Govt awaits Law Commission's report on electronic signatures

Recommendations to government on electronic commerce issues will be made in the Law Commission of New Zealand's report within the next two months. The commission's second report on the topic follows public consultation on its first report released last year.

Recommendations to government on electronic commerce issues will be made in the Law Commission of New Zealand's report within the next two months.

The commission's second report on the topic follows public consultation on its first report released last year: "Electronic Part One: a guide for the legal and business community".

A spokesman for the Ministry of Commerce says the report will cover a range of recommendations on what New Zealand should do regarding e-commerce issues.

It will be up to the government to act on the report, but the spokesman understands legislation isn't likely to happen until after the election.

"And it's likely that any proposed legislation would be based on the provisions in the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Commerce."

Among the issues likely to be addressed in the report is the legality of digital signatures in New Zealand.

According to the Law Commission there is uncertainty in New Zealand over whether it's possible to meet a statutory requirement of a signature unless a physical document is created, and a physical mark is made on that document. This is because of the absence of a statutory definition of "sign" or "signature" by purely electronic means.

In it's initial report, the commission said although the common law has permitted "signature" by a variety of marks or symbols (whether written, printed or stamped on to paper documents), there appears to be no authority which approves a signature by purely electronic means.

It's an issue the UK government is addressing with its Electronic Communications Bill. The UK government has opened a consultation period on the proposed legislation which it hopes will move British law into modern times, and make it more attractive for e-commerce.

The bill covers topics ranging from the terms for introducing third-generation mobile phones to the licensing of broadband services, according to the Department of Trade and Industry (DTI).

Among the proposals drafted in the bill is one specifying that digital signatures should become the legal equivalents of print signatures.

Britain's bill does not have any requirements for key escrow ó third-party storage of decryption keys ó but it does give more power to law-enforcement agencies seeking either the key to the encrypted data, or the plain un-encryp-ted text of the material.

The bill came into the news last month when the Conservative Party, suspecting the Labour Party of leaving a back-door to implement legislation in the future, argued that key escrow was not specifically ruled out.

The DTI also intends to update laws to allow email to be used as an option to printed paper, giving companies, for example, the option of communicating electronically with shareholders.

In New Zealand the Companies Act allows for information to be delivered, posted or faxed to shareholders. Venture capital company IT Capital lobbied the Minister for Enterprise and Commerce, Max Bradford, earlier this year to change the law so shareholders could read company information on a Web site after being notified by email, fax or letter that the information was there. IT Capital managing director David Seton said at the time it no longer made sense, in an increasingly digital world, to have to instead mail information.

The minister responsible for IT affairs in the UK, Michael Willis, left the UK bill open for comments until October 8, and will introduce the bill to Parliament in the next session.

The Department of Trade and Industry can be found on the Web at www.dti.gov.uk.

The Law Commission's first report can be found at www.law com.govt.nz/pub_index.html. The new report will be posted on the site after it's released.

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