Real Estate property registratio

Real estate registration in Latin America. The modernization of the registration system of Chile. Joel González ABSTRACT This report is about the process Chile is engaged in for a profound reform of the real estate registration system; the reform intends to substitute the current system of personal folio for one of real folio (property-based folio); the intense use of the most modern digital technologies to make the registration more efficient (lower cost and less time for the users) and safer, and the creation of a regulatory and supervising agency of the officers in charge of the registry. To understand the reforms that are described in detail, the way the ownership of real estate is acquired in Chile and other countries it is previously explained, and a brief explanation of the way the real estate registry works in this south American country. If the reforms succeed, this new design could be used as a model by other LatinAmerican countries to update their old registration systems. 1. INTRODUCTION The subject concerning the registration of real estate in a special record, the function and effects of this registration, the organization and competence of the offices in charge of the recording and other questions pertaining to the system for the publicity and protection of the legal situation of real estate have experienced a great development in other countries, specially European (Camara 2005), in contrast to the underdeveloped real estate regime of many countries of Latin America. Chile is discussing a great reform to its real estate registration system, but to be able to understand its scope it is necessary some previous explanations on the form of ownership transference in the different countries and times and on the legal concepts of the countries of civil law (continental Europe and Latin America). For the transference of goods, diverse systems have been developed in the history of Law. With Roman precedents, in many legal systems among them the Chilean, for the transference of ownership and other real rights the concurrence of two legal elements is required: a title and a means of acquiring. Real right is the one exerted on a thing with independence of a determined person. Real rights are ownership, inheritance, usufruct, use, right of way, pledge and mortgage. From these rights the real actions arise (article 577 of the Chilean Civil Code). Personal rights or credits are those that can only be demanded from certain people that, by their own acts or the mere disposition of the law, have contracted the correlative obligation; like the one that the moneylender has against his borrower, or the son against the father for food allowance. From these rights the personal actions arise (article 578). Title is the fact or juristic act that serves as antecedent for the acquisition of the ownership. The means of acquiring is the fact or legal transaction that actually produces the acquisition of the ownership. With the title only, then, the ownership of the things is not acquired: from it only a personal right arises, the right to demand that later the ownership be transferred by the obligor, by means of the corresponding means of acquiring. The clearest example is provided by the sale contract: once it has been formalized, the buyer is not yet the owner of the bought thing and the seller has not alienated it; with the contract, the seller has committed itself to transfer it to the buyer; later, the ownership is transferred when the seller delivers to the buyer the delivery or tradition of the sold thing (the tradition according to article 670 of the Chilean Civil Code is a means of acquiring the ownership of the things and consists of the delivery that the owner performs to another party, existing the faculty and intention to transfer the ownership, and by the other party the capacity and intention to acquire it. What it is said of the ownership is extensive to the other real rights). For that reason, it is usually expressed that it is the means of acquiring the source where the real rights arise from. Actually, this duality is not frequently perceived with clearness. It is the case of the title massively used, the sale agreement of movable property, which is consensual; the means of acquiring usually follows the title immediately, that they mix up: agreement on the thing and its price takes place and immediately the sold thing is delivered. But they are distinguished clearly in the transaction of real estate, in which first the contract by public deed is executed and, later, fulfilling the contract, such title is recorded in a registry of real estate property: with that act of registration -the way the tradition of real estate takes placethe ownership transference is carried out. In the practice of the real estate traffic the notarial and registry performances with reciprocal influences converge (and approach of responsibilities), mainly in the preventive control zone, as long as the respective system considers it (Arnáiz 2001). The titles that allow the later transference of the ownership are called transferring titles of ownership. They are innumerable, legally they do not have a closed number and they can have the form and characteristic that the individuals decide. Generally, they adopt the contract form: sale agreement, exchange, donation, contribution to a partnership. That is the Roman system of title and means of acquiring, or of the personal effect of the contract. In addition to Chile, the Spanish, Austrian, Swiss, Russian (Pérez 2000) and several Latin Americans codes follow the Roman system (including the new Brazilian Civil Code of 2002). In contrast to it, there is the consensual system, or of the real effect of the contract, in which the single title or agreement is sufficient to produce the transference of the ownership, with no need to resort to the means of acquiring. It was established by the French Civil Code (article 1138) (Chazal and Vicente 2000) and adopted by others; e.g. those of some Latin American countries and later the Italian, the Portuguese, the one from Québec. The interesting alternative adopted by the German Law must also be considered. For the security of the traffic, the German Civil Code introduces the abstraction, separating (or making it independent) the means of acquiring from the causal business (the title), putting in the middle -like a partition- the transferring agreement. In the transference of the real right there must be a title (that in the reality is the causal act, the contract), that explains the transference; but, with independence of it the transference takes place by the concurrence of the abstract transferring agreement plus the delivery (in the movable property) or the registration (in real state); the transferring agreement is the concise agreement to transfer, between the seller and the buyer; it is abstract because it is independent of its cause (of the causal business); thus, what can happen to the title (invalidity, termination due to breach of contract, etc.) does not affect, or influence, the transferring agreement and, therefore, the transfer of the ownership; the transference prevail (except in extreme exceptions). Abstract transferring agreement plus delivery, or abstract transferring agreement presented before the registrar plus registration carried out by this one, transfers the real right (see mainly, articles 925, 929 and 873 of the German Civil Code). In immovable property, the system must be completed with the regulation of the Registry (Enneccerus et. al. 1971, Pau, 1982, Miquel 2003). But the system, that has not been widely adopted, has been badly criticized; mainly because the causal systems reflect better the reality of the businesses, that people always consider as a unit, and because they solve with more equity the difficulties derived from the lack of justifying title (or of the invalidities, resolutions, etc.), whereas the protection of the traffic can be obtained protecting the good faith third person, as it is postulated by the protection to the appearance (Álvarez 1945, Heck 1965, Martínez 2000). In Chile the system is formed, fundamentally, by articles 588, 670, 675 of the Civil Code; it can also be mentioned the texts that define the main transferring titles of ownership, like articles 1793 and 1897, according to which the seller, the exchanging one, commits himself to give the thing; also article 1824 is clear for this effect (the definition of the donation of article 1386, that is another outstanding transferring title of ownership, is objected by the impropriety of its writing in this respect). The means of acquiring are established in the law and, by the institutional character of the property, cannot be considered as such except those which are mentioned in the legal text (in Chile the Political Constitution expressly states it, article 19 Nº 24). Article 588 of the Civil Code enumerates them. 2. THE CHILEAN REGISTRY SYSTEM TODAY. The fundamental legal norms on the matter are contained in articles 686 and following of the Civil Code and, according to article 695, in a regulatory body known as Statute on Real State Registry (hereinafter Statute). With respect to the location of the regulation of the Registry, the legislations make varied decisions. Some incorporate the regulation in the Civil Code, e.g., Switzerland, Italy, Bolivia, Québec; others, like the Chilean, German, Peruvian, and Paraguayan Codes, incorporate only some brief fundamental norms. The organization and operation of the Registry are contained in the Statute and the Code on Courts Organization (hereinafter CCO) (articles 446 ff) a) It works like an office in each county (comuna) or grouping of counties, in charge of an officer known as Registrar of Real State, and considered as the person who testifies the legality of the registration act. In many municipalities the notary, or one of them, is at the same time the Registrar. b) The fundamental books that they keep are the Repertory, the Register and the General Index. But the center of the system is the Register; the other two constitute its (important) complements. The Repertory is the book in which all the titles presented to the Registry must be written down; by chronological order of arrival, whatever its nature; it is annual. The annotation must contain certain data (mentioned in article 24 of the Statute). The Register, considered the center of the system, is integrated by three particular Registers: the Register of Property, the Register of Mortgages and Liens and the Register of Prohibitions to alienate; all of them are annual. In the first book transferring of ownership will be registered, that is, the transferences, transmissions and acquisitions by prescription (the prescription is a means of acquiring other people's things as a result of having owned them during certain time, and when other legal requirements concur (article 2492 of the Civil Code of Chile)). In the second, the mortgages, the rights of usufruct and use, the right of way and other similar liens. In the third, the prohibitions to alienate. Each partial Register contains an index by alphabetical order with the names of the contracting parties; this index is of special practical importance for the location of the registrations and contributes to characterize the Register (when adhering it to the personal folio system). In addition, in an appendix of this index the documents added at the end of each Register will be inventoried. The General Index, along with the indices of each partial Register, allows the operation of the system since through them the registrations (through their holders) are located and the history of the real estate using some elementary data can be reconstructed. It is ordered by alphabetical order of the contracting parties, and it is formed as the registrations are entered in the three Registers. It is also annual. c) The Registry is public, and the Registrar is forced to give the requested copies and certificates. If the certificate contains an error, the responsibility is of the Registrar. These certificates constitute indispensable elements for a negotiation on real estate. In them it is the formal communication to the interested party in acquiring the dominion or another real right, on the legal status of the real estate. That is why they are demanded for the study of titles, prior to the business. d) As per the responsibility of the Registrar, it is defined basically by the attributions of control conferred by the Statute; these arise from the causes by which he must refuse to register, contained in articles 13 and 14. According to those causes his attributions of control of the validity and effectiveness of the titles are not very ample; and as far as the correspondence between the description of the estate in the title and its real characteristics, he simply lacks control. For this reason, he guarantees neither this congruity between the title and the material characteristics of the estates, nor the quality of authentic proprietor that can have the one who appears as owner in the registration (except when he is forced to refuse to register, according to the mentioned rules). This characteristic is fundamental in the organization of our registry and also basic for its qualification. Then, his responsibility as an officer is defined in the normative set that regulates his functions, attributions and discipline. Basically, those norms are: the Statute (with special influence of articles 13 and 14, and 96 to 98), and the CCO (articles 446 ff plus the norms of the Notaries, if they were applicable, according to article 452, 530 and following articles); and as far as indemnity by damages to individuals in the performance of their functions, the rules of article 2314 and following articles of the Civil Code must be added. The criminal responsibility is governed by the norms of the respective Code, especially those relative to crimes committed by officers in the performance of their duties. e) As far as the remuneration, he does not receive fiscal payment but tariffs that he charges to the interested parties for the proceedings that take place there (with them he also pays the employees that collaborates with him). All that has been said is the theoretical frame of the registry system, but as it is read in the work of the Fueyo Foundation (2003) actually it happens that, except for the intervention of the Government in his appointment, and the attenuated control that on the registrars the judicial power exerts, the satisfaction of the public aim that is entrusted to them is diluted, as long as these officers develop their activity in a similar way to the one of any private businessman, who perceives by his services a remuneration, regulated in the respective tariff, without any other obligation in the financial area than paying their employees and to maintain the minimum operational conditions (premises, furniture, etc.). The tariffs established for the exclusive benefit of the registrars, which represent an enormous income, make these positions extremely coveted, and at the same time it is theoretically- possible the formation of a true group of pressure, which makes the reform of the system thus conceived difficult. This business-like organization limits the possibilities of selection and promotion of the personnel: it does not exist promotion or the qualification by merits, and neither the professional improvement nor the competence in the exercise of the function is stimulated. The Government of Chile aware of this reality, which does not agree with the socioeconomic development that the country has reached, has undertaken the task of a great reform of its registration system and if it works it can be followed by other countries of the region to update their old registration systems (Barnes et. al. 2000). The reform focuses on three matters: i) the substitution of the personal folio system for the real folio (property-based folio), ii) the creation of a Superintendence for the control of the Registrars, and iii) the obligatory incorporation of information technologies in its performances. The degree of "legality" of the Registry is accurately defined with these modifications; this aspect is very important for the improvement of a Registry and cannot be forgotten when promoting any innovation. Among the widely-known principles of a Territorial Registry is the one of "the legality" by virtue of which attributions of preventive control are entrusted to the officer on: 1º) the existence and legal status of the recordable right (with determination of the validity and effectiveness of the titles which constitute the legal antecedents for the registration), and 2º) the congruity between the description of the estate in the title and the characteristics that presents in the reality. The preventive control is integrated by a set of precautions for the entrance of a right to the Registry and then for its successive transferences (that constitutes the legality). When for the first time an immovable property is incorporated to the system a rigorous examination of its legal antecedents must be carried out, that demonstrate its ownership and present status of the right (with special pronouncements on the validity and effectiveness of the titles, in substance and form) and of the congruity between the description of the estate in the title and its real physical characteristics (specially of its surface, demarcation and surrounding area). For this last objective it is required the organization of a local cadastre and a plan of each estate. The future transferences or liens (that with that initial control will be registered more expeditiously), will also be surrounded by precautions that continue assuring the indubitable character of the system. This control can be given in a first instance to the Registrar, with the possibility of an appeal to a higher ranked officer, or to the judge (ordinary). The Chilean system shows a little "legality". According to the Statute the attributions of the Registrar are limited in relation to the examination of the titles that are presented to him for registration; and frequently there are misalignments between the data of the estate contained in the registration and its material characteristics (by the lack of attributions of preventive control and exigency of a plan) (Peñailillo 2006). 3. SUBSTITUTION OF THE PERSONAL FOLIO SYSTEM FOR THE REAL FOLIO. Types of registers or folios. Basically, and if the Registry is organized based on the subject (people) or object (estates), two technical varieties, which will lead to the adoption of the personal folio system, in the first case, or to the real folio system, in the second are distinguished. The personal registers are kept by the names of the proprietors, whereas the real ones are ordered by estates. Personal folio or indirect registers. In this type of registers, the registrations in books are entered by chronological order, organized in alphabetical progression, by the names of the holders. In this system, the axis of the registration publicity is the person, that is, the registry holder, instead of the property. It is the option of the French and Italian traditional systems, although the first one has approached the technique of the real folio, through the incorporation of the "real estate files". In this registration technique, which has been strongly criticized in the compared jurisprudence, the registration procedure and the preparation of the indices are made taking care of the identity of the holders, leaving aside the physical identity of the real estate. The subject and not the object of the right is the orientation and determining element of the system. The personal folio presents the serious disadvantage of making difficult and slow, even unsafe, the total knowledge of the legal status of each immovable property, since, as it is the person of the proprietor and not the property the one that serves as foundation to the registration and determining element to individualize it by the interested party, the registrations are dispersed in the many registers that are constructed with the years. That difficulty even subsists in spite of the existence of more or less complete indices that, although facilitate the work of the interested party when the name of the holder is known at least approximately, make a little less than impossible know the legal situation of the real estate when it is only known its location and demarcation, and there is no antecedent respect to the people who claim to be the holder of the title. In Latin América, Bolivia, Cuba, Ecuador, Venezuela and Chile (Fueyo 1991, 1973) adhere to the personal folio. But the most remarkable fact is that the use until today of the personal folio in these countries does not mean a preference, but difficulties of diverse nature, lack of will or inertia, that maintain the current status. Real folio or direct registers. Here the Register works based on the assignment to each property of an independent sheet or particular register, that constitutes its matriculation and in which all its legal history is concentrated. As it is well explained in the work of the Fueyo Foundation (2003) the real state constitutes a fixed object, visible, tangible and naturally immutable. What changes or can vary is the person of the proprietor. In order to organize the Register around a firm and stable element, and that at the same time can provide an exact knowledge of the relations incorporated to the Register, nothing better than doing it based on the real state, that indeed provides the solid and lasting foundation that the registration publicity requires. That emphasizes the inconsequence that means to try the stability of the rights based on real estate, if at the same time an element of instability is introduced, which is the consideration of the person of the holders, an essentially variable antecedent. These ideas build up the criterion that justifies the positive consecration of the real folio system. The legislations of Switzerland, Germany, Spain and Argentina, among others adopt the real folio procedure. With slight variants, they all present a common characteristic, consisting of opening to immovable property a folio or independent sheet in the Register, recording in the same sheet all the successive transferences, liens and prohibitions that are recorded after the first registration, this way definitively disposing of the chronological-personnel technique, specially undertaken by the French system. In the Spanish system all the registrations that affect the real state are entered one after the other, in the same folio (compound of several blank sheets, without special sections for the right and the limitations). In the German regime, however, the real estate sheet is divided in sections, in which transferences, liens and mortgages are written down respectively. Each section consists of three columns, in which the constitution, modifications and cancellations are written down. The article 3º of the German Real Estate Statute consecrates this principle, called grundbuch, independent sheet or specialty. The real estate sheet consists of 6 folios (12 pages). Each registration sheet of this notebook -in which the front page is the cover and the last one is blank- consists of two parts: the first contains the description of the real estate, and the second the mutations of the same, divided in three sections destined respectively to the ownership, the burden and limitations and the mortgages and liens. Germany (Friedmann 1935, Pau 1982), Switzerland, Australia (Casado 1959), Spain, and in general the more advanced countries in Real Estate Registry Law, use the technique of the real folio. Most of the countries in Latin America have been incorporating the real folio progressively, now only few countries are still attached to the anachronistic formula of the personal folio -among them Chile-, what makes the necessity of a reform more urgent, to adapt to the modernity that demands the real estate traffic in our days. The modern tendency towards the organization of the real folio system is overwhelming, determining the progressive change towards it of numerous systems that used to adhere to the personal folio. The technique of the real folio, as it was said, is based on the criterion to open to each immovable property a register or particular folio, specially destined to concentrate its legal history. But this unit of the registration folio has experienced some exceptions, with the appearance of new complex legal situations. The more frequent exception refers to horizontal property regulated in a different way in diverse legislations and that presents problems, essentially derived from situation of condominium in which a group of people shares certain goods and services of a building, but they exert exclusive ownership on a floor or department. Diverse doctrines have been proposed to explain the legal nature of this institution. The conclusion that predominates is that it coexist in it an independent property of the units with a common property of the ground and other common elements. For the registration effect, the consequence is that each unit independently considered of the building as a whole, could be object of a separated registration -without detriment of the main one, that includes all the building- in the Register. When opening a special sheet for each floor or department, it is possible a perfect identification, thus the main registration is not overloaded. The Spanish Act of 21 July, 1960 adopts this right procedure, subordinating the separated registration to that of the building, which has been previously entered. Other legislations, nevertheless, inspired by the apothegm "a single thing, a single right of property", and setting the institution of the horizontal property in the formula of the community or co-property, deny access to the register of the right of each proprietor of floors, authorizing the practice of a single registration of the set, recording as subregistrations or marginal annotations, the transmissions or modifications that affect the situation of each floor or apartment, this is complemented with the exigency of a plan, to orient better the party that consults the register. This real folio shows evident advantages with respect to the personal folio. The existence of a separated sheet for each immovable property allows the interested party to know with the single examination of the real estate sheet, the property, the liens, mortgages or other limitations that affect an estate; thus the system is simplified, errors are avoided, the objective of the publicity is facilitated and remarkable speed is obtained. For the same reason, the "Study of Titles" is facilitated, because with a single examination, all the property history is known. The search of the titles is reduced to the one of the sheet or folder. In sum, the real folio register increases access, speed and security. It is for that reason that several of the International Congresses of Registry Law, since 1972, openly recommend its application. 4. CREATION OF SUPERINTENDENCE FOR THE CONTROL OF THE REGISTRARS. In this respect Professor Hernandez (2003) says the State, besides taking part in the creation of the service and to regulate its operation, exerts super monitoring or trusteeship on the registrar through agencies of the Administration, to which the registrar is subordinated -like the Ministry of Justice in Germany, or the Treasury Department in France, or the Courts of Justice, in the case of Chile-, agencies which have the mission to control the good ministerial performance of the registrar, being able to make effective its responsibility in case he is not performing his duties properly. The registrars of real estate in Chile are appointed by the President of the Republic, out of a list of three candidates proposed by the respective Court of Appeals. In Chile nowadays there are 166 real estate registry offices With respect to the administrative, disciplinary responsibility or his responsibility as an officer, the registrars are subjects to the monitoring of the Court of Appeals (article 539, paragraph 2º, of the CCO), that can impose them the punishments that are specified in articles 537 and 542 of the same legal body (private reprimand, censures in writing, fines, suspension of functions for 4 months and even arrest for 8 days, commutable in fine). Our present system of control is not the right one, in the first place due to the overload of work of Courts which have exerted a tenuous control of the registrars. And secondly, due to the absence of an expert superior with attributions of control and able to set the criteria in the operation of the system. In the search of a suitable organism for an effective control of the registrars, the following alternatives have been analyzed by the people in charge of the reform. Situation in Spain. Head Office of the Registrars and Notaries. In Spain the offices of the Registry are distributed in territorial circumscriptions called demarcations, each one in charge of a Registrar of the Property, that has the character of government official dependent on the Ministry of Justice, through the Head Office of the Registrars and Notaries. The disciplinary responsibility due to the breach of their duties as officers becomes effective before this Head Office. This exerts the inspection and monitoring of all the Registries of the Property, and solves the administrative appeals that are filed against the qualifications that of the titles the registrars do. Proposal of Professor Hernandez. Creation of a Superintendence of Real Estate Registries. Hernandez (see Fueyo Foundation 2003:276) puts forward the following proposal: "With the intention of obtaining unit in the directive function, registration uniformity of procedures and techniques and the professional improvement suitable for the fulfillment of the function of the service, we propose the institutionalization of the Registry as a public service, organized under the mediate dependency on the Ministry of Justice and immediate of the Superintendence of Real Estate Registries, whose head will be a superintendent, who shall be the link between the Registry and the Undersecretary's office of Justice". As far as the basic organizational structure it proposes a service functionally decentralized. The Superintendence would exert the inspection and super monitoring of the Registrars of Real Estate distributed throughout the country, and progressively it could extend its competition to include also the notaries of all the territory. With respect to the career as an officer it suggests the supply of the positions of Registrars of Real Estate by competitive examination, which together with the hierarchic classification of the registry offices, according to the density of the population of the corresponding circumscription, would allow to improve the professional level of the registration function, when facilitating the promotion of those who demonstrate a greater capacity and competence in their respective rosters, whatever the territorial scope of the offices is. The competitive examination for the supply of positions would have to be regulated and controlled by the Superintendence. In relation to the control and supervising of the Registrars, integrated to the public function, although in a structure widely decentralized, they should be under the administrative responsibility, which can be demanded previous special disciplinary procedure, in which the gravity of the fault and its sanction should be graduated, as well as the agencies with disciplinary power, the applicable sanctions and the appeals. Such a mechanism would allow to exclude the Registrars -and eventually the notaries- of the qualification, pursuant to Title X of the CCO (Nº 3, paragraph 3º), thus the work load of the courts would be diminished, separating them from administrative functions alien to the jurisdiction. According to his opinion, this organization would allow to obtain unit in the directive function, as long as the Superintendence, as an eminently technical organism, would exert the super monitoring and inspection of the Registries of Real Estate and, mainly, the power to solve the administrative appeals filed against their acts, without detriment of the faculty to interpret the sense and reaches of the applicable norm in registration matters. The Superintendence would have special importance as an administrative instance in the qualification of legality of the titles. One of the most important attributions of the Superintendence of Real Estate Registries should be the administrative faculty of revision, so it would be able to know the claims and administrative appeals that arose against the resolutions dictated by the Registrars in the procedure of the qualification of the titles legality. For such effects this agency will constitute a second administrative instance, being the first the revision request presented before the Registrar who emitted the appealed resolution. The resolutions of the Superintendence, when pronouncing itself on the appeals filed before it, will undoubtedly contribute to the formation of valuable administrative precedents, faithfully fitting it to the spirit of the registration legal system. Only when the administrative route has been exhausted, the judicial remedies applicable could take place, before the ordinary courts, for which a special procedure will have to be regulated, brief and concentrated. It would be protected this way the constitutional guarantee of the due process of law as well as the efficiency and legality of the performances of the Registrar. Professor Cuneo (see Fueyo Foundation 2003) criticizes the creation of this agency. In his opinion the proposed Superintendence is not well defined, since it does not consider, among its functions, one that should be basic for the unification aims, to be the regulator, so as to produce obligatory norms, of general character. Proposal of the Association of Notaries and Registrars of Chile. Creation of an Office of the Notaries and Registrars. This organization proposes the creation of an Office of the Notaries and Registrars dependent on the Supreme Court that would have the special particularity to maintain within that perspective a specialized service dependent on the Judiciary, something like the Academy of the Judicial Power but directed only to the profession of notary and registrar. That Office is the one in charge of making the short lists for the appointment of the registrars with greater professional merits and those that indeed have made the advanced training courses necessary and that have the preparation sufficient to accede to this career. “We are certain that in this moment a career for registrar conceived in the strictly academic aspect or based on personal merits does not exist, even though it is contemplated in the law and we think that this is one of the forms to perfect it. We are certain that the career for registrar must exist and that the best form to do it is through this Office dependent on the Supreme Court of Justice” (see Fueyo Foundation 2003:385). This in addition would allow the uniformity that professor Hernandez proposes in his work, especially to avoid disparity in the qualification of the titles with respect to the same matters. In short, this uniformity of criteria should arise from this Office of the Notaries and Registrars, in the meantime is the Directory of the Chilean Corporation of Registration Law Studies the agency that performs that duty, but without obligatory power. This Office would be in charge of the qualification, preparation of the short lists and creation of a bank of registration data for the Registrars and of achieving a uniformity of criterion in the resolution of controversies since it will also have a resolutory function in relation to the claims that have been filed. This Office dependent on the Judicial Power will be the most adequate to exert such functions, maintaining the registration and notarial system in the scope of the Judicial Power. Commenting the previous proposal, Rojas (see Foundation Fueyo 2003), Real State Registrar of Santiago, says that this Office of the Notaries and Registrars must be a service dependent on the Supreme Court with the following functions: a) That administratively it must be in charge of the performance of the directive, correctional and economic faculties which our legal ordering gives to the Supreme Court in relation to notaries and registrars. b) That this office is the one in charge of making the short lists for the appointment of these officers according to the merit of each one and for the qualification to be made following a single criterion. c) That gathers the precedents of registration interest so as to go in the direction of the uniformity of the titles qualification, publicizing it and distributing to the registrars the corresponding instructions and norms of procedure. The creation of this office allows: a) Maintaining the registration and notarial system in the scope of the Judicial Power; b) Having an organism that exerts the directive, correctional and economic faculties according to the law and to the norms of the Supreme Court, and c) That, without detriment to the faculties that in such sense confers the law to the courts, it is this office the one in charge of the functions that according to the project proposed by Professor Hernandez would be those of the Superintendence whose creation is proposed, hence the Courts of Appeals will be free of their functions in relation to Registrars, Notaries and Judicial Archivists, maintaining, as it was said, these assistants of the administration of justice within the scope of the Judicial Power and under the custody of the superior courts of justice through this office. The Government of Chile in the reform that is going to introduce to the registration system is going to decide on the creation of a Superintendence in very similar terms to Professor Hernandez’s proposal. This agency is going to have the faculty to dictate general norms of obligatory character to obtain the uniformity of criteria in the qualification of the titles, will have the faculty to acquit consultations of the Registrars or users, it will control the Registrars and it will act like first instance in relation to the differences that take place between the users and the Registrars when the latter refuse to register, for some reason, a property. As Professor Hernandez accurately indicates: "the decentralized organization of the offices of the Registry of Real Estate, and their total autonomy respect to the Executive authority, has represented an impediment among us for the development of constant and specialized precedents respect to the qualification of the titles legality, since the harmed party due to the refusal of the Registrar must appear before the judge of first instance, who solves ´without delay` which corresponds, previous report of the Registrar. The possibility of appealing administratively before an specialized instance, would allow the affected party to solve such situations in a considerably short time, and with evident advantages from the technical point of view, laying way to the development of constant administrative precedents, that would undoubtedly diminish the work of the civil jurisdiction has venue today on the subject matter. That via would not exclude the option to appeal before the courts, against the resolution of the administrative agency of control of the Registrars" (see Fueyo Foundation 2003:180). A Report of the Chilean Chamber of Construction (2003) indicates: "a disparity of criteria has been verified in the qualification of the titles legality among the different Registrars. Even the Registrars interviewed in the course of the study have recognized such a situation. The present system allows the Registrars to differ with respect to the legal requirements and procedures, which creates a relatively chaotic situation and there is no effective security that a business will be able to be done in certain time, without objections from the Registrars in the registration process. Even more, some Registrars even have disparity of criteria within their same office, since their responsible employees can sustain different theories in determined cases, which produces still greater insecurity in the users, and increases the time of the registration if eventually the Registrar make any objection, which only can be solved with the intervention of a court, in agreement with the Statute that governs the performance of the Registrars". 5. INCORPORATION OF THE INFORMATION TECHNOLOGIES. The objective of the technological innovation that is going to be implemented is to make the registration system faster and more dynamic In an intercommunicated and technological world the legal institutions, among them the registry office, must adapt (Rojas 2000, 1988). The Registrars has the obligation to keep digital records. To keep digital records is the most adequate with respect to the necessities of the country, since it is within the modern tendencies of a "digital country". At the present moment, and with the advance of the corresponding technologies, it is possible to implement a modern system that saves time and resources to the public as to the Registrars. A highly sensitive question that arises is the following: must the information be contained in the Registries within the reach of everyone without any restriction? On this matter there are countries, like Chile, that guarantee the access to the information without restriction. To put all the information of the Registry at the users` disposition in Internet is attractive, but clearly risky. On the one hand, simultaneously diverse users in situ or far away without physically moving from a place to another can access to that information; a previous and remote study of titles is allowed before asking for the necessary Certificates and a reduction of the workload of the Registrars is accomplished. But, on the other hand, it is easy to access to personal and private information of a third person. For that reason, other countries, considering the protection of personal data, restrict the access to the Registers, for example article 221 of the Spanish Mortgage Act indicates: "the records will be public for those who have a well-known interest in finding out the status of real estate or real right registered". The solution is to place some type of filter to the access to that information. And a practical one consists of making it necessary to enter the number of “rol de avalúo” of the property (a number assigned in Chile for the property by the tax collecting organism) so as to access to the information of the Registry in Internet. What it cannot be allowed with the new norm is that with only entering the name or identification number of a person a third party can obtain complete information of that person’s patrimonial situation. Implementation of a digital real folio. Today in the Chilean system, as has already been said, the Registry keeps three paper-based books: 1º Register of property; 2º Register of mortgages and liens, and 3º Register of prohibitions to alienate In the first the following is entered: transferring titles of ownership (purchase and sale contracts, exchange, contribution to a partnership, etc.) and the inheritance rights. In the second, the mortgages, the rights of usufruct and the right of way. In the third, the prohibitions to alienate (embargoes). In these three books or registers the basic information of each immovable property is repeated: location, demarcation and surface. The reform boosted by the Government intends that all the antecedents of the property be registered in a single section called "Description of the Real Estate" (avoiding useless repetitions), reserving other three sections for what until now has been registered in the three separated registers, with the difference that all the sections will be in a single computerized file and no dispersed in three manual registers as it happens at the moment. All the registration data concerning each property will improve the publicity when consisting in a single electronic document. Digital records will avoid the degradation and insecurity of paper land records. Obligation of the notaries to send the deeds electronically to the Registrars. The deeds in which properties are transferred will be sent electronically by the Notary to the Registrar. It must be taken into account that in Chile to acquire the ownership a title is required (contract signed before Notary) and a means of acquiring (registration in the office of the recorder). This will allow shortening the time between the subscription of the deeds in the Notary's offices and their record in the Real Estate Registry. It is wellknown that the users often by ignorance or lack of resources, once the deeds have been signed do not take them to the Real State Registry, then affecting the legal security which is the last objective of the Land Registry Law. The shorter the time between the subscription of the deed and the registration, the better the legal traffic, the routes of access to the credit and the efficiency in the proceedings. The reform forces the Notaries to request immediately the registration to avoid its delay, in addition to other difficulties, like the permanent congestion of the offices of the Registrars that makes difficult the access of the users to the records and that makes the legal proceedings slower. We say that it will help to avoid the delay of the registrations since our registration system is of "inscriptions" and not of "transcriptions". The first ones are extracts or summaries of the exhibited titles. The second ones consist of complete copies of these titles. When the Registrars have the deeds in digital form they will see their work enormously simplified, making the registration process easier, because today some Registrars are extracting the information manually from the deeds or scan them leaving only the antecedents that are required for the registration. 6. OTHER REFORMS. In addition to the incorporation of the real folio, the creation of a Superintendence for the control of the registration system and the massive incorporation of computers and Internet for its better operation, the reform will also deal with the fees of the Registrars, their appointments and their faculties in the examination of the legality of the titles. The reform tries to diminish the transaction costs (fundamentally the price charged to the users for recording their properties in the registry). For this effect it is proposed that every five years, by means of decree of the Ministry of Justice, the fees that the Registrars can charge, be settled previous consultation to the Association of Notaries and Registrars. This mechanism is in some way similar to the one used today for the regulation of tariffs on the part of the authority in regulated sectors, like electricity, telephony, etc. in which every certain period the authority discusses with the companies of the sector the tariffs that will prevail for the following period. The participation of the Registrars in this process would help the fees that are settled be respected, because at the moment, the existence of the fees settled unilaterally by the authority- are not often respected and the users have to pay higher fees than the ones settled by the authority. With respect to the appointment of the Registrars, considering that the present system of appointment (short list elaborated by the respective Court of Appeals and appointment by the President of the Republic) has not worked suitably (lobby to integrate the political short lists, political considerations in the appointments, etc.); in order to alleviate the work load of Courts and because the Registrars do not perform a properly judicial function the reform gives the appointment of these officers, previous competitive examination, to a commission of the highest level integrated by a Judge of the Supreme Court, a Dean in exercise of Faculties of Law and the Superintendent of Notaries and Registrars. The chosen candidate will have to be ratified by the President of the Republic. The faculties of the Registrars in the examination of legality of the titles (Varas 1989, Villalobos 1994, Fuentes 2001) are also part of the reform. As has been noted one of the greater defects of the Chilean registration system is its little "legality". In fact, even though article 13 of the Statute indicates that the registrars can reject the registration of a title in their registers when it is "legally inadmissible" (vague and inaccurate formula), the Registrars have exerted this faculty in very diverse form, because some of them attributing themselves the role of a judge make an analysis of the content of the titles, whereas others merely make an examination on the form of such titles. As the subject of the legality is not dealt with, probably in a next reform, the present one clarifies the category of attributions and arranges that the Registrar has only attributions of registration control (formal). 7. CONCLUSION. The reforms that have just been described, plus others to come, aim in the right direction of updating the land registry process (i.e., digitals deeds and registers) and of removing disincentives such as the high transaction costs, lowering the Land Registry's fees. This will contribute to provide stability to landownership, confidence to foreign investors, will dinamizar the real state market and reduce the non formal transactions; in few words, will increase the public trust in the registry system. About the Author Joel González is a Professor of Civil Law and Researcher at the Catholic University of Chile, Master in European Union Law from Universidad Complutense de Madrid, Spain, and Master in Business Law from Catholic University of Chile. He is the author of many articles and three books: “Comfort Letters” (2002), “Limited Liability Sole Proprietorship” (2003) and “Chilean Index of Private Law” (2006). 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