The Australian Government has announced plans to update the Consumer Data Right (CDR) framework, aiming to simplify compliance, increase consumer engagement, and drive broader adoption across the economy.
The CDR framework and CDR Rules have already been implemented in Australia’s banking and energy sectors, providing a simple, interoperable way for consumers to share data across competing providers. Following the proposed amendments, the CDR framework should be expanded to new sectors.
The latest amendments would streamline the CDR’s consent processes, establish a review of the CDR’s compliance costs, and lead to a formal ban on “screen scraping”. In this article, we’ll focus on four proposed changes to the CDR’s consent requirements.
1. Bundled consent
The CDR Rules currently require authorized data recipients (ADRs) to obtain specific consent for each use of a consumer’s data. The rules intend to ensure transparency and enable consumers to control how their data is used.
However, a granular approach to consent requests can increase friction and annoyance if consumers face multiple consent requests for similar activities.
Under the proposed amendments, ADRs would be allowed to “bundle” consent requests. This change would enable ADRs to request consent for the collection, use, and disclosure of data all at once.
The proposed bundled consent amendments aim to simplify the customer experience and increase the adoption of the CDR. But some activities will continue to require specific consent, such as marketing and data de-identification.
2. Pre-selected consent
The CDR Rules currently require “opt-in” consent – the collection, use, and disclosure of CDR data must be “off” by default.
The proposed amendments would allow ADRs to “pre-select” consent to collect and use data if it is necessary for providing a service.
Where a given piece of data is not essential for a service to function, its collection must remain subject to “opt-in” consent. Such “non-essential” activities would include marketing and data de-identification.
3. Consent duration
The government has proposed allowing ADRs to specify how long a consumer’s consent will persist, i.e. the point at which a consumer’s consent for a given activity will “expire” and require re-authorization by the ADR.
The proposals would allow ADRs to offer consumers more control over the duration of their consent – effectively allowing consumers to set their consent’s “expiry date”. An exception would arise where an ADR reasonably needs to process data for a given period to provide its services.
4. Simplified consent request information
Under the proposed CDR Rules reforms, ADRs would not need to provide as much information to consumers during the consent request process.
For example, ADRs would no longer need to explain the process for withdrawing consent during the consent request process (but would still need to explain this process within the CDR receipt and 90-day notification).
Furthermore, ADRs would not need to explain the consequences of a consumer’s withdrawal of consent during the consent request process (but would still need to explain the consequences as part of the consent withdrawal process).
The CDR Rules reforms would also standardize the information ADRs provide consumers via the CDR receipt and the 90-day notification.
This proposal intends to reduce the risk of “information overload” and make it easier for consumers to understand their options regarding their data.
An evolving approach to consent
The CDR Rules reforms aim to increase adoption of the CDR and ultimately improve consumer choice. However, some of the proposals appear to provide less transparency and control for consumers.
Consent is meaningful when consumers understand what they are consenting to and make a free, unambiguous choice. This will always involve transparent information and some degree of granular control.
But bombarding with notices and options might reduce the meaningfulness of consent as consumers experience overload or fatigue. The proposed CDR reforms seek to establish the right balance of choice and convenience, which should better serve consumers in the long term.
