UETA | Legally Binding Electronic Signature Law in the US

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The Uniform Electronic Transactions Act (UETA)

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With the emergence of international e-commerce, businesses started embracing online technology. They introduced the electronic signature software as a viable method of transacting business digitally.

To ease the adoption of electronic signature, the US enacted UETA. The Uniform Electronic Transactions Act, more commonly known as the UETA of 1999, established the legitimacy of eSignatures. Its purpose was to ensure companies’ electronically signed documents hold up in a court of law.

As a result, UETA was enacted into federal law in 2000, establishing that eSignatures and manual signatures are equivalent means to form legally binding contracts and legally binding agreements.

Document Management System in Compliance with the UETA

There are few requirements which document management systems must meet for the eSignature to be fully compliant with UETA.

First of all, both parties must have the intent to sign and be bound to terms, and they must also consent to do legal business electronically. The signed document must be available to all parties involved. From your perspective, you must be able to associate the signature with a signatory record of contract. Finally, accurately storing those records is necessary for future use or review.  

Sign documents online with your smart phoneWhen signing your documents with DigiSigner, you can create eSignatures that are fully enforceable in a court of law. Our electronic signature software provides the same protections as a pen-on-paper signature.

The History of UETA

As a precursor to the ESIGN Act, UETA grants electronic signatures the same legal status in court as traditional wet ink signatures. This act prevents denial of validity or enforceability of an electronically executed document solely because it is in an electronic form.

While the ESIGN Act is a federal act, which means it affects people who do business online in all 50 states, the UETA functions on a state-by-state basis. The Uniform Electronic Transactions Act (UETA), dates back to 1999 and only acquires authority through the enactment of state legislators. Today, 47 states have adopted this law, the District of Columbia, and the U.S. Virgin Islands.

Major Requirements

As already mentioned, UETA has some requirements for an electronic signature to be recognized under US Electronic Signature laws. These four requirements are:

Intent to sign

Like traditional signatures, electronic signatures are valid only if each party intends to sign.

Consent to do business electronically

All parties involved must consent to do business electronically. While one can establish a business’s consent through analysis of the circumstances of the interaction, there are special requirements for the consumer’s consent. The consumer has to:

  • Received UETA Consumer Consent Disclosures
  • Affirmatively agreed to use electronic records for the transaction
  • Has not withdrawn such consent.

Association of signature with the record

In order to qualify as an electronic signature under the UETA, the system used to capture the transaction must create an associated record that includes either the process used to capture the signature or a textual or graphic statement in a form of an electronic signature.

Record retention

Electronic signature records created for each transaction must be capable of retention and accurate reproduction for reference by all parties entitled to retain the contract or document.

The Uniform Electronic Transactions Act (UETA) Law

DigiSigner provides the ability to apply electronic signatures as defined by the U.S law for full compliance with UETA regulations. Adopt eSignatures and boost your business by signing up for our electronic signature free trial today!

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