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What proposed changes to the Privacy Act 2020 mean for real estate

14 September 2022

The Ministry of Justice (MoJ) has released an engagement document proposing to broaden the notification rules under the Privacy Act 2020 (the Act). The proposed rules would significantly change how real estate agencies and REINZ collect and use sales data. 

Current notification rules

The exceptions provided for in privacy principles 2 and 3 mean when an individual authorises the collection and sharing of their personal information (e.g., sale price and address of a property) to a third party — such as REINZ — by way of an agent, the third party does not currently have to notify the individual that they have obtained their personal information. This is because the third party is not directly collecting that information from the individual.

The proposed changes

The MoJ wants to close this loophole by utilising one or more of the below options:

  1. broadening the notification requirement under privacy principle 3 so that third parties have to notify the individual concerned;

  2. narrowing exceptions to privacy principle 2 (that allow third parties to collect personal information indirectly);

  3. requiring the disclosing agency to notify the individual concerned that their information has been disclosed to a third party (additional administration for real estate agents); and/or

  4. adding a new, separate privacy principle.

 What the proposed changes mean

The above changes proposed would significantly change the way entities such as REINZ and real estate agencies collect and use sales data. The real estate agency and REINZ would be required to notify every single individual party (vendors and purchasers) that they had received or passed on the personal details, whether to REINZ or another third party.

This will create a significant administrative burden, but more importantly, third parties such as REINZ do not have the ability to contact the parties to the sale as we do not have their contact details.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.