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The eIDAS Regulation: Introducing New Electronic Signature Rules

On 1 July 2016, new rules for electronic signatures and other electronic trust services under the 2014 eIDAS Regulation will become effective in all member states of the European Union. Since it is a regulation, no implementation into the national laws will be necessary.

Following a two-year transition period, electronic trust services such as electronic signatures, electronic seals, time stamps, electronic delivery services, and website authentications will now work seamlessly across borders and be given the same legal status as traditional paper-based documents and processes. 

One of the major changes that will have a substantial impact on companies doing business in Germany or other EU member states relates to the electronic signature environment. Prior to 1 July 2016, qualified electronic signatures, which satisfy the legal requirements of a handwritten signature, could only be created if the signatory was in possession of a signature card and a card reader device. Therefore, very few people and companies used qualified electronic signatures.

This impediment is now about to change as the new electronic signature rules under eIDAS make it, for the first time, possible to create so-called remote qualified electronic signatures. These are qualified electronic signatures which are produced under usage of a signature creation device that is not held by the signatory himself but by a third-party trust service provider who creates the electronic signature on behalf of the signatory

Signatories therefore no longer need to be in possession of a signature card and a card reader device if they want to enter into a contract or make a declaration for which a handwritten signature is required. 

Going forward it will therefore not only be permitted but also practically doable to electronically enter into consumer credit agreements, temporary employment agreements, or other B2C contracts which are subject to a statutory written form requirement. This will also provide opportunities for digital services providers as they can add “qualifying trust services” to their portfolio.