Electronic Transaction Law No. 85 Electronic Transaction Law No. 85of 2001of 2001

• Salem Zuhair EisouhSalem Zuhair Eisouh

Legislation in Jordan

• Constitution• Law = 1- Ordinary law 2-Temporary law• Regulations• Custom

IntroductionIntroduction

• In the light ofIn the light of the rapidthe rapid technological technological developmentsdevelopments in our worldin our world , it has become , it has become necessarynecessary for states tofor states to keep pace withkeep pace with thethe technological revolutiontechnological revolution in order for them to in order for them to becomebecome modern and advanced countries,modern and advanced countries, or, at or, at leastleast , to be on the road to, to be on the road to become so, by become so, by investinginvesting inin modernmodern technologies of technologies of communicationcommunication of information,of information, and through theand through the development anddevelopment and investment ininvestment in favor offavor of public public servicesservices..

(.Introduction (cont(.Introduction (cont• There is no doubtThere is no doubt that thethat the tremendous revolution that took place tremendous revolution that took place

inin the world ofthe world of communications has led to a changecommunications has led to a change in the means in the means and methods ofand methods of business transactionsbusiness transactions and expressions of the will and expressions of the will for whatfor what is called nowis called now ““Electronic Data InterchangeElectronic Data Interchange”.”. In lieu In lieu of of paper documents seeking thepaper documents seeking the legislationlegislation of modernof modern developments and keeping up withdevelopments and keeping up with thethe technological technological developmentsdevelopments of theof the countries,countries, JordanianJordanian legislatorslegislators tooktook the leadthe lead among theiramong their Arab counterparts andArab counterparts and issued the Interim issued the Interim Electronic Electronic Transactions ActTransactions Act No. 85No. 85 for the year 2011 onfor the year 2011 on 11/12/2001 11/12/2001.. This This legislation comprised of the firstlegislation comprised of the first Jordanian lawJordanian law in the field of in the field of information technologyinformation technology , which was the, which was the secondsecond Arab lawArab law in thein the field of field of e-commercee-commerce after theafter the Tunisian lawTunisian law making room for making room for other Arab countriesother Arab countries, , out of which was Dubai which out of which was Dubai which enacted the enacted the Act onAct on electronic exchangeselectronic exchanges and Bahrain which passed the and Bahrain which passed the Bahraini law ofBahraini law of ee--commerce.commerce.

(…Introduction (Cont(…Introduction (Cont

• The Jordanian legislature cameThe Jordanian legislature came up with this law up with this law to putto put a legal frameworka legal framework that conforms withthat conforms with the international the international legislative framework in orderlegislative framework in order toto regulate the regulate the electronic electronic transactionstransactions andand to recognizeto recognize allall means ofmeans of electronic electronic datadata and electronic signaturesand electronic signatures in terms of their validity in terms of their validity or invalidity.or invalidity. Moreover, the objective was the Moreover, the objective was the establishment of legal obligationsestablishment of legal obligations on one side andon one side and the the recognition electronic records on the other side.recognition electronic records on the other side.

• TheThe Electronic Transactions ActElectronic Transactions Act allowedallowed the the establishment ofestablishment of authorities ofauthorities of authentication andauthentication and electronic signatures for giving evidence in a electronic signatures for giving evidence in a givengiven argument.argument.

The lawThe law• The law consistsThe law consists seven chapters divided into 41 articles.seven chapters divided into 41 articles.• The law starts with the most important definitions of terms and The law starts with the most important definitions of terms and

concepts. concepts. • The first chapterThe first chapter is entitled “General Provisions” and includes is entitled “General Provisions” and includes

four articles.four articles. • TheThe second chaptersecond chapter is entitled “The Record, the Contract, the is entitled “The Record, the Contract, the

email and the E-Signature” and includes articles 7-18. email and the E-Signature” and includes articles 7-18. • The third chapterThe third chapter is entitled “The Transferrable Electronic is entitled “The Transferrable Electronic

Bond” and includes articles 19-24.Bond” and includes articles 19-24. • The forth chapter is entitled “Transfer of Electronic Funds”.The forth chapter is entitled “Transfer of Electronic Funds”.• The fifth chapter is entitled “Authentication of the Record and The fifth chapter is entitled “Authentication of the Record and

the E-Signature”. the E-Signature”. • The sixth chapter entitled “Sanctions”, and the seventh chapter The sixth chapter entitled “Sanctions”, and the seventh chapter

entitled “Concluding Provisions” both include articles 39- 41.entitled “Concluding Provisions” both include articles 39- 41.

Objectives of the lawObjectives of the law andand the scope of its the scope of its applicationapplication and the transactionsand the transactions to which to which

it appliesit applies• Objectives of the law:Objectives of the law:• Article 3 of this law defines its objectives which Article 3 of this law defines its objectives which

facilitate the use of electronic means to conduct facilitate the use of electronic means to conduct transactions taking into account any other laws and transactions taking into account any other laws and without modifying or omitting any provisions. A without modifying or omitting any provisions. A reference should be made to the international reference should be made to the international commercial customs and to the degree of progress in commercial customs and to the degree of progress in the application of this law as pointed in paragraph B in the application of this law as pointed in paragraph B in the same articles.the same articles.

Objectives of the lawObjectives of the law andand The scope of The scope ofits applicationits application and the transactionsand the transactions to to

(..…which it applies (cont(..…which it applies (cont• Below is a summary of the objectives,Below is a summary of the objectives, whichwhich are drawn are drawn

fromfrom the law itself and are selectedthe law itself and are selected from its provisions:from its provisions:

– Recognition ofRecognition of electronic meanselectronic means for giving evidence and for giving evidence and making contracts, andmaking contracts, and giving the reasonable and acceptablegiving the reasonable and acceptable justification prescribed for the existing contracting means in justification prescribed for the existing contracting means in the ordinary non-electronic environments. the ordinary non-electronic environments.

– Enforcement of trust, promotion of e-commerce in the Enforcement of trust, promotion of e-commerce in the Jordanian market, and provision of e-commerce laws.Jordanian market, and provision of e-commerce laws.

Scope ofScope of LawLaw OperationOperation

• According toAccording to Article 4Article 4 of the same lawof the same law, , the the provisions of thisprovisions of this lawlaw shall apply on the shall apply on the followingfollowing::• • Electronic transactions, electronic records, Electronic transactions, electronic records, electronic signature andelectronic signature and and anyand any electronic electronic message.message.• • Electronic transactionsElectronic transactions adopted byadopted by anyany governmental departmentgovernmental department oror official institutions, official institutions, inin whole or in part.whole or in part.

DefinitionsDefinitions• E-Transaction:E-Transaction: a procedure, or a number of procedures, conducted a procedure, or a number of procedures, conducted

electronically between two or more parties in order to establish obligations or electronically between two or more parties in order to establish obligations or reciprocal obligation on one or more parties related to any commercial deed, reciprocal obligation on one or more parties related to any commercial deed, civil obligation or relationship with any governmental department.civil obligation or relationship with any governmental department.

• Electronic Records: Electronic Records: records, contracts or emails established, delivered or records, contracts or emails established, delivered or stored by electronic means. Article 2 defines the electronic contract as the stored by electronic means. Article 2 defines the electronic contract as the contract which is established electronically in whole or in part.contract which is established electronically in whole or in part.

• Electronic Signature: Electronic Signature: the data that takes the form of letters, numbers, the data that takes the form of letters, numbers,

symbols, signs or other codes which are incorporated in an electronic, digital, symbols, signs or other codes which are incorporated in an electronic, digital, optical or any other similar forms in an email or attached, added or related to optical or any other similar forms in an email or attached, added or related to it. Moreover, it has the features that specify the renewal of the identity of the it. Moreover, it has the features that specify the renewal of the identity of the person who signed it and distinguishes him/her from others for the purpose person who signed it and distinguishes him/her from others for the purpose of approving his/her signature and the content of the email.of approving his/her signature and the content of the email.

• Data Management System: Data Management System: The electronic systems utilized to institute, The electronic systems utilized to institute, send, receive, manage, store or prepare information message in any other send, receive, manage, store or prepare information message in any other form.form.

(.Definitions (cont(.Definitions (cont• Electronic Medium: Electronic Medium: A computer program or any other electronic means A computer program or any other electronic means

used for the purpose of executing or responding to a procedure for the used for the purpose of executing or responding to a procedure for the purpose of instituting, sending or receiving information message without purpose of instituting, sending or receiving information message without personal intervention.personal intervention.

• The Institutor: The Institutor: The person, whether by himself or by proxy, who institutes The person, whether by himself or by proxy, who institutes or sends information.or sends information.

• The Recipient: The Recipient: The person intended by the institutor to receive the The person intended by the institutor to receive the information message.information message.

• Authentication Procedures: Authentication Procedures: The procedures taken in order to verify that The procedures taken in order to verify that the electronic signature or electronic record was instituted by a specified the electronic signature or electronic record was instituted by a specified person, or the procedures taken to track the changes and mistakes that person, or the procedures taken to track the changes and mistakes that occurred in the electronic record after its institution including using means of occurred in the electronic record after its institution including using means of analysis to identify the codes, words and numerals and deciphering the code analysis to identify the codes, words and numerals and deciphering the code and reverse retrieval or any other means or procedures that can accomplish and reverse retrieval or any other means or procedures that can accomplish the intended objective.the intended objective.

(.Definitions (cont(.Definitions (cont• Authentication Certificate:Authentication Certificate: The certificate issued by the The certificate issued by the

competent, licensed or recognized entity to verify the electronic competent, licensed or recognized entity to verify the electronic signature of correspondent to a specified person in pursuance to signature of correspondent to a specified person in pursuance to the recognized authentication procedures.the recognized authentication procedures.

• Identification Code:Identification Code: The code designated by the licensed or The code designated by the licensed or recognized entity to authenticate the concerned personrecognized entity to authenticate the concerned person’’s s electronic contracts for the recipientelectronic contracts for the recipient’’s use for the purpose of s use for the purpose of distinguishing the records issued by that person from others.distinguishing the records issued by that person from others.

• Financial Institution: Financial Institution: The licensed bank or financial institution The licensed bank or financial institution authorized in dealing with monetary transfers in accordance with authorized in dealing with monetary transfers in accordance with the provisions of laws in force.the provisions of laws in force.Illegitimate Records: Any monetary record in the clientIllegitimate Records: Any monetary record in the client’’s account s account resulting from an e-mail sent in his name without his knowledge resulting from an e-mail sent in his name without his knowledge or approval.or approval.

DifferentiationDifferentiation

• Here we mustHere we must differentiatedifferentiate between thebetween the electronic electronic signature andsignature and digital signature because theydigital signature because they differdiffer from from each other. The e-signature is described by a special each other. The e-signature is described by a special program which is a package of digital specifications program which is a package of digital specifications taken from the body of the email sent through an taken from the body of the email sent through an encrypted system which reveals the validity of the encrypted system which reveals the validity of the signature.signature.

Scope of Law ApplicationScope of Law Application

• a) The provisions of this Law shall apply to the a) The provisions of this Law shall apply to the transactions whose parties agree on their transactions whose parties agree on their implementation by electronic means unless an implementation by electronic means unless an explicit text states otherwise.explicit text states otherwise.b) For the purposes of Article 5 an agreement b) For the purposes of Article 5 an agreement between specified parties to implement specific between specified parties to implement specific transactions by electronic means shall not be transactions by electronic means shall not be considered binding to implementing other considered binding to implementing other transactions by those means.transactions by those means.

AnalysisAnalysis and the Opinionand the Opinion andand Conclusion -Article 5-Conclusion -Article 5-

• It seemsIt seems that the legislaturethat the legislature was confusedwas confused in this matter: the basic in this matter: the basic principle isprinciple is that the lawthat the law applies toapplies to transactions to judgments on transactions to judgments on transactions that the parties agree on implementing by electronic transactions that the parties agree on implementing by electronic means so that the law becomes applicable in accordance with the means so that the law becomes applicable in accordance with the agreement, and this is to be inferred from the words: the agreement, and this is to be inferred from the words: the provisions of the law shall apply on transactions on which their provisions of the law shall apply on transactions on which their parties agree to implement by electronic means. Notwithstanding parties agree to implement by electronic means. Notwithstanding the above, if there is no agreement upon the execution of such the above, if there is no agreement upon the execution of such transactions by electronic means the law shall not apply unless transactions by electronic means the law shall not apply unless there is an agreement on the application as inferred from the there is an agreement on the application as inferred from the clause: “unless expressly stated otherwise”.clause: “unless expressly stated otherwise”.

Article 6: ExemptionsArticle 6: Exemptions

The provisions of this Law shall not apply to the following:The provisions of this Law shall not apply to the following:• Contracts, documents and records organized in pursuance to special Contracts, documents and records organized in pursuance to special

legislation in a specific manner or instituted by specific procedures, including:legislation in a specific manner or instituted by specific procedures, including:1. Institution of a will and its amendment.1. Institution of a will and its amendment.2. Institution of an endowment and amendment of its conditions.2. Institution of an endowment and amendment of its conditions.3. Immovable property, disposal transactions including proxies related to 3. Immovable property, disposal transactions including proxies related to same, their title deeds and instituting rights except lease contracts dealing with same, their title deeds and instituting rights except lease contracts dealing with same.same.

•4. Personal status proxies and transactions.4. Personal status proxies and transactions.5. Notices dealing with annulment or revocation of water and electricity 5. Notices dealing with annulment or revocation of water and electricity services contracts, health insurance and life insurance.services contracts, health insurance and life insurance.6. Pleadings, arguments, judicial notices and courts6. Pleadings, arguments, judicial notices and courts’’ decisions. decisions.b) Securities except for what is provided for in special instructions issued by b) Securities except for what is provided for in special instructions issued by competent entities in pursuance to the Securities Law in force.competent entities in pursuance to the Securities Law in force.

Principles,Principles, Conditions andConditions and Provisions PrescribedProvisions Prescribed on the on the LegalityLegality and Legitimacy ofand Legitimacy of Records, Contracts andRecords, Contracts and Electronic Electronic

SignaturesSignatures

• Adoption of the principleAdoption of the principle that anthat an electronic documentelectronic document is a functional equivalentis a functional equivalent ofof a writtena written document,document, andand an an electronic signatureelectronic signature is a functional equivalentis a functional equivalent of a of a handwritten signaturehandwritten signature..

• In order to achieveIn order to achieve the objectives ofthe objectives of the law, there must the law, there must bebe an acknowledgment that an electronican acknowledgment that an electronic documentdocument contractually replaces the writtencontractually replaces the written documentdocument andand in thein the contract. Also, the effectiveness and validity ofcontract. Also, the effectiveness and validity of an an electronic signatureelectronic signature should be defined and recognized should be defined and recognized by the person dealing withby the person dealing with e-commerce.e-commerce.

Conditions Governing the Equivalence of Conditions Governing the Equivalence of Electronic Records to OriginalElectronic Records to Original PapersPapers

• According to Article 8 of theAccording to Article 8 of the JordanianJordanian ee--transactions transactions states that states that a number of conditions should be a number of conditions should be collectively present to consider that an electronic record collectively present to consider that an electronic record is equivalent to the original record, these conditions are:is equivalent to the original record, these conditions are:

•

• • The information contained in thatThe information contained in that recordrecord is to be is to be retainedretained and storedand stored so that it can,so that it can, at any time, be at any time, be referred to. Ifreferred to. If we lookwe look for this condition,for this condition, we find that itwe find that it is aimedis aimed andand designed to bedesigned to be the most importantthe most important pillar pillar of theof the authoritativeauthoritative documentsdocuments that prove thethat prove the validity validity ofof evidenceevidence for reviewfor review at any time.at any time.

ContCont……(..(..((

• Ability toAbility to keepkeep the e-record in a formthe e-record in a form in which it can be in which it can be disclosed, sent or received easilydisclosed, sent or received easily in anyin any form byform by provingproving the accuracy ofthe accuracy of the information receivedthe information received when when disclosed, sent ordisclosed, sent or received. This condition isreceived. This condition is thethe so-so-calledcalled “safety“safety content” or “thecontent” or “the non-arrival ofnon-arrival of change”change” which is awhich is a technical systemtechnical system based onbased on the specific the specific technicaltechnical standardsstandards which show which show the status ofthe status of the the original file andoriginal file and any amendments made on it, and the any amendments made on it, and the times at which such amendments were made.times at which such amendments were made.

Authenticity of theAuthenticity of the Print out ofPrint out of Electronic DocumentsElectronic Documents

• With reference to Article 9 of the Electronic With reference to Article 9 of the Electronic Transactions Act, the addressee’s submission of Transactions Act, the addressee’s submission of paper printouts of the transactions conducted by paper printouts of the transactions conducted by electronic means and submitting it as a written electronic means and submitting it as a written extract meets the obligation determined by the extract meets the obligation determined by the legislation which requires the submission of the legislation which requires the submission of the document or the transaction in writing, but document or the transaction in writing, but these records are not binding for the addressee these records are not binding for the addressee in case that the sender was unable to print, store in case that the sender was unable to print, store or retain such records.or retain such records.

Information MessageInformation Message is a Validis a Valid wayway to Expressto Express the Willthe Will

• The electronic message shall be considered The electronic message shall be considered as a means of expressing the will legally as a means of expressing the will legally admissible for offer or acceptance for admissible for offer or acceptance for contractual intent.contractual intent.

Electronic Transfer ofElectronic Transfer of FundsFunds

• Each financial institute practicing electronic Each financial institute practicing electronic money transfer in accordance with the money transfer in accordance with the provisions of this Law and the regulations issued provisions of this Law and the regulations issued in pursuance shall abide by the following:in pursuance shall abide by the following:a) Abide by the provisions of the Law of the a) Abide by the provisions of the Law of the Central Bank of Jordan, Banks Law and the Central Bank of Jordan, Banks Law and the regulations and instructions issued in pursuance.regulations and instructions issued in pursuance.b) Implement procedures that would ensure the b) Implement procedures that would ensure the presentation of reliable client services and the presentation of reliable client services and the preservation of banking secrecy.preservation of banking secrecy.

Documentation ProceduresDocumentation Procedures

• The Jordanian legislatorThe Jordanian legislator admitted that theadmitted that the documentation proceduresdocumentation procedures be verified in terms of be verified in terms of integrity ofintegrity of the constraintthe constraint--mail,mail, this has gainedthis has gained recognitionrecognition in accordance with Article 30 of thein accordance with Article 30 of the Electronic Transactions ActElectronic Transactions Act which states “If thewhich states “If the documentationdocumentation in accordance within accordance with the proceduresthe procedures accredited certificationaccredited certification oror documentation proceduresdocumentation procedures commercially acceptablecommercially acceptable oror agreed to byagreed to by the parties the parties involved.”involved.”

Crimes Committed by Utilizing Crimes Committed by UtilizingElectronic MeansElectronic Means

Article 38 states that:Article 38 states that:• each person committing an act that constitutes a crime each person committing an act that constitutes a crime

in accordance with the legislations in force by utilizing in accordance with the legislations in force by utilizing electronic means shall be penalized with imprisonment electronic means shall be penalized with imprisonment for a period not less than three months and not more for a period not less than three months and not more than one year or a fine not less than three thousand than one year or a fine not less than three thousand Dinars and not more than ten thousand Dinars, or by Dinars and not more than ten thousand Dinars, or by both penalties. He shall be penalized with the harsher both penalties. He shall be penalized with the harsher penalty if the penalty stipulated in these legislations penalty if the penalty stipulated in these legislations exceeds the penalty stipulated in this Law.exceeds the penalty stipulated in this Law.

كورت فسترجارد

Bibliography

1 - e-transactions law the provisional No. (85) for the year 2001.2 - Jordanian Civil Code No. (43) for the year 1976.3 - Jordanian Trade Law No. (12) for the year 1966.4 - Qhqua, d. Hoda, criminal protection for e-commerce, Amman.5 - committees entitled "criminal protection of the document e" d. Tawfik Ashraf Shams al-Din.6 - a lecture on e-commerce lawyer, Professor Yunus Arabs.7 - UNCITRAL Convention on International Trade.8 - College of Law, University of Mansoura.

Thank you

Salem Zuhair Eisouh