• The New Russian Law on Electronic Signatures Has Lifted the Legal Barrier That Prevented the Wide Use of Electronic Signatures in Business Activities in Russia
  • August 31, 2011 | Authors: Pavel Karpunin; Rimma Leshcheva
  • Law Firm: Capital Legal Services - St. Petersburg Office
  • While the previous law, in place since 2002, addressed only electronic digital signatures and permitted only one type of electronic signature technology, the new law has introduced a broader notion of ‘electronic signature’ and provided a legal basis for the use in Russia of different types of electronic signatures.

    The new law distinguishes between 1) simple electronic signature (electronic signature formed by use of codes, passwords, or other means that confirm the fact of formation of the electronic signature by a particular person) and 2) reinforced electronic signature (depending on the level of encryption protection, reinforced electronic signature may fall into two classes: ‘advanced’ and ‘qualified’, the later being an analog of electronic digital signature addressed by the law of 2002).

    Under the new law, electronic documents signed by electronic signatures may have the same legal effect as paper documents signed by hand; however, in case of simple electronic signatures and advanced signatures the parties shall expressly agree to it or it shall be additionally stipulated by the Russian laws or regulations. Thus, the law opens up opportunities for the wide use of electronic signatures for signing contracts and other legal documents in Russia.

    In particular, the new law is likely to be used by organizations that have to deal with a lot of individuals and handling vast amounts of paper documents in their daily activities, which is not only time and money consuming, but also leads to mistakes when the documents are transferred into electronic form. Through years, the use of paper documents has remained essential due to the need to acquire hand-written signatures. However, by virtue of the new developments of Russian legislation on electronic signatures the situation may change.

    This is also successfully confirmed by international experience. For example, Berliner Sparkasse, a German savings bank, has eliminated the need to print out numerous documents by switching to obtaining electronic signatures of its clients with the use of signature tablets. Signature tablets, as well as other signature capture devices such as pen pads, interactive pen displays or Tablet PCs, capture so-called “biometric” or “dynamic” signatures and link them to the documents signed. The software installed on such devices is capable of capturing the static picture of the signature as well as biometric information (location, time, and pressure levels of pen strokes, etc.), which is unique to every. Once a signature is captured, it becomes possible to perform automatic verification of the signatory’s identity when further documents are signed. This enables the bank to automatically compare the signatures used on documents initiating the performance of bank operations (payment orders, money transfer orders, etc.) to the original signature in order to ensure their authenticity.

    Finally, a copy of the document signed in such a way is printed out for the client, while the bank itself stores the documents signed in electronic form and prints them out when necessary, which allows to avoid excessive paper work and speed up the work process.

    Apparently, the signatures obtained with the use of such devices meet the definition of simple electronic signature under the new law on electronic signatures and thus may be used in cases expressly agreed upon by the parties, which on its own account may in many instances help to facilitate the document flow.

    Moreover, taking into consideration the high reliability of the signatures obtained with the use of such devices, it is likely that the manufacturers of signature capture devices will take steps to confirm that the electronic signatures obtained with the use of their products meet the requirements of the new law towards advanced and even qualified signatures in order to broaden the area of potential application of their products. It appears that if such signatures fell under the definition of advanced or qualified signatures, the signature capture devices could be broadly used in Russia, in particular by banking institutions. 

    However, it should be noted that the data contained in electronic documents signed with the use of signature capture devices will be subject to the regulations of the Russian law on personal data[2]. Therefore, it is necessary to keep in mind the restrictions of the law with respect to personal data processing when organizing electronic document flow.

    [1] Federal Law “On electronic signature” No. 63-FZ dated  April 06, 2011.

    [2] Federal Law “On personal data” No. 152-FZ dated  July 27, 2006.