Blockchain-based Land Registration: Possibilities and Challenges

Maria Kaczorowska

Abstract

In recent decades land registration systems operating in Europe and worldwide have been subject to modernisation processes consisting in implementation of information and communication technologies. Such reforms have gradually led to facilitating access to land information, improving effectiveness of land registration proceedings and even introducing possibilities to dispose of the ownership of land electronically by developing electronic conveyancing mechanisms. Another innovative concept much discussed nowadays is the application of blockchain technology in the land registration sector. This solution is currently being tested in a number of countries.

Distributed ledger technology underlying blockchain is expected to revolutionise land registration by offering a secure architecture to store land transactions with the use of cryptographic protocol. This shall bring advantages of increased trust and processing efficiency as well as reduction of costs. However, the above idea raises concerns given that, under the assumptions of the “original” blockchain model, transactions are irreversible and are carried out without intermediaries, which means the lack of any external control and independent verification of the transactions to be recorded.

The article examines potential benefits and risks of automatisation of land transactions as well as practical experiences of selected countries in implementing blockchain in the area of land registration. On this basis, an assessment will be made as to whether blockchain-based registration could indeed replace the existing methodology of registering rights to land.

Keywords

Blockchain Technology; Informatisation; Land Registration; Real Estate Transactions

Full Text:

References

Show references Hide references

[1] Anand, A., McKibbin, M. and Pichel, F. (2017) Colored Coins: Bitcoin, Blockchain, and Land Administration. In: 2017 World Bank Conference on Land and Poverty, Washington DC, USA, 20–24 March. Available from: https://cadasta.org/resources/white-papers/bitcoin-blockchain-land/ [Accessed 12 December 2018].

[2] Arruñada, B. (2018) Blockchain’s Struggle to Deliver Impersonal Exchange. Minnesota Journal of Law, Science & Technology, 19. https://doi.org/10.2139/ssrn.2903857

[3] Barbieri, M. and Gassen, D. (2017) Blockchain – Can This New Technology Revolutionize the Land Registry System? In: 2017 World Bank Conference on Land and Poverty, Washington DC, USA, 20–24 March. Available from: http://www.notartel.it/export/contenuti_notartel/pdf/Land_Poverty_Conference_Blockchain.pdf [Accessed 12 December 2018].

[4] Blajer, P. (2013) ‘Deeds recordation’ a ‘title registration’. Rozwiązania modelowe w zakresie rejestrów nieruchomości w systemie ‘common law’. Zeszyty Prawnicze, 13 (4). https://doi.org/10.21697/zp.2013.13.4.03

[5] Blajer, P. (2018) Rejestry nieruchomości – studium prawnoporównawcze. Warszawa: C.H. Beck.

[6] Brennan, G. (2015) The Impact of eConveyancing on Title Registration: A Risk Assessment. Cham: Springer. https://doi.org/10.1007/978-3-319-10341-9

[7] Cámara Lapuente, S. (2005) Registration of Interests as a Formality of Contracts: Comparative Remarks on Land Registers within the Frame of European Private Law. European Review of Private Law, 6.

[8] Cash, A. (2016) Land Registration in Brazil: An Interview with Alex Ferreira Magalhães. [online] Available from: http://www.rioonwatch.org/?p=29200 [Accessed 29 December 2018].

[9] ChromaWay. (2018) Blockchain and Future House Purchases: Third Phase to Be Completed in April 2018. [online] Available from: https://chromaway.com/landregistry/ [Accessed 27 December 2018].

[10] Cooke, E. (2003) E-conveyancing in England: Enthusiasms and Reluctance. In: David Grinlinton (ed.). Torrens in the Twenty-first Century. Wellington: LexisNexis.

[11] Gabison, G. (2016) Policy Considerations for the Blockchain Technology Public and Private Applications. SMU Science & Technology Law Review, 189.

[12] Gallego, L. (2016) Blockchain and Title Registration. IPRA-CINDER International Review, 1.

[13] Gołaczyński, J. and Klich, A. (2016) Informatyzacja ksiąg wieczystych. Uwagi ogólne. In: Andrzej Marciniak (ed.). Elektronizacja postępowania wieczystoksięgowego. Komentarz praktyczny. Akty wykonawcze. Warszawa: C.H. Beck.

[14] Graglia, J. M. and Mellon, C. (2018) Blockchain and Property in 2018: At the End of the Beginning. In: 2018 World Bank Conference on Land and Poverty, Washington DC, USA, 19–23 March. [online] Available from: https://www.conftool.com/landandpoverty2018/index.php?page=downloadPaper&ismobile=true&filename=02-11-Graglia-864_paper.pdf&form_id=864&form_version=final [Accessed 22 December 2018].

[15] Gryszczyńska, A. (2011) Nowa Księga Wieczysta. Informatyzacja rejestru publicznego. Warszawa: LexisNexis.

[16] Higgins, S. (2017) Republic of Georgia to Develop Blockchain Land Registry. [online] Available from: https://www.coindesk.com/bitfury-working-with-georgian-government-on- blockchain-land-registry [Accessed 21 December 2018].

[17] Jeżak, Ł. (2019) Blockchain Prywatny VS Blockchain Publiczny. [online] Available from: https://bithub.pl/artykuly/blockchain-prywatny-vs-blockchain-publiczny/ [Accessed 14 April 2019].

[18] Kaczorowska, M. (2019) Informatisation of Land Registers in Poland and Other Member States of the European Union: A Comparative Overview. Law and Forensic Science, 17 (1).

[19] Keirns, G. (2017) Blockchain Land Registry Tech Gets Test in Brazil. [online] Available from: https://www.coindesk.com/blockchain-land-registry-tech-gets-test-brazil [Accessed 27 December 2018].

[20] Kempe, M. (2016) The Land Registry in the Blockchain: A Development Project with Lantmäteriet (The Swedish Mapping, Cadastre and Land Registration Authority), Telia Company, ChromaWay and Kairos Future. [online] Available from: http://ica-it.org/pdf/Blockchain_Landregistry_Report.pdf [Accessed 27 December 2018].

[21] Kempe, M. (2017) The Land Registry in the Blockchain – Testbed. A Development Project with Lantmäteriet, Landshypotek Bank, SBAB, Telia Company, ChromaWay and Kairos Future. [online] Available from: https://chromaway.com/papers/Blockchain_Landregistry_Report_2017.pdf [Accessed 27 December 2018].

[22] Kim, C. (2018) Sweden’s Land Registry Demos Live Transaction on a Blockchain. [online] Available from: https://www.coindesk.com/sweden-demos-live-land-registry-transaction-on-a-blockchain/ [Accessed 27 December 2018].

[23] Lemieux, V. L. (2017) Blockchain Recordkeeping: A SWOT Analysis. Information Management, 51 (6).

[24] Lemieux, V. L. (2017) Evaluating the Use of Blockchain in Land Transactions. European Property Law Journal, 6 (3). https://doi.org/10.1515/eplj-2017-0019

[25] Lemieux, V. L., Flores, D. and Lacombe, C. (2017) Real Estate Transaction Recording in the Blockchain in Brazil (RCPLAC-01). [case study] Available from: http://blogs.ubc.ca/recordsinthechain/files/2018/01/RCPLM-01-Case-Study-1_v14_English_Final.pdf [Accessed 27 December 2018].

[26] Lodde, A. (2016) The European Systems of Real Estate Registration: An Overview. Territorio Italia, 1.

[27] Bertrand du Marais and David Marrani (eds.). (2016) Legal Certainty in Real Estate Transactions: A Comparison of England and France. Cambridge: Intersentia. https://doi.org/10.1017/9781780687285

[28] Martínez Velencoso, L. M. (2017) The Land Register in European Law: A Comparative and Economic Analysis. In: Luz M. Martínez Velencoso, Saki Bailey and Andrea Pradi (eds.). Transfer of Immovables in European Private Law. Cambridge: Cambridge University Press. https://doi.org/10.1017/9781316941034

[29] McMurren, J., Young, A. and Verhults, S. (2018) Addressing Transaction Costs Through Blockchain and Identity in Swedish Land Transfers. [case study] Available from: https://blockchan.ge/blockchange-land-registry.pdf [Accessed 14 November 2018].

[30] Méndez, F. P. (2018) Smart Contracts, Blockchain and Land Registry. [speech] European Land Registry Association (ELRA) General Assembly. Brussels, 30 November. Available from: https://www.elra.eu/wp-content/uploads/2018/12/Smart-ontracts-Blockchain-and- Land-Registry-by-F-Mendez.pdf [Accessed 18 December 2018].

[31] Méndez, F. P. (2018) The Land Registrar as a Legal Professional. 7th ELRA Annual Publication. Available from: https://www.elra.eu/wp-content/uploads/2017/02/6.-Fernando-P.-Mendez-The-Land-Registrar-as-a-Legal-Professional.pdf [Accessed 7 January 2019].

[32] Ministerstwo Cyfryzacji. (2018) Grupa robocza ds. rejestrów rozproszonych i blockchain. Available from: https://www.gov.pl/web/cyfryzacja/grupa-robocza-ds-rejestrow-rozproszonych-i-blockchain [Accessed 4 January 2019].

[33] Nakamoto, S. (2008) A Peer-to-Peer Electronic Cash System. [online] Available from: https://bitcoin.org/bitcoin.pdf [Accessed 12 December 2018].

[34] Boucher, P., Nascimento, S. and Kritikos, M. (2017) How Blockchain Technology Could Change Our Lives: In-depth Analysis. Brussels: European Parliament Research Service.

[35] Niemi, M. I. (2017) Electronic Conveyancing of Real Property in Europe: Two Models. The English and the Finnish One. In: Luz M. Martínez Velencoso, Saki Bailey and Andrea Pradi (eds.). Transfer of Immovables in European Private Law. Cambridge: Cambridge University Press.

[36] Nimfuehr, M. (2017) Blockchain Application Land Register: Georgia and Sweden Leading. [online] Available from: https://medium.com/bitcoinblase/blockchain-application-land-register-georgia-and-sweden-leading-e7fa9800170c [Accessed 21 December 2018].

[37] Nogueroles Peiró, N. and Martinez García, E. J. (2017) Blockchain and Land Registration Systems. European Property Law Journal, 6 (3). https://doi.org/10.1515/eplj-2017-0017

[38] Santiso, C. (2018) Will Blockchain Disrupt Government Corruption? Stanford Social Innovation Review (March). [online] Available from: https://ssir.org/articles/entry/will_blockchain_disrupt_government_corruption [Accessed 21 December 2018].

[39] Shin, L. (2017) The First Government to Secure Land Titles on the Bitcoin Blockchain Expands Project. Forbes, 7 February. Available from: https://www.forbes.com/sites/laurashin/2017/02/07/the-first-government-to-secure-land-titles-on-the-bitcoin-blockchain-expands-project/#2ae7c5184dcd [Accessed 21 December 2018].

[40] Sklaroff, J. M. (2017) Smart Contracts and the Cost of Inflexibility. University of Pennsylvania Law Review, 166 (1).

[41] Spielman, A. (2016) Blockchain: Digitally Rebuilding the Real Estate Industry. [online] Ph.D. Massachusetts Institute of Technology. Available from: https://dspace.mit.edu/bitstream/handle/1721.1/106753/969450770-MIT.pdf?sequence=1 [Accessed 14 December 2018].

[42] Stawecki, T. (2002) Rejestry nieruchomości, księgi hipoteczne i księgi wieczyste od czasów najdawniejszych do XXI wieku. Studia Iuridica, 40.

[43] Stawecki, T. (2005) Rejestry publiczne. Funkcje instytucji. Warszawa: Wydawnictwo Prawnicze LexisNexis.

[44] Szczerbowski, J. J. (2018a) Lex cryptographia. Znaczenie prawne umów i jednostek rozliczeniowych opartych na technologii blockchain. Warszawa: Wydawnictwo Naukowe PWN.

[45] Szczerbowski, J. J. (2018b) Transaction Costs of Blockchain Smart Contracts. Law and Forensic Science, 16 (2).

[46] Szostek, D. (2018) Blockchain a prawo. Warszawa: C.H. Beck.

[47] Tapscott, D. and Tapscott, A. (2016) Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World. New York: Portfolio/Penguin.

[48] Thomas, R. (2017) Blockchain’s Incompatibility for Use as a Land Registry: Issues of Definition, Feasibility and Risk. European Property Law Journal, 6 (3). https://doi.org/10.1515/eplj-2017-0021

[49] Verheye, B. (2017) Real Estate Publicity in a Blockchain World: A Critical Assessment. European Property Law Journal, 6 (3). https://doi.org/10.1515/eplj-2017-0020

[50] Vos, J. (2015) Blockchain-based Land Registry: Panacea, Illusion or Something in Between?. 7th ELRA Annual Publication. [online] Available from: https://www.elra.eu/wp-content/uploads/2017/02/10.-Jacques-Vos-Blockchain-based-Land-Registry.pdf [Accessed 12 December 2018].

[51] Wudarski, A. (2016) Das Grundbuch in der Registerwelt. Eine rechtsvergleichende Untersuchung zum deutschen und polnischen Grundbuch im europäischen Kontext. In: Arkadiusz Wudarski (ed.). Das Grundbuch im Europa des 21. Jahrhunderts. Berlin: Duncker & Humblot. https://doi.org/10.3790/978-3-428-54638-1

[52] Young, S. (2018) Changing Governance Models by Applying Blockchain Computing. The Catholic University Journal of Law & Technology, 26 (2).

[53] Zevenbergen, J. (2002) Systems of Land Registration: Aspects and Effects. Delft: Netherlands Geodetic Commission (NCG).

https://doi.org/10.5817/MUJLT2019-2-8



Copyright (c) 2019 Masaryk University Journal of Law and Technology