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National Electronic Conveyancing

National Electronic Conveyancing. Industry Information Session March & April 2013

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National Electronic Conveyancing

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  1. National Electronic Conveyancing Industry Information Session March & April 2013 We would like to acknowledge this land that we meet on today is the traditional lands for the Kaurna people and that we respect their spiritual relationship with their country. We also acknowledge the Kaurna people as the custodians of the Adelaide region and that their cultural and heritage beliefs are still as important to the living Kaurna people today.

  2. Agenda • Welcome – Brenton Pike • National Overview – Steve Wilden • Questions • South Australian Implementation – Brenton Pike • Questions • Verification of Identity Policy – Cristina Florea • Questions

  3. National Overview Steve Wilden, Director Business Operations

  4. What is Electronic Conveyancing? • Legal Framework • Business Practices • Business Model • Software System It is much more than a Software System

  5. COAG National Partnership Agreement to Deliver a Seamless National Economy Legal Framework Intergovernmental Agreement for a National Electronic Conveyancing Law Australian Registrars’ National Electronic Conveyancing Council (ARNECC) Electronic Conveyancing National Law Australian Registrars’ Operating Requirements Australian Registrars’ Participation Rules Participation Agreement Operating Agreement

  6. Intergovernmental Agreement (IGA) • Provides governance for development, implementation and management of the regulatory framework for National E-Conveyancing • Establishes the Australian Registrars’ National Electronic ConveyancingCouncil (ARNECC) (www.arnecc.gov.au)

  7. Electronic Conveyancing National Law (ECNL) • Application law system that facilitates the implementation and operation of a national system of electronic conveyancing and provides for: • Electronic Lodgement Network Operator (ELNO) • Model Operating Requirements • Model Participation Rules • Use and Effect of Client Authorisation • Use and Reliance on Digital Signatures • Compliance Examination

  8. Electronic Conveyancing National Law (ECNL) • Passed in the NSW Parliament (as the host jurisdiction for the Law) in November 2012 • Other jurisdictions are in the process of enacting application or corresponding legislation • South Australia finalising ECNL Bill for Cabinet approval and introduction into Parliament

  9. Model Operating Requirements (MOR) • Set of common operating requirements determined by the Registrars that an ELNO must comply with and includes: • Eligibility Criteria • General Business Obligations • System Functionality • Information Security Management • Risk Assessment and Management • Business Continuity and Disaster Recovery • Change Management • Business and Services Disengagement • Compliance demonstrated through Self Certifications, evidence and Independent Certifications

  10. Model Participation Rules (MPR) • A set of rules determined by the Registrars that a Subscriber must comply with and includes: • Eligibility Criteria • Compliance with Jurisdiction Laws • Client Authorisation • Verification of Identity • Instrument Certifications • Confidentiality • Security and Integrity

  11. Business Model • National Electronic Conveyancing Development Ltd (NECDL) established to develop and operate the electronic conveyancing system (www.necd.com.au) • Corporation limited by shares funded by government and industry • Implementing the electronic conveyancing system to be known as Property Exchange Australia (PEXA) • PEXA will provide for: • Preparation and lodgement of land title dealings • Electronic settlement of financial transactions • Disbursement of payments • Notification of settlement and lodgement

  12. Australian E-Conveyancing Model Settlement FinancialInstitutions Subscriber FSM RBA P E X A Preparation Compliance & Lodgment User Browser Interface Client Subscriber RO1 Certifier SP Browser Interfaces LR1 Service Providers Web Services RO2 SP Web Services LR2 User Web Services Client Subscriber Certifier

  13. PEXA Implementation Release 1 - mid 2013 • Functional Scope • Standalone Discharge of Mortgage • Standalone Mortgage • Refinance • Target Participants • Victoria, New South Wales, Queensland and Western Australia • Major Financial Institutions (NAB, CBA, ANZ, WBC)

  14. PEXA Implementation Release 2 - mid 2014 • Functional Scope • Transfer • Electronic Settlement • Caveats and Withdrawal of Caveats • Priority and Settlement Notices • Target Participants • All Land Registries • Other Financial Institutions • Legal Practitioners and Conveyancers

  15. South Australian Implementation • Funding approved in the 2012-13 State Budget for $4.7 million over 3 years: • Prepare LSG and industry for implementation • Implementation aligned with replacement of legacy land administration systems through the South Australian Integrated Land Information System (SAILIS)

  16. South Australian Implementation Brenton Pike, Registrar-General

  17. Policy Directions and Reform Alignment of the paper and electronic environments: • One set of policies and requirements • Provide a smooth transition and efficiencies between the two lodgement mediums • Avoid complexity of dealing with two separate systems and requirements

  18. Legislative Amendments and Reform • Electronic conveyancing will be the driver for significant legislative reform • Early adoption of policies and changes that can be introduced in the current environment • Other policies and changes will require amendments to the Real Property Act 1886

  19. Consultation Plan • Industry Representative Group • Industry Information Sessions • Video recordings of sessions for remote customers • Publication of NEC updates and policy papers on LSG web page (www.sa.gov.au/landservices) • Social media updates

  20. Policy Initiatives • Verification of Identity • Client Authorisation • Priority Notices • Removal of duplicate Certificates of Title

  21. Verification of Identity • First policy reform building block • Codification of need to verify client • Foundation for introduction of Client Authorisation • Provides consumer confidence to cater for the removal of duplicate Certificates of Title

  22. Client Authorisation • Closely linked to Verification of Identity policy • Removal of signatures • Removal of witnessing requirements • Client will sign a Client Authorisation form • Legal practitioner or Conveyancer certifies documents

  23. Priority Notices • Notification to anyone searching Title of forthcoming dealing(s) • Gives confidence for transactions • Closely tied to the removal of duplicate Certificates of Title • Added measure to act as a barrier to multiple settlements

  24. Removal Duplicate Certificate of Title • Duplicate Certificates of Title are not compatible with the move towards a more electronic system • Removal of this requirement will reduce costs and overheads for Industry and Lands Titles Office

  25. Policy and Reform Building Blocks Land Title Reform Priority Notices Removal of Duplicate Titles Client Authorisation Verification of Identity Legal Framework

  26. Timeframes for Reform 2nd Qtr 2015 1st Qtr 2015 3rd Qtr 2013 4th Qtr 2014 4th Qtr 2014 1st Qtr 2015 2nd Qtr 2015 Client Authorisation Legislative Amendments SAILIS VOI Priority Notices Removal of Duplicates Go live NEC

  27. Verification of Identity Policy Cristina Florea, Business Specialist

  28. Reasons for Introduction • Necessary for the introduction of electronic conveyancing (condition in MPR) • Aligning the paper and electronic environments • Provide foundation for introduction of other policy initiatives • Strengthen the integrity of the land administration system

  29. Key Provisions of VOI Policy • Persons to be identified • Reasonable Steps • Process • Identification document categories • Specific requirements • Use of agent • Self-represented parties

  30. Persons to be Identified • A representative needs to identify any of their clients or any attorney/individual acting on behalf of that client • An Authorised Deposit-Taking Institute (ADI), (or their representative if they have one), must identify the Mortgagor if the Mortgagor does not have a representative • Any other person being given a duplicate Certificate of Title which is not a representative or ADI • Any person providing an Identifier Declaration

  31. Reasonable Steps • A representative or ADI is required to use reasonable steps to identify the person to be identified • If the representative or ADI follows the steps outlined in the policy this would be considered reasonable steps

  32. Process Outlined in Policy • Face-to-face • Use of identification document categories • Supporting documentation

  33. Specific Requirements The following provisions have specific requirements under the process outlined in the policy: • Body corporate • Attorney • Foreign country

  34. Use of Agent • An agent may be appointed to undertake VOI • There are specific requirements an agent must meet • Evidence is to be received from agent

  35. Self-Represented Parties • Identity to be verified by an authorised person • Authorised person’s certification form to be lodged • Copies of identification documentation to be lodged

  36. Next Steps • Introduction in 3rd quarter 2013 • Policy paper has been published on our web page • Welcome feedback and comments • Feedback and comments requested by end of May • Comments to be provided to: LSBRProgram@sa.gov.au

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