Summer Season – Episode 2
Where Are YOU? When I Needed You Most
With the growth of cloud maturity, companies regardless of size, sector or type have embarked on digital transformation journey. The expected outcomes are enhanced efficiency, reduced operational cost and business sustainability. As the pandemic has brought the “new normal” to workplace, more and more companies are embracing digital documents and electronic signatures in their operation. The question is, are these technologies broadly accepted by the market? Canon has organized Episode 2 of Summer Season webinar – “Where Are YOU? – When I Needed You Most” on 28 Aug 2020, and invited the Partner of Deacons to investigate the application and acceptability of these tools from a legal perspective.
Cloud technology offers convenience to our personal and professional lives, allowing us to work digitally anytime and anywhere. Deacons, a law firm of the longest history in Hong Kong, also realized the growth of digitalization trend in the legal industry. In fact, digital technology can perform different functions in different business aspects such as management of legal documents, retrieval of customer information, and integration of data. Hence, business can save large amount of time, storage costs and spaces.
Digitalizing Business Documents
Facilitate Internal Communication
Communication and document transfer between departments can become more convenient. Simplified workflow can help enhance efficiency and save human resources and time.
Document Traceability
Business can manage better on audit log, version control and file locking through audit trail function, which is especially suitable for complex transactions and multi-party agreement.
Enhance Privacy and Security
Controlling access right of individuals on specific documents can elevate levels of privacy and security. This can also prevent any unauthorized access and use.
Furthermore, e-signatures are becoming more commonplace. It enables all parties to the contract to sign in seconds with their smartphones, computers and other mobile devices and complete transactions remotely. This not only reduces the time required in obtaining, exchanging or posting signed hard copies, but at the same time facilitates the development of e-commerce. E-signatures are widely used in digital businesses such as e-commerce, digital insurance companies and internet banking. In addition, multinational companies in Hong Kong including insurance company, telecommunications company, airline and food and beverage company have already adopted e-signatures in their operations. Cross-border transactions can be therefore completed easily via mobile devices, making digital business attainable.
Applications of Electronic Signatures
Industry Application
E-signatures are legally binding and can be used for most commercial documents and cross-border transactions, enhancing flexibility and efficiency of business operation.
Exceptional Case
Designated documents, such as wills, powers of attorney, affidavits, trusts and court proceedings documents are not suitable to be signed electronically.
E-signature Tool
It is necessary to have multi-factor authentication and well-developed cybersecurity controls to reduce the risk of forgery, and it must comply with local law.
E-signatures are legally binding and has the feature of non-repudiation, which can effectively prevent forgery of documents. The Electronic Transactions Ordinance (Cap. 553) ("ETO") enacted by Hong Kong Government states clearly that e-signatures are legally equivalent to written signature under certain conditions. For electronic transactions with individuals or private institutions, e-signatures must be logically associated with the document and be able to verify identity of all parties to the contract. The relevant methodology must be reliable, appropriate and approved by the recipient. Moreover, transactions with government entities require digital signatures signed using a certified digital certificate in order to comply with local laws and regulations. There are also court cases in Hong Kong and other common law countries that have challenged and tested the use of e-signature, illustrating its popularity across the world.
Electronic Signature Related Court Cases
Hong Kong
In a case concerning debt in December 2015, the judge accepted that the electronic signature in question can be regarded as a valid electronic signature under the Electronic Transactions Ordinance, Cap. 553.
Australia
In 2020, the Australian court did not dispute a Costs Agreement to be signed by clients electronically via DocuSign.
United Kingdom
In a dispute between a car owner and dealer in 2019, the court did not dispute the validity of the e-signature signed using DocuSign in the involved contract.
*The information presented does not, and is not intended to, constitute legal advice. All information and content are for general information only. They are subject to the information published by the courts or official authorities of the relevant countries and regions. Although we have made every effort to provide complete and accurate information, we make no warranties, express or implied, or representations as to the accuracy of information.
