What is an electronic signature?

What is an electronic signature?

Electronic signatures (also called e-signatures, digital signatures, or e-signatures) represent a wide range of methods used to sign and authenticate digital documents. Electronic signing has become so commonplace that it is even enshrined in law.

Definitions for electronic signatures

In Europe, the eIDAS (“Electronic Identification And Trust Services”) regulation states that electronic signatures: “data in electronic form that is attached to or logically associated with other data in electronic form and used by the signer to sign.”

In other words, electronic signatures are used by signers to identify a digital document and must be logically associated with both the contract and the signer.

E-signatures, when used properly, are widely considered a legal substitute for handwritten signatures.

Most e-signature solutions are flexible enough that almost any organization, regardless of size or industry, can benefit from adopting a digital signature method.

Types of electronic signatures

The legal interpretation of electronic signatures is very open. This has led to a variety of ways to sign digital contracts. Some signature methods are faster, others are more secure.

For Europe, the eIDAS Regulation includes the concept of three different signature types - simple, advanced and qualified.

1. Simple Electronic Signature (SES).

Sometimes referred to as electronic signatures or digital signatures, these are among the most common types of electronic signatures.

The simple electronic signature does not have to include any means of identification or show any alteration to the contract. As a result, this form of signature is very easy and quick to perform, but is more difficult to prove than the other two signature forms because the simple electronic signature cannot be clearly assigned to a person.

A classic example of a simple electronic signature is the textual name at the end of an e-mail, a scanned signature or a click on an “I agree” checkbox.

For some documents, a simple electronic signature may be sufficient, depending on the content:

• General Terms and Conditions
• client information
• Documentations
• Internal protocols
• etc.

2. Advanced electronic signatures (AES, Advanced Electronic Signature)

For almost all agreements in the private sector, the advanced electronic signature is the most common choice because it is conclusive and can be executed easily, quickly and without complications. The captured data allows the identity of the signer to be verified after the fact.

According to the eIDAS Regulation, an electronic declaration of intent must meet the following requirements to satisfy the character of an advanced electronic signature:

• The electronic signature is uniquely assigned to the signatory.
• It enables the signatory to be identified.
• It is created using electronic signature creation data that the signer can use with a high degree of confidence under his sole control.
• It is linked to the data signed in this way in such a way that subsequent modification of the data can be detected.

The following documents are typical use cases for advanced electronic signatures:

• Data protection declarations
• Unlimited employment contracts
• Insurance applications
• Liability disclaimers
• Powers of attorney
• SEPA mandates
• Non-disclosure agreements
• offers
• etc.

3. Qualified electronic signature (QES)

With the qualified electronic signature, the identity of the person must be verified before signing. In the case of online contract conclusions, this can be done by Video-Ident, for example. A certified trust center then issues an electronic certificate bearing the name of the signatory. The signer can then use this to trigger qualified signatures (once or several times, depending on the certificate type).

A signature creation device is configured software or hardware that is used to create a signature (Art. 3 No. 22 Regulation (EU) No. 910/2014). The qualified form of this must fulfill additional conditions with regard to security and the possibility of identification. It must be provided by a qualified trust service provider (Art. 3 23 in conjunction with. Annex II Regulation (EU) No. 910/2014).

An essential characteristic of a qualified certificate is that the identity of the signatory is immediately recognizable when the document is opened if the software used is able to retrieve the data from the signature servers. This is ensured by extensive requirements for a qualified certificate (Annex I Regulation (EU) No. 910/2014).

According to the currently valid standards, identification can take place, for example, using the Post-Ident procedure or the Video-Ident procedure. Both procedures mean additional effort for the signatory, some of which is not insignificant. Acceptance of this procedure will therefore depend to a large extent on the significance of the qualified electronic signature service for the signatory.

The most important requirements according to eIDAS for a QES can be summarized as follows:

• All requirements for an advanced electronic signature are also met.
• The QES is issued by an audited trust service provider.
• The identity of the signer has been validated prior to the signature.
• The signature key must reside in a qualified electronic signature creation device.

The legislator requires the so-called written form for some documents. This can only be fulfilled by a handwritten signature on paper or a qualified electronic signature. Although the QES is virtually equivalent to a handwritten signature on paper, there are documents for which the legislator requires a paper copy, such as contracts to be notarized or the termination of an employment relationship.

Examples of documents for which a qualified electronic signature is required:

• Fixed-term employment contracts
• Guarantees
• Life insurance policies on the life of third parties
• etc.

What type of electronic signature should you use?

The type of electronic signature you should use depends on your workflow and individual requirements, but most users want to strike a balance between ease of use and legal enforceability. With this in mind, we recommend that you use simple or advanced electronic signatures when signing documents.

If you use electronic signature providers like fynk, your contracts can also be signed from almost anywhere via mobile devices (iOS or Android), desktops, or laptops.

Author:

Constantin Wintoniak