Electronic signatures in South Africa are approved under The Electronic Communications and Transactions Act (ECTA), 2002. The South African law adheres to the European standard on electronic signatures. Any business operating in the South African market can utilise electronic signatures, and they are treated equally as their paper-based counterparts. Still, there are some restrictions determined by South African law. More importantly, the eSignature law in South Africa does not imply the mandatory signing of contracts to make them valid. The agreement is enforced when two or several parties agree on terms orally, in writing, or electronically. However, an electronic signature is required if you need to provide evidence in court.
You can use electronic signatures for business in South Africa. Because, a wet signature is not required in almost all business-related cases, there are some exceptions.
An eSignature can act as either full-fledged or partial evidence in court, depending on its level of assurance.
South African common law uses the two-tiered legal model and assigns electronic signatures the same status as hand-written ones.
Standard Electronic Signatures – First Level of Assurance
A Standard Electronic Signature or “SES” is defined as “data attached to, incorporated in, or logically associated with other data and which is intended by the user to serve as a signature.” in terms of the ECTA. An SES can be drawn using digital tools or can be a scan of a handwritten signature.
An SES provides evidence that an agreement was reached between the parties involved if no other requirements are specified. Firstly, SES are the most widely used eSignature for business purposes. They are also the most unreliable method of verification due to the high risks of counterfeit.
SES are legally valid if the signatory (or document’s sender) is identified, it indicates the signatory’s approval of the information contained in the document, is appropriate for the document at the time of signature, and the SES is time-stamped.
SES Use Cases
Human resource documents – employment contracts, privacy notices, non-disclosure agreements.
Short-term real estate documents – lease agreements for residential and commercial real estate lasting less than 20 years.
Consumer agreements – new retail account opening documents, order confirmations, purchase offers, invoices.
Commercial agreements between corporate entities – non-disclosure agreements, sales & distribution agreements, procurement documents, invoices.
Advanced Electronic Signatures – Second Level of Assurance
AES or Advanced Electronic Signature is a verified SES by a certified authority.
Most importantly, it has a higher level of credibility, as an AES must comply with additional requirements.
AES are valid if they are uniquely linked to its signatory and are able to identify him/her.
Identification of the signatory must also be done on a face-to-face basis.
Additionally, an AES must provide a tamper-evident audit trail that clearly identifies any areas of risk or suspicion. Where it is possible to notice any change of the data or data message contained in the document
AES Use Cases
A suretyship (General Amendment Act, 1956)
Signing as a Commissioner of Oaths (Justices of the Peace and Commissioners of Oath Act, 1963)
The ECTA currently omits the following cases when documents can’t be verified with an electronic signature.
Contracts for transfer or sale of immovable property (sectional titles and mortgage bonds)
Wills and codicils
Bills of exchange
Deeds and long-term leases for a period of more than 20 years
The licence of intellectual property, employee invention agreements, and IP transfers
All documents mentioned above must be signed with a physical wet signature.
A local deeds office in Bloemfontein registered its first electronically signed property transfer in July 2018. As a result, this historic event could see more efficient conveyancing processes being adopted in the South African property market in the near future.
Lexis Sign completed its first electronically signed power of attorney to transfer the property belonging to Zelda Lendon in early July 2018. The documents still had to be manually lodged at the Bloemfontein’s deeds office, but this is one step closer to the next generation of innovation. The conveyancing industry could see more efficient processes coming forward through this event especially considering there are only nine deeds offices throughout the country.
Conclude offers electronic signature and forms solutions that are fully compliant with the ECT Act. We also work hand-in-hand with the only privately owned Certificate Authority and Time-Stamp authority in South Africa. As a result, we can offer our clients industry-standard solutions.
And with the future of electronic signatures looking so bright, there should be no hesitation in adopting these technologies in your Digital Transformation Journey