A decade after the U.S. Congress passed the ESIGN and UETA acts to bring uniformity to the acceptance of electronic signatures in commerce, some ambiguity remains at the state level regarding what can be accepted as an electronic signature.
This can make the efficiencies you can gain implementing e-signature software harder to obtain as a local business in Washington State.
According to a note (posted in the Washington Law Review, which we found on ESRA?s blog) written by Stephanie Curry, the biggest outstanding issue is the laggardly path to confirming e-signature validity in the State of Washington, where they are still working on a law to confirm their interpretation of the Federal standard.
Washington started out ahead of the curve, passing a legal framework for using digital signatures way back in 1996. They did update the law in 1999, but in a way that created confusion, and left in place language that only referred to ?digital signatures,? creating a lot of confusion as to what is actually legally binding.
All other states have either adopted UETA as their standard, or in the case of New York and Illinois, put in place laws that closely mirror either UETA or ESIGN and don?t raise uncertainties about whether the state law could be pre-empted by the Federal laws, noted Curry.
In her note about this, Curry summed up why this matters to the rest of us:
?Washington?s law was originally drafted to give legal effect to digital signatures?? a?subset of?electronic signatures?that uses specific, secure technology (see our previous post on how digital and electronic signatures differ?- ed.) ? and it has been amended only superficially to incorporate all types of electronic signatures.
Of particular concern to UETA advocates is that Washington State?home to such e-commerce pioneers as Amazon.com, Microsoft, and Expedia?trails behind all other states in its electronic signature laws.?
Ms. Curry?s recommendation is that ESIGN probably pre-empts Washington State?s current electronic signature regime for interstate transactions, but has no role to play in governing intrastate transactions. For those, the old Washington state law must be followed, and it is confusing and probably puts a drag on the use of electronic signature tools in business of all sorts.
If you plan to do business in the State of Washington, involve your own legal and compliance pros to craft your internal policies regarding any transactions that involve obtaining electronic approval/agreement with customers, vendors and other counterparties.