After many incarnations, the Electronic Signatures in Global and National Commerce Act passed through Congress with flying colors in June.
Popularly known as the Digital Signatures Bill, or E-SIGN Bill, the act's purpose is to facilitate the use of electronic records and signatures in interstate and foreign commerce. It gives electronic contracts, records and signatures the same legal weight as their paper counterparts. The few exceptions include family law, creation and execution of wills, court orders, notice of utility terminations, and cancellation of health or insurance benefits.
For entrepreneurs, the act makes a wide variety of electronic transactions available and eliminates the need to obtain "pen and paper" signatures. It defines an electronic signature as an "electronic sound, symbol or process attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record."
Although the act cuts down on paperwork, entrepreneurs need to be aware that consumers must now be allowed to opt-in to electronic records and contracts. The act doesn't specify what methods should be used for authentication. That's where companies like VeriSign come into play-VeriSign is one of many "Internet trust providers" making secure e-commerce transactions possible.
You don't have to be an online retailer to take advantage of the bill. While electronic signatures are expected to be popular in business-to-consumer transactions, they also apply to government-to-business and b2b contracts.