Innovative Blockchain for Notary’s Offices

The notary ecosystem in Brazil is composed by almost 12 thousand notary offices, and, despite earning more than R$ 14 billion in 2017 they began to struggle with the pressure of Digital Transformation. In an environment with still a lot of manual processes and bureaucracy, the use of automation grows to fill the gap during the last years, transforming the Brazilian notary system into one of the most efficient and low cost of the world, but with a long way ahead.

This is the perfect environment to foment innovation, and its where the Notary Ledgers Solution lies. Been built by Growth Tech (growthtech.com.br – an IBM Business Partner) Notary Ledgers is a solution that allows the realization of services in virtual environment, where all transactions are validated and registered in a blockchain held by several Brazilian Notary´s Offices, with different assignments.

The 12 thousand notary offices in Brazil are divided in 7 types, and each type has its own list of services. In addition, we have entire teams in large companies, engaged in legal and notarial proceedings, interacting with these offices. This shows the complexity of the ecosystem, which is extremely regulated and naturally conservative.
Today, many paperwork transactions are not yet made for many problems, and the required bureaucracies are one of the most representative. To give you an idea, 59% of the properties in the city of Campinas (a city in the interior of São Paulo and one of the largest Brazilian municipalities) are not registered in a notary’s office.

As a Blockchain solution, Notary Ledgers is counting with the collaboration of some important players of the Brazilian ecosystem. The project already includes 5 notary offices, including the 15o Ofício de Notas, which is the biggest Notary Office from Rio de Janeiro city, and the third from Brazil. Other offices are being included soon. Important regulators of the segment are also inside the discussion.

The Notary Ledgers solution has a three objective pillars:
• Significantly improve the experience of the end user (individual or legal), since the notary services can be carried out in a virtual way and without the need to go to a physical registry and all the factors associated with the possible displacement.
• Ensure greater security and transparency for transactions. With the blockchain technology the platform can provide the immutability of records and the use of a shared ledger.
• To increase the scope of the activities of notaries in general transactions in the Brazilian market, since, through a digital structure, the notaries can integrate with other systems and processes of companies and institutions in general – still considered a “virgin market “, not served by the notary offices yet.

Reducing costs in a notary’s operation is promising. The biggest reduction would be in personnel (scribes, mainly), which today represents 50% of the office’s monthly costs,
where we can add the infrastructure costs (rental, physical space, etc) representing more
10% of monthly costs.

According to studies done with the 15o Ofício de Notas, we can estimate that the solution
can help reduce total monthly costs by 55%.

The solution is in pilot phase, including 5 notary offices: 15o Ofício de Notas, RCPJ-RJ (Civil Registry of Legal Entities of Rio de Janeiro), 5o Registro Cívil de Pessoas Naturais RJ, 3o Ofício de Justiça de Duque de Caxias RJ, and 4o Tabelionato de Osasco.

At this stage, each Notary represents a Blockchain node:

In the next step, we will have different channels for each notary service and regulators as members of the blockchain:

The technical solution includes custom front ends for each node, as well as the back end, considering the service performed and the validations to be run.

The entire solution is already running on the IBM Cloud, and new capabilities, including the Watson APIs and Digital Business Automation solutions, are being considered to power front ends and back ends, further enhancing the user experience.

Today, a digital ID creation flow is already running in the platform. Involving the 15o Ofício de Notas and RCPJ-RJ, and using validators like SERPRO (Federal Data Processing Service) for CPF/CNPJ (Natural Persons Register / National Registry of Corporations) and facial recognition.

Fernanda Leitão is the notary head of 15o Ofício de Notas, and her innovative vein is contributing at the project engagement.
“The new configuration in the mode of acting of the Brazilian notaries strengthens the movement of technological disruption. The shift from the traditional to the avant-garde model responds to the aspirations of the new society.” – according to her.
Fernanda also guarantees the role of the notary’s offices remains essential: “Public faith is being fully preserved, since all actions continue to be validated and mediated by the notaries, just as in physical environments. This will undoubtedly guarantee greater legal certainty for acts and services performed in the digital environment.”
In early 2019, the solution will start operating and will be open to subscriptions. Other entities are being involved and looking for it.

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