E-signatures for an E-world: states face a thicket of complications born of rapidly changing technology in their quest to regulate electronic commerce.

• Author: Morton, Heather

If Paul Revere lived today, how would he announce the invasion of the Internet? One if by mail, two if by e-mail? Despite the economic downturn and the dot.com bust, the Internet is thriving, and electronic commerce continues to grow.

More than 143 million people use the Internet, according to a study by the U.S. Department of Commerce, "A Nation Online: How Americans Are Expanding Their Use of the Internet." Of the people online, 67 percent use the Net for research and to get product information, while 39 percent use it to make purchases.

VALID SIGNATURES

In order to provide the legal support for electronic commerce, many states have adopted laws that make electronic signatures valid. States such as Arizona, Minnesota, Nevada, New Hampshire, Utah and Washington started with legislation that specifically defined digital signatures. In 1999, the National Conference of Commissioners on Uniform State Laws developed a model act for the use of electronic signatures and records in government or business transactions. The Uniform Electronic Transactions Act (UETA) makes electronic records and signatures as legal as paper and manually signed signatures. Forty states now have some form of the act.

Virginia Delegate Joe T. May says the uniform act is important, because "it makes electronic signatures legal, while forming the legal backbone and providing guidelines for electronic contracting." He says that his state is approaching technology changes with "a measured pace."

Utah Senator Lyle W. Hillyard says the Uniform Electronic Transactions Act was not difficult to pass in his state because there is a lot of legislative interest in electronic commerce. "The technology, especially for the rural population, helps make government more accessible," Hillyard says. "When we did UETA, we knew we were going to nave to adapt it as the technology developed. Our chief challenge at this point is education--getting people to use electronic signatures and electronic commerce.

"We need to be careful to keep the law general enough to allow competition and not favor one type of technology," he says.

FEDS ADOPT ELECTRONIC SIGNATURES

There's also federal legislation that supports electronic transactions. The Electronic Signatures in Global and National Commerce Act (E-SIGN) was adopted under President Clinton and became effective October 2000. The law establishes the validity of electronic records and signatures. It also governs in the absence of a state law or where...