Electronic Signature Laws by State: Do They Differ?

Although usage of electronic signatures is so common in the US and worldwide today, not all types of signatures can be considered acceptable electronic signatures according to the federal digital signatures law and the local rules of some states. For this reason, we decided to clarify the legal side of this process to you before you add a signature to your next document. If you are wondering "Are electronic signatures legal?" read attentively.

Are Electronic Signatures Laws Differ by State

An e-signature is a digitalized signature of a person that can be placed on electronic documents, such as forms and contracts, to confirm that they were filled out with full consent and clear mind. The most common type of electronic signature is, of course, a written signature (scanned, digitally drawn, or generated), but it can also be a sound recording or a symbol.

ESIGN was enacted by the US Federal Law in 2000, and it became a part of the Uniform Electronic Transactions Act (UETA). In the same year, New York and Illinois issued their own versions of the Federal Electronic Signature Act.

Almost 20 years after, Arizona, Nevada, and Tennessee changed their UETAs to start off the integration of more advanced and secure ESIGN protocols with the use of blockchain technologies. This didn’t affect the legislation directly, but it seems that standard e-signatures may become history in the nearest decade or so.

As for the EU, the unified e-sign law was established only in 2016. Before that, all states of the union had their own policies, which had lead to various electronic signature legal issues. Today, the process in all EU members is coordinated by the 2016 electronic Identification and Trust Services for Electronic Transactions (eIDAS). The legality of electronic signatures for particular types of documents still varies from country to country, so check this out for your country.

Electronic Signature vs. Digital

Another important aspect to understand is that electronic and digital signatures are two different types of signatures according to the electronic signature Federal Law.

Electronic signature

Includes most of the e-sign solutions and can use such authentication methods as corporate IDs, signer’s email, password, or a PIN-code sent over the cellular network. The signature must be approved by an embedded digital certificate.

Digital signature

Must use a digital certificate from certified trust service providers (TSP). The approval instrument is called a certificate authority (CA), and it’s embedded into signed documents with the use of encryption.

  1. Under the ESIGN Act of the US, both types of signatures can be presented as evidence in court and, generally, you can use them for signing the same types of documents unless the requester demands a particular solution.
  2. The banking and healthcare sectors are the most active adopters of digital signature solutions as they operate exceptionally large numbers of documentation on a daily basis, and the e-signature act significantly speeds up their standard agreement processes.
  3. If you worry that your electronic and digital signatures can be stored somewhere and reused against your will, we have to bust this myth. Every electronic signature you leave on documents has a mathematical algorithm behind it. It’s also called a hash and matches every document you sign, making it unique and impossible to counterfeit.
  4. Every signature also has a time marker that changes automatically if anything occurs to the signature without authorization. Even if this small marker doesn’t match the date of the document, it becomes invalid. Moreover, the signer always keeps a unique key or any other authenticator so that even a masterfully copied signature won’t have any power if it’s not linked to your unique authentication data.

Even the most basic certified e-signature platforms tie your signatures with your account data and encrypt with long keys to protect sensitive data from copying. Encryption protocols may differ, depending on the service provider you choose, but all of them protect your authenticators and don’t store your personal keys in any format that could be potentially read by a malicious employee or any other party.

You can think of it as an electronic signature authorization language. It’s relatively simple math, but even the most experienced computer engineers cannot take your keys. Even if they managed to find a way to do it, it would be too expensive and risky to commit such theft and initiate a realistic e-signature procedure.

At this point, e-signatures are even more secure than physical signatures. Even a computer-generated typed signature that can be easily copied multiple times is impossible to use on your behalf if there is no unique authentication data behind it. Keep your account password safe in your head, don’t give it to any suspicious parties, and everything will be ok.

FAQ

Questions may pop up all the time in your head when it comes to laws that govern digital signatures. We answered the most probable of them to provide you with a deeper understanding of the topic.
Customer:
Are electronic signatures valid in all states?
Support:
Yes, they are valid in all states. However, the states of New York and Illinois have their unique electronic signature regulations instead of UETA. In recent years, Arizona, Nevada, and Tennessee amended their UETAs in order to signalize the importance of modernizing the technology by means of blockchain. Probably, more states will follow these examples in 2021 and later.
Customer:
What states don't require electronic signatures?
Support:
UETA is adopted in 47 states as well as in the District of Columbia, Virgin Islands, and Puerto Rico. Washington, New York, and Illinois have custom regulations but allow e-signatures too. Only particular documents in each state are prohibited for electronic signatures. The list can be easily found online or requested from a local Notary Public of your state or country.
Customer:
Is it legal to sign documents electronically?
Support:
Yes. E-signatures are legal in all states of the US, EU, and many other countries, but not all documents can be validated with an electronic signature. Here are the forms that can’t be signed electronically in the US:

  • Wills
  • Leases
  • Deeds
  • Adoption papers
  • Notices of termination of (leases, utility, etc.)
  • Notice of repossessions
  • Notice of foreclosure
  • Divorce papers
  • Court orders
  • Notice of eviction
  • Product recall notices.
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