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The Australian Registrars’ National Electronic Conveyancing Council (ARNECC) has outlined that electronic lodgment network operators (ELNOs) need to be ready for full interoperability for key documents by 31 December 2025.
The move to interoperability has been years in the making and aims to allow each party in the settlement process (for example, lawyers, conveyancers, and financial institutions) to use the electronic lodgment network operator of their choice, irrespective of what the other transacting parties choose to use.
PEXA currently holds over 88 per cent of the conveyancing market share, but the interoperability regime aims to facilitate competition by allowing practitioners to transact efficiently with all other parties while subscribing only to the ELNOs they choose (for example, Sympli or LEXTECH).
It aims to help provide more competition in the e-conveyancing market.
The new deadline for full interoperability, outlined in a new version of the Model Operating Requirements (MOR), marks the first time ELNOs will be required to build, design, and test for full interoperability by a mandated date.
NSW and Queensland will be the first states to implement these competition reforms.
ELNOs will also now have a regulatory obligation to preserve an equivalent standard of performance within their network to provide certainty to their subscribers.
Noting the new deadline, a spokesperson from PEXA suggested the new target was “ambitious”.
The spokesperson told Mortgage Business: “Interoperability is complex and it is important that security and risk considerations as well as the impacts on industry stakeholders, are properly considered.
“The timeline for achieving full interoperability therefore remains ambitious and other industry stakeholders have reflected similar concerns, however, PEXA is continuing to work constructively with ARNECC in relation to regulatory reform.”
PEXA has also previously raised concerns over the costs of interoperability.
However, e-conveyancing platform Sympli (a collaboration between InfoTrack and ASX) has welcomed the move, saying it was arrived at following “comprehensive analysis and reviews undertaken by ARNECC over the last five years” and stakeholder feedback and would help bring about “millions of dollars of innovation, service and value benefits to small businesses and customers every year.”
Sympli chief executive Philip Joyce commented: “Having mandated dates means that competition is right around the corner for small businesses, industry and consumers across the country.”
He added that he hoped the focus would shift to “keeping the reform time frame” adding: “We look forward to further uplift in execution, including enforcement of milestones to hold networks to account for delivery and quality.
“We are confident that these network regulatory obligations in the MOR will give industry stakeholders the certainty they need and create even more momentum within the Interoperability Delivery Program.”
Last year, the first pilot transactions utilising interoperability were completed in Queensland.
The refinance transactions involved two electronic lodgment network operators (ELNOs), Sympli and PEXA, with the two lenders involved being the Commonwealth Bank of Australia and National Australia Bank.
[Related: E-conveyancing interoperability pilot a ‘success’: ARNECC]
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