[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 761 Introduced in Senate (IS)]
106th CONGRESS
1st Session
S. 761
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 for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 25, 1999
Mr. Abraham (for himself, Mr. McCain, Mr. Wyden, and Mr. Burns)
introduced the following bill; which was read twice and referred to the
Committee on Commerce, Science, and Transportation
_______________________________________________________________________
A BILL
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 for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Millennium Digital Commerce Act''.
SEC. 2. FINDINGS.
The Congress makes the following findings:
(1) The growth of electronic commerce and electronic
government transactions represent a powerful force for economic
growth, consumer choice, improved civic participation and
wealth creation.
(2) The promotion of growth in private sector electronic
commerce through federal legislation is in the national
interest because that market is globally important to the
United States.
(3) A consistent legal foundation, across multiple
jurisdictions, for electronic commerce will promote the growth
of such transactions, and that such a foundation should be
based upon a simple, technology neutral, non-regulatory, and
market-based approach.
(4) The Nation and the world stand at the beginning of a
large scale transition to an information society which will
require innovative legal and policy approaches, and therefore,
States can serve the national interest by continuing their
proven role as laboratories of innovation for quickly evolving
areas of public policy, provided that States also adopt a
consistent, reasonable national baseline to eliminate obsolete
barriers to electronic commerce such as undue paper and pen
requirements, and further, that any such innovation should not
unduly burden inter-jurisdictional commerce.
(5) To the extent State laws or regulations do not
currently provide a consistent, reasonable national baseline or
in fact create an undue burden to interstate commerce in the
important burgeoning area of electronic commerce, the national
interest is best served by Federal preemption to the extent
necessary to provide such consistent national baseline and
eliminate said burden, but that absent such lack of a
consistent, reasonable national baseline or such undue burdens,
the best legal system for electronic commerce will result from
continuing experimentation by individual jurisdictions.
(6) With due regard to the fundamental need for a
consistent national baseline, each jurisdiction that enacts
such laws should have the right to determine the need for any
exceptions to protect consumers and maintain consistency with
existing related bodies of law within a particular
jurisdiction.
(7) Industry has developed several electronic signature
technologies for use in electronic transactions, and the public
policies of the United States should serve to promote a dynamic
marketplace within which these technologies can compete.
Consistent with this Act, States should permit the use and
development of any authentication technologies that are
appropriate as practicable as between private parties and in
use with State agencies.
SEC. 3. PURPOSES.
The purposes of this Act are--
(1) to permit and encourage the continued expansion of
electronic commerce through the operation of free market forces
rather than proscriptive governmental mandates and regulations;
(2) to promote public confidence in the validity, integrity
and reliability of electronic commerce and online government
under Federal law;
(3) to facilitate and promote electronic commerce by
clarifying the legal status of electronic records and
electronic signatures in the context of writing and signing
requirements imposed by law;
(4) to facilitate the ability of private parties engaged in
interstate transactions to agree among themselves on the terms
and conditions on which they use and accept electronic
signatures and electronic records; and
(5) to promote the development of a consistent
national legal infrastructure necessary to support of electronic
commerce at the Federal and state levels within areas of jurisdiction.
SEC. 4. DEFINITIONS.
In this Act:
(1) Electronic.--The term ``electronic'' means of or
relating to technology having electrical, digital, magnetic,
wireless, optical, electromagnetic, or similar capabilities.
(2) Electronic record.--The term ``electronic record''
means a record created, stored, generated, received, or
communicated by electronic means.
(3) Electrnic signature.--The term ``electronic signature''
means a signature in electronic form, attached to or logically
associated with an electronic record.
(4) Governmental agency.--The term ``governmental agency''
means an executive, legislative, or judicial agency,
department, board, commission, authority, institution, or
instrumentality of the Federal government or of a State or of
any county, municipality, or other political subdivision of a
state.
(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) Sign.--The term ``sign'' means to execute or adopt a
signature.
(7) Signature.--The term ``signature'' means any symbol,
sound, or process executed or adopted by a person or entity,
with intent to authenticate or accept a record.
(8) Transaction.--The term ``transaction'' means an action
or set of actions occurring between 2 or more persons relating
to the conduct of commerce.
SEC. 5. PRINCIPLES GOVERNING THE USE OF ELECTRONIC SIGNATURES IN
INTERNATIONAL TRANSACTIONS.
(a) In General.--To the extent practicable, the Federal Government
shall observe the following principles in an international context to
enable commercial electronic transaction:
(1) Remove paper-based obstacles to electronic transactions
by adopting relevant principles from the Model Law on
Electronic Commerce adopted in 1996 by the United Nations
Commission on International Trade Law (UNCITRAL).
(2) Permit parties to a transaction 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.
(3) Permit parties to a transaction to have the opportunity
to prove in court or other proceedings that their
authentication approaches and their transactions are valid.
(4) Take a nondiscriminatory approach to electronic
signatures and authentication methods from other jurisdictions.
SEC. 6. INTERSTATE CONTRACT CERTAINTY.
(a) Interstate Commercial Contracts.--A contract relating to an
interstate transaction shall not be denied legal effect solely because
an electronic signature or electronic record was used in its formation.
(b) Methods.--Notwithstanding any rule of law that specifies one or
more acceptable or required technologies or business models, including
legal or other procedures, necessary to create, use, receive, validate,
or invalidate electronic signatures or electronic records, the parties
to an interstate transaction may establish by contract, electronically
or otherwise, such technologies or business models, including legal or
other procedures, to create, use, receive, validate, or invalidate
electronic signatures and electronic records.
(c) Not Preempt State Law.--Nothing in this section shall be
construed to preempt the law of a State that enacts legislation
governing electronic transactions that is consistent with subsections
(a) and (b). A State that enacts, or has in effect, uniform electronic
transactions legislation substantially as reported to State
legislatures by the National Conference of Commissioners on Uniform
State Law shall be deemed to have satisfied this criterion, provided
such legislation as enacted is not inconsistent with subsections (a)
and (b).
(d) Intent.--The intent of a person to execute or adopt an
electronic signature shall be determined from the context and
surrounding circumstances, which may include accepted commercial
practices.
SEC. 7. STUDY OF LEGAL AND REGULATORY BARRIERS TO ELECTRONIC COMMERCE.
(a) Barrirs.--Each Federal agency shall, not later than 6 months
after the date of enactment of this Act, provide a report to the
Director of the Office of Management and Budget and the Secretary of
Commerce identifying any provision of law administered by such agency,
or any regulations issued by such agency and in effect on the date of
enactment of this Act, that may impose a barrier to electronic
transactions, or otherwise to the conduct of commerce online or be
electronic means. Such barriers include, but are not limited to,
barriers imposed by a law or regulation directly or indirectly
requiring that signatures, or records of transactions, be accomplished
or retained in other than electronic form. In its report, each agency
shall identify the barriers among those identified whose removal would
require legislative action, and shall indicate agency plans to
undertake regulatory action to remove such barriers among those
identified as are caused by regulations issued by the agency.
(b) Report to Congress.--The Secretary of Commerce, in consultation
with the Director of the Office of Management and Budget, shall, within
18 months after the date of enactment of this Act, and after the
consultation required by subsection (c) of this section, report to the
Congress concerning--
(1) legislation needed to remove any existing barriers to
electronic transacts or otherwise to the conduct of commerce
online or by electronic means; and
(2) actions being taken by the Executive Branch and
individual Federal agencies to remove such barriers as are
caused by agency regulations or policies.
(c) Consultation.--In preparing the report required by this
section, the Secretary of Commerce shall consult with the General
Services Administration, the National Archives and Records
Administration, and the Attorney General concerning matters involving
the authenticity of records, their storage and retention, and their
usability for law enforcement purposes.
(d) Include Findings If No Recommendations.--If the report required
by this section omits recommendations for actions needed to fully
remove identified barriers to electronic transactions or to online or
electronic commerce, it shall include a finding or findings, including
substantial reasons therefore, that such removal is impracticable or
would be inconsistent with the implementation or enforcement of
applicable laws.
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