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Steering Committee endorses national business model of electronic conveyancing

The National Electronic Conveyance Office (NECO) has announced the development of a new body called the National Steering Committee the 6-US meeting on 30 March 2007.

Committee chairman Les Taylor, in a statement dated 18 March 2007, reinforced the need for the committee to have a national business model to ensure “common view” on the way toward electronic conveyancing (e-conveyancing).

About electronic conveyancing

Mr Taylor explained that E-conveyancing hopes to provide a “shared electronic workspace” for legal practitioners, conveyances, financial representatives and mortgage processors to:

* Prepare all necessary instruments to register changes in ownership and interests;
* Settle financial transactions (including payment of duties, taxes and any disbursements);
* Lodge their dealings with the appropriate Land Registry; and
* Receive confirmation of dealing lodgement and registration.

Every party to the transaction will provide information about transaction electronically rather than the paper-based approach.

The NECS model seeks to ensure that parties adhere to “strict security checks” and meet “certain threshold requirements” in order to use the new system. This includes the verification of identity via an “Australia Business Number Digital Signing Certificate” (ABN-DSC).

Digital conveyancing will replace the traditional physical swapping of legal deeds, manual signatures and drawing of bank cheques. Settlement, lodgement and notification of transaction details all occur electronically in one process.

Benefits of electronic conveyancing

According to both NECO and the Department of Land in Victoria, the benefits of e-conveyancing include:

* Eliminating the need to store bulky paper certificate of titles and mortgage documents;
* Eliminating manual drawing or depositing of bank cheques via a new Electronic Funds Transfer option, saving on bank clearance time;
* Easy access to all subscribers regardless of time or place;
* Allows for solicitors, conveyancers and financial institutions to cut down on the need for face-to-face settlements thereby improving efficiency and reducing costs.

The disadvantages of electronic conveyancing

There has been widespread debate over a number of potential concerns, including:
* Whether electronic conveyancing will make land titles registration more vulnerable to fraud;
* Consistency of the NECS model between states and territories; and
* Emerging technology problems such as outages.

The proposed system also does not cover:

* Preparation and exchange of contracts for sale;
* Pre-settlement investigations;
* Procurement of any insurances required by purchasers;
* Creation of loan documents and
* Processes for examining and registering instruments once lodged with a Land Registry;

NECS latest update – the National Business Model

Mr Taylor said in the latest Steering Committee meeting that “he sought and obtained from all the jurisdictions a commitment to the National Business Model as the basis for developing the national system”.

According to NECO, the Committee put its stamp of approval on:

* The National Business Model as the basis for national electronic conveyancing;
* Development of the detail of what is required as quickly as possible; and
* A “National Roadmap” as the basis for defining and implementing NECS, with the updating/republishing of the Roadmap documents with the relevant findings relating to risk, regulation and governance and of national consultation.

“The independent consultancy reports on risk assessment, regulatory review and governance together with the Progress Report on Consultation were well received,” Mr Taylor said. “Their findings will provide guidance in further developing the requirements for NECS and its supporting arrangements.”

The Committee has given its permission to proceed with the next stage of the project.