Australian Privacy Principle 1–open and transparent management of personal
Australian Privacy Principle 1 (APP 1) addresses open and
transparent management of personal information. The Companion Guide states that
the requirement for open and transparent management is the first APP because
'it will emphasise that entities should first plan how they will
handle personal information before they collect and process it'. In addition,
it will make sure that entities consider their privacy obligations when
planning new systems. The Companion Guide noted that this reflects international
moves towards a 'privacy by design' approach, so that information systems
include privacy and data protection compliance from their inception.
In its review, the Australian Law Reform Commission (ALRC) considered
the openness requirements of the privacy regime. The ALRC concluded that there
should be a discrete principle requiring an agency or organisation to operate
openly and transparently by providing general information on how it manages
personal information. It was noted that compliance with openness requirements
generally benefits the regulatory system as a whole and 'therefore, plays a key
role in promoting best practice in the handling of personal information'.
In addition, the development and publication of privacy policies will promote
accountability and increase the transparency of the information handling
practices of entities.
Although both the Information Privacy Principles (IPPs) and the National
Privacy Principles (NPPs) set out openness requirements, openness is achieved
by different regulatory mechanisms for agencies and organisations. The ALRC was
of the view that there should be one consolidated and simplified openness
requirement and stated:
The 'Openness' principle should make it clear that a Privacy
Policy is the regulatory mechanism by which agencies and organisations are to
achieve openness. Agencies and organisations should be required to set out in
Privacy Policies clearly expressed policies on their handling of personal
take a more prescriptive approach and list specific matters to be included in
the record summarising how an agency handles personal information.
expressed in high-level terms. The ALRC was of the view that 'the central
obligation should be for agencies and organisations to set out in such a
document clearly expressed policies on an agency's or organisation's handling
of personal information, including how it collects, holds, uses and discloses
should not be regarded as being exhaustive.
and recommended that the list of matters should be limited, but include the
sort of personal information held, and the purpose for which that information
available to an individual to access and correct personal information and avenues
The mechanisms for making privacy policies available were canvassed in
the review, with the ALRC commenting that loading policies onto websites was
'an ideal mechanism for making them generally available'. In addition, the ALRC
recommended that hard copies should be made available on request or in a form
accessible for those with special needs.
The development of short form privacy notices was also examined. The
ALRC concluded that short form privacy notices serve a useful purpose and
recommended that the Office of the Privacy Commissioner (OPC) should continue
to encourage and assist entities to make these available.
The Government accepted the ALRC's recommendations in relation to the availability
of privacy policies and the development of short form privacy notices and
accepted, with amendments, the ALRC's main recommendation in relation to a
The Government response stated:
The Government agrees that organisations and agencies should
consider their personal information handling policies and practices and clearly
promote transparency in the handling of personal information, as well as
consumer control, choice and trust in how their information will be handled.
The Government also agrees that requiring agencies and
organisations to express in their Privacy Policies how they handle personal
information at each stage of the information cycle, will encourage them to
consider how the Privacy Principles apply to their activities.
The Government outlined the areas where it intended to make amendments
to the ALRC's recommendation as follows:
in order to align the Privacy Principles with the stages of the
information handling cycle, the 'openness' principle is to be the first
enumerated privacy principle;
in addition to the obligations proposed by the ALRC, the
'openness' principle should also require entities to take reasonable steps, having
regard to the circumstances of the agency or organisation, to develop and
implement internal policies and practices that enable compliances with the
Privacy Principles including staff training;
a general obligation to take reasonable steps to implement
policies and practices that ensure compliance with the Privacy Principles is to
be included in the openness principle in order to ensure a proactive approach
to considering information handling and privacy compliance requirements; and
the obligation to implement policies and practices to enable
compliance with the Privacy Principles is to be qualified by a 'reasonable
steps' test in recognition that 'the appropriate steps to take will depend upon
the circumstances of each agency or organisation' thus adopting a 'risk-based
The Government response concluded:
This additional supporting obligation to the 'openness'
principle would expressly recognise what is only implicit in the existing
Privacy Principles: that agencies and organisations need to take positive steps
to ensure they comply with the Privacy Principles. However, it reflects what
many agencies and organisations currently do in practice to ensure they meet
their obligations under the Privacy Act. It is therefore not intended to impose
any unreasonable additional burden on agencies and organisations.
The ALRC, OPC, Privacy NSW and the Australian Institute of Credit
Management welcomed the positioning of the openness and transparency principle
as the first APP. Professor Rosalind Croucher, President, ALRC, commented
It brings it up to the front as the first principle and
provides, as I described it in the submission, a conceptual mirror to the idea
of openness that is captured in the freedom of information legislation. That is
a good initiative and we commend the introduction of the principles in that
Support was expressed for the Government's aim of encouraging entities
to manage personal information openly and transparently, as well as the aim of ensuring
that entities take reasonable steps to comply with the Privacy Act and to
handle complaints. The Government's intention to ensure that entities undertake
appropriate planning prior to the point of dealing with personal information,
and when planning new information systems, was also welcomed.
However, in order to ensure that this was stated more clearly, the NSW
Department of Justice and Attorney General suggested that APP 1(2) be
re-titled 'Planning for compliance with the Australian Privacy Principles'.
The committee also received submissions that did not support the notion
that the privacy obligations could, or should, be considered when entities
design information systems, that is, the 'privacy by design approach'. Microsoft
commented that 'it could be hard to read privacy by design elements into the
principle as currently worded'. Microsoft went on to state that it would be
wary about trying to load this concept into the principle as it is difficult to
see how it would be defined or enforced. In addition, it would raise 'real
possibilities of inappropriate government interventions into what should
properly be business decisions'. Microsoft also pointed to comments by European
Union Data Protection Supervisor, Mr Peter Hustinx, who saw privacy by design
not as a matter of law, but something that would be achieved through the
practices of organisations. Microsoft supported this view and concluded that
legislating for privacy by design would be 'onerous, impractical and would have
real potential to stifle innovation'.
The Office of the Information Commissioner Queensland (OIC) drew
attention to the inclusion of a 'reasonable in the circumstances' test in
APP 1 and commented that it did not consider that the obligation to comply
with the privacy principles should be subject to such a test. The OIC argued
that state and territory jurisdictions, which have enacted information privacy
laws, impose a mandatory requirement to comply with the relevant privacy
principles. In addition, the OIC commented that the adaptable and flexible
nature of the APPs provides sufficient scope for entities to implement them in
ways which are reasonable, based on the circumstances and context of the
entity's personal information handling. As such the OIC recommended that the committee
consider APP 1 in terms of whether or not it would be more appropriately
stated as a mandatory obligation.
The committee considers that by placing the 'openness' principle as the
first APP, attention is drawn to the need to manage personal information in an
open and transparent way. The Government has included in APP 1 an
obligation to develop and implement internal policies and practices that enable
compliance with the privacy principles. This will strengthen the 'openness'
principle and encourage a proactive approach to privacy compliance. The
committee believes that by requiring the planning of data systems to take
account of privacy requirements, the handling of personal information will be
improved and individuals will be confident that entities have taken all
necessary steps to provide adequate systems to protect their personal information.
Further, the committee does not agree that the 'privacy by design' approach
will stifle innovation. Rather, as technology is advancing so rapidly, what is
regarded as 'innovation' may in fact pose significant risks to privacy, and
thus privacy obligations should be a fundamental consideration in planning
The committee also considers that the inclusion of a test of
reasonableness ensures that entities have flexibility in the way in which they
address the obligations under this principle and, as stated in the Government response,
recognises that the appropriate steps to take will depend upon the
circumstances of each agency or organisation. In addition, the committee notes
that the Government commented in its response to the ALRC's recommendations
In this way, the additional requirement adopts a risk-based
approach, whereby an agency or organisation would consider what internal
practices and policies to implement with regard to such matters as the volume
of personal information it handles, the sensitivity of that information and the
purpose for which the information is collected, used and disclosed.
In addition to considering the level of risk in their
information handling needs and practices, agencies and organisations would also
consider what is reasonable for them to do with regard to their size and
available resources, the type of functions or activities they undertake, and
the extent to which they have already established internal policies and
The committee concurs with this approach.
Structure and terminology
Submitters commented on the structure of, and the terminology used in,
APP 1. The Law Institute of Victoria (LIV) suggested that, to ensure
consistency with APP 1(3) which requires an entity to have 'up-to-date
policy' on the management of personal information, APP 1(2) should be
amended to read 'implement and review practices'.
The Law Council of Australia (LCA) commented on the terms used in APP 1(2)(a).
First, the LCA was concerned about the strength and the mandatory nature of the
language used. Secondly, the LCA noted that APP 1(2)(a) requires an entity
to take 'such steps as are reasonable in the circumstances to implement
practices, procedures and systems that will ensure that the entity complies
with the Australian Privacy Principles'. The LCA suggested that it is not
possible for 'practices, procedures and systems' to ensure compliance with the
APPs. In order to address this matter, the LCA suggested replacing the word
'will ensure' with words such as 'have the primary purpose of promoting
The department responded to the LCA's comments and stated that, by
including the 'will ensure' formula, the Government has gone further than the
ALRC recommendation 'in requiring agencies and organisations not only to create
reasonable steps to comply with both the privacy principles and their own
The department went on to state that the term the 'primary purpose of
promoting' provides for a different requirement than the term 'will ensure'. The
department argued that the terms of APP 1(2)(a) provide a clear
requirement for entities to have practices, procedures and systems that will
ensure compliance with the APPs. The term suggested by the LCA was seen as a
lesser obligation and 'is not consistent with the Government's approach of
promoting high standards of compliance that will require entities to consider
how the principles apply to their own circumstances and what steps it should
take to implement appropriate policies and practices'. The department concluded
It was the Government's intention for the compliance
standards on agencies and organisations to be sufficiently high to enhance
privacy protections. The 'will ensure' obligation was included so that privacy
protections are built into the design of an entity's system and not 'bolted on'
Microsoft put the view that APP 1(2) is redundant. Microsoft noted
that section 16A of the Privacy Act 1988 provides that 'an organisation
must not do an act, or engage in a practice, that breaches a National Privacy
Principle'. If, it was argued, a modified version of section 16A is to be
enacted to prohibit breaches of the APPs, regulated entities will be required
to take steps to comply with the APPs and thus APP 1(2) is redundant.
If APP [1(2)] was enacted as proposed, it would be possible
for an entity to be liable for breaching APP [1(2)] simply because it had not
prepared a document that described the procedures it would take with the objective
of ensuring compliance with the remainder of the APPs. This would be so even if
there had been no breach by the entity of any of the substantive APPs...
We just do not believe that APP [1(2)] will assist
individuals whose privacy is at risk of being interfered with - they will have
remedies if and when a breach of the substantive principles occurs. In a case
involving serious and systematic breaches of the APPs, a court has power under
section 98 of the Privacy Act to require an entity to take positive steps to
prevent future breaches. This power would likely extend to introducing a
compliance program - similar orders are commonly made at the request of the
ACCC in cases involving contraventions of the Trade Practices Act.
The OPC also commented on the complexity of the term 'steps as are
reasonable in the circumstance' used in APP 1 and other APPs.
The committee has addressed these comments in its discussion on the complexity
of the APPs in chapter 3.
first, that it must be clearly expressed and up-to-date (APP 1(3)); and secondly,
that it must contain certain information (APP 1(4)). These provisions were
supported by the Health Services Commissioner, Victoria, who noted that the
provisions of APP 1 go further than the existing provisions in the Privacy
Act and the equivalent provisions in the Victorian Health Records Act.
Similarly, the Office of the Victorian Privacy Commission supported the more
prescriptive nature of APP 1 as 'it will better allow individuals to
identify precisely how entities intend to handle personal information'.
The committee received comments suggesting improvements to the privacy
policy provisions. Professor Graham Greenleaf and Mr Nigel Waters, in their
joint submission, commented on the need to make the list of matters to be
to be notified when collecting personal information under APP 5. For
example, APP 1(4) requires information about how an individual may access information
(d) and complain (e), but not 'identity and contact details' (APP 5(2)(a)).
The NSW Department of Justice and Attorney General suggested that
privacy policies should also provide some description of the individuals or entities
who are likely to receive personal information and commented that 'this is
crucial in terms of giving members of the public a real picture of how personal
information is handled and to answer the question: "who are they giving it
to?".' It was argued that such a requirement would complement the
obligations under the disclosure principle (APP 5(f)).
Other submitters, however, raised a range of concerns about the prescriptive
contain 'reasonable information' or 'general information' about the various
The Australian Finance Conference (AFC) also commented that the
prescriptive approach was at odds with the objective of providing high level
principles and recommended that APP 1(4) be omitted entirely. Both the Australian
Association of National Advertisers (AANA) and AFC recommended that the
guidance on content of privacy policies be left to the Australian Information
Similarly, the AANA submitted that the provisions in relation to privacy
policies be limited to core information requirements and that guidance, as is
currently the case, be developed to assist entities in meeting their
Microsoft's comments concerning APP 1(4) were based on 'evidence
that individuals can be overwhelmed but not enlightened by long privacy
policies or disclosure statements, even where intended to allow informed
consent'. Microsoft submitted that layered privacy notices were one way of
improving understanding of privacy policies by providing clear and concise
summaries with links to the full privacy statement for those interested in more
detailed information. Microsoft suggested APP 1(3)–1(6) (and APP 5) be
streamlined by focusing on identifying transparency objectives. Organisations
could then choose how best to communicate with individuals to meet these
objectives in an effective and cost efficient way. Microsoft concluded that 'this
would help reduce the compliance burden on organisations and reduce the load on
A range of comments were received in relation to APP 1(4)(g) which requires
that if an entity is likely to disclose personal information to overseas recipients,
countries in which such recipients are likely to be located. The inclusion of
this requirement was supported by Privacy NSW.
In addition, Professor Greenleaf and Mr Waters argued that the inclusion of the
term 'if it is practicable to specify those countries' provided a far too
subjective qualification, and 'is likely to lead to many entities not including
this important information'. It was suggested that entities, which do not
include this information, be required to give an explanation as to why
Other submitters did not support the inclusion of the obligation under
APP 1(4)(g). It was argued that to comply with the obligation was
impractical, onerous and costly.
Submitters, for example, Yahoo!7 and the Australian Bankers' Association (ABA),
commented on the obligations imposed by APP 1(4)(g) for those entities
which use overseas servers and cloud computing. It was argued that it was
impractical to list all countries, with the ABA noting that banks do not
control the location of an overseas server and the server's location may change
without the bank's knowledge. The ABA argued that to keep track of these
changes, and to continuously update privacy policies, would be onerous and
The ABA also suggested that APP 1(4)(g) may lead to an individual
drawing an incorrect inference that a country named as the location of the
intended overseas recipient is not to be trusted with the personal information
and 'this would be an unfortunate signal for Australia's law to send
A number of suggestions to address concerns with APP 1(4)(g) were
put to the committee. Yahoo!7 favoured a simple disclosure obligation which
referred to international data transfer and backup more generally.
However, Telstra suggested that the use of very broad references and catch-alls
in a privacy notice would diminish the value of providing the information and
may lead to confusion. Thus, Telstra argued that APP 1(4)(g) should be
The ABA suggested the addition of the words 'reasonable and' before the
word 'practicable' to take into account potential volatility in the location of
servers in other countries.
A number of submitters suggested that as APP 8 deals specifically with cross-border
disclosure of personal information APP 1(4)(g) is irrelevant.
Again, concerns were raised that consumers would not be assisted by long
and complex information, specifically in relation to APP 1(4)(f) and (g). Privacy
Law Consulting was also of the view that there may be limited benefit to
consumers of the provisions as 'they do not result in consumers being provided
with a level of information that will enable them to properly consider privacy
issues associated with the overseas disclosure'.
The AANA also commented that APP 1(4)(f) and (g) 'are unnecessary and not
useful information to an individual'. Rather, the AANA submitted that 'the
intent of these provisions is to alert individuals that an overseas recipient
may not be subject to privacy legislation similar to that of Australia'.
Privacy Law Consulting voiced concern with the requirement of APP (4)(f)
and (g) in relation to the disclosure of commercially confidential information
and stated that these obligations may result in the disclosure of details about
an organisation's operational arrangements and 'inner-workings'. Privacy Law
Consulting gave the example of the outsourcing of back-office functions such as
accounts or dictation transcription and noted that such information is not
normally made public.
The committee considers that there are benefits in including in the APPs
a list of requirements for privacy policies: it helps to promote transparency;
provides consumers with a clear indication of what must be included in a
be required to examine how they handle personal information at each stage of
the information cycle.
While the committee acknowledges concerns that such an approach may
compromise the aim of high-level principles in the Privacy Act and that
consumers do not always comprehend overly long privacy policies, the committee
considers that the benefits to transparency and overall compliance with the
privacy principles outweigh these concerns. The committee considers it is
important that the principle provides for the minimum amount of information
exhaustive and that further information must be included as the particular
circumstances of the entity require. On balance, the committee therefore
within the body of the principle. The committee also notes that the Government
encourages the Office of the Australian Information Commissioner to provide
guidance in this matter.
In relation to APP 1(4)(g), the committee considers that many
consumers have concerns about the transfer of personal information overseas and
that this practice is increasing as technology changes and global markets
expand. The committee therefore believes that privacy policies should include
information if an entity is likely to disclose personal information to an
overseas entity and the countries in which such recipients are likely to be
located. The committee notes that APP 1(4)(g) contains the proviso that
committee considers that this provides sufficient flexibility to address
concerns raised by Yahoo!7 and the Australian Bankers Association.
Both the NSW Department of Justice and Attorney General and Professor
Greenleaf and Mr Waters commented that the proposal that an entity's privacy
policy need only be made available 'in such form as is appropriate' (APP 1(5)(b))
was different to the ALRC's recommendation that access must be provided
'electronically'. Professor Greenleaf and Mr Waters argued that the proposed
provision was both weaker and inferior and went on to argue that the requirement
in APP 1(6) for entities to respond to an individual's request for the
policy in 'a particular form' is only a partial and relatively weak substitute.
The NSW Department of Justice and Attorney General commented that:
In the interests of transparency and accountability, APP1
could explicitly state that entities should take reasonable steps to make the
policy available electronically. In practice, this will most likely result in
policies being posted on the websites of entities that have them. This is
likely to be the first place members of the public will look for privacy
policies and it may be appropriate to make explicit the requirement to make
them available in this manner.
The department responded to concerns about APP 1(5) and stated that
electronically would be a significant burden on organisations without a website
or means to otherwise produce an electronic copy. The department went on to
state that APP 1(5)(b) puts agencies and organisations under an obligation
reasonable in all the circumstances, having regard to the agencies' or organisations'
functions, types of business and restrictions. It also addresses issues around
accessibility; for example, clients of some entities may not have computers and
therefore are unable to electronically access privacy policies. The department
concluded that, as a consequence, there should be the option available of
providing the policy in any other appropriate format.
Professor Greenleaf and Mr Waters also suggested that it was undesirable
for APP 1(6) to apply only to requests from individuals as often organisations
such as NGOs and the media may seek access to privacy policies, and this should
be expressly accommodated.
In response to this suggestion, the department stated the provision is based on
ALRC recommendation 24-2, which also uses the terminology 'individual'. While there
is no definition for 'individual' in either the APPs or the ALRC Report, paragraph
22(1)(aa) of the Acts Interpretations Act defines an 'individual' as a 'natural
person'. The department went on to state that there is nothing preventing an
individual within an organisation, or the media, from making the request and
Therefore, in practice, there should be no foreseeable
problem in media or organisations gaining access to relevant documents
containing the Privacy Policies of an agency or organisation.
It is not the Government's intention to prevent organisations
will consider the Senate Committee's recommendations on this issue, including
suggestions for improving clarity on this issue.
The committee considers the requirement for an entity to make its
clarified by the inclusion of a note at the end of APP 5 indicating that
relation to concerns about access to privacy policies by organisations
including the media, the committee does not believe that an entity would deny
access through a narrow reading of the provisions of APP 1(6). However, to
ensure that the intent of the provision is clear, the committee considers that
the provision be re-drafted to clarify that privacy policies must be available
to both individuals and entities.
The committee recommends that a note be added at the end of
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