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The ABC of the e-DRS

Recent advances made in information- and communication technology have made us accustomed to having the world at our fingertips. We are able to fulfill our social obligations, attend meetings, book holidays, do our tax returns, tend to banking transactions, shop the latest trends and view the most recent listed properties – all with the click of a button and from the comfort of our own home or office. Global computerisation and digitalisation have taken the world by storm and it begs the question: Will the South African legal system sink or swim?

In an attempt to address this question, the President of the Republic of South Africa signed into law the Electronic Deeds Registration Systems Bill on 2 October 2019. However, upon closer inspection, it becomes quite clear that the Electronic Deeds Registration Systems Act, Act 19 of 2019 (hereinafter referred to as “the Act”) is merely a preliminary life-jacket.

This article will delve deeper into the Act itself, focusing on its most important aspects, its advantages and promises for the future.

The Act: Important aspects

According to its preamble, the Act aims to provide for electronic deeds registration while having regard to legislation regulating electronic communication and transactions (i.e the Electronic Communications and Transactions Act, Act 25 of 2002) and to provide for matters connected therewith. The act merely envisages the facilitation and development of an entirely electronic deeds registration system (also known as the e-DRS).

In order to achieve its objectives, section 2 of the Act empowers and instructs the Chief Registrar of Deeds (“the Chief Registrar”) to develop, establish and maintain the e-DRS using information and communication technologies for the preparation, lodgement, registration, execution and storing of deeds and documents. The Chief Registrar may, after consultation with the Regulations Board referred to in section 9 of the Deeds Registries Act, Act 47 of 1937 (“the Deeds Registries Act”), issue directives for inter alia

  • the functional requirements, technical specifications and operation of the electronic deeds registration system;
  • the specifications for the interface between the e-DRS and any party interfacing in the system which will be authorised to access the electronic deeds registration system;
  • the standards governing its information security;
  • the processing of deeds and documents using the e-DRS;
  • the secure retention and subsequent production of deeds and documents, or any other electronic records, which may be pertinent to the registration of rights in the deeds registry or that may be required for the administrative or legal proceedings that must be complied with by users interacting with the e-DRS.

Section 5 empowers the Minister to make regulations relating to:

  • the procedures for the electronic lodgement of deeds or documents and electronic record storing by deeds registries;
  • the manner of identification of the person who prepares, executes, lodges, registers or stores any deed or document required or permitted to be prepared, executed, lodged, registered or stored in any deeds registry;
  • the manner in which electronic payment of fees may be introduced;
  • the procedure and manner for accessing the electronic deeds registration system for information purposes only;
  • the authorisation of any user of the e-DRS, as contemplated in section 4 of the Act; and
  • any matter that may be necessary to give effect to the objectives of the Act.

The Act therefore merely aims to empower the relevant authorities to take the necessary measures in order to put the e-DRS system in place.

One of the most significant advances of this Act, is Section 3 which provides that, subject to section 14 of the Electronic Communications and Transactions Act, a deed or document generated, registered and executed electronically and any other registered or executed deed or document scanned or otherwise incorporated into the electronic deeds registration system by electronic means is for all purposes deemed to be the only original and valid record.

It is also important to take note of the definition of signature in section 1, which reads as follows:

“Signature in respect of any act performed in terms of the Deeds Registries Act and Sectional Titles Act by a conveyancer, notary public, statutory officer or Registrar in attesting his or her signature to a deed or document or a scanned image of a deed or document in respect of the registration thereof, means an advanced electronic signature as defined in section 1 of the Electronic Communications and Transactions Act, and ‘‘electronic signature’’ has a corresponding meaning.”

The e-DRS will be an internet-based system with its ultimate objective to eventually revise and replace the current procedures that are in place in terms of the Deeds Registries Act, the Sectional Titles Act, Act 95 of 1986 (“the Sectional Titles Act”) and other relevant pieces of legislation and regulations. The transitional provisions of this Act however provides that it will not affect the validity of any registrations effected prior to the coming into operation thereof and Registrars will continue with the registration, execution and filing of deeds and documents as prescribed by the Deeds Registries Act and the Sectional Titles Act, until the e-DRS or related provisions or regulations are in place, where after the registration, execution and filing procedures in terms thereof will be discontinued. All parties involved must therefore continue with the preparation and lodgement of deeds and documents as prescribed by the Deeds Registries Act and the Sectional Titles Act, until the e-DRS or related provisions or regulations are in place, where after the current preparation and lodgement procedures will also be discontinued: Provided that any deed or document electronically executed or registered, shall be deemed to have been executed or registered in the presence of the Registrar by the owner or by a conveyancer authorised by power of attorney to act on behalf of the owner.

Advantages

The Act aims to streamline and lessen the current burdens experienced with the preparation, processing, lodgement and registration of deeds and documents by the Registrar. It hopes to enable the registration of large volumes of deeds effectively, while providing countrywide access to deeds registration services and other information and eliminating the need for correspondent conveyancers, while still promising to enhance security of title. It also aims to improve transparency and provide greater accuracy in examination and registration.

The Future

The Act will come into operation on a date to be fixed by the President by proclamation in the Government Gazette. No practical provisions and/or procedures are in place yet and as is quite clear from the Act itself, there is still a lot of work to be done before the system will be able to become a practical reality. While we may not be certain when exactly that will be, what is certain is that a very careful and precise approach in the preparation and implementation of the system is fundamental to its success. Considering what is at stake, there is simply no room for error.

While this system has the potential to evolve conveyancing as we know it, this specific Act merely provides the first step towards that evolution. We look forward to a pro-active approach in developing a system that will not only keep us afloat but will have a significant positive effect on the conveyancing- and property industry of South Africa.

Article written by Inge Johnson, Attorney at Faure & Faure Inc.

For more information email contact@faurefaure.co.za

Inge Johnson | Attorney | Faure & Faure Inc.