Electronic Signature Law Of The Peoples Republic Of China

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Gregory Sy, Lehman, Lee & Xu

The Standing Committee of the National People’s Congress adopted the Electronic Signature Law of the People’s Republic of China on August 28th, 2004, and went into effect on April 1st, 2005. This law is expected to have a large impact on the development of electronic commerce in China. In summary, the law establishes the validity of electronic documents and signatures, and outlines the requirements necessary for their binding legal effect.

China Electronic Signature Law provides key definitions before introducing its precepts. For instance, Article 2nd defines data message as information generated, sent, received or stored by electronic, optical, magnetic, or other similar means. An electronic signature means data in electronic form, attached to or associated with a data message which serves to identify the signatory, in relation to the data message, and to indicate the signatory’s approval of the information contained in the data message. Where the parties agree to use such data messages or electronic signatures, they may not deny the legal effect of such documents merely because the documents are in electronic form.

Are there exceptions to the validity of electronic documents under the China Law?

Yes, electronic documents rules will not be applicable to documents pertaining to:
(a) personal relationships such as marriage, adoption, inheritance, etc.;

(b) transfer of rights and interests in real property, such as land, housing, etc.;

(c) suspension of the supply of public utilities, such as water, heat, gas, electricity, etc; and

(d) other conditions specified in laws and regulations for which electronic documents

are inappropriate.

What elements must a data message have to be considered an original document?

In order to constitute an original document, a data message must meet the following requirements:
(a) its contents must be effectively displayed, retrieved, consulted and used at any time; and

(b) it must reliably maintain its content integrity, without modification, from the time it is finished. Yet, the addition of an endorsement on a data message or change in the format during the data exchange period, storage and display, shall not affect the integrity of such message;

What are the conditions for document preservation under China Digital Signature Law?

In order to meet the requirements of laws and regulations for document preservation, the electronic document must comply with the conditions set forth below:
(a) its contents must be effectively displayed, retrieved, consulted and used at any time;

(b) its format must remains the same at the time of its creation, transmission or receipt, or its format is different but the data message can accurately display its original contents when generated, transmitted or received; and

(c) its sender, recipient and the time of transmission and receipt must be identified.

What are the requirements of an Electronic Signature to be binding?

To be legally binding, an electronic signature must meet all of the following conditions:

(a) the electronic signature must belong to the party creating the document to which the electronic signature is being attached;

(b) at the time of signing, the electronic signature attached to a document must be solely controlled by the electronic signatory;

(c) any change to the electronic signature after signing must be noticeable; and

(d) after signed, any change to the content and form of the data message must be noticeable.

Courtesy of Internet Business Law Services.

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