Thursday, June 23 2022

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There has been a notable increase in the use of electronic signatures for various transactions as quarantine restrictions are imposed to deal with the COVID-19 pandemic.

Electronic signatures have been expressly recognized for over two decades in the Philippines. The Electronic Commerce Act of 2000 (Electronic Commerce Act) in the Philippines recognizes electronic documents and electronic signatures in accordance with its provisions, and expressly states that an “electronic signature on the electronic document is equivalent to the signing of an electronic document. person on a written document “.

This law emphasizes the vital role of information and communications technologies in nation-building and aims to facilitate domestic and international transactions, transactions and contracts through the use of electronic technology. , to recognize the authenticity and reliability of electronic messages or electronic documents relating to these activities. , and promote the universal use of electronic transactions within government and by the general public.

In 2001, the Supreme Court, recognizing the objectives of the Electronic Commerce Act and in accordance with its power to promulgate rules regarding pleading, practice and procedure in all courts, issued the Rules on Electronic Evidence (REE ), which expressly provides that an electronic signature is admissible in evidence as the functional equivalent of a person’s signature on a written document if it is authenticated in the manner provided in the REE.

A. Court decisions supporting electronically signed documents

Under the REE, an electronic signature is admissible in evidence as the functional equivalent of a person’s signature on a written document provided that it is authenticated in the manner provided in the REE. There is a dearth of cases relating to electronic signatures. Here are some of the notable cases:

1. Bagumbayan-VNP Movement, Inc. v. Election Commission (RG nos. 206719, 206784 and 207755, April 10, 2019)

This involved an analysis of what constitutes an electronic signature, which is defined as any distinctive sign, characteristic and / or sound in electronic form, representing the identity of a person and attached or logically associated with the electronic data message or document. electronic, or any methodology or procedure employed or adopted by a person and performed or adopted by that person, for the purpose of authenticating, signing or approving an electronic data message or electronic document.

In this case, the petitioners questioned the Automated Electoral System (AES) for the process of voting, counting and canvassing of national and local election results. The petitioners argued that the Election Commission (COMELEC) violated automated election laws by removing the requirement for digital signatures because the Election Modernization Act requires election reports to be digitally signed.

The Supreme Court has recognized the scope of what can be considered a digital signature, which is considered an electronic signature, as the relevant regulations provide that it can be any mark or distinguishing feature that represents the identity of somebody. Thereby, a machine signature of a constituency counting optical scanning machine (PCOS) can be regarded as the functional equivalent of a digital signature because it represents the identity of the individual, such a digital signature being naturally created specifically for the person who enters the details herself.

2. Capalla v. Election Commission (RG n ° 201112, 201121, 201127 & 201413, June 13, 2012)

In this case, the petitioners attacked the validity and constitutionality of the resolutions of COMELEC for the purchase of PCOS machines. One of the grounds cited by the petitioners is the alleged infirmities and palpable defects of PCOS machines in the production of digital signatures, which is required under the Elections Modernization Act. The Supreme Court has recognized that using a gadget (that is to say, the iButton), as well as the PIN codes, can be considered an electronic signature and he recognized that PCOS machines are capable of producing digital signatures.

3. AES Watch v. Election Commission (GR n ° 246332, December 9, 2020)

In this case, the Supreme Court upheld its decision by
Capalla, recalling that PCOS machines are capable of producing digital signatures. In the case of PCOS machines, algorithms generate these keys and the method for comparing these keys. The private key in the electronic transmission of results and the public key held by COMELEC must match to consider the electronic transmission of results as an official record of the elections. The private key is generated when the members of the polling station use their respective iButtons and enter their respective PIN codes on the voting machines. The Supreme Court has again recognized that the use of iButtons and PIN codes are the functional equivalents of digital signatures.

B. Other examples of cases where the government has recognized the use of electronic signatures

Many Philippine government agencies recently released rules that expressly allow the use of electronic signatures to meet remote work arrangements implemented to comply with COVID-19 quarantine measures. Documents filed with a Philippine government agency should generally be original documents signed in wet ink.

The Securities and Exchange Commission (SEC), which is the government agency responsible for overseeing the corporate sector, capital market participants, and the securities and investment instruments market, now allows companies to execute their audited financial statements using electronic signatures and submit them online. However, the SEC may still require documents signed in wet ink for surveillance or investigative purposes.

The Bureau of Internal Revenue (BIR), which is the government agency responsible for enforcing tax laws, currently accepts the use of electronic signatures for certain BIR forms and certificates that must be submitted by a withholding tax officer. . An electronic signature is recognized as the functional equivalent of a manual signature on these BIR forms and certificates.

The revised standards for the treatment of business permits and licenses in all cities and municipalities, jointly issued by the Ministry of Interior and Local Governments, the Ministry of Trade and Industry and the Ministry of Information Technology and Communications, which provides guidance on the processing of business permits and licenses in local communities, expressly recognizes the use of electronic signatures for the approval of business permits and licenses.

C. Electronic notarization of documents

Certain contracts must appear in a public document (that is to say a document signed or recognized before a notary) to be valid or to bind third parties. The Law on Electronic Commerce provides that the Supreme Court can adopt the use of electronic notarization systems. The REE also provides that “a document notarized electronically in accordance with the rules promulgated by the Supreme Court will be considered as a public document and proven as a notarial act under the Rules of the Court”. While the Supreme Court has published rules for remote notarization, it has yet to publish the relevant rules for electronic notarization of documents.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.


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