President Gives Nod to Digital Signatures
Page 1 of 2
A Friday Webcast featured U.S. President Bill Clinton penning his electronic "John Hancock" on the Electronic Signature Act, officially granting e-mail the same status as paper in court.
EXBTV.COM carried the Webcast live from the historical grounds where the Declaration of Independence was signed with a quill pen. Clinton used a smart card to transform the bill into law, after he had signed the document earlier in the day with a more traditional pen.
Jake Siewert, White House spokesman, was jokingly tentative about the dual signatures. He said the law was signed by both electronic and conventional means in honor of tradition and because the law would most likely best tested in court.
"At this point we're still exploring whether it would be constitutionally acceptable for the president to e-sign a bill and whether it's advisable in light of the 200 years of tradition," Siewert said.
The House of Representatives and the Senate overwhelmingly approved the bill earlier in June. It was crafted to pave the way for a new era of e-commerce.
The measure, similar to laws already approved in dozens of states, requires that consumers consent to doing business online and that they are assured consumer protection that is equivalent to those in the paper world.
Under the legislation, no contract, signature or record can be denied legal effect solely because it is in electronic form. Currently, a consumer that desires to open a mutual fund account can get a load of information about varying funds on the Internet. But there is no way to open an account without printing a document and faxing a form back, and forth while the consumer waits for the transaction to be processed.
The E-SIGN law eliminates paper requirements and delays, allowing consumers the conveniences of opening such accounts online. Under the law, consumers must opt-in for electronic records, ensuring that those who don't have access to computers could maintain paper records.
Since May, the House has passed several key measures designed to promote growth in the new economy. Representatives have worked to press through legislation that could eventually extend a five-year moratorium on Internet taxes, permanently ban taxes on Internet access fees and eliminate the 3 percent federal excise tax on long-distance telephone charges.
Federal legislators remain tasked with the issue of what data it would require companies to electronically archive. Congress is expected to specify data storage requirements long before the law takes effect on March 1, 2001.
MessagingDirect Ltd. has been working to gain acceptance of digital signatures over the past 12 years. Steve Hole, MessagingDirect chief technical officer, said the firm has set many standards for the secure messaging industry in preparation for e-mail equality with paper.
"Because we've been involved with securing electronic message services since for a long time, our core of software programmers have developed more than 35 standards that impact how the secure messaging infrastructure and delivery format operates," Hole said.
While consumers inherently fear e-mail fraud, like most new technologies are feared, Hole said the market is about to undergo a liberating experience due to the new law.
"We have single consumers that are producing more than 10 million bills or statements each month," Hole said. "Because a digital signature also works as a time stamp, the new law relieves regulatory pressures on industries that produce mountains of statements."
"Financial institutions, insurance companies, brokerages, and utility companies wil