eSignature Legality
in Europe
eIDAS (electronic Identification, Authentication, and trust Services) is an EU regulation on electronic identification and trust services for electronic transactions in the European Union. It was established in EU Regulation 910/2014 of 23 July 2014 and applies from 1 July 2016. This regulation is a guiding torch that provides detailed conditions and differentiation related to three different types of electronic signatures: simple, advanced, and qualified. It also clarifies and ensures the legal validity of electronic signatures.
Types of E-signatures:
Basic or Simple Electronic Signatures
The basic e-signature is technology-neutral. Meaning, any electronic form or process is typically accepted because the resulting e-signature meets the following three basic requirements for signing.
- Used by the person related to the signature
- Used in a fashion that demonstrates the intent of the signer
- Associated with the document or data the signer intended to sign
Advanced Electronic Signatures (AES)
An advanced electronic signature goes beyond the essential e-signature by tying authentication to the signature and thus the document. This drastically decreases risk in business transactions by providing additional evidence that can be used to verify the signature’s authenticity. It’s harder to forge, and less evidence could even be required by the court to prove the intent and authenticity of the signature.
An advance electronic signature, in addition to complying with the requirements of an SES, must also require to be:
- Associated with the person using the signature
- Able to spot the signer
- Created in a way that the signer is confident it’s under their sole control
- Linked to the document, so any changes made afterward are identifiable
For their use of electronic signatures, most business establishments choose AES as their standard e-signature. By having mechanisms for built-in authentication assurance, it increases security without impacting the customer experience.
Qualified Electronic Signatures (QES)
The term “qualified electronic signature” is predicated on the eIDAS Regulation, but it’s almost like many other laws worldwide that need a certificate issued by an accredited organization.
A qualified electronic signature is a complicated electronic signature that also requires a private digital certificate additionally to all or any other standard requirements. The digital certificate could also be a secure, personal and unique electronic identity credential that possesses to be issued to the signer to keep under their control.
Qualified electronic signature must comply to the requirements of both electronic signatures and advanced electronic signatures, and also be:
- Created employing a professional electronic creation or signature creation device.
- Supported by qualified certificate (issued by knowledgeable trust service provider)
- Like a sophisticated e-signature, it is recognized as a handwritten signature. A QES requires no additional evidence by the court under Article 25 of eIDAS if the validity of the same is questioned during a dispute.
A qualified e-signature reverses the burden of proof that generally is created during a digital transaction. With qualified e-signature, the signer must produce the digital certificate used to authenticate the signature.
Legal validity of electronic signatures under eIDAS
eIDAS ensures that each kind of electronic signature has legal validity and admissibility as evidence in EU courts and shall not be denied legal effect solely because of its electronic form.
The enforceability of a transaction concluded using electronic signatures will depend on a selection of things, including the type of signature used and thus the evidence embedded in it.
The enforceability of a transaction concluded using electronic signatures will depend on a selection of things, including the type of signature used and thus the evidence embedded in it.
The eIDAS Regulation doesn’t dictate what kind of signature or when a signature is required. In their individual data laws, every EU member state must specify:
- Use cases of documents that compulsorily require a traditional wet ink signature, and
- Use cases of documents that need a qualified electronic signature.
Generic use cases of electronic signature in eIDAS:
- Commercial agreements
- Purchase orders
- Non-Disclosure Agreements (NDAs)
- Invoices
- Order acknowledgments
- Distribution agreements
- Services agreements
- Software license agreements
- Licenses of intellectual property, including copyright, patent, and trademark
- Employee invention agreements
- Privacy notices
- Commercial and residential lease agreements
- Consumer agreements
- Service terms
- Consumer credit agreements
- Shipment documents
- Order confirmations
- Software licenses
- User manuals
The COVID-19 pandemic has radically changed our lifestyles and how one conducts business. Most non-essential companies have established completely remote work setups. This “new normal” has concentrated more attention on electronic means of transactions. The “new normal” in the age of Covid-19 proceeds to facilitate the use of eSignatures.
DISCLAIMER
Certinal is making available the information and materials in this article for informational purposes only and is meant to help companies understand eSignature’s application in a legal framework. Laws change rapidly, and Certinal makes every reasonable effort to keep the content of this article current, hence Certinal makes no claims or representations that the information contained in this article is true, accurate, correct, or current. The law differs from jurisdiction to jurisdiction, and even similar laws may be interpreted differently in different courts or places. Since these factors differ according to individuals and businesses, Certinal is not liable for any consequence of any action taken by any third party relying on material/ information provided under this article. The contents hereof should not be construed as legal advice in any manner whatsoever. In cases you require any assistance; you must seek independent legal advice.
