Privacy Act may force change to the way many do business

AUSTRALIA’S new privacy legislation could to harm the resale value of some businesses because it might decrease the value of their databases.

The issue is being taken seriously by those in the industry, and at least one business broking representative body is looking into the legislation’s implications.

While a database can be a considerable business asset, how a purchaser can use it will be affected by the new Privacy Act.

The Act will have an effect on company’s databases much as council zoning laws have on property development.

The Privacy Act treats the purchase of a business and its database as the collection of information. If the purchaser continues to use the information for the purpose it was gathered, then the Act remains silent.

If, however, the purchaser wishes to expand the purpose the information was gathered for, it needs the consent of those whose information it has collected before it can do so.

Real Estate Institute of WA chief executive officer Michael Griffiths said the Act would have an effect on business broking.

Through its national umbrella group the Real Estate Institute of Australia, REIWA has been involved with a special committee comprising business brokers, commercial tenancy and strata agents.

That committee has appointed a Canberra-based law firm to put together a draft management plan to deal with the Act’s effects.

Privacy Commissioner Malcolm Crompton admitted the new Act could affect some businesses’ values.

“Under the Privacy Act you have to tell people that you are collecting information on them and why you are collecting it,” Mr Crompton said.

“You can only use that data for the primary purpose it was collected.”

CPA Australia WA director Justin Walawski said most businesses usually only found the best uses for the databases after it had been collected.

“This could force a change in the way many people do business,” Mr Walawski said.

Future unknown for Porters group

THE controversy surrounding Coles Myer’s takeover bid for Australian Liquor Group has overshadowed negotiations over the future of the Porters brand.

ALG bought the name and operating group for the Porters buying group shortly before the Coles Myer takeover bid was announced and members of the group, who generally own their own stores, have been waiting for months to find out the future of the Porters name.

A number of senior players in the Porters organisation are understood to have quit and at least three people linked to Porters at an executive level have been listed as directors of a company registered earlier this month.

Morris Short, Gary Kramer and Andrew Turner are named as directors of Liquor Services Group Limited.

Calls by Business News regarding the matter were referred to Mr Short, but he declined to comment on the purpose of the new company or the status of negotiations.

The question mark over the ultimate ownership of Porters remains in doubt despite a takeovers panel ruling on Tuesday restraining payment to ALG directors for 14 days.

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