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The Electronic Transactions Act

Monday, December 10, 2012
Law Made Simple

The Electronic Transactions Act was passed in 2011 and has been partially proclaimed by Legal Notices 1 and 8 of 2012. The main objectives of the act are to facilitate and provide a legal framework for electronic transactions and commerce, to give legal effect to electronic signatures, electronic documents and electronic records, and to help establish standard rules regarding the verification and integrity of electronic records.


Electronic transactions and electronic commerce relate generally to communications/activities related to the sale or purchase of goods and services over computer networks and systems including the Internet.


Requirements for legal recognition
The act gives legal recognition to information or records in electronic form and provides that such documents shall not be denied legal effect solely because it is in electronic form.



Further, electronic records shall generally be considered equivalent to records required to be in writing. Where records or information must be presented or kept in its original form, that is, in writing, the act provides that this requirement is met if there is reliable assurance (through technological security measures) that the integrity of the electronic record is maintainable and accessible for future reference.



Also, the act provides that the legal requirements for keeping information and requests for copies are satisfied if done in the form of electronic records.


Formation of contracts
The act provides that any negotiation or other dealing that goes to the formation of a contractual relationship between parties can be validly done by electronic means. Additionally, the use of electronic agents (automated programs) to assist in forming a contractual relationship with a party shall be valid unless certain errors occur while dealing with the electronic agent.


Electronic signatures
Generally, electronic signatures are recognised under the act as being valid provided that there is agreement by the parties for its use and the signature meets the minimum standard of reliability and integrity. Electronic authentication technology shall be used to validate an electronic signature.


Electronic records and public bodies
The act provides that public bodies are generally authorised to conduct its activities related to filing, retaining, producing or issuing of documents (including licenses and permits) by electronic means. The public body however must have a procedure specifying how the above mentioned are to be done. In addition, documents required by a public body for inspection can be produced in electronic form.


Non-application of the act
It is to be noted that nothing in the act requires a public body to accept or issue any document in electronic form. Also, the act does not apply to certain specific pieces of legislation that require written or original documents and signatures, such as legislation relating to the conveyance of property, making of wills, endorsement of negotiable instruments or creation of a trust or power of attorney.


This column is not legal advice. If you have a legal problem you should consult a legal adviser.


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