e-Conveyancing – lessons from Australia

e-Conveyancing – lessons from Australia

The implosion of Boris Johnson’s government has seemingly put paid to any government intervention in the housing market as the industry contemplates its 11th Housing secretary in 12 years.

Calls for intervention to support the implementation of a universal e-conveyancing solution have increased as the UK property market continues to struggle with the delays in the transaction process.

e-Conveyancing would enable the array of current technology solutions to communicate within the same environment on the same transaction. It’s a system the Australian market moved to introduce in 2013 the best known of which is the PEXA platform. PEXA was born from a Council of Australian Governments’ initiative to deliver a single, national e-conveyancing solution to the Australian property industry.

Since its inception, more than 85% of all property and refinance transactions go through PEXA Exchange. According to PEXA, Australians can now narrow down the hour, not just the day, of completion, and track it all in a secure consumer mobile app.

And in a potential lesson for the UK market, legislation has been passed in Australia to enhance competition in the space as rival operators vie for position.

In a piece which appeared in The Australian recently, the competitive landscape is heating up, with PEXA being accused by a rival platform of delaying the ability of rivals to integrate with its technology, so-called interoperability.

The Australian Competition and Consumer Commission (ACCC), Australia’s equivalent of the Competition and Markets Authority, said the competition regulator was considering issues raised by competitor Sympli but has provided no further comment.

Australia’s e-conveyancing regulator – Australian Registrars’ National Electronic Conveyancing Council – recently pushed back the go-live timing for the first interoperable transaction to enable independent assessments of system readiness before interoperable transactions could occur.

PEXA have stated in a blog on its website that there was “valid concerns from industry around the resilience of an interoperable system, and that further safeguards are required to protect consumers.”

When contacted about the accusations, a PEXA spokesperson said,

“PEXA has long supported the introduction of competition in e-conveyancing and is contributing significant resources (more than 1000 personnel hours in 2021 alone) to design and implement interoperability.

“PEXA is focused on continuing to deliver positive industry and consumer outcomes, and is excited to share our knowledge and expertise with the UK market. We believe a consumer-centric approach should be at the heart of the design and implementation of any digital transformation.”

The Australian market is dominated by PEXA who alongside Sympli (an entity owned by the Australian stock exchange operator Australian Securities Exchange) and ATI Global (Australian Technology Innovators who own a range of property and technology businesses in Australia and the UK) are driving e-conveyancing forward in Australia.

While the UK government have been hands off to date, encouraging market forces to determine the future of e-conveyancing, the Levelling up whitepaper released in February provided a first indication that that it will act with legislation should progress not be made quicker.

“The home buying and selling process which can be expensive, time consuming and stressful will be improved. Around a third of all housing transactions fall through, costing people hundreds of millions of pounds each year. The UK Government and the industry will work together to ensure the critical material information buyers need to know – like tenure type, lease length and any service charges – are available digitally wherever possible from trusted and authenticated sources, and provided only once. If necessary, the UK Government will legislate.”

In June the ACCC launched an investigation into the proposed acquisition of Link Administration Holdings, who own 43% of PEXA, by Dye & Durham. In a statement on their website, the ACCC acknowledge that

“While combining D&D and Link does not raise issues, by acquiring Link, D&D would gain the 42.77% shareholding in PEXA Group Ltd (PEXA) (ASX:PXA) that Link currently owns. It is the potential vertical integration of D&D’s operations and PEXA that gives rise to the competition concerns. It is the potential vertical integration of D&D’s operations and PEXA that gives rise to the competition concerns.”

Since then, a revised offer has been turned down by Link.

It’s not the first time Dye & Durham’s acquisition strategy has brought them to the attention of competition watchdogs. Earlier this year Dye & Durham were instructed to divest the search company tmgroup by the Competition and Markets Authority.

The acquisition of tmgroup, adding to the acquisitions of poweredbypie, Property Search Group (PSG), Index, GlobalX, Future Climate Info and Terrafirma, would make it the largest player in the market and reduce competition. In its final decision the CMA indicated that it felt the only way to address the issue would be for Dye & Durham to sell tmgroup, a decision Dye & Durham “disagreed” with in a subsequent statement.

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