D: The use of SCHUFA scores is problematic

According to a press release of the Independent State Center for Data Protection of Schleswig-Holstein (Unabhängige Landeszentrum für Datenschutz, ULD), SCHUFA's refusal to make available to the supervisory authorities and to the business partners of SCHUFA information regarding the determination of scores is leading to the consequence that companies in particular cannot comply with their statutory obligations to disclose information regarding parties affected.

New requirements in the area of so-called "scoring" have been in effect since April 1, 2010. The probability value (score value) calculated in connection with the scoring serves as a reference point for the creditworthiness of a party affected.

The newly-created Section 28b of the Federal Data Protection Act (Bundesdatenschutzgesetz, "BDSG") establishes what data may be used in order to calculate the score value. The disclosure obligations of companies are contained in Section 34, paragraph. 2 of the BDSG. Thus, companies must be informed of the types of data used to calculate the score value, and must be presented the formation and the importance of the score value.

SCHUFA's refusal to make available information about the score value, which was criticized by ULD, is leading to the conclusion that an evaluation of the calculation of the value in conformity with data protection laws is impossible. However, for a decision regarding the establishing of a contractual relationship, companies may only draw on score values that are calculated in conformity with data protection law.

One cannot rule out that the score calculated by SCHUFA fulfills the statutory requirements; however, companies cannot be certain of this.

Companies may not provide to the parties affected necessary disclosure, even under Section 34, paragraph 2 of the BDSG. Upon a violation of this disclosure obligation, a fine may be levied in accordance with Section 43, paragraph 1, number 8a of the BDSG.

In regards to the disclosure obligations regarding the score value, the law establishes for companies a "fallback option" in Section 34, paragraph 2, sentence 4 of the BDSG. In this case, the company may immediately refer the parties affected for the disclosure to the office responsible for the calculation - in this case, SCHUFA. This could be an option for companies to reduce their risk of incurring a fine upon disclosure requests by the parties affected. However, one cannot estimate whether such a referral would help even if the company were to know that SCHUFA does not provide sufficient information to the parties affected.

However, this "fallback option" does not change the fundamental problem with the use of the SCHUFA score value, which, according to the view of ULD, consists of the fact that the use of a score value calculated in a manner that is not clearly legal cannot be "answered."

Source: Press release of ULD on July 19, 2010