Overview of electronic signature law and its legality in Hong Kong
Electronic signatures first became legally valid in Hong Kong with the passing of the Transactions Ordinance Act of 2000. This law allowed eSignatures to become available for use in the private sector.
Hong Kong has a tiered legal model, which means that electronic signatures are legally admissible in court. Electronic signatures can also be used in general business settings, though there may be a few exceptions, which we’ll outline below.
Overview of Hong Kong’s legal model
Common Law Systems
Hong Kong operates under a Common Law legal model. Common Law is based on a number of legal statutes that have been established by the judicial system. Several other countries operate under Common Law systems, including the United States, Ireland, and New Zealand.
Common Law is also sometimes referred to as case law because it relies on judicial precedents to determine the outcome of future cases. However, it’s up to the presiding judge to interpret the legal precedents and what they mean.
A frequent argument against Common Law systems is that they often result in the marginalization of certain groups due to outdated legal precedents. But periodically, societal changes will require that the courts overturn old or outdated legal statues.
The electronic signature law in Hong Kong
In Hong Kong, a handwritten signature is not required for contracts or legal documents to be considered valid. And according to the Electronic Transactions Ordinance, contracts cannot be invalidated simply for being conducted electronically. This gives residents more freedom to choose how they want to conduct business transactions.
The Electronic Transactions Ordinance of 2000
In 2000, the Electronic Transactions Ordinance (ETO) passed and is what permitted eSignatures for general business use. Section 2 of the ETO defined electronic signatures in a very general way, so that they will be accessible to a wide variety of people.
Section 6(1) of the ETO clearly outlined three requirements that an electronic signature must meet to be legally valid. Here is an overview of these three rules:
- If your legal signature is required by law, then you must also have an electronic record to authenticate your information. Your eSignature must also be on the electronic document.
- The method of obtaining the signature must be reliable and easily understood.
- Both parties must consent to the method used to obtain the electronic signature.
When are eSignatures appropriate in Hong Kong?
The type of document you are signing will largely determine what type of electronic signature is required. In many cases, a standard electronic signature (SES) will be appropriate. An SES doesn’t require validation, and the signer can draw or type their name.
However, some documents will require a qualified electronic signature (QES). An electronic signing document validates a QES. A QES is considered to be the same as a handwritten signature.
When is an SES appropriate?
An SES is appropriate in the following situations:
- Non-disclosure agreements;
- Employee onboarding documents;
- Benefits paperwork;
- Sales agreements;
- Software licenses;
- Copyright or trademark agreements.
When is a QES required?
In Hong Kong, a QES will likely be required for all government documents. However, in some situations, a handwritten signature may be necessary. This could be necessary for things like employee termination notices, wills, and documents assigning power of attorney.
Can I use PandaDoc digital signature software in Hong Kong?
Yes, our eSignature software is compliant with digital signature laws in Hong Kong. Our digital signature software is ESIGN and UETA compliant. If you need an added layer of security, we can provide you with a digital certificate for every signed document.
If you’re interested in learning how our software works, feel free to sign up for a free 14-day trial.