New Positive Registry changes banking secrecy

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New Positive Record changes banking secrecy to protect consumer data

Bill 414/2017, which changes the rules of the Cadastro Positivo, is being analyzed by the Chamber of Deputies after having been approved by the Federal Senate. In this post, I'm going to discuss the change proposed by the Cadastro Positivo for everyone to Complementary Law No. 105 of January 10, 2001, which deals with banking secrecy by financial institutions.

The aim of this complementary legislation is to make it clear that the provision of financial and payment data relating to a credit operation to database managers, for the purpose of forming a credit history, does not constitute a violation of banking secrecy. The current legislation therefore allows the formation of the Negative Register. I reproduce paragraph 3 of article 1 in full below. Please pay special attention to item II.

Art. 1 Financial institutions shall maintain confidentiality in their active and passive operations and services provided.

§ Paragraph 3 does not constitute a breach of the duty of secrecy:

I - the exchange of information between financial institutions, for registration purposes, including through risk centers, in compliance with the rules issued by the National Monetary Council and the Central Bank of Brazil;

II - the provision of information contained in the register of issuers of bad checks and delinquent debtors to credit protection entities, in compliance with the rules issued by the National Monetary Council and the Central Bank of Brazil;

III - providing the information referred to in § 2 of art. 11 of Law no. 9.311, of October 24, 1996;

IV - reporting criminal or administrative offenses to the competent authorities, including the provision of information on operations involving funds from any criminal practice;

V - the disclosure of confidential information with the express consent of those concerned;

VI - the provision of information under the terms and conditions established in articles 2, 3, 4, 5, 6, 7 and 9 of this Supplementary Law.

What PLP 414/2017 proposes is to extend this authorization available in item II to compliance information - only to the credit score or score of a given consumer. However, in order for a company to consult the information contained in the credit history, i.e. for a company to be able to see the open information not consolidated in the score, it must obtain express authorization from the consumer.

Once again it is clear that the will of the consumer prevails. The right to privacy provided for in the Constitution for all Brazilians is not being violated. In fact, this measure of access to payment data gives legal certainty to the transfer of information, just as Complementary Law No. 105, of 2001, already provides for in relation to Negative registration.