US Signature Bill validates e-commerce transactions

US Signature Bill validates e-commerce transactions

Industry observers are still trying to assess the impact on e-commerce of the new digital signatures law in the US.

In recent discussions, California Attorney General Bill Lockyer joined with several heads of high tech companies to assess the impact of the Electronic Signatures in Global and National Commerce Act, or E-Sign.

Issues raised include the Government's role in shaping e-commerce, the security of digital signatures, and what needs to happen in the future to improve the technology behind digital signatures.

Lockyer positioned the state government's role in e-commerce as a constructive partner "trying to facilitate the new commerce."Government is stepping up its presence, Lockyer suggested, as issues of security, Internet-based crime, and commerce rise to the forefront of the economy.

"With respect to State Government, there will be a variety of e-government solutions. We will have enhanced and aggressive efforts to combat fraud to try to protect businesses, property, and consumers," Lockyer said. "We have high tech crime problems in California, as well as in the rest of the nation . . . and part of our responsibility in the department of justice is to assist with Federal, State, and local investigations, forensic efforts, and prosecutions as we identify issues of that sort."A major implication of the digital signature act for businesses is the validity the law brings to e-commerce transactions, according to John Witchel, CEO of Red Gorilla, in San Francisco, which syndicates applications for use by Web sites.

"A deal initiated over e-mail and concluded electronically is now something you can go to court over. A digital signature means a judge can validate that that is a binding contract," Witchel said. "Now finally we have the courts behind us and we can conduct higher volumes of transactions and trade more confidently."Accessing the law's impact on the online mortgage industry, Henrick Johanson, the executive VP of strategic development at US-based Creditland, said legally binding digital signatures will bring down the cost of processing mortgages and let consumers close mortgages online in as little as five days instead of the 60-day process it can take today.

The law will also help automate the entire process of conducting commerce transactions, which until now has been held back by the legal need for manual intervention.

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