Compliance Electronic Signatures in
Global and National Commerce Act (E-SIGN)
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E-SIGN
The Electronic Signatures in Global and National Commerce Act (E-SIGN) (Public Law 106-229) is a United States federal law passed by the U.S. Congress 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. This federal law establishes the guidelines for interstate commerce. The general intent of the E-SIGN Act is 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.
Resources for Compliance
Electronic Signatures in Global and National Commerce Act
(E-SIGN)
- ESIGN Act Sec 106 definitions
- (2) ELECTRONIC- The term `electronic' means 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.[2]
- 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"
Retention of contracts and records
Section 101(d) provides that if a law requires that a
business retain a record of a transaction, the business
satisfies the requirement by retaining an electronic record, as
long as the record "accurately reflects" the substance of the
contract and is "accessible" to people who are entitled to
access it "in a form that is capable of being accurately
reproduced for later reference, whether by transmission,
printing or otherwise."
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