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10 October 2018

154: Are electronic signatures valid on legal documents?

The Law Commission has recently issued a consultation on electronic signatures and their validity under UK law.

The signing of legal documents has changed from the traditional wet ink signature on a paper deed to the more modern use of e-signing on e-documents. In particular, the fast-paced world of real estate transactions has embraced this change in approach and speed in order to get deals done as quickly as possible.

So what is an e-signature? An electronic signature might be as simple as typing a name in an email or applying a pre-approved electronic signature to a document.  It may involve logging into a platform to access a document, applying a computer generated signature or using a touch screen to add a virtual signature.

The Law Commission has now confirmed that electronic signatures are indeed capable of being legally binding and valid under current legislation. This is good news, largely because e-signatures have already become part of common practice. The government also wishes to consider what, if any, changes may need to be made to the law to adapt to IT infrastructure and keep abreast of the ever changing technological landscape.

Having given an initial view that electronic signatures are legally binding, the Law Commission wish to obtain wider views about whether or not:

  • it 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 further projects on whether deeds are fit for purpose in the 21st century.

This consultation is open until 23 November 2018 and views are requested in writing on all of the above issues.

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