Are digital signatures valid in the UK?
E-signature validity varies from place to place, and the regulations and laws in different jurisdictions vary greatly. This can be confusing, but in this blog post we will aim to dispel some confusions on e-signature validity in the jurisdictions of the UK.
E-signatures in different UK jurisdictions
The first thing to point out is that the UK is not one jurisdiction - it is split up into three - England and Wales, Scotland, and Northern Ireland. Northern Ireland is similar to England and Wales, however, Scotland uses a completely different system, based on Roman law.
All of the UK’s jurisdictions provide for e-signatures in statute and case law. The main issue regarding e-signatures in the UK is being able to prove who signed and that they intended to be bound. The Agrello simple signature is able to be used in the majority of cases in the UK market, exceptions to which are noted further on in this article.
In England and Wales, there are two statutes implementing the EU eIDAS regulations, the Electronic Identification and Trust Services for Electronic Transactions Regulations 2016 and Electronic Identification and Trust Services for Electronic Transactions (Amendment etc.) (EU Exit) Regulations 2019 (SI 2019/89). The Electronic Communications Act 2000 also provides for use of e-signatures in legal proceedings and business transactions.
Case law on digital signatures in the UK
There is also some case law providing for digital signatures. The cases to note here are Golden Ocean Group, where it was ruled that e-mails could be the basis of a valid contract, and Mercury, which has been interpreted in the way that means signing a document with wet ink on paper and scanning it as a PDF is valid under the EIDAS regulations.
In Scotland, the Writing Act 1995 provides for instances where advanced or qualified electronic signatures need to be used. These are documents related to land, gratuitous unilateral obligations i.e. making a definite promise to do something such as giving money to charity, ‘truster as trustee’ trusts - where the person who is setting up the trust is the same as the person benefiting from the trust, or where a document needs to be self proving, a process similar to witnessing the signing of a contract.
Which documents can be signed digitally in the UK?
- Employment contracts;
- B2B agreements;
- Service agreements.
Financial agreements and documents can be signed electronically, but careful consideration should be taken in financial transactions.
In family law, digital signatures can be used with caution, and under advice from a solicitor.
Which documents cannot be signed digitally in the UK?
There are some areas where e-signatures either cannot be used or need to be used with care. This includes deeds, and statutory declarations.
- Deeds are documents that transfer or confirm the right or an obligation to someone. A contract might contain a deed, for example, an employment contract may contain a deed that transfers a power of attorney, in which case digital signing cannot be used.
- Statutory declarations are declarations, that a piece of information is true to the best of the knowledge of the person making and signing the declaration. These cannot be signed digitally.
- Documents for HMRC (His Majesty’s Revenue and Customs), the UK tax authority, cannot be signed digitally.
- Documents for the Land Registry, the body dealing with land and real estate, can be signed digitally, but with very specific rules, for which a solicitor should be consulted.
- For documents related to corporate governance, company deeds need to be signed in specific ways according to the Companies Act 2006. If company deeds are signed with witnesses, then electronic signatures cannot be used.
- In cases of intellectual property, digital signatures cannot be used to transfer rights and assign design rights, as per ss90(3) and 222(3) of the Copyright Designs and Patents Act 1988.
Overall, most simple contracts can be signed digitally and with Agrello, but there are some exceptions for which digital signing cannot be used, or where a solicitor needs to be consulted.