Electronic Signatures in Global and National Commerce Act

Encyclopedia : E : EL : ELE : Electronic Signatures in Global and National Commerce Act

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The Electronic Signatures in Global and National Commerce Act, or ESIGN, is a United States federal law passed by the U.S. Congress on June 30, 2000 to facilitate the use of electronic records and signatures in interstate and foreign commerce by ensuring the validity and legal effect of contracts entered into electronically. E-SIGN is codified at 15 U.S.C. 7001 et seq. [Findlaw Article on ESIGN]

Although every state has at least a law pertaining to electronic signatures, it is the federal law that lays out the guidelines for interstate commerce. The general intent of the ESIGN Act is spelled out in the very first section(101.a), that a contract or signature “may not be denied legal effect, validity, or enforceability solely because it is in electronic form”. This simple statement provides that electronic signatures and records are just as good as their paper equivalent, and therefore subject to the same legal scrutiny of authenticity that applies to paper documents.[Electronic Signatures - Understanding the Origins, Laws and Affects]

Examples of electronic contracts

eMortgages

Sections from the ESIGN Act

ESIGN Act Sec 106 definitions

(2) ELECTRONIC- The term `electronic' means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.

(4) ELECTRONIC RECORD- The term `electronic record' means a contract or other record created, generated, sent, communicated, received, or stored by electronic means.

''(5) ELECTRONIC SIGNATURE- The term `electronic signature' means an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.

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General Intent

(1) a signature, contract, or other record relating to such transaction may not be denied legal effect, validity, or enforceability solely because it is in electronic form; and

(2) a contract relating to such transaction may not be denied legal effect, validity, or enforceability solely because an electronic signature or electronic record was used in its formation.

Consumer Disclosure

Section 101 of the ESIGN Act, sub-section (b), preserves the rights of individuals to NOT USE electronic signatures. Here the law provides that individuals reserve the right to use a paper signature. Sub-section (c) is in direct support of (b) by requiring a “Consumer Disclosure” that the signatory has consented to use an electronic format.[Electronic Signatures in Global and National Commerce Act Compliance]

Section 101(c)(1)(C) states that the consumer also "consent electronically, in a manner that reasonably demonstrates that the consumer can access information in the electronic form that will be used to provide the information that is the subject of the consent"

See also

• Electronic signature
• Uniform Electronic Transactions Act

References

External links

[Text of the Act in PDF]

[The eSign effect]

[Consumer Consent Provision]

 

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