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TN Emergency Rules (2019)

Rule/Regulation

State: Tennessee

Effective: July 01, 2019

Summary

The Tennessee Secretary of State has issued emergency rules to implement online notarization.

Affects

Creates Chapter 1360-07-03 of the Rules and Regulations of the State of Tennessee.

Changes

Online Notary Commission

  1. Provides that a person who has been previously commissioned as a Notary by a county legislative body, and who meets the qualification requirements for commissioning as a Notary, may apply for commissioning as an online Notary.
  2. Requires the application for commissioning as an online Notary to include the applicant’s: (a) legal name as listed in the records of the county where the applicant is commissioned as a Notary;  (b) Tennessee physical address (street address, city, state, and zip code) as is on record with the clerk of the county in which the Notary is commissioned (the applicant may provide a post office box number for purposes of receiving mail from the Department of State, but must also provide a physical address); (c) valid email address; (d) Tennessee county where the applicant was commissioned as a Notary; (e) Notary commission date; and (f) Notary commission expiration date.
  3. Requires the application for commissioning as an online Notary to include the following information regarding the technology the applicant will use: (a) the name of the vendor and electronic technology or technologies to be used in attaching or logically associating an electronic notarial certificate, signature, and seal to an electronic document; (b) the name of the vendor and electronic technology or technologies to be used in conducting identity proofing and credential analysis; (c) a copy of the applicant’s unique electronic notarial certificate (otherwise known as a digital certificate) or other technology for rendering a notarized electronic document tamper-evident; (d) a copy of the applicant’s unique electronic seal, in a file format acceptable to the Department; (e) a copy of any necessary instructions or techniques supplied by a vendor that allow the online Notary’s electronic notarial certificate and seal to be read and authenticated; (f) a copy of any necessary instructions or techniques supplied by a vendor that allow the online Notary to conduct identity proofing and credential analysis; and (f) an explanation of the methods and/or technology by which the online Notary will maintain and store the secure electronic records of all electronic documents notarized by the online Notary in accordance with Rule 1360-07-03-.03(8).
  4. Requires an applicant for an online Notary commission to certify that the applicant will comply with the following standards prescribed by the Secretary of State in the emergency rules.
  5. Sets an application fee of $75 for application as an online Notary.
  6. Provides that the Secretary of State will issue an online Notary commission and online Notary identification number to the applicant that must be used for reference in all communications between the online Notary and the Department of State.
  7. Requires an online Notary to provide the online Notary’s identification number to all principals for whom the online Notary performs an online notarial act.
  8. Provides that an online Notary may renew his or her online Notary commission by filing an application for renewal in the same manner and on the same form as if filing an initial commission application, no later than the expiration date of the online Notary’s current commission.
  9. Provides that online Notary commissions will terminate on the same date on which the county Notary commission terminates, unless both the county Notary commission is extended, and the online Notary submits an application for renewal which is approved.
  10. Provides that applications for an online Notary commission may be submitted online to the Department of State, Division of Business Services via the online portal established by the Department at sos.tn.gov.

Status Changes

  1. Requires an online Notary to notify the Secretary of State, on a form prescribed by the Secretary, of any change in address within 15 days of the date of the change.
  2. Clarifies that an online Notary who changes his or her address, such that the online Notary no longer qualifies for either a Notary commission or an online Notary commission, vacates the office of online Notary and must surrender the online Notary commission to the Secretary of State. 
  3. Allows an online Notary to change the name on the online Notary commission by notifying the Secretary of State of the name change on a form prescribed by the Secretary, along with a copy of a court order or other document verifying the change of name and updated copies of the online Notary’s electronic notarial certificate, electronic signature, and electronic seal showing the updated name.
  4. Provides that when an online Notary notifies the Secretary of State of a name change, the Secretary will then issue an amended commission to the online Notary in the updated name.
  5. Provides that upon issuance of the amended commission for a name change, the online Notary must only perform notarial acts using the updated electronic notarial certificate, electronic signature, and electronic seal bearing the updated name.
  6. Clarifies that before performing online notarial acts in a new name, an online Notary must first ensure that he or she has appropriately changed his or her name with respect to his or her Notary commission in the county in which the commission was issued before updating his or her name relating to the online Notary commission. 
  7. Provides that an online Notary who replaces or changes an electronic notarial certificate or electronic seal during the term of the online Notary commission must provide an updated copy of the electronic notarial certificate or electronic seal to the Secretary of State prior to conducting any notarial acts using the updated electronic notarial certificate or electronic seal.
  8. Provides that if at any time during the term of the online notary commission an online Notary elects to use a new vendor or technology or technologies to be used in attaching or logically associating an electronic notarial certificate, signature, and seal to an electronic document, the online Notary must provide to the Secretary of State the name of the vendor and electronic technology or technologies and a copy of any necessary instructions or techniques supplied by the vendor that allow the online Notary’s electronic signature and seal to be read and authenticated prior to conducting any notarial acts using the new vendor or technology or technologies. 
  9. Provides that if at any time during the term of the online Notary commission an online Notary elects to use a new vendor or technology or technologies for conducting identity proofing and credential analysis, the online Notary must provide to the Secretary of State the name of the vendor and electronic technology or technologies to be used in conducting identity proofing and credential analysis and a copy of any necessary instructions or techniques supplied by the vendor that allow the online Notary to conduct identity proofing and credential analysis prior to conducing any notarial acts using the new vendor or technology or technologies. 
  10. Provides that if the Secretary of State determines that an online Notary has not complied with the emergency regulations or the provisions of Tennessee Code Annotated Title 8, Chapter 16 related to online notarization, the Secretary of State must terminate the commission of the online Notary.  

Standards for Online Notarial Acts

  1. Authorizes an online Notary to perform authorized online notarial acts relating to electronic documents only if the principal personally appears before the online Notary at the time of the notarization; but also provides that personal appearance may be by means of an electronic two-way audio and video communication.
  2. Authorizes an online Notary to perform authorized notarial acts by means of an electronic interactive two-way audio and video communication only when the online Notary is physically located within Tennessee, without regard to whether the principal is physically located in Tennessee at the time of the online notarization.
  3. Requires an online Notary to require the principal to demonstrate, to the satisfaction of the online Notary, that he or she is not under duress and is not otherwise being coerced to complete the transaction, in order to preserve the integrity, security, and authenticity of online notarizations.
  4. Allows an online Notary to refuse to perform a notarial act when the online Notary has reasonable grounds to believe that the principal is acting under coercion or undue influence.
  5. Requires an online Notary to verify the identity of a principal at the time that the signature is taken by means of two-way video and audio conference technology.
  6. Provides that a principal’s identity may be verified by (a) the online Notary’s personal knowledge of the principal, or by: (b) remote presentation by the principal of a non-military, government-issued credential, which is an identification card or other document issued by the United States government, any state government, or a passport issued by a foreign government that has been stamped by the United States immigration and naturalization service, and which is unexpired, contains the signature and a photograph of the principal, and which is capable of credential analysis in accordance with Rule 1360-07-03-.05, credential analysis of the credential provided by the principal as set forth in Rule 136007-03-.05; and identity proofing of the principal as set forth in Rule 1360-07-03-.05. 
  7. Prohibits an online Notary to base identification of a principal merely on familiarity with a principal’s electronic signature or an electronic verification process that authenticates the principal’s electronic signature when the principal does not personally appear before the online Notary.
  8. Requires an online Notary to refuse to complete the performance of a notarial act when: (a) the online Notary has reasonable grounds to believe that the principal is acting under coercion or undue influence; (b) the online Notary is unable to verify the identity of the principal using the means and the standards identified in the emergency rules; (c) the online Notary becomes aware that the security of the two-way audio visual transmission is not secure; (d) the signature of the principal cannot be attached to the electronic document; or (e) the online Notary’s electronic notarial certificate and seal cannot be attached to the electronic document using an electronic technology which renders any subsequent change or modification to the document evident.
  9. Authorizes an online Notary to certify that a tangible copy of an electronic record is an accurate copy of the electronic record by also affixing his or her signature and seal to the copy of the electronic record in the traditional manner or other manner authorized by law, but only where the online Notary is capable of independently verifying the document is a true and correct copy of the electronic record.

Standards for Credential Analysis, Identity Proofing and Online Notarization Systems

  1. Requires identity proofing and credential analysis to be performed by a third party that has provided evidence to the online Notary of the ability to satisfy the requirements of the emergency rules. 
  2. Provides that for credential analysis a credential must be a non-military identification card or other document issued by the United States government, any state government, or a passport issued by a foreign government that has been stamped by the United States immigration and naturalization service.
  3. Provides that for credential analysis to be valid, a credential must also be unexpired and contain the photograph and signature of the principal.
  4. Provides that credential analysis must, at a minimum: (a) use automated processes to aid the online Notary in verifying the identity of a principal; (b) ensure that the credential passes an authenticity test, consistent with sound commercial practices that use appropriate technologies to confirm the integrity of visual, physical or cryptographic security features  and that the credential is not fraudulent or inappropriately modified; (c) use reasonable efforts to utilize information held or published by the issuing source or authoritative source(s), as made generally available for commercial purposes, to confirm the validity of personal details and credential details and provide output of the authenticity test to the online Notary; and (d) enable the online Notary to visually compare the following for consistency: the information and photo presented on the credential itself and the principal as viewed by the online Notary in real time through audio-visual transmission.
  5. Provides that identity proofing is the process by which the identity of an individual is affirmed by a third party through review of public and proprietary data sources.
  6. Provides that identity proofing is performed through dynamic Knowledge Based Authentication (KBA) through which the principal must answer a quiz consisting of a minimum of five (5) questions related to the principal’s personal history or identity, formulated from public and proprietary data sources.
  7. Provides that in a KBA each question must have a minimum of 5 possible answer choices; at least 80% of questions must be answered correctly; and all questions must be answered within 2 minutes.
  8. Provides that if the principal fails in his or her first KBA, the principal may retake the quiz one time within 24 hours with a minimum of 60% of the prior questions replaced; and if the principal fails in his or her second attempt, the principal is not permitted to retry with the same online Notary for a period of 24 hours.
  9. Provides that if the principal must exit the online notarization workflow, the principal must meet the criteria outlined in this section and must restart the identity proofing and credential analysis from the beginning.
  10. Requires an online notarization system used to perform online notarial acts by means of two-way audio-video communication to: (a) provide for continuous, synchronous audio-visual feeds; (d) provide sufficient video resolution and audio clarity to enable the online Notary and the principal to see and speak with each other simultaneously through live, real-time transmission; (c) provide sufficient captured image resolution for credential analysis to be performed in accordance with the emergency rules; (d) include a means of authentication that reasonably ensures only authorized parties have access to the audio video communication; (e) provide some manner of ensuring that the electronic record presented for online notarization is the same record electronically signed by the principal; and (f) be capable of securely creating and storing or transmitting securely to be stored an electronic recording of the audio-video communication, keeping confidential the questions asked as part of any identity proofing quiz and the means and methods used to generate the credential analysis output. 
  11. Requires an online notarization system to provide reasonable security measures to prevent unauthorized access to: (a) the live transmission of the audio-video communication; (b) a recording of the audio-video communication; (c) the verification methods and credentials used to verify the identity of the principal; and (d) the electronic documents presented for online notarization. 

Certificate of Online Notarial Act

  1. Provides that the electronic notarial certificate for an online notarization must contain a notation that the notarization is an online notarization, which may be satisfied by affixing the online Notary’s seal to the electronic notarial certificate.
  2. Provides that the acknowledgment contained within the electronic notarial certificate must also contain a statement that the principal “personally appeared before me by audio-video communication” or “personally appeared by audio-video communication” or “before me appeared by audio-video communication.”
  3. Requires an online Notary to complete and attach a unique electronic notarial certificate to all written notarial acts that identifies the principal, the date of notarization, the state and county in which the notarization was performed, that the notarial act was an online notarization, and the type of notarial act performed.
  4. Requires an electronic notarial certificate to be signed by affixing or logically associating the online Notary’s unique electronic notarial certificate (digital certificate), unique electronic signature, and electronic seal in a manner that is capable of independent verification and renders any subsequent change or modification to the electronic document evident. 

Electronic Signature and Seal

  1. Requires an online Notary to use the same unique electronic signature for all online notarial acts performed by the online Notary. 
  2. Requires an online Notary to use the same unique electronic seal for all online notarial acts performed by the online Notary.
  3. Requires an online Notary to provide a copy of the online Notary’s electronic seal to the Department of State at the time of the online Notary’s application for certification as an online Notary.
  4. Provides that the name on the online Notary seal must match the name, as stated on the application, under which the online Notary is commissioned and performs notarial acts.
  5. Provides that an online Notary must use an electronic seal that substantially conforms to the following design: a circular seal with the Notary’s name as it appears on the commission printed at the top, the county of election printed at the bottom, the words “State of Tennessee Notary” or “Tennessee Notary” printed in the center, and the words “Online Notary” printed below, followed by the online Notary’s identification number. 
  6. Provides that the electronic seal must also be accompanied by a statement of the date upon which the online Notary’s commission expires.
  7. Requires an online Notary to attach or logically associate his or her unique electronic signature and seal to the electronic notarial certificate in a manner that is capable of independent verification and renders any subsequent change or modification to the electronic document evident.

Technology Platforms

  1. Requires an online Notary to use technology from a third-party provider that has provided the online Notary with evidence of its ability to provide an electronic technology standard that utilizes Public Key Infrastructure (PKI) technology from a PKI service provider that is X.509 compliant.
  2. Requires an online Notary’s unique electronic notarial certificate, electronic signature, and electronic seal to remain within the exclusive control of the online Notary (including control by means of use of a password) at all times and shall be used only for the purpose of performing online notarial acts.  
  3. Requires an online Notary to provide any necessary instruction or techniques supplied by a vendor that allow the online Notary’s electronic notarial certificate and seal to be read and authenticated. 
  4. Provides that if at any time the online Notary adopts a new or additional technology or vendor with which to perform online notarial acts, the online Notary must notify the Department of State of the new or additional technology, signature and/or seal, as well as any additional information that may be requested by the Department.

Records of Online Notarial Acts

  1. Requires an online Notary or his or her properly designated custodian or repository to keep, for at least 5 years after the date of the transaction or proceeding, a secure electronic record of all electronic documents notarized by the online Notary.
  2. Requires the electronic record to contain all of the following information: (a) the date and time of the notarization; (b) the type of notarial act; (c) the type, the title, or a description of the electronic document or proceeding; (d) the printed name and address of each principal involved in the transaction or proceeding; (e) evidence of the identity of each principal involved in the transaction or proceeding in the form of: a statement that the principal(s) is personally known to the online Notary; or both a notation of the type of identification document provided to the online Notary for each principal and a notation that the principal(s) completed identity proofing and credential analysis procedures described by Rule 1360-07-03-.05; (f) a recording of the video and audio conference that is the basis for satisfactory evidence of identity and a notation of the type of identification presented as evidence; and (g) the fee, if any, charged. 
  3. Requires an online Notary to take reasonable steps to ensure that the two-way video and audio communication used is encrypted during transmission, through means such as a virtual private network (VPN), and secure from unauthorized interception.
  4. Prohibits an online Notary from disclosing any access information used to affix the online Notary’s electronic notarial certificate, signature, and seal, except when requested by the Secretary of State, law enforcement, the courts, or pursuant to an agreement between the online Notary and an electronic documentation preparation and transmission vendor, which agreement shall have in place reasonable precautions to prevent the unauthorized release of access information.
  5. Provides that an online Notary should ensure that all records relating to any individual transaction are securely stored using the Advanced Encryption Standard (AES) as a minimum encryption standard and that the principal’s personally identifying information or any government-issued identification numbers cannot be accessed by unauthorized individuals.
  6. Provide that an online Notary should refrain from recording, or take steps to obscure from the recording, any identification number that was assigned to the principal by a governmental agency or by the United States and any other number(s) that could be used to identify the principal. 
  7. Requires records of an online notarization to be retained, in a safe and secure manner, for 5 years following the date of the notarization.
  8. Requires an online Notary to maintain a backup of the electronic records for 5 years and to protect the record from unauthorized use.
  9. Authorizes an online Notary to elect to store recordings of online notarizations with a custodian or repository.
  10. Provides that recordings of online notarizations may be stored separately from the journal if the corresponding journal entry cross-references the place of storage and describes the manner in which the record is stored.
  11. Authorizes an online Notary to use his or her electronic signature only for performing online notarizations.

Fees for Online Notarial Acts

  1. An online Notary, or the online Notary’s employer, may charge a fee that does not exceed $25 for performing each online notarization. 
Analysis

Last year, the Tennessee General Assembly passed, and the Governor signed, legislation authorizing Tennessee Notaries Public to perform online notarizations. The statute, which takes effect on July 1, 2019, required the Secretary of State to adopt rules to implement the new law. Emergency rules were published by the Secretary of State on April 15, 2019 for the new law taking effect this July. The emergency rules cover a wide range of topics, including commissioning of online Notaries, standards for performing online notarial acts, standards for technology vendors and systems, fees, recordkeeping and changes after commissioning. The emergency rules are in force until October 12, 2019, at which time they must be replaced by permanent rules.

Read the emergency rules.

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