Online signatures deal aims to boost e-commerce in Europe

Date: 04/11/1999

By Peter Chapman

MEMBER states are set to boost the EU's fledgling electronic commerce market later this month by adopting new Union-wide rules which would require European courts to recognise electronic signatures used in online contracts.

The aim of the move, which is expected to be approved by Union telecoms ministers at their next meeting on 30 November, is to boost the confidence of firms and customers in e-commerce by giving contracts signed electronically over the Internet the same legal status as those with a traditional hand-written signature.

The prospect of agreement on the proposal will come as a relief to the Finnish presidency, given the lack of progress it has made so far in thrashing out deals on other planned information society legislation.

Attempts to get agreement on the Commission's proposals for an electronic commerce directive before the end of this year have run into serious trouble, as they are now caught in a separate dispute over the right of consumers to take legal action in contractual disputes in their own courts.

The chances of getting a deal on proposed new online copyright rules by December also look slim as the debate between member states over a slate of complex issues hots up.

Finnish diplomats say agreement on the planned new rules to govern digital signatures - which include measures to create a single market for the officially-recognised bodies which 'certify' that signatures are authentic - has been made possible by a vote on the issue in the European Parliament last week and ministers' decision to bury their earlier differences over the proposals.

France, Germany, Italy and Portugal had originally called for a detailed 'technical annex' to be added to the draft legislation setting out precise requirements for approved signatures in a bid to reduce the risk of forgery. But this ran into opposition from other member states, which insisted that industry should be left to decide which standards to use.

A compromise formula drawn up by the Finns which keeps technical requirements to a minimum while ensuring safeguards are put in place has found favour with both camps, paving the way for a deal.

Electronic signatures use unique data to formulate the electronic equivalent of traditional pen and ink. A signature can either be based on a long string of numbers generated by complex mathematical formulae or other 'biometric' technology which creates a signature from unique features such as a finger print or human eye.

Member States are set to boost the EU's fledgling electronic commerce market by adopting new Union-wide rules which would require European courts to recognise electronic signatures used in online contracts.