COMMISSION OPINION

of 7 August 2015

on the draft Regulation of the European Central Bank concerning the collection of granular credit and credit risk data

(2015/C 261/01)

1.   Introduction

On 26 June 2015, the Commission received a request from the European Central Bank (ECB) for an opinion on a draft Regulation concerning the collection of granular credit and credit risk data (‘the Draft ECB Regulation’).

The Commission welcomes this request and recognises that the ECB hereby acts in accordance with its obligation to consult the Commission on draft ECB regulations whenever links with the statistical requirements of the Commission exist as laid down in Article 5(2) of Council Regulation (EC) No 2533/98 concerning the collection of statistical information by the ECB (1), in order to guarantee the coherence necessary to produce statistics meeting the respective information requirements of the ECB and of the Commission. A good cooperation between the ECB and the Commission is beneficial for both institutions as well as for users and respondents by allowing a more efficient production of European statistics.

The Commission fully supports the need for the collection of micro-level credit and credit risk data, using a harmonised approach. The merits of the proposal are clear and significant and are important for a wide set of stakeholders and for different purposes, including monetary policy, macro-prudential policy, banking supervisory tasks, and credit market analysis.

2.   Comments on and proposed changes to the legislative proposal

The Commission notes that the Draft ECB Regulation gives due consideration to the European system of accounts (ESA 2010), established by Regulation (EU) No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European system of national and regional accounts in the European Union (2), insofar as the definition of institutional sectors and financial instruments are concerned.

As future potential users of the statistical datasets resulting from the Draft ECB Regulation, the Commission would like to make the following comments:

2.1.   Scope of the collection exercise

Given the ambitious scope and the extent to which this data could improve decision making at various stages of the legislative process (impact assessments at the moment of proposed new legislation, ex-post evaluations as regularly required in the legislation), it is crucial that the Commission has access to both granular and aggregated data.

The Commission proposes to broaden the scope of the collection exercise by including data on consumer credits, potentially provided by all lenders (not only monetary financial institutions) and also cross-border. This would fill the gaps in existing credit statistics. The collection of this data would be of crucial importance for the Commission to be able to monitor the performance of the consumer credit market and fulfil its obligations under Article 27 of Directive 2008/48/EC of the European Parliament and of the Council (3) on credit agreements for consumers. The category of consumer credits should cover overdrafts, credit cards, credit lines and other consumer credits as sub-categories.

Moreover, in order to get a broad and complete overview of credit exposures of the financial sector and associated credit risks, the reporting population should be extended, once possible, to ‘other financial corporations engaged in lending’.

Finally, the Commission would like to remark that in order to minimize the cost of data collection, data should be obtained where possible from existing databases. For instance, a lot of supplementary non-credit information on SMEs (including legal address, size, and number of employees) could be retrieved from the RIAD data base.

2.2.   Specific comments on the protection of personal data

The Commission considers that the text of the Draft ECB Regulation should be strengthened as regards the protection of personal data. Whenever the measures provided for in the Draft ECB Regulation entail the processing of personal data, they must be carried out in accordance with EU law on the protection of such data, in particular Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regards to the processing of personal data and on the free movement of such data (4) and the national implementing measures thereto and Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data (5). The Commission would therefore propose to include a reference to this generally applicable legislation in the recitals of the Draft ECB Regulation, as well as to redraft its Article 13 to include a clear obligation to respect EU law on protection of personal data, in particular Directive 95/46/EC and Regulation (EC) No 45/2001, replacing the proposed Article 13(2).

Article 13(1) should thus be: ‘The measures provided for in this Regulation shall be carried out in accordance with EU law on protection of personal data, in particular Directive 95/46/EC on the protection of individuals with regards to the processing of personal data and on the free movement of such data and the national implementing measures thereto, as well as Regulation (EC) No 45/2001 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data.’

The Commission would also advocate a more prudent approach to granting access to personal data for third parties. With reference to recital 18 of the Draft ECB Regulation, the Commission does not consider it appropriate to allow credit databases other than central credit registers to reuse data without further specification of such third parties, in particular not without the consent of the counterparties. The Commission would therefore propose to delete the words ‘and other relevant credit datasets established by the public sector’ in recital 18. In the same vein, the Commission would propose to delete the words ‘and grant access to such data for third parties’ in Article 11(1) of the Draft ECB Regulation. Moreover, Article 11(3) should be amended to cover not only legal entities but also natural persons.

2.3.   Other comments

The Commission is of the opinion that liability aspects with regard to the data collected could be better explained. For example, it is not clear who is responsible for the development and maintenance of the mentioned secure channels and if the needed infrastructure is already in place. It is also not fully clear whether data (on households) will be anonymized at source, at the central database level before storing them in the AnaCredit database, or when extracting the data for the feedback loop.

If information feedback loops are created, public and private credit providers should be treated on an equal footing. Such treatment will prevent potential market distorting effects e.g. from empowering a public central register with data that is not available to private competing credit reporting service providers.

The Commission shares the view that information feedback loops need a sufficient degree of flexibility. However, too much national freedom may result in competitive distortions across the EU and thus harm the existing credit information ecosystem. In order to prevent this, it may be warranted to design rules on feedback loops centrally. It is not clear from the Draft ECB Regulation if Member States are allowed to apply lower thresholds and whether this is encouraged. Overall, the goals of AnaCredit could get better defined. Currently the set of potential purposes is very broad. The level of information accessibility (e.g. anonymized, punctual, aggregated, etc.) should be made clear for each category of users.

References to the cost-benefit analysis should be added. Such references would increase the credibility of the proposal and make it more balanced in terms of its impact.

3.   Conclusion

The Commission supports the Draft ECB Regulation, as it would result in the availability at the micro level of data on credit and credit risk, which is of high importance to stakeholders and the Commission itself.

The Commission, however, is of the opinion that the issues mentioned above should be addressed.

(1)  OJ L 318, 27.11.1998, p. 8.

(2)  OJ L 174, 26.6.2013, p. 1.

(3)  OJ L 133, 22.5.2008, p. 66.

(4)  OJ L 281, 23.11.1995, p. 31.

(5)  OJ L 8, 12.1.2001, p. 1.