Land RegistrationPrivatisation of public registries? EU – US

comparisons

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 1. Privatisation of land registration?• 2. Private re-registration of mortgages in the

US: Mortgage Electronic Registration Systems (MERS)

• 3. Concluding remarks: Could this also happen in the EU?

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 2. Private re-registration of mortgages in the US: MERS (1)

"We introduce this subject with a riddle: What entity is not a bank but claims to hold title to approximately half of all the mortgaged homes in the country? The answer is MERS.”

Selya, Circuit Judge in: Culhane v. Aurora Loan Services

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 2. Private re-registration of mortgages in the US: MERS (2)

– Formal (public) registration• Property level

– Informal (private) registration• Mixed property/contract level: trade in mortgages

– Culhane v. Aurora Loan Services (US 1st Cir.)– Leslie Jensen Edwards v Mortgage Electronic Registration

Systems Inc (et al), (Idaho Supreme Court).

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 2. Private re-registration of mortgages in the US: MERS (3)

– Bill: Transparency and Security in Mortgage Registration Act of 2013

– Bill: Protecting American Taxpayers and Homeowners Act of 2013

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 2. Private re-registration of mortgages in the US: MERS (4)

– Transparency and Security in Mortgage Registration Act of 2013• Federal land title recordation system?

– or.....

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 2. Private re-registration of mortgages in the US: MERS (5)

– Protecting American Taxpayers and Homeowners Act of 2013, Section 332:

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 2. Private re-registration of mortgages in the US: MERS (6)“SEC. 332. LEGAL EFFECT OF REGISTRATION WITH REPOSITORY.Notwithstanding any provision of State or Federal law to the contrary, by proper demonstration of registration with the Repository, any holder of an interest in any mortgage-related note shall satisfy any requirement for demonstration of a right to act regarding such note or other registered data that exists in State or Federal law, including any obligation to produce or possess an original note. The Director shall provide for the establishment of procedures for proper demonstration of registration of any mortgage-related document and of an interest by the holder of an interest in any such document with the Repository. Once registered with the Repository, such registration shall be a legal right enforceable in any judicial or nonjudicial process.”

Faculteit der Rechtsgeleerdheid / Faculty of Law

Land Registration

• 3. Concluding remarks:– Privatisation of public registries: An informal

process in the US; also possible in the EU– The private sector may take over, if the public

sector ignores the reality of the internal EU market

– Next to public officials (land registrars, notaries) bank employees responsible for land registration?

– A wake-up call!