.

22  Timing of audits
  • The chief executive may audit the records of recognised users under section 92H(1)(b) at any time.

Michael Webster,
for Clerk of the Executive Council.


Explanatory note

This note is not part of the regulations, but is intended to indicate their general effect.

These regulations, which come into force on 13 February 2012, prescribe various matters for the purposes of sections 92A to 92I of the Summary Proceedings Act 1957 (the principal Act), as amended by the Summary Proceedings Amendment Act 2011.

Sections 92A to 92I of the principal Act authorise the routine disclosure of amounts of overdue penalties (default balances) to recognised users (generally credit reporting agencies) for inclusion in credit reports and other documents about the creditworthiness of individuals or organisations.

Section 92B of the principal Act states that the purpose of the disclosure is to provide incentives to defendants who have default balances to pay or resolve the required payments in accordance with that Act. In order to achieve that purpose, sections 92C to 92I of the principal Act authorise, among other things,—

  • the chief executive of the Ministry of Justice to disclose information about a person's default balance to recognised users to enable them to assess the creditworthiness of the person and to protect themselves against the possible subordination of their security interests; and

  • the chief executive of the Ministry of Justice to use information received from recognised users (for example, updated information about a person's address, employer, or occupation) to enhance the accuracy and completeness of fines enforcement records and, therefore, to facilitate the collection of fines.

Sections 92A to 92I of the principal Act underpin the other provisions in the Summary Proceedings Amendment Act 2011 that allow a District Court to be given priority over a secured creditor for proceeds from the sale of seized property if the creditor could have used the new credit reporting legislative framework to discover that a default balance was owed by the defendant, before the creditor advanced money to the defendant to finance that property, and some or all of that default balance is still owing by the defendant when the property is seized.

These regulations set out provisions that are required for the proper implementation and operation of the credit reporting measures in the principal Act, including the detailed framework governing the exchange of information between the Ministry of Justice and the credit industry for credit reporting purposes.


Issued under the authority of the Acts and Regulations Publication Act 1989.

Date of notification in Gazette: 3 November 2011.

These regulations are administered by the Ministry of Justice.