Electronic Signature – Legal Aspects

1.  Definition of the electronic signature

1.1 Electronic and paper writing – No distinction
  • Article 1365 of the French Civil Code, by defining the writing as “a series of letters, characters, numbers or any other signs or symbols with an intelligible meaning whatever its medium“, makes no distinction between electronic writing and paper writing.
  • Article 1366 of the French Civil Code specifies that “an electronic document has the same probative value as a paper document, provided that the person from whom it originates can be duly identified and that it is established and stored in such a way as to guarantee its integrity“.
  • Article 1174 of the French Civil Code also specifies that “when a writing is required for the validity of a contract, it may be drafted and kept in electronic form under the conditions laid down in Articles 1366 and 1367“. It establish therefore the equal value of the electronic and paper written documents. He adds that “where a written statement is required by the person who is bound to do so, the latter may affix it in electronic form if the conditions for affixing it are such as to guarantee that it can only be done by himself“.

 

1.2 Role of the signature – Identification and consent

 

  • According to article 1367 of the French Civil Code, “the signature necessary for the perfection of a legal act identifies its author. It expresses its consent to the obligations arising from this act (…) When it is electronic, it consists of the use of a reliable identification process guaranteeing its link with the act to which it is attached. The reliability of this process is presumed, until proven otherwise, when the electronic signature is created, the identity of the insured signatory and the integrity of the deed guaranteed, under conditions set by decree“.
  • The rule is not a substantive rule but a rule of proof.
  • It only means that a document is a perfect mode of proof only if it is signed.
  • The signature does not affect the validity of the documents; it conditions the probative value of a written document. This article indicates the functions attached to the signature:
    1. allow the author of the writing document to be identified with certainty, and
    2. express its consent to the content of the document.
  • European law enacted a legal regime for electronic signatures by a first Directive of 13 December 1999, which has since been replaced by a European Regulation No 910/2014 of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market (hereinafter referred to as the “eIDAS Regulation“).
  • The eIDAS Regulation defines the ” reliable identification process” within the meaning of article 1367 of the French Civil Code.

 

2.  Electronic signature and proof rules

  • Under French law, Decree No. 2017-1416 of 28 September 2017 on electronic signatures adapted the legal regime for electronic signatures to the eIDAS Regulation.

 

2.1 Presentation of the different types of electronic signatures

 

  • The eIDAS Regulation defines, in general, the electronic signature as “data in electronic form which is attached to or logically associated with other data in
  • electronic form and which is used by the signatory to sign“. It distinguishes between two types of signatures: the advanced electronic signature and the qualified electronic signature. This distinction is transposed into French law by the Decree of 28 September 2017.
  • The advanced electronic signature is defined by the eIDAS Regulation as “an electronic signature which meets the requirements set out in Article 26“, namely:
    •     it is uniquely linked to the signatory;
    •     it is capable of identifying the signatory;
    •     it is created using electronic signature creation data that the signatory can, with a high level of confidence, use under his sole control; and
    •     it is linked to the data signed therewith in such a way that any subsequent change in the data is detectable.
  • A qualified electronic signature is defined as one that is “created by a qualified electronic signature creation device, and which is based on a qualified certificate for electronic signatures“. Such signature involves issuing a unique qualified certificate for each signatory and is not suitable for operations involving a very large number of signatories.
  • The electronic signature proposed by Armada Lex via DOCUSIGN France (hereinafter “DOCUSIGN“) meets the criteria of Article 26 of the eIDAS Regulations and must be considered as an advanced electronic signature.
    •     It provides a unique link between the signature and its author because the platform provides individualized space for each signatories;
    •     It allows signatories to be identified by an electronic certificate issued by DOCUSIGN and attached exclusively to his/her person;
    •     It is created in using electronic signature data that the signatory can, with a high level of confidence, use under his exclusive control: a private key is created only after authentication of the contracting party, and that party can activate it for a single operation. The key is destroyed after use.
    •     It is linked to the data to which it relates so that any subsequent changes in the data can be detected: the signed documents comply with the European PAdES standard and are archived in a proof file.

 

2.2  Proof and types of electronic signatures
  • Article 1367 of the French Civil Code specifies that qualified electronic signature benefits from a simple presumption of reliability.
  • When the electronic signature is not qualified within the meaning of the eIDAS Regulation, this does not affect the admissibility of the electronic signature as evidence, but the burden of proof of the reliability of the process will be on the party seeking to rely on it.
  • Article 25 of the same Regulations expressly prohibits that the “legal effect and admissibility as evidence in legal proceedings” should not be refused “solely on the grounds that it is in an electronic form or that it does not meet the requirements for qualified electronic signature”.
  • In any event, where the burden of proof of the reliability of the electronic signature is on the party invoking it, French case law admits this rather easily. In particular, it considers that the reliability of the signature is demonstrated when it is established that the process used “meets the reliability criteria relating to the identification of the author of the electronic writing and the immutability of its content” and that access and transmission of the document is in “secure mode” and is “no longer modifiable once transmitted” (CA Nîmes, 2 e ch. Com., sect. B, 1 st Oct 2015, n°14/01618; CA Aix en Provence, 26 June 2014, n°13/19600; CA Caen, 5 March 2015, n°13/03009; Cass. civ 1 st, 6 April 2016, n°15-10.732. More generally, see E. Caprioli, JCP G n°18, 29 April 2013, 497.)
  • Proof that the electronic signature meeting the requirements of Article 26 of the eIDAS Regulation guaranteeing the identification of the signatory and the integrity of the signed document is provided by the technical procedures set up by the DOCUSIGN platform.

 

3.  Date of electronic signature

 

3.1  Definition of electronic time stamping

 

  • The signature of each party attests to his or her consent, which is reflected in article 1367 of the French Civil Code. The signature therefore marks in time the birth of the contractual relations between the parties. There is therefore an interest in determining the date of the electronic signature, which is made possible by time stamping.
  • The so-called “timestamping” process was enshrined in French law with the Decree No. 2011-434 of 20 April 2011 on the timestamping of letters sent or received electronically for the conclusion or performance of a contract and in the eIDAS Regulation of 23 July 2014.
  • Electronic time stamping makes it possible to ensure that, at a given date and time, a document was electronically signed. As such, it freezes the content of a document at that moment, to ensure its integrity and prevent any subsequent modification.
3.2 Electronic time stamping and proof rules
  • The eIDAS Regulations, like the Decree of 20 April 2011, determine the proof rules applicable to electronic time stamping with the same scheme as the one relating to electronic signature. The reliability of the process must be established, it being understood that the reliability is presumed when the timestamp meets the conditions necessary to make it “qualified”. When these conditions, described below, are not met, simple timestamping remains valid, but the burden of proof of its reliability then is on the party invoking it.
  • The eIDAS Regulation provides that qualified timestamping is provided by a trusted service provider who, in the same way as for electronic signatures, must have obtained a qualified status awarded by an inspection authority, i.e., in France, the ANSSI.
  • In any event, paragraph 1 of Article 41 specifies that “the legal effect and admissibility as evidence in legal proceedings” should not be refused “solely on the grounds that it is in an electronic form or that it does not meet the requirements of the qualified electronic time stamp“.
  • DOCUSIGN provides for a timestamp of the signature which is not qualified but has legal effect and probative value. Time stamping occurs after the electronic signature has been affixed to the document and fixes the content of the document and the signatures it contains over time. Proof of its reliability must be provided by the party invoking it. In this respect, what applies to the electronic signature itself applies here to timestamping.
  • In these circumstances, the contract is effective and must be considered, on the basis of the evidence, as perfect after the last signature of the parties, unless expressly stipulated otherwise (e. g.: “This contract is deemed perfect and shall take effect as from …“).

 

4.  Laws applicable to electronic signatures

  • The question of the applicable law arises when a contract has a foreign element relating to the nationality of the contracting parties, the place of formation or performance of the contract, etc. The question of determining the applicable law is likely to arise when the signature is electronic, its dematerialization favoring signature from remote locations.
  • EC Regulation No. 593/2008 of 17 June 2008 on the applicable law to contractual obligations, known as “Rome I”, gives the parties the possibility to choose the law applicable to their contract. Article 3 provides that “a contract shall be governed by the law chosen by the parties. The choice shall be made expressly or clearly demonstrated by the terms of the contract or the circumstances of the case“.
  • The Rome I Regulation specifies that the law applicable to the substance of the contract, designated by the parties, also governs the formation of the contract and its proof. Article 10 applicable to the “consent and material validity” of the contract provides that “the existence and validity of a contract, or of any term of a contract, shall be determined by the law which would govern it under this Regulation if the contract or term were valid”.
  • Regarding proof rules, article 18 of the Regulation provides that “the law governing a contractual obligation under this Regulation shall apply to the extent that, in matters of contractual obligations, it contains rules which raise presumptions of law or determine the burden of proof“.
  • Therefore the electronic signature expressing the consent of the parties and contributing to the existence of the contract, must be subject, as to proof, to the law applicable to the substance of the contract, in other words, to the law designated by the parties, wherever they may be physically located.
  • Therefore, if the parties have chosen French law as the applicable law to their contract (or any other EU law, as French law has only transposed European Regulation No. 910/2014 of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market), it is this law that will apply to electronic signatures.