Australia: how identity and client authority are checked in a sale

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Kooky

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In an electronic property transaction in Australia, the buyer and the seller never sign the transfer themselves. Their conveyancer or lawyer signs it for them, digitally, inside an electronic lodgment network. That one fact explains why a client is asked for a passport, a rates notice and a signature on a fixed form well before settlement day: the land registry is relying on the practitioner's word that the right person, with the right to the land, gave the instruction.

The duties behind that paperwork sit in the Model Participation Rules published by the Australian Registrars' National Electronic Conveyancing Council, known as ARNECC, and in the guidance notes ARNECC publishes alongside them. This guide walks through what those documents require: whose identity is verified, what "reasonable steps" means, how the Verification of Identity Standard works, what the client authorisation form is and is not, how right to deal is checked, and how long the evidence is kept. It closes with what the registrars of New South Wales and Victoria publish on the same subject.

ARNECC Model Participation Rules, Version 7, dated January 2024: Rules 6.5.4 and 6.6 and Schedule 6.

Where the rules come from

ARNECC's publications page lists the versions of the Model Participation Rules, from Version 1 in April 2013 to Version 7, published in January 2024. Rule 1 of Version 7 says the rules constitute the participation rules determined by the Registrar under section 23 of the Electronic Conveyancing National Law. In other words, the model text is national, and the registrar of each state or territory is the one who makes it binding there.

The rules speak of a Subscriber, the person or firm that has signed up to use an electronic lodgment network. A Subscriber that acts for someone else is a Representative, and the person who appointed it is the Client. The obligations covered in this guide are found in Rule 6: Rule 6.3 on client authorisation, Rule 6.4 on right to deal, Rule 6.5 on verification of identity and Rule 6.6 on supporting evidence.

ARNECC also publishes nine guidance notes to the rules. Its guidance page lists all nine as Version 7 documents published on 23 August 2024. Four of them matter here: Guidance Note 1 on client authorisation, Guidance Note 2 on verification of identity, Guidance Note 4 on right to deal and Guidance Note 5 on retention of evidence.

Whose identity has to be verified

Rule 6.5.1 lists six groups of people whose identity a Subscriber must take reasonable steps to verify. Two of them are the public face of the rule: clients, and borrowers who are granting a mortgage. The others concern the people inside a firm who use the lodgment network.

A Client Agent is someone who signs for the client. Guidance Note 1 gives the examples of an attorney acting under a power of attorney and an officer of a company.

For mortgages, the rule places the duty on the lender. A Subscriber acting for a mortgagee does not have to repeat the check where the mortgagee has already done it; the rule carries a reliance exception for that case. The third row of the table is narrower than it looks: Schedule 1 of the rules says paragraph (c), on certificates of title, does not apply in New South Wales, South Australia, Tasmania, Western Australia or the Australian Capital Territory.

Reasonable steps, and the Standard as a safe harbour

The rule does not say "collect these documents". It says "take reasonable steps". Guidance Note 2 explains the phrase at section 5.1: reasonable steps are the steps an ordinarily prudent Subscriber or mortgagee would have taken in the circumstances. Whether they were taken is a question of fact that a court decides objectively.

Rule 6.5.2 then offers two routes. A Subscriber may apply the Verification of Identity Standard set out in Schedule 8 of the rules, or verify identity "in some other way" that amounts to reasonable steps. Guidance Note 2 says plainly that the Standard "is not mandatory".

What the Standard gives is certainty. Under Rule 6.5.6, compliance with it is deemed to be the taking of reasonable steps. That is the safe harbour: a practitioner who follows the Standard properly does not have to argue later about whether the method was prudent. The guidance note adds a caution at section 5.7. If there is a dispute, it is the Subscriber who must prove the Standard was properly applied, which is why the paperwork from the interview is kept.

The safe harbour has a limit. Rule 6.5.6 is "subject to" Rule 6.5.3, which requires further steps where the Subscriber knows, or ought reasonably to know, that an identity document is not genuine, that a photograph is not a reasonable likeness, or that the person does not appear to be the person the document relates to. It also requires further steps where it would otherwise be reasonable to take them.

The face-to-face interview and the document categories

According to Guidance Note 2, the Standard is built around a face-to-face, in-person interview. Both people are physically present, and the identity documents are sighted as originals. The documents must be current, with one exception the note spells out: an Australian passport that expired within the last two years can still be used.

The documents are grouped into six categories. Guidance Note 2 describes how the ladder works rather than leaving the choice open. Australian citizens and residents use Categories 1 to 5. People who are not Australian citizens or residents use Category 6. The verifier must use the highest category the person can meet, and may drop to a lower one only where the person does not hold the documents of the higher category, where those documents have expired, or where the Australian passport on offer expired more than two years ago.

Category 5 is the last rung for residents who cannot produce the documents of the categories above. It relies on an Identifier Declaration, which the guidance note describes as a statutory declaration made by someone who knows the person being identified. The person making it, called the Identity Declarant, must have their own identity verified under the Standard, and cannot themselves be verified through another declarant. The note's examples of declarants include doctors, nurses, police officers, teachers, employers and community leaders.

Names have to line up. Where the documents show different names because of a legal change, a change of name certificate or marriage certificate is produced.

The exact list of documents that makes up each of the six categories is set out in a table in Schedule 8 of the rules. That table could not be read for this guide, so the combinations are not reproduced here; the structure above is as Guidance Note 2 describes it.

Identity agents and clients abroad

A practitioner does not have to conduct the interview personally. Rule 6.5.5 allows a Subscriber, or a mortgagee it represents, to use an Identity Agent. The rules define that as a person appointed in writing, whom the Subscriber reasonably believes to be reputable, competent and insured.

Guidance Note 2 sets out the mechanics. The appointment is made in writing before the agent meets the person, and it directs the agent to use the Standard. After the interview, the agent hands back copies of the documents it sighted, each signed, dated and endorsed as a true copy, together with an Identity Agent Certification in the form of Schedule 9.

The insurance requirement has numbers attached. Schedule 6 of the rules requires professional indemnity and fidelity cover, or professional indemnity cover that extends to third-party dishonest and fraudulent acts, with an approved insurer and covering the verification work. The insured amount is at least A$1,500,000 per claim, the excess is no greater than A$20,000 per claim, and the annual aggregate is not less than A$20,000,000.

Guidance Note 2 observes that a Justice of the Peace typically lacks the required insurance, and that one Subscriber normally cannot rely on a certification given to another Subscriber.

For a client outside Australia, the guidance note gives one option, an Australian consular office, where a consular officer checks that the photographs are a reasonable likeness, endorses the copies, witnesses signatures and completes the certification. The note says using a consular office is not mandatory.

When an earlier check still counts, and when more is needed

Rule 6.5.4 spares a returning client from being interviewed for every matter. A Subscriber need not verify again where the person was verified within the previous two years, provided it takes reasonable steps to make sure it is dealing with that same person. Separately, a client or Client Agent under a current client authorisation is not verified again if the check was done before the Subscriber digitally signed for the client under that authorisation. Once that authorisation has expired and the check is more than two years old, the note says a fresh verification is required.

A worked example, with assumed dates: a vendor was verified on 1 March 2025 for a sale. The same firm is instructed on a purchase on 1 November 2026, twenty months later. The earlier check is inside the two-year window, which runs to 1 March 2027, so the firm may rely on it if it takes reasonable steps to confirm it is dealing with the same person. An instruction arriving on 1 April 2027 would fall outside the window.

The other side of the rule is the duty to do more when something looks wrong. Section 5.5 of Guidance Note 2 lists circumstances that may call for further steps:

• the person has very limited identity documents and no explanation for it;
• a document has been cancelled;
• signatures differ between the identity documents and the client authorisation or the mortgage;
• the supporting documents of someone acting as an agent are inconsistent;
• the transaction is urgent, the instructions are in doubt, the mortgage is a non-standard one over an unencumbered title, or the person has limited English.

The further steps the note suggests are examples, not a fixed list: asking for more documents, making enquiries, verifying documents electronically, or bringing in an independent interpreter.

The client authorisation form

Identity answers the question "who is this?". The client authorisation answers "what have they asked the practitioner to do?". Guidance Note 1 explains why it exists: clients cannot sign through an electronic lodgment network, so a conveyancer or lawyer who represents a client there needs a document that authorises them to act.

The note stresses that a client authorisation "is NOT a power of attorney". It lets the Representative sign registry instruments and documents, present them for lodgment, and authorise or complete the financial side of the transaction.

Rule 6.3 fixes the essentials. The form must substantially comply with Schedule 4 of the rules. It must be entered into before the Representative digitally signs any electronic registry instrument or document. The Representative must act within its terms, take reasonable steps to verify the authority of each person who signs it for the client, and take reasonable steps to make sure it is signed by the client or the Client Agent.

"Substantially comply" is read narrowly. According to Guidance Note 1, the form stands alone, its words cannot be changed, and only superficial variations of format or style are allowed. It cannot be folded into a retainer, and it cannot be varied by another arrangement such as a lender's panel agreement.

Schedule 4 provides three kinds of authority.

Under the form's revocation term, either the client or the Representative may end the authorisation by written notice to the other.

There are cases where no form is needed. Rule 6.3 makes it optional for caveats, priority notices and the extension or withdrawal of priority notices, although the practitioner must still take reasonable steps to verify the authority of whoever gives the instructions.

Who signs the authorisation, and what ends it

Guidance Note 1 works through the common structures. Where an attorney acts, the form is completed in the name of the person who gave the power, and the attorney signs as Client Agent. Where the client is a company, its officers sign as Client Agents, and each company has its own form. Signing under section 127 of the Corporations Act is not mandatory, the note says, but it gives the practitioner the benefit of the assumptions in section 129.

Guidance Note 1 says there is no requirement for a wet signature, and leaves it to the Subscriber to determine whether electronic signing complies with the relevant Electronic Transactions Act.

Events can end an authorisation as surely as a notice. The death of the client ends it, the note says, with an exception in South Australia under section 59 of that state's Real Property Act 1886.

Right to deal: linking the person to the land

A genuine passport proves who someone is. It does not prove they own the house. Rule 6.4.1 therefore adds a separate duty: for each conveyancing transaction, a Representative must take reasonable steps to verify that its client is a legal person and has the right to enter into the transaction. Rule 6.4.2 puts the equivalent duty on a mortgagee for each mortgage.

Guidance Note 4 defines right to deal as "the entitlement of a Person to be a particular Party to a Conveyancing Transaction". The test is whether the evidence links the transacting party to the land.

For a party on the way out, a vendor or a borrower, the note lists a current council rates notice, current utility bills for the property, a current land tax assessment notice, loan documentation, the existing mortgage, and the certificate of title or a recent registration confirmation statement. For a party on the way in, a buyer or a lender, it lists the contract of sale and loan documentation. A title search is obtained to confirm who is registered.

Two cautions run through the note. Reliance on any one document is not conclusive evidence. And a duplicate certificate of title shows that someone has access to the title, not that they have the right to deal with the land.

Particular capacities raise particular questions. For an executor, whether the transaction is contemplated by the will. For an attorney, whether the power is still current and whether attorneys act jointly or severally. For a company, whether it exists as a legal entity, checked for example through a search of the corporate regulator's register and a review of the constitution. For a trustee, whether the trust permits the transaction and who the current trustees are.

Keeping the evidence for seven years

Rule 6.6 requires a Subscriber to keep the evidence supporting a registered or recorded document for at least seven years from the date of lodgment. The rule lists what falls within that: the client authorisation and what supports it, the evidence of identity verification, the evidence of right to deal, evidence of compliance with other prescribed requirements, and anything the duty authority requires.

If an Identity Agent did the interview, Guidance Note 5 says the written appointment and the Schedule 9 certification are kept too.

For a standing or batch authorisation the clock starts later. Guidance Note 5 says the seven years run from the last conveyancing transaction lodged under it, and for a standing authority from the last one lodged before it was revoked or expired.

A worked example, with an assumed date: a transfer is lodged on 10 October 2026. The supporting evidence is kept until at least 10 October 2033.

The evidence may be electronic or paper, and may be held by the Subscriber or by an agent on its behalf. The condition the note sets is that it be accessible, legible, and safely and securely stored.

The registrar may ask to see it. Guidance Note 5 explains that the Registrar can conduct a compliance examination following a request or complaint from any person, or on the Registrar's own initiative. The guidance notes read for this guide do not set out the consequences of falling short.

What New South Wales and Victoria publish

The same duties appear in state instruments, in the state's own words.

In New South Wales, the Registrar General's Conveyancing Rules are made under section 12E of the Real Property Act 1900. Version 5, the version read for this guide, took effect on 15 May 2019. Its Rule 4.1 mirrors the national text on reasonable steps, the Standard and the two-year window; Rule 4.3 covers right to deal and Rule 5.2 the seven-year retention period from lodgment.

Some provisions are specific to the state. Under Rule 4.4, for mortgages executed on or after 19 May 2017, a mortgagee that follows the Standard is treated as having taken reasonable steps to identify the mortgagor. Rule 11 requires a client authorisation to substantially comply with Schedule 4 of the participation rules, and says the only paper document that can be signed under one is the National Mortgage Form. Whether a later version of the Conveyancing Rules has since replaced Version 5 was not confirmed for this guide.

In Victoria, the land registry's page on verification of identity, last updated on 20 May 2026, says the Registrar of Titles has formalised requirements for both electronic and paper conveyancing transactions. All parties to a conveyancing transaction must have their identity verified. A conveyancer or lawyer is responsible for verifying a client they represent, and a mortgagee must verify its mortgagor. The page points practitioners to the Victorian participation rules, listed there as Version 7.

Victoria also deals with the person who has no representative. According to the same page, a non-represented party who must sign a conveyancing instrument has their identity verified by Australia Post. A specific form is used, and only that form; it is completed but left unsigned and taken to a post office offering the land title identity check service.

The registry never meets the client. It relies on a practitioner who did, and who can still show how seven years later.

Kooky, from Shaka

Kooky edits Agents Estate and builds Shaka, the payment router he made for real estate professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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