What is an electronic signature?

I’m a newly qualified solicitor acting in a commercial transaction. To speed up the process, the parties have agreed to use electronic signatures to sign the contract. What constitutes an electronic signature?

The term ‘electronic signature’ is a general description of a variety of electronic methods for ‘signing’ documents in the same way as a manuscript signature.

It is widely used within commercial contract work.

An electronic signature is defined in section 7(2) of the Electronic Communications Act 2000 as anything in electronic form:

• as is incorporated into or otherwise logically associated with any electronic communication or electronic data; and
• purports to be so incorporated or associated for the purpose of being used in establishing the authenticity of the communication or data, the integrity of the communication or data, or both

Examples of an electronic signature include:

• typing the name of a person at the bottom of an email, word-processing document, or web page
• a person typing his name into a contract or into an email containing the terms of a contract
• a manuscript signature that is scanned and becomes a graphic image that is inserted into a document
• the clicking of an 'I accept' button or icon on a web page where the intention is to enter into a legal obligation

A ‘digital signature’ is a more secure form of electronic signature where its authenticity is guaranteed by a third party who has validated the signatory and the use of certain encryption and a password or key.

For further information, see our practice note on execution of a document using an electronic signature.