US President, Bill Clinton has signed into law a bill that makes electronic signatures submitted to US websites as valid as signatures made in ink.
According to Clinton, the law, officially known as the Electronic Signatures in Global and National Commerce Act, will protect consumers and boost ecommerce, and "give fresh momentum to what is already the longest economic expansion in history."
Electronic signatures are unique pieces of encrypted code that are assigned to individuals to avoid forgery and theft. They are used for such web transactions as financial applications, payments and legal documents.
The signatures also use a key-based encryption system with an unique digitally encrypted private key that is assigned to each user. The key can only be decoded by key holders such as businesses or government agencies.
"High-tech companies now conduct a substantial and fast-growing amount of business online," said William Archey, president of the American Electronics Association, which represents the US IT industry. "To continue the robust growth of online commerce, these companies absolutely need an atmosphere of legal certainty."
Clinton, who first signed the bill on paper and then on a computer, said he believes that electronic signatures and ecommerce are important to global and national economies.
The law takes effect 1 October and as of 1 March, 2001 US companies can begin the electronic retention of legal records such as mortgages and financial securities.
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