Overview of electronic signature law and its legality in the United States
Electronic signatures can help you leave paper documents behind and create legally-binding contracts in an electronic form. Select a country to learn how e-signature laws affect the legality of your contracts when working across international borders.
Electronic signatures are powerful tools that you can use to streamline every aspect of your business operations.
Every day, businesses around the world use e-signature solutions like PandaDoc to get proposals, contracts, agreements, and forms signed in a digital format. This removes the trouble of printing and digitizing paper documents and optimizes record retention all while speeding up everyday business processes.
Using digital signatures allows businesses to operate across national and international boundaries by creating electronic records that comply with federal laws and regulations.
This type of electronic communication means that businesses leveraging electronic documents are able to react more quickly to customer needs.
In short, the flexibility that digital signatures bring to modern businesses only works as long as the legality of electronic signatures is upheld by the country where the contract takes place.
This is made possible in a large part by legal recognition in the United States and the European Union. State laws and federal regulations ensure the validity of electronic signatures and serve as a framework for the requirements surrounding the use of electronic signatures.
If you’re new to electronic signatures, don’t worry! The legal requirements behind digital signatures — from public-key encryption to traceable audit trails — are well-established. Courts have defended the legal power of digital contracts in electronic commerce for decades.
As long as you’re using an e-signature solution that adheres to current regulations, an electronic signature will carry the same legal effect as that of a handwritten signature.
As with most legal matters, electronic signature law can be difficult to understand.
That’s why electronic signature solutions like PandaDoc exist. As your signing solution, we ensure that the electronic records you send are secure and that the digital signatures created by your signers are authentic and traceable.
You don’t need to worry about staying up to date on the latest e-signature regulations.
Focus on creating the documentation and be sure that the country you’re doing business in accepts the type of contract you need to send. We’ll make sure that your signing process is simple and secure.
While the exact documents vary from country to country, there are a few major documents worth noting:
In many cases, yes. This varies based on use case and federal law.
For example, in the United States, the ESIGN Act indicates that electronic signatures can be upheld in a court of law, but requires that paper contracts and handwritten signatures remain the standard in certain cases to protect consumers.
– Family law (adoption, divorce, etc.)
– Wills and trusts
– Utility notices (terminations, cancellations)
– Housing matters (foreclosure, eviction, etc.)
– Documents issued by a court (notices, orders, etc.)
– Health and life insurance benefits termination
– Product recalled due to health and safety
– Hazardous material travel documentation
In many cases regarding business and commercial transactions, including hiring and onboarding, electronic signatures are valid and enforceable, but specific exceptions may apply depending on your business and your specific use case.
We ensure that your signatures are authentic, credible, and enforceable by complying with all regulations regarding the security and traceability of an electronic signature.
You can also take additional steps to protect sensitive data through verification methods (passcode or SMS text) to verify the recipient’s identity before opening or signing a document.
This means that we can securely send your documents to the user of your choice and ensure that the individual you send your contracts to is the only one who can sign that documentation.
While we do provide an e-signature solution that provides legally-binding digital signatures, we can’t speak to the validity of your contract.
Be sure to check with legal experts to ensure that your contract is enforceable within the jurisdictions where it may need to be enforced.
The security of your data is our highest priority. We are SOC Type 2 compliant, and all of your data is encrypted while in transit and at rest.
Always. While you are able to download or export your signed documents, you can organize them inside PandaDoc for easy access.
However you choose to do maintain your records, please be aware that record retention is a key factor in the use of electronic records.
You’ll need to store your contracts and documents for a number of years in order to adhere to most federal regulations.