Legality of Electronic Signatures around the World

2 Legality of Electronic Signatures

Introduction

Kinds of electronic signatures

An electronic signature is an electronic means - o�en a sound, symbol, or process - attached to or associated with a contract, document, or other record. It is used by a person to indicate his approval of the contents of the document and sign the record.

Since the term electronic signature refers to any electronic process that is used to indicate agreement with the contents of a form or document, a range of electronic methods can come under the umbrella term of electronic signatures, even digital signatures. Other formats of electronic signatures include a scanned image of your signature on paper, a typed name at the end of your email message, a video or a voice signature, etc to name a few.

From the legal perspective, electronic signatures are of three types:

Basic electronic signatures(also known as Simple Electronic Signatures or Open Electronic Signatures)

This type of electronic signature is technology-neutral, which means any electronic form or technology is generally accepted. The resulting electronic signature should:

a. demonstrate the intent of the signerb. be made by the person associated to the signaturec. be indelibly associated to the document the signer intended to sign

Advanced electronic signatures

This form of electronic signature adds additional requirements above the Basic electronic signature. The electronic signature must:

a. be uniquely linked to signerb. identify the signerc. be under sole control of signerd. detect changes to the document or data a�er the application of the electronic signature.

Qualified electronic signatures(also known as Digital Signatures or Certificate Signatures)

The Certificate electronic signature or the Digital signature (or the Qualified electronic signature in the European Union) is an advanced electronic signature that uses a digital certificate issued by an accredited Certificate Authority as a secure, personal electronic identity credential. The unique digital certificate must be issued to an individual in a form they can keep under their control. An electronic signature based on a digital certificate meets the requirements for basic and advanced electronic signatures as well.

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Types of electronic signature laws

OpenOpen, minimal, or permissive laws allow for the legal enforceability of all types of electronic signatures barring a few exceptions. Under such laws, handwritten signatures, digital signatures, and all other forms of electronic signatures have the same legal status. The countries with an Open legality structure are:

The electronic signature laws around the world can be categorized into three categories - Open, Tiered & Prescriptive. Countries around the world fall into one of these categories when it comes to legality of electronic signatures.

TieredTiered laws accept electronic signatures as legally admissible, and enforceable, but recognises authenticated digital signatures or ‘Qualified Electronic Signatures’ as possessing a greater evidentiary weight over electronic signatures in specific transactions. The countries with a Tiered legality structure are:

PrescriptivePrescriptive laws dictate specific technical methods to electronically sign a document, typically digital signatures. They might even dictate which electronic signature platforms are acceptable. Very few countries have adopted a prescriptive law for electronic signatures.

USA

United Kingdom

Sri Lanka

Canada

Australia

New Zealand

China

Argentina

Austria

Belgium

Brazil

Chile

Colombia

Denmark

Finland

Germany

Hong Kong

Hungary

Ireland

Italy

Macao

Mexico

Netherlands

Norway

Peru

Portugal

Romania

South Africa

South Korea

Spain

Malaysia

Turkey

India

Indonesia

Sweden

Switzerland

Taiwan

4 Legality of Electronic Signatures

A closer look at global electronic signature laws

United States

The legal admissibility of electronic signatures is well established in the United States. The Uniform Electronic Transactions Act (UETA) 1999 and the Electronic Signatures in Global and National Commerce Act (ESIGN) 2000 admits the validity and enforceability of electronic signatures. Both these laws explicitly provide that “a signature, contract, or other record relating to such [commercial] transaction may not be denied legal e ect, validity, or enforceability solely because it is in electronic form.”

United Kingdom

The electronic communications act 2000 and the electronic signature regulations 2002 lay out the legal framework for electronic signatures in the UK. A handwritten signature is capable of being satisfied by any electronic signature, including an advanced electronic signature. The UK does not specify any special legal status for any of the di erent types of electronic signatures. Therefore all electronic signatures are considered of equal status and a handwritten signature can be satisfied by any electronic signature.

European Union

According to the EU Directive 1999/93/EC on Electronic Signature, a qualified electronic signature is the equivalent of a handwritten signature, but in order to simplify procedures, and facilitate cross-border use, “procedures by electronic means should rely on simple solutions, including as regards the use of electronic signatures.” It goes on to specify in Article 1 that the Commission in no way prevents member states from accepting any type of electronic signatures—normal, advanced, or qualified.

The eIDAS regulation backs this and reiterates that electronic signatures are legally binding and admissible in a court of law. Article 25 of the regulation establishes that “An electronic signature shall not be denied legal e ect and admissibility as evidence in legal proceedings solely on the grounds that it is in an electronic form or that it does not meet the requirements for qualified electronic signatures.”

Australia

There are no federal laws in Australia requiring the use of specific technology for a legally enforceable electronic signature. This means that electronic signatures of all kinds are acceptable as legally enforceable. The Electronics Transactions Acts of the Commonwealth, States and Territories of Australia, along with other regulations, set out exclusions to the use of electronic signatures.

Under Australian contract law, contracts are generally valid if legally competent parties reach an agreement either verbally, electronically or in a physical paper document. Admissibility as evidence in courts depends only on how the parties support the existence, authenticity, and valid acceptance of a contract.

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Canada

There are no Canadian federal laws requiring the use of specific technology for a legally enforceable electronic signature. This means that electronic signatures of all kinds are acceptable as legally enforceable, although specific requirements may govern transactions with institutions of certain state governments.

In Canada, contracts are generally valid if legally competent parties reach an agreement either verbally, electronically or in a physical paper document. Admissibility as evidence in courts depends only on how the parties support the existence, authenticity, and valid acceptance of a contract under provincial legislation pertaining to (electronic) evidence and the Canada Evidence Act.

India

Signatures in electronic form have been recognized by law in India since 2000, with the passage of the Information Technology Act.

The Act identifies and establishes a two-tiered legality structure, classified as simple electronic signatures and digital signatures. Under the Indian Information Technology Act, only digital signatures are recognized as valid electronic signatures. However, simple electronic signatures can be produced as evidence as per the Evidence Act of India. A court in India will admit electronic signatures as evidence, therefore specifying even simple electronic signatures as legally admissible.

6 Legality of Electronic Signatures

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