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E-Signature signed contracts in Ukraine. Is it possible?
Автор: Юрий Котляров, Мария Бокач
Источник: Lexology, 5 августа 2019 года
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E-Signatures are legally valid and enforceable not only in industrialized countries, but also  in less developed countries that beginning to enact e-signatures laws.

Generally, there are three types of e-signature laws: `permissive` that allow for the broad enforceability of e-signatures; `prescriptive` that require approved technologies to electronically sign a document and `two-tier` that permit the use of e-signatures on technology-neutral basis, but provide  greater evidentiary weight to digital signatures like qualified e-signature.

In 2014 the EU has adopted a new regulation, which will introduce a new legal framework for electronic signatures, seals, stamps and electronic trust services for all members of the EU, known as `e-IDAS Regulation` and replaced the Directive on Electronic Signatures ( 1999/93/EC).

Ukraine has enacted a two-tier approach to legislation governing e-signatures.

In the effort to harmonize the Law regulating electronic signatures in Ukraine with the e-IDAS Regulation, the Ukrainian parliament adopted the Law of Ukraine `On electronic trust services` (`the ETS Law`), which fundamentally amends the national domain of electronic signatures and introduces the concept of electronic identification and electronic trust services.

The ETS Law provides for three types of electronic signature: electronic signature; advanced electronic signature, and a qualified electronic signature. Due to different legal regimes of different types of e-signatures in Ukraine there is also used a term of a `simple e-signature`.

All this types of e-signatures are used extensively today in legal signing processes, but the specific choice for every company will depend not only upon risk profile and business requirements, but also  on governing law of the country that apply to regulate  the usage of e-signatures and its certain types in different B2B transactions. So, it is necessary to understand how to make easy to set up agreements that work across multiple countries with just a few simple steps and follow legal requirement prescribed by law to ensure such agreements to be enforceable.

 

Types of e-signatures

The simple e-signature is not sufficiently defined and regulated by the specific Ukrainian law, but its usage shall be preconditioned by the execution of the prior consent as established by the Civil Code of Ukraine. This type of e-signature is not capable of identifying the person that signed it.

An advanced e-signature is more secured than a simple e-signature, as it is created as a result of cryptographic conversion of electronic data, using the means of an advanced e-signature and a personal key that enables electronic identification of the signatory.

Only a qualified e-signature shall have the equivalent legal effect of a handwritten signature and is based on a qualified open key certificate.

 

Are electronic signatures enforceable for the contract signing  in Ukraine?

Generally, yes. Under the general rule parties can use relevant type of the e-signature for civil transactions if (i) it is permitted by the Ukrainian Law; or (ii) the parties have previously agreed in writing to use the e-signatures in their future relations and such their written consent contains the specimen of the e-signatures that will be used as an analogue of their handwritten signatures.

But it is worth mentioning that some types of contracts are not legally prohibited from being signed by the e-signature, it nevertheless cannot be used due to certain technical or practical limitations. For example, agreements on sale and purchase of real estate for three and more years cannot be signed electronically because they require notarization. According to the ETS Law documents  that require notarization could be signed and/or notarized by e-signature, but de-facto, no, whereas  the notarial process in Ukraine is not yet compatible with the ETS Law.

That is to say, that the Law generally allows using relevant type of the e-signature for signing the contracts unless the transaction (i) is specially prohibited from being executed in electronic form or under the specific type of signature or (ii) specifically requires use of the qualified electronic trust services and the qualified e-signature. 

The main aim of an e-signature is to identify the data signer and to indicate that the person intends to approve with the contents of the contract. There are always risks attached to the use of any form of e-signature, and the user, whether a sending party or a receiving party, should first of all be guided by the requirements of the legislation and secondly make themselves aware of the risks before using any form of e-signature for high value transactions, even less secured type of the e-signature is permitted by the Law.