Digital signature legal requirements: When are they legally binding?

What constitutes a digital signature?

Digital signatures are a type of electronic signatures that relies on PKI to verify identify and protect document from tampering. They are used to sign various items including documents, applications, programs, or other types of electronic files.

A digital signature certificate is a PKI-based credential that authenticates the signer's identity and confirms that electronically transmitted documents and digital messages have not been forged or alterred. Using the public-key cryptography, the signature is mathematically bound to both the signer and the specific file. Digital signatures are simply code embedded into the files, which can be visualized if the use case requires it.

Like handwritten signatures, digital signatures are unique to the signer, but they provide far stronger security by verifying origin, identity, and integrity. Because of these protections, they are widely recognized as legally binding in the United States and many other jurisdictions when applicable requirements are met.

Digital signatures comply with strict regulations, including the United States Electronic Signatures in Global and National Commerce Act (ESIGN Act), the Uniform Electronic Transactions Act (UETA), and comparable international frameworks.

What is the difference between a digital signature and an electronic signature

Although often used interchangeably, electronic signatures and digital signatures are not the same. The distinction is incredibly important from a legal perspective.

Electronic signatures are the broadest set of solutions that use an electronic process for affixing a document or transaction with a signature. The use of this type of signature has grown incredibly over time as documents and communication increasingly move into the digital realm, and businesses and consumers worldwide embrace the solution's speed and convenience. But there are many different types of electronic signatures, each allowing users to sign documents digitally and offering some degree of identity authentication.

Digital signatures are a secure type of electronic signature that rely on digital certificates issued by a trusted certificate authority to verify the signer’s identity and protect the document from alteration.

Other types of electronic signatures may rely on weaker authentication methods such as email addresses or phone numbers. For higher risk transactions or stricter legal requirements, PKI-based digital signatures are often preferred because they create a verifiable link between the signer’s identity and the signed document.

Are digital signatures legally binding?

Yes. Digital signatures are generally legally binding in most jurisdictions, although specific requirements vary by country and transaction type. Because digital signatures are a secure type of electronic signature, they are typically accepted anywhere electronic signatures are permitted.

A digitally signed PDF is legal in most jurisdictions. However, or low risk or informal transactions, the level of security provided by a digital signature may be more than necessary. However, with the increase in remote work and document digitization, there’s an increase in both organizations and independent professionals needing to provide identity-verified signatures.

To be considered a legitimate digital signature, the most basic requirement is that the signer's identity must be securely linked to the signature, typically through a certificate or other authenticated credential. A document signing certificate provides this linkage by using a public and private key pair to verify the signer and detect any changes to the document. This binding supports non repudiation and ties the signature directly to the signer.

Before making any decisions about the type of signature that is best for you or your organization to use, please refer to your local regulation and industry best practices. In this section, we will take a high-level look at legality in the United States (U.S.) and the European Union (EU).

Digital signatue in the United States

Digital signatures, and electronic signatures in general, are legally valid in the United States, provided certain conditions are met. This is largely due to two pieces of regulation, the UETA (Uniform Electronic Transactions Act) drafted in 1999 and the ESIGN Act (Electronic Signatures in Global and National Commerce Act) passed in 2000.

When the Uniform Laws Commission created the UETA, they intended to create a legal framework that could be used by states to enact similar laws concerning electronic signatures at all levels. It established a foundation of minimum standards for everything from how records can be created, transferred, and finally retained along with the audit trails required along the way.

Before these federal laws were enacted, there were only patchwork state laws and frameworks concerning digital and electronic signature legality. This complicated any type of national standardization effort for organizations in the U.S.

To date, UETA has been enacted by 49 U.S. states as well as the District of Columbia. New York is the primary state that has not enacted the framework directly but instead havs its own laws that address signature requirements in analogous ways.

As UETA attempted to standardize the minimum requirements for state laws concerning e-signatures, the ESIGN Act attempted to ease the adoption and acceptance of them. This act ensured that qualified electronic signatures can be used in nearly any situation that an ink signature can be used. This includes situations as important as evidence in civil or criminal court cases. This act essentially codified the validity of e-signatures and established them as enforceable statements of identity.

The legality of electronic and digital signatures in the U.S. revolves around four major pillars:

1. Intent: This is no different than with a handwritten signature. The signatory must show clear intent to actually affix their name/identity to the electronic document. In this case, you cannot force someone to opt out and consider it to be a legal signature.
2. Consent: When an electronic document or contract is signed, every party signing it must specifically consent to allow an electronic signature. Without this, the use of electronic signatures cannot be considered valid unless the signer opted in at a previous date and never withdrew their consent.
3. Accuracy: The specific method used for affixing the electronic signature must not only keep a record but also must be a demonstrably accurate record. This record should also fully explain the method that was used to create and affix the electronic signature.
4. Retention: The record of an electronic signature must be accurately reproduced and available for the files of any party entitled to such data. This leaves an audit trail and allows access to any necessary records.

Certain documents may still require traditional signatures or special procedures, such as wills, some family law matters, certain court filings, and documents requiring in-person notarization, depending on state law.

Digital signatures in the European Union

The European Union (EU) enacted the electronic IDentification, Authentication, and Trust Services (eIDAS) regulation in 2014 to regulate electronic signatures, the various processes involved, and the regulatory bodies that handle enforcement. 

Under eIDAS, electronic signatures are categorized into three levels:

• Simple electronic signatures (SES): Basic electronic acknowledgment methods with no identity verification
• Advanced electronic signatures (AES): Uniquely linked to the signer and require identity verification
• Qualified electronic signatures (QES): The most secure option created using qualified certificates and issued by a qualified trust service provider (QTSP)

Digital signatures under eIDAS provide a higher degree of assurance, and some hold the same legal effect as a wet ink signature. Conforming to eIDAS requirements requires a qualified certificate stored in one of several qualified signature solutions that must be issued and managed by a qualified trust service provider (QTSP) like Sectigo.

Qualified certificates from Sectigo enable individuals and organizations to sign or seal documents and meet eIDAS requirements.

eIDAS digital signature requirements include:

1. Identity: Signatory is identified and validated
2. Intent: Record of signatory understanding of content and intent to sign
3. Reliable: Is reliable and secure for the specific use case. This can mean:
   1. Tampering or changing the content or signature is detected and recorded
   2. The process or solution used to create the digital signature is solely handled by the signatory and linked to only their identity

Make sure you meet the legal requirements for digital signatures in your country - learn about Sectigo’s different signing certificate offerings, including: S/MIME email encryption, code signing, and document signing. Also explore our eIDAS certificates.

What is the purpose of a digital signature?

A digital signature uses a secure digital key that certifies the identity of the author of a digital message, electronic form, or document. This gives customers confidence that the signed documents originate from the recognized source and that their electronic records have not been forged or tampered with.

Use cases

Digital signatures are used in many ways and can largely be sorted into three broad use case categories:

• Attribution: If the signature is attached to a file, message, or document, it can be legally trusted that the owner of the signature was involved. There is no doubt or risk of repudiation, and there will also be record retention that leaves an audit trail.
• Authenticity: Using a signature means that the identity of the signer has been validated by a third-party CA, such as Sectigo. This level of validation and authentication supports the signature's attribution.
• Integrity : Attaching a signature to a file, especially to a message or email, informs the recipient (whether human or system) that the data has not been altered or tampered with during transport. It is important to note that the signature itself does not have any protective measures, but rather it indicates to the recipient whether any interference was detected. This allows the recipient and sender to make an informed decision on how to respond while better understanding possible attack vectors.

Get expert guidance on digital signatures from Sectigo

Digital signatures continue to provide a legally recognized, secure method for signing electronic documents worldwide. While specific requirements vary by jurisdiction and industry, modern regulations generally support electronic execution of agreements when identity, intent, and record integrity can be demonstrated. 

Whether you’re an independent professional seeking a simple document signing solution or an enterprise managing complex workflows, trusted certificates help enable secure and verifiable digital signatures. Learn more about Sectigo’s document signing and eIDAS certificate options, or contact us to discuss the right solution for your needs.

Want to learn more? Get in touch to book a demo of Sectigo Certificate Manager!