[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 761 Engrossed Amendment House (EAH)]
2d Session
S. 761
_______________________________________________________________________
AMENDMENTS
In the House of Representatives, U. S.,
February 16, 2000.
Resolved, That the bill from the Senate (S. 761) entitled ``An Act to
regulate interstate commerce by electronic means by permitting and encouraging
the continued expansion of electronic commerce through the operation of free
market forces, and other purposes'', do pass with the following
AMENDMENTS:
Strike out all after the enacting clause and insert:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Electronic Signatures in Global and
National Commerce Act''.
TITLE I--VALIDITY OF ELECTRONIC RECORDS AND SIGNATURES FOR COMMERCE
SEC. 101. GENERAL RULE OF VALIDITY.
(a) General Rule.--With respect to any contract, agreement, or
record entered into or provided in, or affecting, interstate or foreign
commerce, notwithstanding any statute, regulation, or other rule of
law, the legal effect, validity, or enforceability of such contract,
agreement, or record shall not be denied--
(1) on the ground that the contract, agreement, or record
is not in writing if the contract, agreement, or record is an
electronic record; or
(2) on the ground that the contract, agreement, or record
is not signed or is not affirmed by a signature if the
contract, agreement, or record is signed or affirmed by an
electronic signature.
(b) Autonomy of Parties in Commerce.--
(1) In general.--With respect to any contract, agreement,
or record entered into or provided in, or affecting, interstate
or foreign commerce--
(A) the parties to such contract, agreement, or
record may establish procedures or requirements
regarding the use and acceptance of electronic records
and electronic signatures acceptable to such parties;
(B) the legal effect, validity, or enforceability
of such contract, agreement, or record shall not be
denied because of the type or method of electronic
record or electronic signature selected by the parties
in establishing such procedures or requirements; and
(C) nothing in this section requires any party to
use or accept electronic records or electronic
signatures.
(2) Consent to electronic records.--Notwithstanding
subsection (a) and paragraph (1) of this subsection--
(A) if a statute, regulation, or other rule of law
requires that a record be provided or made available to
a consumer in writing, that requirement shall be
satisfied by an electronic record if--
(i) the consumer has affirmatively
consented, by means of a consent that is
conspicuous and visually separate from other
terms, to the provision or availability
(whichever is required) of such record (or
identified groups of records that include such
record) as an electronic record, and has not
withdrawn such consent;
(ii) prior to consenting, the consumer is
provided with a statement of the hardware and
software requirements for access to and
retention of electronic records; and
(iii) the consumer affirmatively
acknowledges, by means of an acknowledgement
that is conspicuous and visually separate from
other terms, that--
(I) the consumer has an obligation
to notify the provider of electronic
records of any change in the consumer's
electronic mail address or other
location to which the electronic
records may be provided; and
(II) if the consumer withdraws
consent, the consumer has the
obligation to notify the provider to
notify the provider of electronic
records of the electronic mail address
or other location to which the records
may be provided; and
(B) the record is capable of review, retention, and
printing by the recipient if accessed using the
hardware and software specified in the statement under
subparagraph (A)(ii) at the time of the consumer's
consent; and
(C) if such statute, regulation, or other rule of
law requires that a record be retained, that
requirement shall be satisfied if such record complies
with the requirements of subparagraphs (A) and (B) of
subsection (c)(1).
(c) Retention of Contracts, Agreements, and Records.--
(1) Accuracy and accessibility.--If a statute, regulation,
or other rule of law requires that a contract, agreement, or
record be in writing or be retained, that requirement is met by
retaining an electronic record of the information in the
contract, agreement, or record that--
(A) accurately reflects the information set forth
in the contract, agreement, or record after it was
first generated in its final form as an electronic
record; and
(B) remains accessible, for the period required by
such statute, regulation, or rule of law, for later
reference, transmission, and printing.
(2) Exception.--A requirement to retain a contract,
agreement, or record in accordance with paragraph (1) does not
apply to any information whose sole purpose is to enable the
contract, agreement, or record to be sent, communicated, or
received.
(3) Originals.--If a statute, regulation, or other rule of
law requires a contract, agreement, or record to be provided,
available, or retained in its original form, or provides
consequences if the contract, agreement, or record is not
provided, available, or retained in its original form, that
statute, regulation, or rule of law is satisfied by an
electronic record that complies with paragraph (1).
(4) Checks.--If a statute, regulation, or other rule of law
requires the retention of a check, that requirement is
satisfied by retention of an electronic record of all the
information on the front and back of the check in accordance
with paragraph (1).
(d) Ability to Contest Signatures and Charges.--Nothing in this
section shall be construed to limit or otherwise affect the rights of
any person to assert that an electronic signature is a forgery, is used
without authority, or otherwise is invalid for reasons that would
invalidate the effect of a signature in written form. The use or
acceptance of an electronic record or electronic signature by a
consumer shall not constitute a waiver of any substantive protections
afforded consumers under the Consumer Credit Protection Act.
(e) Scope.--This Act is intended to clarify the legal status of
electronic records and electronic signatures in the context of writing
and signing requirements imposed by law. Nothing in this Act affects
the content or timing of any disclosure required to be provided to any
consumer under any statute, regulation, or other rule of law.
SEC. 102. AUTHORITY TO ALTER OR SUPERSEDE GENERAL RULE.
(a) Procedure To Alter or Supersede.--Except as provided in
subsection (b), a State statute, regulation, or other rule of law may
modify, limit, or supersede the provisions of section 101 if such
statute, regulation, or rule of law--
(1)(A) constitutes an enactment or adoption of the Uniform
Electronic Transactions Act as reported to the State
legislatures by the National Conference of Commissioners on
Uniform State Laws; or
(B) specifies the alternative procedures or requirements
for the use or acceptance (or both) of electronic records or
electronic signatures to establish the legal effect, validity,
or enforceability of contracts, agreements, or records; and
(2) if enacted or adopted after the date of the enactment
of this Act, makes specific reference to this Act.
(b) Limitations on Alteration or Supersession.--A State statute,
regulation, or other rule of law (including an insurance statute,
regulation, or other rule of law), regardless of its date of the
enactment or adoption, that modifies, limits, or supersedes section 101
shall not be effective to the extent that such statute, regulation, or
rule--
(1) discriminates in favor of or against a specific
technology, process, or technique of creating, storing,
generating, receiving, communicating, or authenticating
electronic records or electronic signatures;
(2) discriminates in favor of or against a specific type or
size of entity engaged in the business of facilitating the use
of electronic records or electronic signatures;
(3) is based on procedures or requirements that are not
specific or that are not publicly available; or
(4) is otherwise inconsistent with the provisions of this
title.
(c) Exception.--Notwithstanding subsection (b), a State may, by
statute, regulation, or rule of law enacted or adopted after the date
of the enactment of this Act, require specific notices to be provided
or made available in writing if such notices are necessary for the
protection of the public health or safety of consumers. A consumer may
not, pursuant to section 101(b)(2), consent to the provision or
availability of such notice solely as an electronic record.
SEC. 103. SPECIFIC EXCLUSIONS.
(a) Excepted Requirements.--The provisions of section 101 shall not
apply to a contract, agreement, or record to the extent it is governed
by--
(1) a statute, regulation, or other rule of law governing
the creation and execution of wills, codicils, or testamentary
trusts;
(2) a statute, regulation, or other rule of law governing
adoption, divorce, or other matters of family law;
(3) the Uniform Commercial Code, as in effect in any State,
other than sections 1-107 and 1-206 and Articles 2 and 2A;
(4) any requirement by a Federal regulatory agency or self-
regulatory organization that records be filed or maintained in
a specified standard or standards (including a specified format
or formats), except that nothing in this paragraph relieves any
Federal regulatory agency of its obligations under the
Government Paperwork Elimination Act (title XVII of Public Law
105-277);
(5) the Uniform Anatomical Gift Act; or
(6) the Uniform Health-Care Decisions Act.
(b) Additional Exceptions.--The provisions of section 101 shall not
apply to--
(1) any contract, agreement, or record entered into between
a party and a State agency if the State agency is not acting as
a market participant in or affecting interstate commerce;
(2) court orders or notices, or official court documents
(including briefs, pleadings, and other writings) required to
be executed in connection with court proceedings; or
(3) any notice concerning--
(A) the cancellation or termination of utility
services (including water, heat, and power);
(B) default, acceleration, repossession,
foreclosure, or eviction, or the right to cure, under a
credit agreement secured by, or a rental agreement for,
a primary residence of an individual; or
(C) the cancellation or termination of health
insurance or benefits or life insurance benefits
(excluding annuities).
SEC. 104. STUDY.
(a) Followup Study.--Within 5 years after the date of the enactment
of this Act, the Secretary of Commerce, acting through the Assistant
Secretary for Communications and Information, shall conduct an inquiry
regarding any State statutes, regulations, or other rules of law
enacted or adopted after such date of the enactment pursuant to section
102(a), and the extent to which such statutes, regulations, and rules
comply with section 102(b).
(b) Report.--The Secretary shall submit a report to the Congress
regarding the results of such inquiry by the conclusion of such 5-year
period.
(c) Additional Study of Delivery.--Within 18 months after the date
of the enactment of this Act, the Secretary of Commerce shall conduct
an inquiry regarding the effectiveness of the delivery of electronic
records to consumers using electronic mail as compared with delivery of
written records via the United States Postal Service and private
express mail services. The Secretary shall submit a report to the
Congress regarding the results of such inquiry by the conclusion of
such 18-month period.
SEC. 105. DEFINITIONS.
For purposes of this title:
(1) Electronic record.--The term ``electronic record''
means a writing, document, or other record created, stored,
generated, received, or communicated by electronic means.
(2) Electronic signature.--The term ``electronic
signature'' means information or data in electronic form,
attached to or logically associated with an electronic record,
and executed or adopted by a person or an electronic agent of a
person, with the intent to sign a contract, agreement, or
record.
(3) Electronic.--The term ``electronic'' means of or
relating to technology having electrical, digital, magnetic,
optical, electromagnetic, or similar capabilities regardless of
medium.
(4) Electronic agent.--The term ``electronic agent'' means
a computer program or an electronic or other automated means
used independently to initiate an action or respond to
electronic records in whole or in part without review by an
individual at the time of the action or response.
(5) Record.--The term ``record'' means information that is
inscribed on a tangible medium or that is stored in an
electronic or other medium and is retrievable in perceivable
form.
(6) Federal regulatory agency.--The term ``Federal
regulatory agency' means an agency, as that term is defined in
section 552(f) of title 5, United States Code, that is
authorized by Federal law to impose requirements by rule,
regulation, order, or other legal instrument.
(7) Self-regulatory organization.--The term ``self-
regulatory organization'' means an organization or entity that
is not a Federal regulatory agency or a State, but that is
under the supervision of a Federal regulatory agency and is
authorized under Federal law to adopt and administer rules
applicable to its members that are enforced by such
organization or entity, by a Federal regulatory agency, or by
another self-regulatory organization.
TITLE II--DEVELOPMENT AND ADOPTION OF ELECTRONIC SIGNATURE PRODUCTS AND
SERVICES
SEC. 201. TREATMENT OF ELECTRONIC SIGNATURES IN INTERSTATE AND FOREIGN
COMMERCE.
(a) Inquiry Regarding Impediments to Commerce.--
(1) Inquiries required.--Within 180 days after the date of
the enactment of this Act, and biennially thereafter, the
Secretary of Commerce, acting through the Assistant Secretary
for Communications and Information, shall complete an inquiry
to--
(A) identify any domestic and foreign impediments
to commerce in electronic signature products and
services and the manners in which and extent to which
such impediments inhibit the development of interstate
and foreign commerce;
(B) identify constraints imposed by foreign nations
or international organizations that constitute barriers
to providers of electronic signature products or
services; and
(C) identify the degree to which other nations and
international organizations are complying with the
principles in subsection (b)(2).
(2) Submission.--The Secretary shall submit a report to the
Congress regarding the results of each such inquiry within 90
days after the conclusion of such inquiry. Such report shall
include a description of the actions taken by the Secretary
pursuant to subsection (b) of this section.
(b) Promotion of Electronic Signatures.--
(1) Required actions.--The Secretary of Commerce, acting
through the Assistant Secretary for Communications and
Information, shall promote the acceptance and use, on an
international basis, of electronic signatures in accordance
with the principles specified in paragraph (2) and in a manner
consistent with section 101 of this Act. The Secretary of
Commerce shall take all actions necessary in a manner
consistent with such principles to eliminate or reduce, to the
maximum extent possible, the impediments to commerce in
electronic signatures, including those identified in the
inquiries under subsection (a) for the purpose of facilitating
the development of interstate and foreign commerce.
(2) Principles.--The principles specified in this paragraph
are the following:
(A) Free markets and self-regulation, rather than
Government standard-setting or rules, should govern the
development and use of electronic records and
electronic signatures.
(B) Neutrality and nondiscrimination should be
observed among providers of and technologies for
electronic records and electronic signatures.
(C) Parties to a transaction should be permitted to
establish requirements regarding the use of electronic
records and electronic signatures acceptable to such
parties.
(D) Parties to a transaction--
(i) should be permitted to determine the
appropriate authentication technologies and
implementation models for their transactions,
with assurance that those technologies and
implementation models will be recognized and
enforced; and
(ii) should have the opportunity to prove
in court or other proceedings that their
authentication approaches and their
transactions are valid.
(E) Electronic records and electronic signatures in
a form acceptable to the parties should not be denied
legal effect, validity, or enforceability on the ground
that they are not in writing.
(F) De jure or de facto imposition of standards on
private industry through foreign adoption of
regulations or policies with respect to electronic
records and electronic signatures should be avoided.
(G) Paper-based obstacles to electronic
transactions should be removed.
(c) Consultation.--In conducting the activities required by this
section, the Secretary shall consult with users and providers of
electronic signature products and services and other interested
persons.
(d) Privacy.--Nothing in this section shall be construed to require
the Secretary or the Assistant Secretary to take any action that would
adversely affect the privacy of consumers.
(e) Definitions.--As used in this section, the terms ``electronic
record'' and ``electronic signature'' have the meanings provided in
section 104 of the Electronic Signatures in Global and National
Commerce Act.
TITLE III--USE OF ELECTRONIC RECORDS AND SIGNATURES UNDER FEDERAL
SECURITIES LAW
SEC. 301. GENERAL VALIDITY OF ELECTRONIC RECORDS AND SIGNATURES.
Section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c) is
amended by adding at the end the following new subsection:
``(h) References to Written Records and Signatures.--
``(1) General validity of electronic records and
signatures.--Except as otherwise provided in this subsection--
``(A) if a contract, agreement, or record (as
defined in subsection (a)(37)) is required by the
securities laws or any rule or regulation thereunder
(including a rule or regulation of a self-regulatory
organization), and is required by Federal or State
statute, regulation, or other rule of law to be in
writing, the legal effect, validity, or enforceability
of such contract, agreement, or record shall not be
denied on the ground that the contract, agreement, or
record is not in writing if the contract, agreement, or
record is an electronic record;
``(B) if a contract, agreement, or record is
required by the securities laws or any rule or
regulation thereunder (including a rule or regulation
of a self-regulatory organization), and is required by
Federal or State statute, regulation, or other rule of
law to be signed, the legal effect, validity, or
enforceability of such contract, agreement, or record
shall not be denied on the ground that such contract,
agreement, or record is not signed or is not affirmed
by a signature if the contract, agreement, or record is
signed or affirmed by an electronic signature; and
``(C) if a broker, dealer, transfer agent,
investment adviser, or investment company enters into a
contract or agreement with, or accepts a record from, a
customer or other counterparty, such broker, dealer,
transfer agent, investment adviser, or investment
company may accept and rely upon an electronic
signature on such contract, agreement, or record, and
such electronic signature shall not be denied legal
effect, validity, or enforceability because it is an
electronic signature.
``(2) Implementation.--
``(A) Regulations.--The Commission may prescribe
such regulations as may be necessary to carry out this
subsection consistent with the public interest and the
protection of investors.
``(B) Nondiscrimination.--The regulations
prescribed by the Commission under subparagraph (A)
shall not--
``(i) discriminate in favor of or against a
specific technology, method, or technique of
creating, storing, generating, receiving,
communicating, or authenticating electronic
records or electronic signatures; or
``(ii) discriminate in favor of or against
a specific type or size of entity engaged in
the business of facilitating the use of
electronic records or electronic signatures.
``(3) Exceptions.--Notwithstanding any other provision of
this subsection--
``(A) the Commission, an appropriate regulatory
agency, or a self-regulatory organization may require
that records be filed or maintained in a specified
standard or standards (including a specified format or
formats) if the records are required to be submitted to
the Commission, an appropriate regulatory agency, or a
self-regulatory organization, respectively, or are
required by the Commission, an appropriate regulatory
agency, or a self-regulatory organization to be
retained; and
``(B) the Commission may require that contracts,
agreements, or records relating to purchases and sales,
or establishing accounts for conducting purchases and
sales, of penny stocks be manually signed, and may
require such manual signatures with respect to
transactions in similar securities if the Commission
determines that such securities are susceptible to
fraud and that such fraud would be deterred or
prevented by requiring manual signatures.
``(4) Relation to other law.--The provisions of this
subsection apply in lieu of the provisions of title I of the
Electronic Signatures in Global and National Commerce Act to a
contract, agreement, or record (as defined in subsection
(a)(37)) that is required by the securities laws.
``(5) Savings provision.--Nothing in this subsection
applies to any rule or regulation under the securities laws
(including a rule or regulation of a self-regulatory
organization) that is in effect on the date of the enactment of
the Electronic Signatures in Global and National Commerce Act
and that requires a contract, agreement, or record to be in
writing, to be submitted or retained in original form, or to be
in a specified standard or standards (including a specified
format or formats).
``(6) Definitions.--As used in this subsection:
``(A) Electronic record.--The term `electronic
record' means a writing, document, or other record
created, stored, generated, received, or communicated
by electronic means.
``(B) Electronic signature.--The term ``electronic
signature'' means information or data in electronic
form, attached to or logically associated with an
electronic record, and executed or adopted by a person
or an electronic agent of a person, with the intent to
sign a contract, agreement, or record.
``(C) Electronic.--The term `electronic' means of
or relating to technology having electrical, digital,
magnetic, optical, electromagnetic, or similar
capabilities regardless of medium.''.
Amend the title so as to read ``An Act to facilitate the
use of electronic records and signatures in interstate or
foreign commerce.''.
Attest:
Clerk.