Electronic signatures are an established means of legally secure documents worldwide. However, legal requirements vary between regions and countries. Every company must clarify the respective legal requirements for transactions protected with electronic signatures.
It’s important to distinguish between the venue and the applicable law in accordance with the principle of freedom of contract. The venue is the place whose court may be appealed to in case of doubt. The applicable law refers to the national law under which the document would be decided in the event of a dispute. The applicable law governs both the content of the document and its electronic signatures.
Legal models for signatures
The legal models for electronic signatures scale from less to highly regulated. The requirements are less regulated in North America, where a range of technological solutions and security levels are accepted as legally secure. The countries of the European Union, for which the eIDAS regulation forms the legal framework, have medium or tiered regulation. Only a few countries have particularly strong or restrictive regulation.
Low regulation | Tiered regulation | Restrictive regulation |
|---|---|---|
U.S.A. | EU | Brazil |
It’s worth focusing on the two most widely used legal models: low regulation and tiered regulation.
Low regulation
In the U.S., Canada, Australia and New Zealand, electronic signatures are generally accepted and provide the same legal effect as manual signatures. All types of electronic signatures are legal and enforceable and are considered equivalent.
Example of the U.S.
Electronic signatures are legally permissible and 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 recognize the validity and enforceability of electronic signatures. Both laws expressly provide that a signature, contract or other record in connection with a commercial transaction may not be denied legal validity solely because it is in electronic form.
Tiered regulation
Example of the European Union
The legal framework for electronic signatures in the EU is the eIDAS Regulation. The abbreviation stands for "Electronic IDentification, Authentication and Trust Services," in the European Single Market. The regulation has been in force since 2016.
eIDAS provides a tiered legal model to make electronic transactions more secure, trustworthy and simple. As an EU regulation, it is a kind of European law and supersedes the national legislations of the EU member states. Each EU member state had to adapt its laws to the content of the regulation. In Germany, for example, eIDAS was implemented in the German Trust Services Act, among other things.
eIDAS applies throughout the European Economic Area (EEA), which includes Norway, Iceland and Liechtenstein. However, non-European companies doing business with EU companies should also consider eIDAS. For example, many U.S. companies have branches or customers in the EU and in this case must also comply with the eIDAS requirements.
eIDAS distinguishes between three levels of electronic signatures, which have different documentary proof: the simple, the advanced, and the qualified electronic signature.
Simple: informal with low legal risk
For many documents we use the simple electronic signature. In an email and many contracts, the typed name and/or the bitmap image of the handwritten name is sufficient. There is no specific form required by law for such documents and there is little risk of their legal validity being challenged. With DocuWare, you can provide a simple electronic signature with a stamp.Advanced: medium legal risk
In the event of a dispute where it must be possible to identify the signatory of a document or the creator of the signature, you need an advanced electronic signature. It is widely used for commercial contracts in the B2B sector. eIDAS prescribes certain rules for this signature level, such as the signature creator must be identified by using an electronic signature certificate. The advanced signature has medium documentary proof.Qualified: greatest security
For some documents, such as certain contracts, for example German law requires a handwritten signature. In these cases, the qualified electronic signature is used, which, with some exceptions, is equivalent to a handwritten signature in court and has the highest documentary proof.
Advanced electronic signatures can be accepted by other EU member states, whereas qualified ones must be accepted throughout the EU. However, each member state regulates for itself whether a business or official transaction requires an electronic signature and the level at which it must be provided.
Qualified certificates are provided by trust service providers (TSP), which must meet special security requirements for this purpose. These providers have received qualified status after an official audit by a national authority and are listed in the EU list of eIDAS Trusted Lists (LOTL).
For electronic seals, which you can use with DocuWare and Validated ID, the eIDAS regulation makes the same specifications. The seal differs from the signature only in that the certificate is associated with a legal entity instead of a natural person.
Example of Japan
Japan also has a tiered legal model for the regulation of electronic signatures. The Japanese Electronic Signatures and Certification Business Act (Act No 102 of 31 May 2000) has been in force since April 2001, according to which a qualified electronic signature is considered a legally compliant electronic signature. An advanced electronic signature is possible, but on its own it has less documentary proof.
DocuWare supports all scenarios and legal requirements
With the DocuWare Signature Service, you can use electronic signatures efficiently in your company and ensure greater compliance. In cooperation with the signature service providers Validated ID and DocuSign, DocuWare offers you a wide range of secure procedures for this purpose.
Check which of your documents need which level of compliance according to legal requirements. Based on this, decide which of the many signing options you want to use.