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UK moves to clear up "confusion" over electronic signatures in England and Wales

Editorial Staff

So, it's simple: you attach an electronic signature to an electronic document and off it wings by e-mail. Job done, right? Apparently "some businesses are still unsure if electronic signatures would satisfy legal requirements," says The Law Commission. But instead of just saying "of course, in the absence of fraud or some other frustrating or negating matter, that's a validly executed document" the Law Commission has produced "proposals." So, not simple at all, then.

The Law Commission says "Not all transactions have to comply with formal requirements. But as far back as 1677, the Statute of Frauds required certain documents to be in writing and signed. It is still in force today but the world has moved on. Many expect transactions to be instant and often digital, regardless of the type of transaction. The EU-wide eIDAS regulation says that an electronic signature cannot be denied legal validity simply because it is electronic and that that electronic signatures are admissible in evidence in legal proceedings. But while the Electronic Communications Act 2000, a UK statute, mirrors the admissibility provision in eIDAS, it does not expressly provide for the validity of electronic signatures."

Easy enough, then, simply insert one line into the ECA2000 that says "electronic signatures are a valid form of execution."

The Law Commission goes on "This lack of clarity in the law is discouraging businesses from executing documents electronically when it would be quicker and easier to do so. This may disproportionately affect small businesses and start-ups, which do not have access to legal expertise in the same way as larger commercial businesses." While the position is symptomatic of the poor legal drafting that has developed in the past quarter of a century in the UK (and elsewhere which has followed the sloppy approach in the UK) it is the work of moments to search the internet for authoritative answers. True, insofar as there is a problem it is because the draftsmen did as modern draftsmen do: they drafted for themselves not for the rest of us who have no idea what they are talking about and therefore require clear, unequivocal, even brutal language and grammar. In this case, there is a logical conclusion to be drawn - if you can't deny the validity of an electronic signature, then such a signature is binding. But we, hoi poloi, should not have to draw conclusions: the law should be clear.

But then, instead of fixing the problem, The Law Commission proposes what government departments always propose: overkill.

in further steps to improve the law, the Law Commission is seeking views on whether:

- the government should set up a group of industry experts to monitor the use of electronic signatures and advise on potential changes which could help businesses as new technology emerges
- webcam or video links could be used instead of a physical witness for documents which require witnessed signatures
- there should be a move away from traditional witnessing in person to:
- - a signing platform alone, where the signatory and witness are logged onto the same programme from different locations; or
- - the ability of a person to “acknowledge” that they applied an electronic signature to a witness after the event
- there should be a further project on whether the concept of deeds is fit for purpose in the 21st century

Read that carefully. What do you see? Did you work out that there is proposal that agreements signed under hand should not be valid and that only agreements registered, recorded and signed in a central database will be enforceable? The concept of the centralised register and signing platforms is not new: they have been around for several decades. The most fashionable because it has reached outside the legal industry in a way that no other has so far managed is Ethereum. But those are voluntary schemes: the UK Law Commission's proposal is that "only" such a "signing platform" would be acceptable.

The Electronic Execution of Documents consultation was published at 00:01 on 21 August 2017 at: https://www.lawcom.gov.uk/proj....

The deadline for responses is 23 November 2018. It refers only to the law, as it will be, in England and Wales.

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