ELECTRONIC SIGNATURES: BREAKING DOWN THE INS AND OUTS OF E-SIGNATURES
Updated: Nov 11
In the wake of the COVID-19 outbreak, in addition to the implementation of a 21-day national lockdown in South Africa, it has become almost impossible to acquire multiple original handwritten signatures on the same document. This poses several problems for companies operating during the lockdown. In business, handwritten signatures are essential on just about all documents.
The need to keep the economy going has led to the necessity to find ways to continue to do business during the lockdown period. A potential solution to this hurdle may be uncovered in the Electronic Communications and Transactions Act 25 2002 (ECTA). The ECTA requires two types of signatures in electronic form namely; electronic signatures and advanced electronic signatures.
Electronic signatures may be used for most transactions, except where the law specifically states that e-signatures may not be used, or where the parties to a transaction agree that they may not be used.
In cases where parties to a transaction have not stipulated the nature of the electronic signature required, the electronic signature will be binding only once a method is used to identify the signing person and to indicate the person's approval of the information communicated. In addition to this and concerning all the relevant circumstances at the time if the above method was used, the method must be reliable and appropriate for the purpose for which the information was communicated.
Several steps may be taken to ensure that the method of electronic signature in use is reliable and appropriate. Having the signatory send the signed document promptly to the recipient - reducing the use of intermediaries, the use of a reserved organisation domain name that identifies the company to which the signatory belongs and ensuring stringent compliance with signature formalities that may be specified in the relevant agreement are just a few of these steps that may be taken.
Advanced electronic signatures are obligatory where the signature of a person is required by law. The South African Accreditation Authority must accredit the products and services used to create the advanced electronic signature.
It is an unclear and daunting time for South African businesses and residents all over the country, however, the challenges we face will push us to innovate and explore previously undiscovered avenues of doing business.