[Congressional Record (Bound Edition), Volume 145 (1999), Part 20]
[House]
[Pages 29200-29224]
[From the U.S. Government Publishing Office, www.gpo.gov]



       ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT

  The SPEAKER pro tempore. Pursuant to House Resolution 366 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the State of the Union for the consideration of the bill, H.R. 1714.

                              {time}  1226


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the State of the Union for the consideration of the bill 
(H.R. 1714) to facilitate the use of electronic records and signatures 
in interstate or foreign commerce, with Mr. Bonilla in the chair.
  The Clerk read the title of the bill.
  The CHAIRMAN. Pursuant to the rule, the bill is considered as having 
been read the first time.
  Under the rule, the gentleman from Virginia (Mr. Bliley) and the 
gentleman from Michigan (Mr. Dingell) each will control 30 minutes.
  The Chair recognizes the gentleman from Virginia (Mr. Bliley).
  Mr. BLILEY. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, last Monday the Committee on Commerce brought H.R. 
1714, the Electronic Signatures in Global and National Commerce Act, to 
the floor under suspension of the rules.
  Unfortunately, H.R. 1714 fell just four short votes of passage. The 
Clinton administration and minority leadership of this body mounted an 
intense lobbying campaign against the bill. We were proud of the number 
of votes that we were able to achieve in support of the bill, and we 
return to the House floor this week with the identical bill that was 
considered last Monday.
  We remain confident that H.R. 1714 is strong legislation that helps 
to facilitate e-commerce in the new economy. This bill is perhaps the 
most important pro-technology vote that this Congress will take. It 
should not fall prey to partisan battles.
  The Committee on Commerce unanimously, Mr. Chairman, unanimously 
voted this bill out of the committee this summer with support from both 
sides of the aisle. Since that time, we have worked closely with the 
minority leadership of the committee to craft the additional consumer 
protection provisions that appear in the bill considered last week and 
remain in the bill today.
  We believe those negotiations to be fair and worthwhile, and were 
disappointed to learn for the first time on the floor last week that 
the minority did not feel the same. These important new provisions 
offer consumers strong protection in the electronic world. They require 
consumers to opt in if they wish to receive their documents in 
electronic form.
  Let me repeat, nothing, nothing in this bill requires consumers to 
receive documents electronically against their wishes. Further, the 
bill requires that all consumers must receive important

[[Page 29201]]

notices that may affect health or safety in the traditional paper form. 
This includes notices of such as the termination of utility service, 
cancellation of health benefits or life insurance, and foreclosure or 
eviction from a residence.
  I would like to take this opportunity to rebut some of the charges 
and unfounded attacks that were made by my colleagues across the aisle 
when this bill was brought to the floor last week.
  We heard that under H.R. 1714, consumers would be forced to accept 
electronic documents, even if the consumer did not have a computer or 
an e-mail account.

                              {time}  1230

  We also heard that 1714 will sweep away Federal and State consumer 
protection laws. These claims, Mr. Chairman, are completely false.
  As I have said many times previously, consumers must have safety, 
security, and privacy on line or they will not accept this new 
technology. H.R. 1714 provides on-line consumers with a confident 
assurance that their on-line transactions will be secure and that they 
will continue to receive the same consumer protections as consumers 
purchasing a product at a local shopping mall.
  We also heard, much to my surprise, claims that the process for 
considering H.R. 1714 was unfair. First, it was claimed that the bill 
had been substantially changed since the minority had last seen it. In 
fact, it was even charged that the consumer protections in the bill had 
been removed. This is simply untrue.
  We provided the minority with a copy of the text of H.R. 1714 before 
it came to the floor, and with minor exceptions that strengthen 
consumer protections, it was identical to the bill that they had agreed 
to just days before. The only real change was that the minority 
leadership had called a meeting with a number of Committee on Commerce 
Democrats in which they were told to stop cooperating with the 
majority, so we had the instance of politics overriding substance.
  Mr. Chairman, there were also charges that the bill was brought to 
the floor too quickly. Again, such a claim is false. H.R. 1714 was 
approved by the Committee on Commerce unanimously by voice vote on 
August 5. We filed our report on September 27. The bill was originally 
scheduled to come to the floor on October 18, but I asked it to be 
withdrawn so that we could continue to negotiate with the minority.
  The bill brought to the floor on November 1 was the product of 2 
weeks of negotiations with the minority. This can hardly be considered 
rushing legislation to the floor. Some have said that all that was 
needed was one more day of negotiations. To that I say we have given 
the minority 14 days of negotiations.
  Any charges that the majority acted in bad faith are simply 
incorrect. I gave the minority every opportunity to provide input from 
before the bill was introduced to right up until the bill came to the 
floor. I think our negotiations were very successful. In fact, key 
consumer protections in the bill, Mr. Chairman, were the result of our 
negotiations with the minority.
  Unfortunately, at the last minute the minority leadership decided 
they had to block this legislation. They had to keep Republicans from 
passing an important pro-technology bill that enjoys unanimous support, 
unanimous support in the technology community.
  I would also like to touch on one more important consumer issue that 
has been little discussed until now. Electronic signature technologies 
provide consumers with much more assurance that their transactions and 
communications will take place in a safe, secure and private 
environment. The encryption capabilities that are used to protect such 
valuable signatures offer much greater protection than ever possible in 
the traditional paper world.
  Electronic signatures provide a level of authentication that far 
surpasses the ink signature that has come to be the accepted standard. 
Moreover, H.R. 1714 makes it possible to have seamless and efficient 
processing of electronic signatures records. Electronic transactions 
have much less chance of human error, and provide for more reliable 
retention after the initial transaction takes place.
  Critics have argued that this bill should not apply to records. In 
fact, they want to severely narrow the bill's scope to delete records. 
This would be a shame and I could not support it. Records are an 
important component in electronic commerce transactions. Consumers will 
benefit from the use of electronic records and we should provide the 
legal framework to allow their use and acceptance.
  The world is moving towards a paperless society and we cannot sit 
back and ignore reality as some would like us to do. A proper course of 
action is to address records by adding appropriate consumer protections 
like we have done in H.R. 1714.
  Mr. Chairman, the 105th Congress was credited with passing monumental 
legislation to help facilitate E-commerce. This vote is perhaps the 
most critical one that the 106th Congress will consider to continue the 
growth and success of the digital economy. If Members support the U.S. 
high-tech industry, they will vote ``yes'' on this bill. A vote in 
support of H.R. 1714 is a vote to support providing consumers with 
greater security in on-line transactions. It is a vote in support of 
allowing business to provide new and innovative services on line.
  Mr. Chairman, I understand that an amendment will be offered today by 
a number of my colleagues, including the gentleman from Washington (Mr. 
Inslee), the gentlewoman from California (Ms. Eshoo), the gentleman 
from Virginia (Mr. Moran) and the gentlewoman from California (Ms. 
Lofgren). This amendment further clarifies the important consumer 
protections that are included in this bill. I thank the gentleman from 
Washington (Mr. Inslee) and his colleagues for their constructive work 
on this amendment and recognize that he and several other Members of 
his party have made valuable contributions to this process, instead of 
trying to undermine it.
  Mr. Chairman, I will support this amendment and I ask that all 
Members of the House do the same. I urge my colleagues to rise above 
partisan politics and support H.R. 1714.
  Mr. Chairman, in September, the Banking Committee raised with the 
Commerce Committee the need to make clear that the ``the autonomy of 
parties'' provision of the reported version of H.R. 1714 was not 
intended to limit the authority of the Federal banking agencies to 
impose and enforce minimum safety and soundness standards for the use 
of electronic signatures and records by entities they regulate. I want 
to assure the Banking Committee today that the language in Section 
103(a)(4) of the modified text before us this afternoon was drafted so 
as to accommodate those concerns. Nothing in this bill should be 
interpreted to interfere with the authority of federal banking agencies 
to impose and enforce minimum safety and soundness standards for the 
use of electronic signatures and records by entities they regulate.
  Mr. Chairman, I reserve the balance of my time.
  Mr. DINGELL. Mr. Chairman, I yield myself 6 minutes.
  Mr. Chairman, I want to express considerable affection and respect 
for the gentleman from Virginia (Mr. Bliley), my good friend and the 
chairman of the committee. But I want to observe that he is in error on 
a number of important points.
  First of all, we did have 2 weeks of negotiation and we were making 
good progress. Second of all, the gentleman from Virginia terminated 
the discussions and brought the bill to the floor without completing 
the negotiations. I would observe we were making good progress. I would 
observe we could have made further good progress and we could have a 
bill which could pass unanimously. Regrettably, we do not because there 
are important consumer protections which are missing from this bill.
  The haste is charged up to partisanship. Well, that might perhaps 
tell more about the author of that statement than it does about anybody 
else. In point in fact, our concern here is protecting consumers and I 
will address that question as I go forward in my statement.

[[Page 29202]]

  Mr. Chairman, I also would observe something else and that is that 
there is no magic to completing this legislation now, nor is there 
magic in completing it within 14 days. Completing legislation well in a 
fashion which serves the interests of all parties, those who would 
engage in electronic commerce and those who would be consumers and 
customers of those who engage in electronic commerce, is in the best 
traditions of this institution.
  Now, Mr. Chairman, I would observe something else. The future of the 
American economy depends upon our making this new form of conducting 
business a success, one which can be accepted by all and which can be 
regarded as being fair indeed to all. Unfortunately, the bill before us 
contains major flaws that harm consumers, and I regret that the 
gentleman from Virginia did not give us more time in which to complete 
those matters.
  Regrettably, I therefore must oppose the bill in its current form. 
The gentleman from Virginia (Mr. Bliley) did work closely with the 
minority to correct some of the deficiencies. I regret, however, that 
gaps remain, some of which are indeed serious.
  It is interesting to note that many of the companies recommending and 
representing the high-tech community do not oppose the consumer 
protections which we think should be included. Regrettably, a small but 
nevertheless important minority of business interests continues to 
oppose consumer protections in any form. Those are not, regrettably, 
people in the electronic commerce business. Those are simply people in 
the financial interests of this country which want to have it all their 
way, and I can sympathize with my friend from Virginia in dealing with 
such an obdurate lot.
  An amendment today which will be offered will seek to improve the 
legislation, and I commend the authors of the legislation, the 
gentlewoman from California (Ms. Eshoo), the gentleman from Washington 
(Mr. Inslee), and others. Unfortunately, the amendment would improve 
certain aspects of the bill but, unfortunately, it still falls short.
  The Bliley bill, even with the Inslee amendment, would harm consumers 
in several ways. First, it would not require any notice, conspicuous or 
otherwise, that consumers are entitled to receive certain records in 
writing under existing law. Before choosing to receive these documents 
electronically, I believe consumers should be given specific notice as 
to what existing rights they are giving up. Regrettably, the Bliley 
bill leaves consumers in the dark on this matter.
  Secondly, the opt-in provision as currently structured in the bill 
before us would allow all sorts of dissimilar records to be bundled 
together giving, at best, confusion to the consumers and would require 
them to essentially take an all-or-nothing approach in which records 
they agree to receive electronically.
  Clearly, there are records and records, and clearly they should and 
can be easily treated differently by the consumers and the purchasers.
  In effect, an on-line merchant could require consumers to take it or 
leave it, thereby defeating the will of the parties, and especially the 
consumers, to receive some records electronically, but not others that 
they would prefer to receive in a traditional form.
  Finally, the bill would allow merchants to vitiate contracts entirely 
if consumers do not agree to opt in to receiving records 
electronically. That is not an option. In the law it is called a 
``contract of adhesion'' and in a word it is a contract which is not 
equal and in which the parties are not equal parties to a contract.
  Clearly, if we are seeking to improve the attitude of consumers and 
to earn their trust, this is not the way that the matter should be 
handled. The administration shares these concerns and strongly supports 
the substitute which I will offer today with the gentleman from 
Missouri (Mr. Gephardt), the gentleman from Michigan (Mr. Conyers) and 
the gentleman from New York (Mr. LaFalce).
  The administration has additional concerns, as do I, concerning the 
effect of this bill in on-line transactions. For these reasons I urge a 
``no'' vote on H.R. 1714 and urge my colleagues to support the 
substitute which has been made in order by the Committee on Rules.
  The substitute would take an important first step, fully recognizing 
the validity of electronic signatures in contract law. That is good. 
The legislation will give Congress the additional time to explore the 
effect on consumers of the new electronic contract laws to the myriad 
of important records and documents that accompany these agreements. It 
also would avoid stomping on the actions of legislatures in having 
created and in addressing contract problems, as they have traditionally 
done under the historic laws of the United States, wherein the matters 
of ordinary commerce are dealt with by the several States and dealt 
with well, indeed, under things like the Uniform Commercial Code.
  Mr. Chairman, I see no reason for supplanting the knowledge, reason, 
and expertise and the traditions which have vested in the legislatures 
the ability to address these questions by adding a whole new array of 
changes which may or may not be in the consumers' interest and may not 
be in the interest of business in the United States and which clearly 
are opposed by consumer groups and by the administration.
  Mr. Chairman, I ask unanimous consent to yield 15 minutes of my time 
to the distinguished gentleman from Michigan (Mr. Conyers) to control 
as he sees fit.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Michigan?
  There was no objection.
  Mr. DINGELL. Mr. Chairman, I reserve the balance of my time.
  Mr. BLILEY. Mr. Chairman, I yield 3\1/2\ minutes to the gentleman 
from Louisiana (Mr. Tauzin).
  Mr. TAUZIN. Mr. Chairman, I thank the gentleman from Virginia (Mr. 
Bliley), chairman of the Committee on Commerce, for yielding me this 
time. I particularly want to commend him for this legislative effort 
and, like him, I want to thank particularly the gentlewoman from 
California (Ms. Eshoo) of our committee who has done such great work 
over the years in helping to develop an electronic signature bill for 
the E-commerce age, and the gentleman from Washington (Mr. Inslee) and 
others for working with the chairman of the committee in offering a 
very helpful amendment that we are going to hear about later today.
  Mr. Chairman, let me first say that this bill obviously has the 
support of an incredible array of business groups, including the United 
States Chamber, which is going to score this as one of our major votes 
this year because business sees this, of course, as a major step 
forward in the development of electronic commerce for our country and 
our country's economy.
  But I want to speak more importantly about the impact of this E-SIGN 
bill on consumers. I think we all agree that consumers are the backbone 
of the electronic commerce model. If consumers do not feel comfortable, 
if they do not feel at ease with this new technology, then they are 
going to lose confidence in the growing electronic commerce of our 
country and the world, and that is certainly a result no one wants.
  I understand, Mr. Chairman, that over 10 million Americans are going 
to join in the electronic commerce revolution this Christmas and make 
purchases for their Christmas gifts over the Internet.

                              {time}  1245

  But as more and more consumers come to use the Internet and the 
electronic commerce, this E-SIGN bill is going to become more and more 
important. This bill strikes, I think, the right balance. It recognizes 
that we are moving toward electronic transactions and then allows many 
types of transactions to take place over the Internet while, at the 
same time, it continues to provide the protections that consumers have 
been accustomed to in the world of paper and written checks and 
contracts, and in the analog world itself.
  H.R. 1714, which I was very pleased to join the gentleman from 
Virginia

[[Page 29203]]

(Chairman Bliley) in sponsoring in its onset, recognizes that there are 
important State and Federal laws that protect consumers today such as 
the requirement that consumers be provided copies of important 
documents such as warrants, notices, and disclosures.
  This bill recognizes and retains these important consumer protection 
laws and develops a system whereby consumers can choose to accept 
electronic versions of the documents and then receive them 
electronically. Understand, consumers choose to do so.
  It furthermore provides that consumers must separately and 
affirmatively opt in and consent to receiving important documents 
electronically and then must be assured that those documents can be 
retained for future use. That is why this bill has the right balance, 
good for business, good for consumers.
  Let me say a word in opposition to the substitute that we will see. 
The substitute would apply only to contracts.
  Let me give an example of what the substitute will miss. Today we 
spend almost $4 billion handling paper checks with an electronic 
commerce world; $4 billion could be saved for consumers if, in fact, we 
could literally bank electronically without the necessity of all this 
paper. Imagine all the weight this paper has in the transport 
industries as cargo on planes. If one eliminates all that paper in our 
lives and in the shipment and cargoes and transportation, those kind of 
savings are ours if we reject the substitute and stick with the main 
bill.
  Mr. CONYERS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I would like to begin by thanking the gentleman from 
Michigan (Mr. Dingell), dean of the House and the ranking member of the 
Committee on Commerce, for sharing the time in general debate with the 
Committee on the Judiciary that I represent on this side.
  Now, Mr. Chairman, we all know there are millions of Internet users 
and millions of consumers, and that this number increases daily. It has 
been said here earlier, electronic commerce is the future of our 
economy. As more and more people buy and sell merchandise on-line, we 
find that e-commerce has made life easier for people as well as 
improved our overall economy by making shopping and other commercial 
transactions far more convenient.
  I want to enact Federal legislation that would facilitate electronic 
signatures and make e-commerce more robust. We need to ensure that 
contracts are not denied validity that they otherwise would have simply 
because they are in electronic form or signed electronically.
  Now, if the measure before us did this without doing violence to our 
most cherished and long-fought consumer protections, I would be 
supporting it without reservation. Now, especially with the recent 
decision in the Microsoft case, which suggests that a high-tech giant 
may not always be friendly to consumers, it makes it even more 
important than ever that consumers have confidence in the Internet and 
that they believe it is friendly and a friendly place to do business. 
This is critical to the future of this whole industry.
  It is only when consumers have confidence in on-line transactions 
that it will become the vibrant marketplace that it can be. The high-
tech community should not let itself be hijacked by security firms or 
banks or the insurance industry whose history with respect to consumers 
has not always been what we would wish it to be. The on-line community 
should be in the forefront of consumer protection. Instead, they are 
being dragged backwards by special interests.
  That is where I hope that I may be able to be of some small help in 
this debate, because this measure, as it is written, goes far beyond 
the needs of the vast majority of on-line businesses. H.R. 1714 has 
become an 11th hour grab bag for our special interests to hurt 
consumers by undermining critical laws that require notice of rights 
and that prevent unscrupulous business people, of which, unfortunately, 
there are some, from cheating unsuspecting customers.
  Because of the special interests overreaching, what started as an 
uncontroversial bill to validate electronic signatures and contracts 
has turned into a battle over the electronic records of every type 
imaginable. Let us try to rescue this measure from that kind of a 
result.
  So for this reason, instead of considering a bill that should be a 
win-win situation, both for consumers and e-commerce, we are now being 
pressured into voting on a bill that pits the opportunities of one 
against the rights of the other.
  It is, therefore, no surprise that the bill is opposed by our 
administration. It is opposed by consumer groups. It is opposed by the 
National Conference of State Legislatures and the United Automobile 
Workers and many others.
  So what we have here is, unfortunately, a very good idea that has 
attached to it provisions that undermine consumer protection laws that 
would require notice, warranties, and disclosures to be in writing 
because it permits consumers to unwittingly click away many of these 
rights.
  For example, critical notices regarding the cancellation or change in 
terms of insurance agreements or a change in the interest rate or the 
service or the change of a servicer of a mortgage, of recall notices, 
and other warranty information could be sent electronically or posted 
on a Web site regardless of whether the person owns a computer, which 
it may not come as news to you, many people do not, or whether the 
consumer has an e-mail account, which they may not, or whether they 
know how to navigate the World Wide Web even if they have the 
technology, some of which do not.
  Furthermore, this measure stands for the proposition that the States 
somehow do not have the ability to enact their own electronic commerce 
laws or to reinstate many additional consumer protections.
  So rather than respecting the tradition in our country of hundreds of 
years that reserves contract law to the States, the bill says that the 
States, that they may only reenact supplemental consumer legislation if 
it fits into a narrowly described category.
  So far, thus, even if a State wanted to maintain its protections 
against fraudulent or deceptive practices and automobile sales, for 
example, the Federal Government would in effect tell the State that it 
cannot do so.
  So for these and other reasons, we have created, along with the 
gentleman from Michigan (Mr. Dingell) and the other Members, a 
substitute that represents the bipartisan language agreed on by Members 
of the other body, Members, Senator Abraham and Senator Leahy, that 
satisfies the needs of the high-tech community which we laud without 
sacrificing consumers in the process.
  So I urge that my colleagues reserve their support for this 
substitute.
  Mr. Chairman, I reserve the balance of my time.
  Mr. DINGELL. Mr. Chairman, I reserve the balance of my time.
  Mr. BLILEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Virginia (Mr. Davis) in strong support of this legislation.
  Mr. DAVIS of Virginia. Mr. Chairman, I am proud to be an original 
cosponsor of this legislation and also familiar with the need to 
provide legal certainty to electronic signatures and electronic 
records. That is why I eagerly cosponsored this legislation, because I 
think it is time for Congress to take positive, not regulatory, steps 
to help promote growth and development of electronic commerce.
  Late last week, we were surprised by the minority leadership. They 
must have decided that appearing to oppose high-technology legislation 
was not the political stance, so they decided to introduce their own 
electronic signature bill, H.R. 3220, which we will be considering 
later today as a substitute amendment.
  Unfortunately, that legislation falls way short of what is needed. 
The appearance of supporting technology legislation is not enough. 
There has to be substance behind that appearance. I believe that H.R. 
3220 falls short.
  Last week on the floor, I spoke at length about the important 
consumer

[[Page 29204]]

protections contained in this legislation, H.R. 1714, and tried to 
rebut some of the claims that this was bad for consumers. I would like 
to briefly touch on some of those points.
  First, consumers are absolutely free to choose or not to choose to 
enter into an electronic transaction. Nothing requires any party to use 
or accept electronic records or electronic signatures. The bill simply 
offers consumers the option to engage in electronic transactions. If a 
consumer does choose to conduct an on-line transaction, that consumer 
is protected by the underlying Federal or State laws governing that 
transaction.
  If a law requires that a notice or a disclosure be made available in 
writing to a consumer, then those traditional writings must continue to 
be delivered to the consumer. Nothing in this bill, nothing, will 
nullify such existing State consumer protection laws.
  Let me reiterate. Under H.R. 1714, consumers must be provided with 
important notices, disclosures, or other documents as they are entitled 
to receive under the current law.
  Before a consumer can receive an electronic copy of an important 
document, such as a warranty or a disclosure, a consumer must 
separately and affirmatively consent to receive such a document 
electronically. That is, a consumer must specifically approve of 
receiving electronic documents and that portion of a contractor 
agreement telling a consumer what documents he or she will receive 
electronically.
  I urge my colleagues to support this legislation. The companies and 
manufacturers that use electronic technology, along with on-line users, 
need this legislation.
  Mr. DINGELL. Mr. Chairman, may I inquire of the time remaining.
  The CHAIRMAN. The gentleman from Virginia (Mr. Bliley) has 15\1/2\ 
minutes remaining. The gentleman from Michigan (Mr. Conyers) has 7\1/2\ 
minutes remaining. The gentleman from Michigan (Mr. Dingell) has 9 
minutes remaining.
  Mr. DINGELL. Mr. Chairman, I yield 2 minutes to the distinguished 
gentlewoman from California (Ms. Eshoo).
  Ms. ESHOO. Mr. Chairman, I thank the gentleman from Michigan, the 
distinguished ranking member of the House Committee on Commerce, for 
granting me the 2 minutes, especially since we hold opposing views on 
this. But I sincerely appreciate it.
  Mr. Chairman, I rise in support of H.R. 1714, and I urge my 
colleagues to do support its passage.
  I would like to thank the gentleman from Virginia (Mr. Bliley), the 
distinguished chairman of the full committee, for his work on the 
legislation and for all of my colleagues for their interest in this 
very important public policy area.
  As many of my colleagues know, I have a legislative history on the 
issue of electronic signatures in the Congress, having introduced the 
first piece of legislation addressing this issue in the last Congress 
and succeeding in passing it into law. That bill required Federal 
agencies to make government forms available on-line and accept a 
person's electronic signature on these forms.
  In this Congress, I introduced a bill to expand the legality of 
electronic signatures to the private sector. Today, we are going to 
discuss a very important amendment to the bill of the gentleman from 
Virginia (Mr. Bliley), which I believe improves the bill as it relates 
to consumer protections.
  The bill includes technical neutrality, and it grants to States who 
have not yet adopted legislation in this area this piece of 
legislation; and if they so wish to come up with more stringent 
legislation in a given period of time, they then can do so.

                              {time}  1300

  I believe that the Congress must ensure that no roadblocks exist 
which would stymie the growth of e-commerce. So I think the Congress 
must act to bridge the gap between now and the time when every State 
has passed an updated form of the Uniform State Law Code. The 
projections for the growth of e-commerce and its effect on our economy 
are just simply too overwhelming. Business to business e-commerce was 
nearly five times greater than e-commerce in the consumer market, 
reaching $43 billion just last year.
  This bill ensures that our laws do not impede this staggering growth, 
and with the adoption of the amendment that we are going to discuss, 
and which I am proud to offer with my colleague, the gentleman from 
Washington (Mr. Inslee), and several other Democrats, the bill takes a 
major step in guaranteeing that strong consumer protections can coexist 
with transactions in cyberspace. I think that we can do both, Mr. 
Chairman, and I am proud to support this bill, H.R. 1714, and urge all 
of my colleagues to support it.
  Mr. BLILEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Ohio (Mr. Oxley).
  Mr. OXLEY. Mr. Chairman, I rise in strong support of H.R. 1714.
  Last Thursday, Mr. Chairman, the House passed legislation to 
modernize the laws that govern our financial services industry. The 
laws we changed were more than 60 years old and had been bypassed in 
recent years by the marketplace. Congress was in many ways just trying 
to catch up with what had already happened. The lessons we learned in 
that debate I think are quite clear. If Congress cannot respond quickly 
to the changes in the marketplace and update the applicable laws, the 
inevitable result will be more harm than good. The longer we wait to 
act, the more entrenched the various factions will become, making it 
more difficult for legislation with each passing day.
  We do not need another web of inconsistent State laws and Federal 
regulations that will leave consumers and businesses guessing whether 
their contract is valid or not just because it was conducted on line. 
Let us understand that the world is changing and the Congress needs to 
change the laws to reflect those inevitable changes. Electronic 
commerce is growing exponentially and will continue to change the way 
we conduct our business. Given the opportunity before us to enhance 
electronic commerce in the same manner the marketplace has, it would be 
foolish to a large extent not to provide the legal certainty that will 
benefit consumers and facilitate commerce. Our laws need to keep up 
with the significant technological developments.
  This bill, sponsored by the chairman of the Committee on Commerce, 
the gentleman from Virginia (Mr. Bliley), is designed to bring legal 
certainty to electronic transactions. Legal certainty. The parties need 
to understand that when they sign that contract there is a legal 
binding obligation on both of them, and the handwritten signature more 
and more becomes less and less significant.
  Mr. Chairman, this is another essential step necessary for our 
economy to take advantage of the efficiencies of electronic commerce. 
This is the same exact legislation most of us supported just last week. 
I will also be supporting the amendment by our friend, the gentleman 
from Washington (Mr. Inslee), who will be offering that recordkeeping 
provision and clarifying the recordkeeping provisions of the bill.
  Mr. Chairman, this legislation is good public policy and it continues 
a strong tradition by the Committee on Commerce of enacting legislation 
that keeps up with the electronic marketplace that is changing so 
dramatically. I urge strong support of this legislation.
  Mr. CONYERS. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
California (Ms. Lofgren), a member of the Committee on the Judiciary.
  Ms. LOFGREN. Mr. Chairman, I am pleased to appear today in favor of 
1714, especially after the Inslee amendment is adopted. I would like to 
say that some of the tinge of rhetoric that approaches partisanship, I 
think, is unfortunate.
  I am privileged to serve with the gentleman from Michigan (Mr. 
Conyers), the ranking member, who really has played such a leadership 
role in so many high-tech issues this year, including the patent reform 
bill and the Y2K reform bill. I mean we are here because we are dealing 
with difficult times, a transition from the analog world to the digital 
world, and I think that as we do that, we have to create a

[[Page 29205]]

transition rule for the parts of the country that are not where Silicon 
Valley is yet.
  In doing so, I think it is important that we establish some 
principles. I heard the distinguished Member from Michigan mention 
contracts of adhesion, and clearly contracts of adhesion violate 
contract law. I think it needs to be emphasized that nothing in this 
bill amends contract law other than the means of transmission. The 
medium for transmission does not change the substance of the law. A 
contract is a contract is a contract.
  We recognize that because we are in a transition area there are 
certain things that are too high risk to have fully in electronic 
commerce in this transition period, including foreclosures of real 
property and the like, that are outlined in the bill of the gentleman 
from Virginia (Mr. Bliley), but it is important that we take a step 
forward to promote electronic commerce.
  How do I do it? We bought our last car on line. And when I get the 
notices, I just click and file those notices under my commercial 
receipts file in my e-mail account. When I go to amazon.com, and they 
send me the notices of where my books are on the way, I file those in a 
pending file. Some day, all of us will do that.
  For now, this bill, with the amendment, will allow all of America to 
move forward.
  Mr. BLILEY. Mr. Chairman, I yield 2 minutes to the gentleman from New 
York (Mr. Fossella), a distinguished member of the committee.
  Mr. FOSSELLA. Mr. Chairman, I thank the chairman of the Committee on 
Commerce, the gentleman from Virginia (Mr. Bliley), for yielding me 
this time, and I compliment him for his efforts and his leadership.
  The American people want action, they just do not want words. And 
when we add this to the Telecommunications Act of 1996, and as was 
mentioned earlier the Financial Modernization Act that was passed 
overwhelmingly by the House and Senate last week, I think the gentleman 
from Virginia (Mr. Bliley) deserves a lot of credit from this Congress 
because, ultimately, it means good things for the American consumers, 
more jobs, and coming out on the side of growth, such as the case with 
the Electronic Signatures in Global and National Commerce Act.
  I rise today in support of H.R. 1714, the Electronic Signatures in 
Global and National Commerce Act. As of today, the success of 
electronic commerce has led 44 States to enact laws to provide 
recognition for electronic signatures and records. However, all 44 
statutes are different and many only recognize the use of electronic 
signatures and records in governmental transactions. In today's global 
economy, a certain level of uniformity is necessary in order to conduct 
the business over State and international borders. That is common 
sense.
  While electronic commerce, in theory, represents the perfect model of 
interstate commerce, these many conflicting standards lead to legal 
uncertainty, to the point where it becomes impossible to effectively 
use electronic signatures in the digital arena.
  H.R. 1714 creates a uniform nationwide legal standard for the use and 
acceptance of electronic signatures and electronic records in 
interstate commerce. It allows parties the freedom to set their own 
rules for using electronic signatures and electronic records in 
interstate commerce. Any contracts or agreements developed 
electronically by the agreeing parties have full legal effect.
  H.R. 1714 furthermore recognizes the progress that States have 
already made in the area of electronic signatures and allows them to 
pass any statute that complies with the basic principles of this 
Federal bill.
  Mr. Chairman, I urge my colleagues to join me in supporting this 
important bill. It is common sense and it puts Congress on the side of 
facilitating and encouraging economic growth instead of standing in its 
way.
  Mr. CONYERS. Mr. Chairman, I yield 4 minutes to the gentleman from 
California (Mr. Berman).
  Mr. BERMAN. Mr. Chairman, I think the entire body wholly supports and 
we want to use this opportunity to encourage the growth of the Internet 
and e-commerce, but moving to a digital world, moving to the world of 
the Internet, it does not follow that every principle of Federalism and 
every principle of consumer protection should be wiped out, obviated 
and extinguished in the name of advancing e-commerce and e-contracts 
and e-signatures.
  Eliminating hard fought laws, both State and Federal, that make sure 
that a consumer has the information that they need to make informed 
decisions takes us back to the age of scams and frauds, but this time 
in the on-line environment. We have been so successful in developing a 
legal environment that gives consumers' rights and assures that outlaw 
merchants are dealt with, it is not necessary and it benefits no one 
for the Internet to become the place for unscrupulous businesses to 
flourish. My fear is that H.R. 1714, the underlying bill sponsored by 
the gentleman from Virginia (Mr. Bliley), would lead us down that path.
  The high-tech industries are seeking an immediate Federal law 
validating electronic contract formation to help pave the way for the 
growth of electronic commerce until States can adopt a recently 
promulgated Uniform Electronic Transaction Act. We need to provide that 
help, but H.R. 1714 goes way, way beyond this need. It satisfies a much 
broader, much more controversial, long-range desire of financial 
services and insurance industries to accomplish the goal of the 
financial services.
  H.R. 1714 seriously undercuts hard fought consumer protections as 
well as both Federal and State regulatory requirements. The bill 
threatens a State's ability to adopt a uniform State law with a 
permanent preemption provision.
  The National Conference of State Legislatures, in their letter of 
November 1, opposes H.R. 1714, stating that the legislation will 
eviscerate consumer protections and impede the States' insurance 
securities and banking agencies in their regulatory oversight of the 
financial services industry. This from the State legislatures.
  In a letter we received today, the National Consumers Law Center, the 
United Auto Workers, and the Consumers Union expressed their opposition 
for the underlying bill, and even with the Inslee amendment, and their 
support for the Dingell-Conyers-LaFalce-Gephardt substitute.
  States and the Federal Government should have the opportunity to 
review their writing requirements and determine which can be done away 
with and which standards should apply in each specific situation where 
electronic records may be substituted. A reckless uninformed broad-
brush approach, such as we see in H.R. 1714, is offensive to this 
notion. We cannot blindly wipe away State and Federal writing 
requirements and then provide a narrow patchwork of exceptions and 
opportunities for only States, not the Federal Government, not Federal 
regulatory agencies, to reestablish requirements where needed after 
some disastrous systemic failure.
  The substitute amendment offered by the ranking member, the gentleman 
from Michigan (Mr. Dingell) and his colleagues, provides the needed 
uniformity as to contract formation. It gives the boost that is needed 
for e-commerce without interfering with existing laws that address 
writing requirements for important notices, disclosures, or retained 
records necessary for regulatory or supervisory government activities.
  This amendment, the Dingell amendment, is the very same language as 
the bipartisan compromise reached by Mr. Abraham and Mr. Leahy in the 
Senate. If H.R. 1714 were to pass the House, it would never see the 
light of the day in the Senate, it would be vetoed by the 
administration, and it would mark us as supporting an anti-consumer 
bill.
  I urge opposition to the bill and support for the Dingell-Conyers 
amendment.
  Mr. BLILEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Roanoke, Virginia (Mr. Goodlatte).
  Mr. GOODLATTE. Mr. Chairman, I want to thank the gentleman for 
yielding me this time, and I especially want to thank the gentleman 
from Virginia,

[[Page 29206]]

the chairman of the Committee on Commerce, for his leadership on this 
issue. He has been at the forefront of this issue throughout this 
Congress, and this is vitally important legislation that I urge my 
colleagues to support and to oppose any substitutes or any 
alternatives.
  The previous gentleman made reference to protecting consumers. In my 
opinion, this legislation does more to help consumers in the 
transactions that they participate in than anything that we could do 
with relation to making sure that they get prompt and adequate 
disclosure about contracts they sign.

                              {time}  1315

  None of the current Federal or State laws are abrogated in terms of 
notices that go to consumers regarding particular transactions that 
they participate in. They simply will be allowed to receive those 
notices electronically now. And that has a number of very positive 
benefits.
  First, it is faster. If there is a change in circumstances, if there 
is a problem with a product, a defect, they are going to get that 
notice much more quickly electronically than they will get it through 
the mail.
  Secondly, it is cheaper. Some types of financial transactions are 100 
times more costly to conduct in person than they are if they can 
conduct the transaction electronically. And if they are dealing with 
somebody on the other side of the country, the delay in being able to 
participate in that and close that contract, because we do not have a 
nationally recognized standard for accepting digital signatures, is 
very costly to consumers as well as to other people. Business people 
engage in business-to-business transactions, as well.
  But probably the most important reason why this is more helpful to 
consumers than current law is that the information they get will be 
better; it will be more comprehensive.
  If they have a notice about a particular disclosure that is required 
under the law for a real estate closing or a bank loan, whatever the 
case might be, and they do not understand a particular word in that 
notice, under electronically transmitted information, the bank or the 
other company providing the information can put a whole host of other 
information on-line. They can click on a particular word in that notice 
and get an explanation of it, a definition of the word, if they do not 
understand what it means in that particular context.
  So from the standpoint of the consumer, this is vitally important.
  Secondly, from the standpoint of uniformity, of having one national 
area of commerce to be able to conduct business across State lines 
without the difficulties that come from a morass of, a variety of 
different laws from different States, that is vitally important.
  Now, instead of being only able to buy from people nearby them all 
governed by the same State law, people are now empowered to buy things 
by auction or other ways on-line from a whole host of different ways.
  I urge Members to reach across the line. We have had some differences 
on this bill. Let us have a strong bipartisan vote. It had almost a 
two-thirds vote when it came up under suspension. Let us give it a 
majority here today.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the distinguished 
gentleman from Washington State (Mr. Inslee).
  Mr. INSLEE. Mr. Chairman, I rise in support of H.R. 1714 after 
completion of our amendment.
  I want to thank the gentleman from Michigan (Mr. Dingell), the 
gentleman from Michigan (Mr. Conyers), and the gentleman from New York 
(Mr. LaFalce) for their guidance and long-time leadership on consumers 
issues. They have helped me craft this amendment in a way that I think 
will help consumers.
  I want to thank the gentleman from Virginia (Chairman Bliley) for his 
courtesy in trying to put this together.
  Mr. Chairman, I want to tell my colleagues that I believe we have a 
product, after completion of our amendment, that is pro-consumer. I 
will tell my colleagues two reasons. Number one, this is a consumer 
freedom bill. It gives consumers a new freedom and the freedom to be 
allowed to receive information and complete transactions 
electronically, a right, a freedom that will remain theirs and theirs 
alone. Only consumers will have the prerogative to decide whether or 
not transactions are electronic.
  Secondly, Mr. Chairman, I want to make abundantly clear throughout 
this debate, nothing in my amendment or the bill, nothing, not one 
word, will remove one single consumer protection to receive a notice of 
any law in this country State, Federal, or municipal. Look at page 3 of 
our amendment. Nothing will remove the right to get this notice.
  All it does is it changes from papyrus or lambskin to electronic at 
the consumer's request.
  Mr. BLILEY. Mr. Chairman, how much time do we have remaining?
  The CHAIRMAN pro tempore (Mr. Miller of Florida). The gentleman from 
Virginia (Mr. Bliley) has 8 minutes remaining. The gentleman from 
Michigan (Mr. Conyers) has 1\1/2\ minutes remaining. The gentleman from 
Michigan (Mr. Dingell) has 6 minutes remaining.
  Mr. BLILEY. Mr. Chairman, I reserve the balance of my time.
  Mr. DINGELL. Mr. Chairman, I yield 2 minutes to the distinguished 
gentleman from Minnesota (Mr. Vento).
  Mr. VENTO. Mr. Chairman, I thank the distinguished gentleman from 
Michigan (Mr. Dingell) for yielding me the time.
  Mr. Chairman, I rise in opposition to this bill. I would have opposed 
the rule had I been here and requested a rollcall vote. The fact of the 
matter is, late in the session, first this is attempted to be passed on 
suspension of the rules. It has been a moving target for the last 3 
weeks in terms of how this bill can be sold to the Members of this 
body.
  I think any discussion or evaluation of this measure yields more and 
more problems that are inherent in the bill. The fundamental bill in 
terms of electronic signatures, as has been pointed out by some of my 
other colleagues, probably could have been passed with near unanimous 
support in this body.
  The fact is that this bill does not just deal with electronic 
signature but goes on to invade a plethora of both State and national 
laws which are at the heart, basically, of financial transactions and 
consumer protection, which have received the deliberate judgment of 
this Congress for decades and, I trust, that of legislatures across 
this country.
  It fundamentally invalidates any State law and a host of Federal laws 
that are inconsistent with the provisions of this bill. It permits 
consumers simply on the assumption that they understand what is in the 
disclosure documents and records to dispense with them and to receive 
them electronically.
  I would just suggest that the efforts to date to try and repair this 
by virtue of accepting something like the Inslee amendment simply 
sugarcoats the end result. The end result will be the same.
  I appreciate the effort of the gentleman to try and protect 
consumers. But, in the end, I think that that proposal may make 
something more palatable that is indigestible in terms of what goes 
down.
  This bill fundamentally is an overreach. It sunsets all of these 
State laws with the right for States to come back and reenact them.
  Well, we all know the host of special interest groups that are going 
to be there waiting to oppose that both at the Federal and State level 
such enactment. It just is breathtaking. And it is dumping and reneging 
on consumer laws that exist and protect individuals.
  Mr. Chairman, I rise today in support of the amendment, and against 
the underlying legislation. While I favor an implementation of the use 
of electronic signatures, this measure sets a policy path of electronic 
commerce and computer dependence, and strips key federal and consumer 
safeguards and protections from transactions.
  I have deep reservations about this legislation for reasons which I 
brought forth on the floor last week. One specific concern which I 
raised at that time was that H.R. 1714 completely undermines 
protections afforded by laws and regulations such as the Consumer 
Credit Protection Act, Truth in Saving, the

[[Page 29207]]

Real Estate Settlement Procedures Act and other key consumer laws such 
as the Magnuson Moss Act, which is the federal law requiring basic 
information about the extent and limitations of warranties to 
consumers.
  I requested to offer an amendment last night at rules which would add 
these protections to the provisions excluded in the bill, so that these 
laws would not be overridden. Unfortunately, this amendment was not 
made in order by the Rules Committee. By preserving, not preempting the 
requirements of these laws that afford consumers key information at the 
right time before, during and after transactions are consummated, the 
Vento amendment would have assured that essential information required 
by federal laws and regulations would not be made electronically when a 
consumer might not have a computer, might have a broken computer or 
printer, might acquire a new e-mail address or service provider, or 
might not clearly understand the importance of notifications or 
disclosures that they assent to obtaining electronic electronically, 
never to read or know if they missed it. Without these protections, 
populations like our seniors who are already at a technological 
disadvantage will be rendered even more vulnerable.
  I also offered an amendment which would have added a new section 
providing privacy protections to this legislation. This too was 
rejected by the Rules Committee. Digital signatures will make it easier 
for consumers to buy goods and services directly from the comfort of 
their own homes, and allows businesses an unprecedented opportunity to 
reach more customers. This expansion of e-Commerce, however, should not 
come at the expense of allowing for the misuse or exploitation of a 
wide range of consumer data. This amendment would have allowed 
consumers to regain some control over their own personal information 
without unnecessarily hindering Internet services which collect 
information for legitimate purposes, and replace the self regulated 
environment that is being promoted today--without standards or 
compliance and no enforcement. It is unworkable and unacceptable.
  Specifically, my amendment would have disallowed any Internet service 
from passing on information to a third party unless clear and 
conspicuous notice is provided and consumers are allowed an opportunity 
to direct that the information not be shared. In addition, consumers 
would be able to require a copy of the information compiled about them 
at no charge, and allowed to review, verify or correct such data. 
Internet services would still be able to share information with their 
affiliates, allowing them to perform necessary transactional services 
and functions. Most importantly, this amendment would have ensured that 
those businesses which offer services or products over the Internet 
take affirmative responsibility to maintain the integrity of the 
information being accumulated.
  Recently, the House included privacy provisions into the Financial 
Services Modernization legislation. This was a step forward in the 
arena of providing safeguards for consumer data. However, we are all 
well aware that concerns regarding the protection of consumer data go 
far beyond the realm of the financial world. It is important that we in 
Congress support a clear and consistent message when dealing with the 
issue of information collection and use. This amendment would expand 
privacy regulations to ensure that consumers as well as businesses are 
able to utilize technology to its fullest potential without infringing 
on the basic right to privacy.
  Some of my other concerns have been addressed by the Dingell/Conyers/
LaFalce/Gephardt amendment, which I have cosponsored. This substitute 
amendment recognizes that in order to be successful, e-Commerce can not 
pit high-tech business against consumers. Additionally, it deals with 
another problem which I raised last week, by not undermining State 
rights and judgment in dealing with issues such as what records must be 
retained in paper forms and when and how consumers must be notified 
about changing circumstances or enforcement of key contract terms. 
Additionally, it provides that a contract may not be denied legal 
effect or enforceability solely because an electronic signature or 
electronic record was used in its formation. These are common sense 
measures which ensure that consumers are not the unsuspecting victims 
in the excitement to embrace technological advances in commercial 
dealings.
  In conclusion, I feel that the House should address the issue of 
electronic signatures in its totality, and H.R. 1714 fails to address 
several areas which should be further improved. The consequences of 
moving too quickly on the implementation of legislation which will 
expand e-Commerce can not be underestimated. The law of unintended 
consequences should be avoided by not over reaching with the underlying 
measure. With the vast potential that the Internet promises, it is 
vital that we consider the interests and needs of businesses, the 
industry and consumers equally, so that everyone can benefit from this 
venture.
  Mr. BLILEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Virginia (Mr. Moran).
  Mr. MORAN of Virginia. Mr. Chairman, we have heard a lot about the 
digital divide. And certainly one exists between those school systems 
and communities who can afford to be wired and those who cannot.
  But there is also a digital divide in the Congress. It is between 
those who understand the new economy and what constructive role we can 
play in it and those who are afraid of it and feel the need to protect 
us from it.
  The people who are using the Internet with their computers around the 
country tend to be more confident of themselves than we are of them and 
their ability to use the New Economy to their advantage. They, in many 
ways, are more knowledgeable than we are about the role that computers 
can play in making their lives easier and more productive. They 
certainly want to be empowered to have the choice of whether or not 
they will use their computer to maximum advantage because they are far 
more interested in opportunity than in security.
  In fact, when they were recently asked in a survey what was more 
important to them, opportunity or security, they saw opportunity 
overwhelmingly as more important to them. They wanted to be able to 
protect themselves, certainly, but they feel empowered to do that on 
their own. .
  The fact is that the consumers that will be affected by this bill 
will be empowered, will be advantaged by this legislation. It is not 
just companies who will be able to operate more efficiently. It is 
consumers who want the ability to use their computers, to use the 
Internet in the most efficient and effective and legal, manner 
possible.
  The fact is that in this bill consumers who will be using e-commerce, 
digitized signatures, have the opportunity to affirmatively and 
separately consent prior to receiving their notices electronically. It 
ensures that existing consumer protection laws that are in place today 
are maintained. The fact is that we build upon the laws that exist 
today.
  This is going to come. It can either come with the support, the 
encouragement, the empowerment by the Congress, or it can come despite 
the Congress. We ought to work for and with the new economy, not in 
opposition to its culture and its opportunities.
  My comments are really directed to my own party because I know that 
the opposition is well intentioned; and it is thoughtful and it is 
knowledgeable. But it is wrong and shortsighted. The reality is that 
what we are debating is already happening today.
  Digitized signatures work. People find them to be not only easier to 
use but, in fact, entirely consistent with the economy in which they 
are operating. This will show that the Congress can be ahead of the 
curve, that Congress can play a constructive role, that the Congress 
can be leading instead of impeding. Instead of always trying to play 
catch-up like we had to do with the Financial Services Modernization 
Act.
  Look to the consumers who are using the Internet. They are asking for 
this ability to use digitized signatures. This is what the new economy 
is all about. This is why we are so prosperous. We ought to be part of 
this progress by contributing to it and certainly not oppose thoughtful 
legislation like this.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the distinguished 
gentleman from Massachusetts (Mr. Delahunt).
  Mr. CONYERS. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman 
from Massachusetts (Mr. Delahunt), my colleague on the Committee on the 
Judiciary.
  The CHAIRMAN pro tempore. The gentleman from Massachusetts (Mr. 
Delahunt) is recognized for 2\1/2\ minutes.
  Mr. DELAHUNT. Mr. Chairman, I thank both gentlemen for yielding me 
the time.
  Mr. Chairman, at our hearings on the Committee on the Judiciary, we 
were

[[Page 29208]]

told that legislation was needed to ensure the validity of electronic 
agreements entered into by private parties until the States are able to 
adopt the uniform electronic transactions act. In other words, it was 
needed to fill the gap until the States could act.
  That made sense. But then the bill was hijacked. Instead of filling 
the gap, it preempted the field; it prohibits the States from enacting 
the uniform law, as California has just recently already done, in a way 
that preserves consumer protections. It even prohibit the States from 
reenacting those protections to the extent that we supersede them.
  Now, how do people who only yesterday were waving the banner of 
States' rights and espousing federalism defend a bill that sets aside 
the will of the States in such a cavalier fashion?
  Well, we hear the term ``uniformity.'' Yet, if uniformity were all 
they were after, they would have been satisfied to let the bill sunset 
as the uniform act is adopted by each of the States over the coming 
months. And they did not. It is not in the bill.
  What the proponents of the bill really want is to arrest the process, 
to prevent the States from preserving consumer protection laws, which 
they want to do away with. It is that simple. It is one thing to try to 
ensure the validity of electronic signatures. I support that effort, 
and I am sure if that was the import of the legislation it would pass 
unanimously in this body. But it is another attempt to use this 
legislation as an end run around State consumer protection legislation. 
That is what this bill is all about.
  I urge adoption of the substitute and defeat of the bill.
  Mr. Chairman, I rise in opposition to this bill and in support of the 
Dingell-Conyers-LaFalce-Gephardt substitute.
  What we have here, Mr. Chairman, is a case of legislative hijacking. 
A bill intended to enhance the ease and security of electronic 
transactions has been commandeered. By a financial services industry 
that sees an opportunity to sweep aside a generation of state laws. 
Laws that enshrine such familiar and fundamental concepts as proper 
notice. Full disclosure. Informed consent. Truth in lending. Fair 
credit practices.
  These laws have helped ensure that the ordinary citizen will not be 
taken advantage of by powerful commercial interests who have all the 
leverage. Who hold all the cards. And in so doing, these laws have 
helped maintain a thriving economy that depends on consumer confidence.
  That is supposedly what this bill is about. Consumer confidence in 
electronic transactions. Yet ironically, by undermining state 
protections, this bill will erode consumer confidence. Not enhance it. 
If this bill becomes law, consumers will have fewer rights. And they 
will be less certain what rights they retain. Hardly a recipe for 
consumer confidence.
  At our hearings, we were told that federal legislation was needed to 
ensure the validity of electronic agreements entered into by private 
parties until the states are able to adopt, the Uniform Electronic 
Transactions Act. In other words, it was needed to fill the gap until 
the states could act.
  But then the bill was hijacked. Instead of filling the gap, it 
preempts the field. It prohibits the states from enacting the uniform 
law--as California has recently done--in a way that preserves consumer 
protections. It even prohibits the states from RE-enacting those 
protections to the extent we supersede them.
  How do people who only yesterday were waving the banner of ``states 
rights'' defend a bill that sets aside the will of the states in so 
cavalier a fashion?
  They do so in the name of ``uniformity.'' yet it uniformity were all 
they were after, they would have been satisfied to let this bill sunset 
as the Uniform Act is adopted by each of the states over the coming 
months.
  What the proponents of the bill really want is to arrest that 
process. To prevent the states from preserving consumer protection laws 
which they want to do away with. It is one thing to try to ensure the 
viability of electronic signatures, and I support that effort. But it 
is another to use this legislation as an ``end run'' around state 
consumer protection laws.
  Apart from the policy considerations, it raises serious 
constitutional questions. Given the recent holdings of the Supreme 
Court regarding the limits of congressional power, I have serious 
doubts that we have the authority to preclude the states from re-
enacting laws in an area of commercial activity that lies so squarely 
within their traditional sphere of competence.
  We should do all we can to embrace and encourage the development of 
electronic commerce. But if that brave new digital world is to provide 
hospitable to human habitation, we must take with us the great advances 
in the law that have made this world habitable.
  I am ready and willing to support a bill that does this, Mr. 
Chairman, but the current proposal falls too far short of the mark. 
That is why it is opposed by the Administration, and by every major 
consumer organization in the country.
  I urge my colleagues to oppose the bill and support the substitute.
  Mr. BLILEY. Mr. Chairman, how much time do I have remaining?
  The CHAIRMAN pro tempore. The gentleman from Virginia (Mr. Bliley) 
has 5 minutes remaining. The gentleman from Michigan (Mr. Dingell) has 
3 minutes remaining.
  Mr. BLILEY. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
New Jersey (Mrs. Roukema).

                              {time}  1330

  Mrs. ROUKEMA. Mr. Chairman, I thank the gentleman for yielding me 
this time. I will not take the entire 2 minutes. I had not anticipated 
speaking on behalf of the general debate, but I certainly do rise in 
strong support of this proposal.
  I want to make it clear here that this is not anti-consumer, it is 
both pro-business and pro-consumer, it really does not denigrate or 
eliminate any consumer protections that are currently in law, and it 
goes beyond that. I particularly am a strong supporter of the Inslee 
amendment and would like to speak on that at the appropriate time.
  I want to congratulate the chairman of the Committee on Commerce for 
his leadership here. This is excellent legislation. As a member of the 
Committee on Banking and Financial Services, I will look forward to 
continuing to work in the future on other aspects of e-commerce as it 
relates to more specific banking legislation.
  I rise today in strong support of H.R. 1714, the Electronic 
Signatures in Global and National Commerce Act.
  The bill accomplishes the two major, and often conflicting, goals of 
being both Pro Business and Pro Consumer. As we have heard, millions of 
Americans are shopping via the Internet everyday. The growth in e-
commerce is expected to explode in the next 2 years with U.S. Consumers 
spending billions on line by the year 2001. E-commerce is happening as 
we speak. We here in Congress should do everything we can to promote e-
commerce. I believe H.R. 1714 strikes the right balance between 
encouraging the growth of e-commerce while including common sense 
consumer protections.
  The bill is Pro Business because it ensures that Internet 
transactions have the same legal effect and recognition as paper 
transactions. This is accomplished by establishment of a federal law 
which recognizes e-signatures as having the same force and effect as an 
ink signature. In addition, required records and disclosures may be 
delivered electronically IF the Consumer ``opts in''.
  The bill is Pro Consumer because it encourages the growth of e-
commerce--which has led to lower prices, greater choice and round the 
clock availability. These developments are all Pro Consumer.
  Later on we are going to consider the Inslee/Eshoo/Dooley/Moan/
Roukema Amendment. This Amendment includes several provisions from H.R. 
2626, the Electronic Disclosures Delivery Act of 1999, which I 
introduced on September 1st along with Mr. Inslee and Mr. Lazio. The 
Amendment is pro consumer because it provides the additional consumer 
protections such as (1) Customer ``opt in'' for electronic delivery 
specifically required, (2) clear requirements on review, retention and 
printing of documents and disclosures, (3) the ability of a Customer to 
``opt out'' of electronic delivery at any time.
  I thought these were good provisions when I introduced H.R. 2626. I 
thought they were good provisions when proposed before the Rules 
Committee, and that is why I cosponsored the Inslee Amendment. It 
clearly improves the Bill and we should approve the Inslee Amendment 
later on when we have the opportunity.
  Mr. Chairman, this bill is an extremely good bill. I urge strong 
support for H.R. 1714.
  Mr. DINGELL. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, the issue here is a very simple one. It is not about 
whether the contract may be signed electronically. Everyone here is in 
agreement that that is a good thing. It is

[[Page 29209]]

about the notices which follow after that, notices of waste on a real 
estate contract, notice of failure to comply with requirements for 
insurance, failures of the electronic media to deliver.
  An interesting thing to note would be that this proposal is going to 
come just in time, if it is signed into law, for the year 2K bug to 
bite. The question that has to be asked is what happens if the Internet 
provider is down and the individual does not get the notice. What 
happens if on that particular day there is a virus that contaminates 
the operation of the recipient or the sender, so the recipient never 
gets it. Look at the wide array of notices which are extremely 
important and which are protected in a wide array of State laws, 
notices of nonpayment of taxes, notices which would vitiate a mortgage, 
entitle the mortgagor to cancel or to foreclose. Those are things which 
would hurt the mortgagee.
  I would ask my colleagues to understand that what we are trying to do 
here is not to stop electronic commerce or the signing of contracts 
electronically but, rather, to assure that a wider array of judgments 
are available to the purchaser and that he may then insist that he get, 
for very good reason, certain kinds of notices which he might view as 
being important. The mortgagor or the seller or the vendor under the 
contract has every right to ask that individual if he will then change 
the contract to waive those rights. But we are trying to protect 
historic rights that have always belonged to purchasers under written 
contracts under the law of the several States.
  I would give Members just one last quote. Under Statement of 
Administration Policy, the administration makes this statement, and 
Members should be aware that they are probably looking at a veto here:
  ``The administration believes that en bloc amendments fall short of 
eliminating serious defects in H.R. 1714. The Secretaries of Commerce, 
Housing and Urban Development, and the Treasury will recommend the 
President veto H.R. 1714 with the en bloc amendments. For the reasons 
explained below and in the enclosed Statement of Administration Policy, 
the administration would support adoption of the Gephardt-Dingell-
LaFalce-Conyers substitute.''
  Let us try to pass something which will make progress, something 
which will protect consumers, something which will move forward 
electronic commerce but not something which affords enormous operation 
to hurt innocent purchasers around this country.
  Mr. BLILEY. Mr. Chairman, I yield myself the balance of my time.
  This has been an interesting debate. First of all let me say that 
this bill came out of the Committee on Commerce unanimously August 5. 
We have worked with the minority. It was originally scheduled for 
October 18 on the floor. They asked for further consideration. We 
pulled it. And we worked. Everything was all in agreement. And then 
last Friday, the White House comes down here and gets a meeting with 
the Democrat leadership and all of a sudden this becomes a terrible 
bill. Nothing could be further from the truth. This is a thing to 
prevent this legislation being adopted on Republicans' watch.
  Let me give Members a list of the people who support this 
legislation:
  IBM, Information Technology Association of America, Information 
Technology Industry Council, Microsoft, American Insurance Association, 
Alliance of American Insurers, American Council of Life Insurance, 
Council of Insurance Agents and Brokers, National Association of Mutual 
Insurance Companies, National Association of Surety Bond Producers, 
Reinsurance Association of America, Securities Industry Association, 
America Online, America Electronics Association, GTE, MCI WorldCom, 
Cable and Wireless, DLJ Direct, PanAm Sat, Telecommunications Industry 
Association, National Retail Federation, Charles Schwab, Fidelity, Ford 
Motor Credit, National Association of Manufacturers, AT&T, U.S. Chamber 
of Commerce, and the Chamber will score this bill; Investment Company 
Institute, Yahoo, Equifax, International Biometric Industry 
Association, Consumer Mortgage Coalition, Financial Services 
Roundtable, Sallie Mae, Apple Computer, Hewlett-Packard, American 
Bankers Association, Consumer Bankers Association, the New York Stock 
Exchange, Business Software Alliance.
  This is a good bill. Nobody in this legislation is coerced to do 
anything. They have to agree. And, working with the minority, we say 
that if there is anything to do with eviction, foreclosure, that this 
is exempted, it is carved out of here, you cannot do it this way.
  Mr. Chairman, this is a good bill. We had a great vote a week ago. 
Let us not go back on that. Let us move the legislation forward, go to 
conference with the Senate, and then send legislation to the President.
  Mrs. MINK of Hawaii. Mr. Chairman, I rise today in opposition to H.R. 
1714, the Electronic Signatures in Global and National Commerce Act.
  No one can deny what an amazing effect the Internet and electronic 
commerce has had on national and global commerce. The Internet has 
allowed some businesses to flourish in a global marketplace in a way 
not possible by traditional means.
  The remarkable opportunities which the Internet and electronic 
commerce provides needs to be protected by ensuring that electronic 
signatures and contracts are held as legally valid and binding. H.R. 
1714, however, is not the best bill to accomplish this because it 
achieves the goal of validating electronic signatures and contracts at 
the expense of American consumers.
  If H.R. 1714 becomes law, we can expect that many of our Nation's 
consumers will unknowingly ``click away'' their rights because this 
bill does not ensure that any and all notices to consumers about their 
rights and the consequences of electronically signing their names be 
either clear or conspicuous. This is fundamentally unfair to consumers, 
especially those who may not yet be familiar with the concepts of the 
Internet and electronic commerce.
  I urge my colleagues to protect consumers and reject H.R. 1714.
  The CHAIRMAN pro tempore (Mr. Miller of Florida). All time for 
general debate has expired.
  In lieu of the amendments recommended by the Committees on Commerce 
and the Judiciary now printed in the bill, it shall be in order to 
consider as an original bill for the purpose of amendment under the 5-
minute rule an amendment in the nature of a substitute printed in the 
Congressional Record and numbered 1. That amendment shall be considered 
read.
  The text of the amendment in the nature of a substitute is as 
follows:

                               H.R. 1714

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 ``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.

[[Page 29210]]

       (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 separately and affirmatively consented 
     to the provision or availability of such record, or 
     identified groups of records that include such record, as an 
     electronic record; and
       (ii) has not withdrawn such consent; and
       (B) 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).

     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 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 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 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 
     safety or health of an individual consumer. 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 
     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 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.

     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

[[Page 29211]]

     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 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.''.

  The CHAIRMAN pro tempore. No amendment to that amendment shall be in 
order except those printed in House Report 106-462. Each amendment may 
be offered only in the order printed in the report, may be offered only 
by a Member designated in the report, shall be considered read, 
debatable for the time specified in the report, equally divided and 
controlled by the proponent and an opponent, shall not be subject to 
amendment, and shall not be subject to a demand for a division of the 
question.
  The Chairman of the Committee of the Whole may postpone a request for 
a recorded vote on any amendment and may reduce to a minimum of 5 
minutes the time for voting on any postponed question that immediately 
follows another vote, provided that the time for voting on the first 
question shall be a minimum of 15 minutes.
  It is now in order to consider amendment No. 1 printed in House 
Report 106-462.


                 Amendment No. 1 Offered by Mr. Inslee

  Mr. INSLEE. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:


[[Page 29212]]

     Amendment No. 1 offered by Mr. Inslee:
       In section 101(b), strike paragraph (2) and insert the 
     following:
       (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 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).
       At the end of section 101, add the following new 
     subsections:
       (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.
       In section 102(c), strike ``safety or health of an 
     individual consumer'' and insert ``public health or safety of 
     consumers''.
       In section 104, add at the end the following new 
     subsection:
       (c) Additional Study of Delivery.--Within 18 months after 
     the date of 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.

  The CHAIRMAN pro tempore. Pursuant to House Resolution 366, the 
gentleman from Washington (Mr. Inslee) and the gentleman from Michigan 
(Mr. Conyers) each will control 15 minutes.
  The Chair recognizes the gentleman from Washington (Mr. Inslee).
  Mr. INSLEE. Mr. Chairman, I yield myself 2 minutes.
  Mr. Chairman, I would like to tell Members what our goal was in 
drafting this amendment. Our goal basically is to assure an American's 
right to make the decision by themselves based on the information they 
have to receive information electronically and to form contracts 
electronically.
  Our goal is based on the proposition something like this: If you read 
the Declaration of Independence, it reads just as well electronically 
as it does on a piece of paper. And when you receive information in an 
on-line transaction, if you want to purchase insurance, a car, a book, 
the information you are going to receive reads just as well 
electronically. Therefore, we have crafted an amendment that would 
assure that every consumer has a new right, and, that is, the right to 
decide they want to receive information electronically.
  I want to point out several things about it. Number one, it makes 
sure that this is a decision made and has to be made affirmatively by 
an American. They have to affirmatively take an action to disclose they 
want to do business electronically. Number two, and very importantly, 
this makes very clear that any requirement of any government in America 
to give any notice will still exist after the passage of this bill if 
this amendment prevails.
  I want to read the applicable section. It reads:

       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.

  I read this because I have heard many other Members suggest that 
somehow consumers will lose the right to receive notifications. This is 
inaccurate. This amendment will assure that every notification a person 
is entitled to receive, they will still be entitled to receive.
  Third, it makes abundantly clear, we added a provision that consumers 
have to be notified what hardware and software they need to receive 
this information so that they are not acting blindly. We have heard 
suggestions that somehow electronic commerce is inefficient, 
ineffective. I think we have to realize sometimes the mail gets eaten 
by the dog as well, or misplaced, and, in fact, if consumers want to do 
business electronically, they should be entitled to do so.
  We have also, fifth, provided that the credit card rules, the 
limitations of liability, still apply in this context, if somebody 
steals your identity essentially.
  And, sixth, we provide, and I think this is very important because I 
have heard some misinformation on the floor already in this regard. 
Where the law requires provision of a notice, where a business has to 
provide notice to a consumer, they will still be required to provide 
notice, not simply post it on a website.
  Mr. Chairman, I yield 1 minute to the gentlewoman from California 
(Ms. Lofgren).
  Ms. LOFGREN. Mr. Chairman, when do you have information? Ten years 
ago, I was in local government and we organized our court files 
electronically and allowed the sheriff to access those court files for 
jail management. I remember going over to talk to the then sheriff who 
had deputies handwriting the information down on pieces of paper off 
the screen.
  I asked, ``Why are you doing this?'' He said, ``So we'll really have 
the information.''
  Do you have the information when it is on the screen, on your hard 
drive, in your head, or when it is on a piece of paper? The answer is, 
in all of those cases. We are not changing any consumer law at all with 
this bill and with this amendment. What we are doing is allowing for 
the free flow of information on the Internet, so that we can have 
electronic commerce, so that information in the Information Age can 
flow.
  I have heard many expressions really of anxiety by Members about the 
Information Age and the concept that you have information when it is 
electronic. Let me assure my colleagues that you do and consumers will 
be fully protected under the amendment.
  Mr. CONYERS. Mr. Chairman, I yield myself 3 minutes.
  I want to start off by commending my friends that are with the 
gentleman from Washington (Mr. Inslee) on his amendment. This is an 
important step forward. The problem is, it is still a half a loaf, and 
I appreciate the Democrats that are trying to improve it.
  This amendment makes minor improvements in the underlying bill but, 
indeed, it makes it worse in several respects. That is why it is quite 
clear why financial services, industries and banks are supporting it 
and consumer groups are opposing it.
  Here is why it is a backward step. It leaves to the courts to 
determine who bears the burden when an electronic disclosure notice is 
not received.

                              {time}  1345

  The bill does that. The Inslee amendment puts the burden squarely on 
the consumer's shoulders.
  Mr. Chairman, H.R. 1714, the Bliley bill leaves it to the courts; the 
Inslee

[[Page 29213]]

amendment leaves it to the consumer the responsibility of creating an 
affirmative obligation to notify a provider of a change of e-mail 
address.
  Now, in addition, this will not be corrected by the Inslee amendment. 
No requirement that the consumer be told what legal rights he is 
waiving or to what types of records that is the notices, disclosures 
and statements, that the waiver applies to. Because both the bill and 
the amendment permit a consumer to waive writing requirements for 
groups, ``groups of records,'' and there is no requirement that the 
record be similar or relate to the same transaction. The consumer can, 
without any prior knowledge, waive all the future notices with one 
click.
  This, I say to my colleagues, is the substance of what leads me to 
regretfully not be able to support the Inslee amendment. It does help 
in some respects, but in other respects, it is worse. For that reason I 
would urge that we think very carefully about this so-called 
improvement.
  The amendment improves the opt-in by requiring it to be conspicuous 
and visually separate. But there is still no requirement that the 
consumer be told what legal rights he or she is waiving or what types 
of notices and disclosures the waiver applies to.
  The Inslee amendment narrows the States' ability to reenact 
supplemental protective legislation for their citizens. This is not 
good. For that reason I ask that my colleagues critically evaluate this 
supposed improvement in the bill.
  While I appreciate the efforts of my fellow Democrats to improve H.R. 
1714, this amendment is merely an industry-drafted cosmetic fix that 
makes only minor improvements to the underlying bill, and indeed, makes 
it worse in several respects. Furthermore, it leaves unaddressed many 
fundamental problems of H.R. 1714.
  It is therefore no surprise--and is quite telling, in fact--that this 
amendment is supported by the banks and financial services industries, 
but is opposed by the consumer groups.
  The Inslee amendment is a step backwards for consumers in many ways. 
Unlike H.R. 1714, which leaves it to the courts to determine who bears 
the burden when an electronic disclosure or notice is not received, the 
Inslee amendment puts the burden squarely on consumers' shoulders by 
creating an affirmative obligation for consumers to notify a provider 
of a change of email address. The U.S. Postal Service has standardized 
procedures for address changes, forwarding mail, and returning mail to 
the sender that currently are not present in the on-line world. Without 
these real-world ``back-up'' mechanisms, this amendment simply creates 
a defense for merchant in cyberspace that it would not have in the 
physical world.
  The Inslee amendment also is a step backward from H.R. 1714 because 
it takes away the requirement that when a contract is required by law 
to be in writing, the electronic record of the contract must: (1) 
accurately set forth the information in contract after it was first 
generated, and (2) remain accessible for later reference, transmission 
and printing. Under the amendment, these standards apply only where a 
law requires a record to be retained. This significantly undercuts the 
reach of H.R. 1714.
  In addition, the Inslee amendment narrows the states' ability to 
reenact supplemental protective legislation for their citizens. Instead 
of allowing the states to enact laws for the safety or health of an 
individual consumer, the amendment permits the states to legislate only 
where it is necessary for the protection of ``public health or safety 
of consumers.'' Thus, if certain notices and disclosures are not for 
the benefit of the public health or safety and only benefit individual 
consumers--such as notices to individuals about changes in their 
insurance policies, or a specific consumer's late payment on his 
utilities--the state cannot enact or reenact supplemental laws for this 
purpose.
  Furthermore, the Inslee amendment leaves in place many of the most 
troubling aspects of H.R. 1714. For instance, although the amendment 
improves the opt-in by making requiring it to be ``conspicuous'' and 
``visually separate,'' there is still no requirement that the consumer 
be told what legal rights she is waiving or what types of notices and 
disclosures the waiver applies to. In addition, the consumer can still 
waive ``groups of records'' with one click, regardless of whether or 
not they are related to each other or if they are similar in nature.
  The Inslee amendment also maintains the bill's broad preemption of 
state laws. In order for a state to avoid preemption by the federal 
statute, the Uniform Electronic Transactions Act, or UETA, must be 
consistent with the electronic contracts and records provisions of this 
bill. This does not give the states sufficient flexibility to exempt 
necessary state writing requirements. Ironically, even if a state 
adopted UETA without excepting any of its laws. The state would still 
be preempted by the federal law, because UETA does not provide for an 
opt-in, and that would make the state law inconsistent with--and 
therefore preempted by--the federal law.
  Another flaw with the Inslee amendment is that it does not address 
the regulatory and supervisory problems with H.R. 1714. Under this 
amendment, regulated industries such as the banking and insurance 
industries would still be relieved from their legal requirements to 
maintain paper records. How can a state insurance regulator determine 
if an insurance company is properly capitalized, or if it has the 
proper reinsurance it cannot access the company's electronic records, 
or if the regulator can not require that the company keep its records 
in a tamper-proof format?
  I understand my colleagues' desire to improve H.R. 1714--because it 
needs much improvement. But the Inslee amendment just scratches the 
surface of what's needed to make the necessary improvements in H.R. 
1714. Indeed, the amendment makes the bill worse in several respects.
  Mr. Chairman, I reserve the balance of my time.
  Mr. INSLEE. Mr. Chairman, I would note that that click will waive no 
rights; it will simply indicate that notifications will be coming 
electronically rather than writing them in. A click will waive no 
rights under this amendment.
  Mr. Chairman, I yield 1 minute and 40 seconds to the gentlewoman from 
California (Ms. Eshoo).
  Ms. ESHOO. Mr. Chairman, I thank the gentleman from Washington (Mr. 
Inslee) for yielding me this time.
  I am very proud to be offering this amendment with him and several of 
my Democratic colleagues as well as the gentlewoman from New Jersey 
(Mrs. Roukema).
  First, let me just stipulate that there is not any mandate in this 
amendment that says to the consumers of America that they have to go 
on-line and use digital signatures. There is not a mandate. This is all 
about choices, but it does add the protections to the consumer if they 
so choose to exercise this.
  This amendment that we bring before my colleagues today I believe 
cures some of the criticisms, many of the criticisms of the underlying 
bill. Quite simply, it ensures that consumers who choose to receive 
electronic records from their banks, their mortgage companies, or their 
on-line trading brokers will make this decision knowingly. The 
amendment gives consumers the ability to opt in to receive electronic 
records and requires that the consent be conspicuous and visually 
separate from other terms. In other words, consumers must agree to a 
statement that they will accept the records electronically. This 
statement cannot be buried in a morass of terms and conditions. It must 
be clear and separate.
  Additionally and importantly, this amendment requires that prior to 
consenting, consumers must be provided with an explanation of how to 
access and retain electronic records. This is important because if a 
consumer cannot review, retain, and print an electronic record, that 
record is not considered valid.
  I am very proud of this amendment. I believe that it makes the bill 
totally acceptable. This should not be a partisan issue. We should come 
together from both sides of the aisle, because it protects consumers 
and it allows electronic commerce to go forward. I urge support of this 
amendment.
  Mr. CONYERS. Mr. Chairman, I yield 2 minutes to the gentleman from 
New York (Mr. LaFalce), the distinguished ranking member of the 
Committee on Banking and Financial Services.
  Mr. LaFALCE. Mr. Chairman, I think that almost everyone would favor 
the purposes of the primary bill before us today, and it is possible to 
achieve a good bill and a bipartisan bill. And, on the Senate side, 
Senator Abraham, a Republican, Senator Wyden, a Democrat, Senator 
Leahy, a Democrat, and the administration have gotten together and 
basically they have come

[[Page 29214]]

together in support of a good bill, and that is what the gentleman from 
Michigan (Mr. Dingell) and the gentleman from Michigan (Mr. Conyers) 
and I are going to offer as a substitute.
  The gentleman from Washington (Mr. Inslee) and the gentlewoman from 
California (Ms. Eshoo) are attempting to deal with the Bliley bill, 
which the administration strongly opposes and said they would veto with 
an amendment. I know they are good faith, but I point out that the 
National Consumer Law Center, the Consumer Federation of America, the 
United Auto Workers, the Consumers Union, the U.S. Public Interest 
Research Groups, and the National Consumers League have drafted a 
letter today which they have sent out to each of us which says, ``The 
Inslee-Eshoo amendment is a cosmetic attempt to make a dangerous bill 
appear more palatable. Further, this amendment will make it more 
difficult for consumers to assert their rights under existing consumer 
protection laws.''
  So this is cosmetically attractive, but dangerous because of that 
very fact.
  Mr. INSLEE. Mr. Chairman, I yield 30 seconds to the gentleman from 
California (Mr. Dooley).
  Mr. DOOLEY of California. Mr. Chairman, I rise in support of the 
underlying bill and also in strong support of the amendment offered by 
the gentleman from Washington (Mr. Inslee), myself and a number of our 
colleagues.
  This legislation is a step forward to trying to ensure that consumers 
and businesses have a better ability to conduct commerce over the 
Internet. This amendment that we are supporting today provides for 
added consumer protections. It ensures that every consumer will have to 
opt in in order to participate. It ensures that consumers will have to 
acknowledge the conditions of a contract. It also provides assurances 
that a consumer will have to acknowledge that they will have to notify 
the business or the entity that they might be doing business with if 
they change their e-mail.
  This is not any different than what one would have to do with one's 
address at one's home if one is going to relocate.
  Now, if we want to have people to have the benefits that the Internet 
can provide and e-commerce can provide, we have to understand that we 
are dealing with a different medium, and this amendment goes a long way 
to ensuring that consumers will have those protections, that they will 
have the notifications that are important for them to understand their 
responsibilities and obligations.
  Mr. Chairman, I heard some folks earlier today talking in opposition 
to the underlying bill, but there are a lot of people out there that do 
not have a computer; there are a lot of people out there that do not 
have an e-mail address; there are a lot of people out there that do not 
know how to navigate the Web. Well, if we use that as a standard to 
preclude us from moving forward with digital signature, we are never 
going to get there. But we also have assured that any consumer that 
might not have a computer, that does not have e-mail, that they do not 
have to opt in to participate in a digital signature. We provide the 
consumer protections. This amendment is a good amendment; the 
underlying bill deserves passage.
  Mr. CONYERS. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman 
from California (Mr. Berman), a distinguished member of the Committee 
on the Judiciary.
  Mr. BERMAN. Mr. Chairman, I rise in opposition to the amendment. 
While it makes some improvements in some parts of the base bill, it 
also in some areas actually goes backward. But I think the broader 
point is the point I would like to speak to.
  We seem to be talking just totally by each other. No one here is 
opposed to the concept that we need to legislate a digital signature 
law so that people in places where there is now an obligation to enter 
into a writing-in contract can enter into a contract electronically and 
bind themselves to that through digital signatures along the standards 
of the bill. There is no dispute about that.
  I hear my friend from Virginia speak in exciting and provocative 
terms about the new economy, the new elite, people who want the 
opportunity, they are governed by potentials and not their fears, and I 
say yes. But it is not a requirement to be an advocate of the new 
economy or to be a new Democrat to think that there are some people who 
will be caught in the transition and that maybe, where the Comptroller 
of the Currency decides that a particular bank should have a backup set 
of records in writing because that might be the only place they can go 
to determine whether reserves are being kept adequately, or whether in 
a particular situation involving changes in an insurance policy, let us 
just validate that for this particular type of consumer whose, perhaps, 
adult children signed them on to the insurance policy electronically, 
we should validate it by the written contract, that we are going to 
just trample over these people in the name of doing something new and 
exciting.
  Mr. Chairman, I do not have the arrogance to say that every single 
law that says that without regard to whom the consumer is, what the 
State of their mentality is, that we are going to wipe out some 
considered judgment by a regulator or by a State legislator, by a 
Federal legislator that in all circumstances, that is preempted.
  The gentleman from Washington says his amendment waives no rights, 
but it does waive one right. By conscious decision, hopefully of a 
sophisticated and educated consumer, it waives the right to have the 
disclosures, the changes, the notices in writing. That is indisputable. 
His amendment waives that right. In most cases, that will be great. 
There might be a few cases where it is not great, and it is in those 
cases that I say let us be a little careful about just wiping out all 
of these laws.
  Mr. INSLEE. Mr. Chairman, I yield 10 seconds to the gentlewoman from 
California (Ms. Lofgren).
  Ms. LOFGREN. Mr. Chairman, I think it is important to point out that 
there is no waiver of notice in writing. All we are talking about is 
transmission of that writing and whether the writing is received 
electronically or on a piece of paper, it is in writing in both cases.
  Mr. INSLEE. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman 
from Washington (Mr. Smith).
  Mr. SMITH of Washington. Mr. Chairman, I rise in support of the 
Inslee amendment and in support of the underlying bill.
  Everyone says we all agree, we are going to have digital signature, 
it is just a matter of the details. Unfortunately, the details that are 
being presented by the opponents of the Inslee amendment and of the 
Dingell amendment are such that one would, in practical effect, not be 
able to do digital signature. If, first of all, one does not have 
uniformity and one is doing something across State lines and one has 50 
or maybe even 100 different rules and regulations for how it is going 
to be done, it makes it very, very difficult to do business in the 
electronic commerce world. That is what the Dingell amendment would do. 
That creates a huge problem for the bill.
  Second of all, it requires that paper be done in addition to the 
digital signature. Well, if we are going to have to do a paper 
contract, what is the advantage of doing a digital contract? One merely 
has to duplicate oneself. Those two provisions basically mean that what 
the opponents of the Inslee amendment are doing is creating a situation 
where digital signature will not be a choice that any logical 
businessman will make. That is why we have to oppose it.
  Two final points. Consumer protection is clearly protected in this 
bill. The sentence says this law changes in no way one's contractual 
protections under consumer protection laws. We are simply doing it 
digitally instead of by paper. We have the same protections.
  Lastly, this well, if one goes on a computer it could get lost, the 
computer could blow up; paper notices get lost all of the time. If one 
moves and the notice is required to go by mail, many times these 
notices do not arrive. Whether it is paper or digital,

[[Page 29215]]

there are challenges in making sure that all of the notices get there. 
I strongly submit that those challenges are no greater with digital 
signature than they are with paper, and we are stuck in a lost mindset 
here thinking that somehow, if it is not paper, it is not real. If we 
do not do this right, we will not have digital signature. The Inslee 
amendment does it right. Support it.

                              {time}  1400

  Mr. CONYERS. Mr. Chairman, I am pleased to yield 3 minutes to the 
gentleman from Minnesota (Mr. Vento).
  Mr. VENTO. Mr. Chairman, I thank the gentleman for yielding time to 
me.
  I rise in opposition to the amendment, Mr. Chairman. I recognize that 
there is an effort here to make this, as I said, palatable, but it 
remains indigestible. What we are doing here is we are force-feeding 
the States, force-feeding consumers this particular format in terms of 
how transactions and record will be eliminated.
  Someone says, the electronic signatures, we are all for it, we can 
permit that, but we need this because we need to eliminate or give the 
possibility for people to accept notices and disclosures 
electronically, that is the only thing. But the heart and soul of most 
consumer laws are the absolute disclosure provisions. So once we go 
down this path, we have, for all intents and purposes, circumvented 
many of the consumer laws of the Federal and many at the State level.
  This is not transactions initiated over the Internet, this could be 
someone at the door that we open the possibility of fraud and abuse to 
here, because someone at the door, when we get a cooling off period for 
not purchasing, we would sign it away. There is no assurance that they 
have Internet; electronic computer equipment or service. It is only 
one-third of the homes in this Nation have Internet, so these are not 
even just transactions. We open up that possibility.
  We have tried mightily in terms of this particular provision, but we 
have gone one step forward and two back. The rule of holes is that when 
you are in a hole and you want to get out, quit digging, but this 
amendment digs in more. It tries to legitimatize what is inappropriate 
in this bill.
  The fact of the matter is, look at where the consumer is. They are 
buying a home, they are buying a car. They are blinded by the fact of 
that new shiny Chevrolet or that wonderful new home that they are going 
to get. They are signing a whole bundle of papers. In the process of 
doing it, they sign the copy, disclosure and notification away with no 
assurance, and all the responsibility put back on the individual 
consumer on something that may be the most important transaction they 
make.
  This vitiates the truth-in-lending, the real estate State Sales 
Practices Act. The Federal regulators are already working on the issue 
of electronic commerce and attempting to interface the rules and e-
commerce. Instead of doing something for the consumer, they are taking 
away the options they have today.
  Members are saying that the price of being active in this electronic 
signature bill and this electronic Internet world is that we are going 
to deny some of the rights people have today. We basically say, we will 
let you give up your rights. We should not do that, and we should know 
that individuals do not have fully informed consent, the mechanics, 
workers, blue collar workers or others getting minimum wage. They are 
not sitting in the halls of this Congress, they are not out there 
walking around in the lobbies, they need our help. Ironically this 
legislation protects the sophisticated financial institutions and 
Federal regulators.
  We ought to be doing something for the consumer, like providing 
favorable options for them on privacy in the Internet. We are not doing 
for them what we did in the Financial Modernization Act. We are doing 
more harm in this act, with this particular provision and certainly the 
underlying measure.
  When we talk about the provision in the financial modernization, we 
had balance in that bill. There is no balance in this bill. This policy 
in this bill is not necessary. These provisions on records are not 
necessary to make the electronic signature legitimate. We are 
undercutting consumer law. There is a bandwagon effect here in terms of 
the special interests that have annealed themselves to this popular 
electronic signature legislation in order to circumvent the very real 
decades of consumer law that have protected and serve the consumers and 
the people we represent. Vote ``no'' on this bill.
  Mr. INSLEE. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman 
from the Garden State, New Jersey (Mrs. Roukema).
  Mrs. ROUKEMA. Mr. Chairman, I have to say, as a member of the 
Committee on Banking and Financial Services, I rise in strong support 
of the amendment offered by the gentleman from Washington (Mr. Inslee). 
I would like to identify myself as a cosponsor of that amendment.
  I would also like to take exception to some of the loose rhetoric 
that I have heard on the floor today, and would like to speak to the 
specifics.
  It seems to me that Congress and the regulators are overdue in 
playing a leadership role in updating many of the consumer protection 
laws to reflect the new technologies in electronic commerce that we see 
out there. This bill and this amendment takes a giant step toward that 
protection. It does not diminish in any way, as far as I can tell, the 
protections that consumers already have.
  I want to be specific. The amendment is pro-consumer because it 
provides the additional consumer protections such as a clear, number 
one, customer opt-in for electronic delivery specifically is required, 
an opt-in. There are clear requirements on review, retention, and 
printing of documents and disclosures. Three, the ability of a customer 
to opt out is there for any customer at any time for the electronic 
delivery system.
  I think that this is, as I said, not only a giant step, but it is 
also clearly defined, and I dismiss any of the loose rhetoric that acts 
as though we are taking something away. We are really building not only 
a firm foundation, but a giant step for consumers in this new 
electronic age.
  Mr. Chairman, as a cosponsor, I rise today in strong support of the 
Inslee/Eshoo/Dooley/Moran/Roukema amendment. It is both Pro Business 
and Pro Consumer. It is common sense and will improve the bill.
  Millions of consumers today routinely conduct business over the 
Internet, buying and selling a myriad of products and services from 
companies large and small, near and far. Many of these consumers engage 
in financial transactions--investing in stocks and bonds, checking 
account balances, transferring funds, applying for credit cards, and 
paying bills without leaving their homes. This explosion of on-line 
financial services offers great benefits. Nonetheless, the ability to 
offer many financial services, particularly loans and mortgages, would 
be enhanced if the banking laws were amended to clarify the rules 
governing the electronic delivery of financial services.
  H.R. 1714 and the Inslee Amendment will clarify that electronic 
delivery of required consumer disclosures over the Internet is 
permissible as long as there are certain safeguards for consumers. This 
bill does not lessen the rights of consumers to receive required 
disclosures. In addition, it does not affect the content of any 
disclosure, including the timing, format and information to be 
provided. Furthermore, consumers would control which information could 
be sent to them electronically.
  This legislation will assist the growth of on-line financial 
transactions and at the same time provide consumer protections. Online 
disclosures will provide consumers with a number of benefits:
  Convenience and time-saving--Consumers can conduct transactions 
virtually anywhere and at any time, 7-days-a-week, 24-hours-a-day.
  User friendly information--Legalistic jargon in on-line disclosure 
forms can be linked to plain-English definitions, making them much more 
readable and understandable. Consumers can electronically search 
documents rather than reading through reams of paper.
  Enhanced services for under-served communities--Rural and urban 
communities will have enhanced access to financial services, even where 
brick and mortar branches are not available. In areas where residents 
cannot afford computers, libraries and schools provide on-line access.

[[Page 29216]]

  Reduced cost--Electronic delivery of disclosures will cost less than 
providing the same information on paper or paying employees to handle 
face-to-face disclosures, Competition should encourage business to pass 
on those savings to consumers.
  E-commerce is here. U.S. citizens are spending billions of dollars 
each year on-line. Congress and the regulators must play a leadership 
role in updating many of the consumer protection laws to reflect new 
technologies and establish a coherent legislative framework for the 
delivery of financial services through electronic commerce. This bill 
and this amendment takes a giant step toward that protection.
  The Inslee/Eshoo/Dooley/Moran/Roukema Amendment includes several 
provisions from H.R. 2626, the Electronic Disclosures Delivery Act of 
1999, which I introduced on September 1st along with Mr. Inslee and Mr. 
Lazio. The Amendment is pro consumer because it provides the additional 
consumer protections such as clear (1) Customer ``opt in'' for 
electronic delivery specifically required, (2) clear requirements on 
review, retention and printing of documents and disclosures, (3) the 
ability of a Customer to ``opt out'' of electronic delivery at any 
time.
  I thought these were good provisions when I introduced H.R. 2626 with 
Mr. Lazio and Mr. Inslee. I thought they were good provisions when 
proposed before the Rules Committee, and that is why I cosponsored the 
Inslee Amendment. I believe the Inslee/Roukema Amendment protects 
consumers in a rational clearly defined common sense manner. It clearly 
improves the bill.
  We should approve the Amendment and we should approve H.R. 1714.
  Mr. CONYERS. Mr. Chairman, I yield 30 second to the gentleman from 
New York (Mr. LaFalce).
  Mr. LaFALCE. Mr. Chairman, I wonder if the gentlewoman from New 
Jersey would answer why the chairperson of the Subcommittee on 
Financial Institutions has had no hearings on the bill that she 
introduced, and dealing with the impact of this bill and her bill on 
the consumer protection laws?
  Mrs. ROUKEMA. Mr. Chairman, will the gentleman yield?
  Mr. LaFALCE. I yield to the gentlewoman from New Jersey.
  Mrs. ROUKEMA. Mr. Chairman, I will tell the gentleman exactly why; we 
got a little directed and focused on financial modernization.
  Mr. LaFALCE. The gentlewoman was too busy to have hearings on these 
consumer protections.
  Mrs. ROUKEMA. I was the author of the financial privacy and financial 
modernization. I find this completely consistent.
  Mr. INSLEE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Virginia (Mr. Moran).
  Mr. MORAN of Virginia. Mr. Chairman, I thank the gentleman from 
Washington (Mr. Inslee) for yielding time to me.
  Mr. Chairman, I am also an original sponsor of this amendment because 
it clarifies the consumer protections in H.R. 1714. I have been wanting 
to respond to my friend, the gentleman from California, not because I 
take issue with his characterization of my remarks as New Democrat in 
nature, but because he said that I am supporting this bill because it 
is new and exciting.
  That is not why I am supporting this bill. It is because it is 
responsible and needed. The fact is that this bill provides a 
consistent and predictable national framework of rules governing the 
use of electronic signatures. This bill is needed. This bill was and is 
bipartisan. When the final vote is taken, it will be apparent that it 
is bipartisan. In fact the vote will be lopsided because it provides 
consumers and companies doing business on the Internet the legal 
certainty they need for electronic signatures, until all 50 States pass 
their own legislation on the legality of electronic signatures.
  This amendment is important because it clarifies the consumer 
protections that were originally inlcuded in this bill. It makes it 
clear, as the prior speakers have said, that consumers are not required 
to use or accept electronic records or electronic signatures. There has 
to be mutual consent, and it expands the bill's requirement that 
consumers be able to receive and retain electronic records.
  Mr. Chairman, this amendment is important because it says that 
opportunity for consent must be conspicuous and visually separate from 
all the other terms.
  In addition, the consumer must be provided with an explanation of how 
to access and retain electronic records. Records will be received, 
retained, and printed. The fact is that consumers are going to be 
protected, but most importantly, they are going to have a choice. Today 
they do not have that uniformity, that predictability that comes with 
uniform national standards.
  The Internet is national in nature. Our constituents need this 
legislation. Make it bipartisan and make it an expression of our 
unequivocal support for this productive, prosperous new economy.
  Mr. CONYERS. Mr. Chairman, I yield 2 minutes to the gentleman from 
Michigan (Mr. Dingell), the dean of the House and the ranking member of 
the Committee on Commerce.
  Mr. DINGELL. Mr. Chairman, I thank my good friend for yielding time 
to me.
  Mr. Chairman, I want to try and make clear what is at stake here.
  There is no objection, I think, on the floor on the part of anyone, 
my good friend, the gentleman from Michigan, myself, or anybody else, 
to whether or not the contract is signed electronically. The question 
relates to notice of later events under that contract which can 
severely impact the purchaser, such as things which would trigger 
foreclosure of a mortgage on a house or an automobile, failure to keep 
up insurance, failure to prevent waste, failure to make payments.
  It could happen for many reasons, such as year 2K. It could happen 
because of the situation which might occur, a hard drive might crash, 
or there might be any one of a number of other events, including a 
failure of the Internet provider or something of that sort, or the 
matter would just get lost in cyberspace.
  There is nothing in anything that we are talking about here that 
would preclude an individual from giving up some right and waiving his 
right to that notice. But as an attorney of longstanding and as one who 
has dealt with foreclosures and the hardship that those kinds of events 
trigger, I think it is important to see to it that some who might not 
be as smart as some of the Internet whizzes and the computer whizzes 
and jocks that we have has the capability of protecting himself, 
because we are talking about things such as the purchase of stock, 
mortgages on homes, automobile purchases, major purchases of equipment, 
and things of that kind which could incur enormous obligations on the 
part of the purchaser.
  I propose to support the amendment. It improves the bill. It does not 
improve the bill by addressing the fundamental, basic question of 
whether the consumer gets the necessary notices that are required by a 
long history of State law to apprise him that he is in danger under the 
contract of losing money or rights.
  Mr. INSLEE. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I would just like to specifically note that the 
underlying bill excludes from its ambit notices of foreclosure, of 
acceleration of default on the home. Those are specifically excepted 
and should not be an issue.
  Mr. DINGELL. Mr. Chairman, will the gentleman yield?
  Mr. INSLEE. I yield to the gentleman from Michigan.
  Mr. DINGELL. I thank the gentleman for yielding.
  Mr. Chairman, I am not talking about notices of foreclosure, I am 
talking about notices that would trigger foreclosure, notice that the 
insurance has not been paid, that damage was being committed on the 
property, that a public nuisance is being committed on the property, or 
even a notice that the individual has failed to make a payment, which 
will trigger foreclosure.
  Those are the kinds of notices that I am talking about, and they can 
severely, adversely impact the party.
  Mr. INSLEE. Reclaiming my time, those will be given. Those notices 
will be given. In every case, the consumers electronically, if they 
want it electronically, and on paper if they want it on paper, those 
notices shall be given.

[[Page 29217]]

  Mr. Chairman, I yield 1 minute to the gentleman from from Virginia 
(Mr. Bliley).
  Mr. BLILEY. Mr. Chairman, I appreciate the gentleman yielding time to 
me.
  Mr. Chairman, I think the gentleman's amendment improves the bill. I 
support it.
  I would also like to point out, as was mentioned in the earlier 
debate, that what happens if the Y2K problem happens or the computer 
breaks down, the bill requires that a record sent be able to be 
retainable, printable, and transferrable. If the Internet is down this 
standard is not met, and thus, a consumer would not be liable.
  I fully support this amendment. I urge its adoption, and I urge 
adoption of the underlying bill.
  Mr. CONYERS. Mr. Chairman, I yield the balance of my time to the 
gentlewoman from Texas (Ms. Jackson-Lee), a distinguished member of the 
Committee on the Judiciary.
  Ms. JACKSON-LEE of Texas. Mr. Chairman, I thank the distinguished 
ranking member of the Committee on the Judiciary for yielding time to 
me.
  I thank the Members for their good intentions behind this effort. I 
happen to be a supporter of electronic commerce. I wish we could have 
done this in a bipartisan way.
  Mr. Chairman, I do rise to support the incremental change that the 
Inslee amendment makes. It does not answer my concerns, however. I do 
believe that it is important for the consumers to conspicuously be able 
to opt in to give consent to know whether or not their business is 
going to be done in an electronic form, but I think what my good 
friends are missing and the reason I support the substitute is they are 
missing the fact that although we can lay out the long list of 
supporters of this bill, the responsibility of this Congress is to 
ensure that those voices which cannot be heard, those people needing to 
have information about the drugs they get out of the Food and Drug 
Administration, those young couples who are buying homes, still need to 
have the ability to understand the documents that they are utilizing.
  Under the underlying bill, creditors could condition credit on a 
consumer's consent to receive all disclosures electronically. I do want 
us to all be hooked up to the Internet, but unfortunately, even as we 
go into the 21st century, all Americans are not. Can Members imagine 
being denied credit because they refuse or do not understand that they 
need to be hooked up to the Internet? Even in credit transactions 
involving the mortgage, people would have that problem.
  Consider the FDA's responsibility to provide people with information 
about drugs, and those drugs that would conflict with others. Now we 
have the obligation of written information. Just imagine that that 
information will now be on the web page, and they leave people to their 
own devices, and they say, forget about the written materials, just go 
to the web page that most of those who are in certain levels in our 
country do not have.

                              {time}  1415

  The substitute, however, would sunset when a state enacted a uniform 
electronic transactions act which would provide for protections for our 
consumers.
  The substitute also does not affect Federal laws or regulations, but 
instead gives Federal agencies 6 months to conduct a careful study of 
barriers to electronic transactions under Federal laws or regulations. 
The substitute also represents the E-commerce bill that is the most 
likely to be enacted into law, because it is a combination of Democrats 
and Republicans, House Members and Senate Members, who have come 
together.
  Mr. Chairman, we are not against electronic commerce. I think that is 
the point that should be made. I have friends on the other side that I 
agree with, and friends over here that I agree with. But what my voice 
must be for are those individuals who do not know the Internet, who do 
not have access to computers, who are intimidated by some large 
business telling them they can not get credit or that home that they 
have been dreaming of because they will not consent to have their 
business done in an electronic process.
  Mr. Chairman, let us make it a bipartisan bill and support the 
substitute and do the right thing for the American people.
  Mr. INSLEE. Mr. Chairman, I yield 15 seconds to the gentleman from 
Ohio (Mr. Kasich).
  Mr. KASICH. Mr. Chairman, I would like to compliment the gentleman 
from Washington (Mr. Inslee) for his amendment in terms of clarifying. 
But one thing we should not be confused about, this Congress nor 
government should stand in the way of what has been remarkable progress 
here at end of the 20th century moving into the 21st century. It has 
done an enormous amount of good for families, not just in America but 
across the globe. Let us clarify this but not hesitate to invest and 
have confidence in those people who are really moving us forward and 
empowering people.
  The CHAIRMAN pro tempore (Mr. Miller of Florida). The question is on 
the amendment offered by the gentleman from Washington (Mr. Inslee).
  The question was taken; and the Chairman pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Mr. INSLEE. Mr. Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 418, 
noes 2, not voting 13, as follows:

                             [Roll No. 577]

                               AYES--418

     Abercrombie
     Ackerman
     Aderholt
     Allen
     Andrews
     Archer
     Armey
     Bachus
     Baird
     Baker
     Baldacci
     Baldwin
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Barrett (WI)
     Bartlett
     Barton
     Bass
     Bateman
     Becerra
     Bentsen
     Bereuter
     Berkley
     Berman
     Berry
     Biggert
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonior
     Bono
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brady (TX)
     Brown (FL)
     Brown (OH)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Capps
     Capuano
     Cardin
     Carson
     Castle
     Chabot
     Chambliss
     Chenoweth-Hage
     Clay
     Clayton
     Clement
     Clyburn
     Coble
     Collins
     Combest
     Conyers
     Cook
     Cooksey
     Costello
     Cox
     Coyne
     Cramer
     Crane
     Crowley
     Cubin
     Cummings
     Cunningham
     Danner
     Davis (FL)
     Davis (IL)
     Davis (VA)
     Deal
     DeFazio
     DeGette
     Delahunt
     DeLauro
     DeLay
     DeMint
     Deutsch
     Diaz-Balart
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doolittle
     Doyle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Ehrlich
     Emerson
     Engel
     English
     Eshoo
     Etheridge
     Evans
     Everett
     Ewing
     Farr
     Fattah
     Filner
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Fowler
     Frank (MA)
     Franks (NJ)
     Frelinghuysen
     Frost
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Gonzalez
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Green (TX)
     Green (WI)
     Greenwood
     Gutierrez
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hastings (FL)
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hill (IN)
     Hill (MT)
     Hilleary
     Hilliard
     Hinchey
     Hinojosa
     Hobson
     Hoeffel
     Hoekstra
     Holden
     Holt
     Hooley
     Horn
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hyde
     Inslee
     Isakson
     Istook
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson, E. B.
     Johnson, Sam
     Jones (NC)
     Jones (OH)
     Kanjorski
     Kaptur
     Kasich
     Kelly
     Kennedy
     Kildee
     Kilpatrick
     Kind (WI)
     King (NY)
     Kingston
     Kleczka
     Klink
     Knollenberg
     Kolbe
     Kucinich
     Kuykendall
     LaFalce
     LaHood
     Lampson
     Lantos
     Larson
     Latham
     LaTourette
     Lazio
     Leach
     Lee
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lofgren
     Lowey
     Lucas (KY)
     Lucas (OK)
     Luther
     Maloney (CT)
     Maloney (NY)
     Manzullo
     Markey
     Martinez
     Mascara
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McCrery
     McDermott
     McGovern
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     McKinney
     McNulty
     Meehan
     Meeks (NY)
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (FL)
     Miller, Gary
     Miller, George
     Minge
     Mink
     Moakley
     Mollohan
     Moore
     Moran (KS)
     Moran (VA)
     Morella
     Murtha
     Myrick
     Nadler
     Napolitano
     Neal
     Nethercutt
     Ney
     Northup

[[Page 29218]]


     Norwood
     Nussle
     Oberstar
     Obey
     Olver
     Ortiz
     Ose
     Owens
     Oxley
     Packard
     Pallone
     Pastor
     Payne
     Pease
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Phelps
     Pickering
     Pickett
     Pitts
     Pombo
     Pomeroy
     Porter
     Portman
     Price (NC)
     Pryce (OH)
     Quinn
     Radanovich
     Rahall
     Ramstad
     Rangel
     Regula
     Reyes
     Reynolds
     Riley
     Rivers
     Rodriguez
     Roemer
     Rogan
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Rothman
     Roukema
     Roybal-Allard
     Royce
     Rush
     Ryan (WI)
     Ryun (KS)
     Sabo
     Salmon
     Sanchez
     Sanders
     Sandlin
     Sanford
     Sawyer
     Saxton
     Schaffer
     Schakowsky
     Scott
     Sensenbrenner
     Serrano
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Sherwood
     Shimkus
     Shows
     Shuster
     Simpson
     Sisisky
     Skeen
     Skelton
     Slaughter
     Smith (MI)
     Smith (NJ)
     Smith (WA)
     Snyder
     Souder
     Spratt
     Stabenow
     Stark
     Stearns
     Stenholm
     Strickland
     Stump
     Stupak
     Sununu
     Sweeney
     Talent
     Tancredo
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thompson (CA)
     Thompson (MS)
     Thornberry
     Thune
     Thurman
     Tierney
     Toomey
     Towns
     Traficant
     Turner
     Udall (CO)
     Udall (NM)
     Upton
     Velazquez
     Visclosky
     Vitter
     Walden
     Walsh
     Wamp
     Waters
     Watkins
     Watt (NC)
     Watts (OK)
     Waxman
     Weiner
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Weygand
     Whitfield
     Wicker
     Wilson
     Wise
     Wolf
     Woolsey
     Wu
     Wynn
     Young (AK)
     Young (FL)

                                NOES--2

     Paul
     Vento
       

                             NOT VOTING--13

     Coburn
     Condit
     Dickey
     Gephardt
     Hutchinson
     Largent
     Matsui
     Meek (FL)
     Pascrell
     Scarborough
     Smith (TX)
     Spence
     Tiahrt

                              {time}  1439

  Mr. KUCINICH and Mr. WATT of North Carolina changed their vote from 
``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.
  Stated against:
  Ms. EDDIE BERNICE JOHNSON of Texas. Mr. Chairman, on rollcall No. 
577, I was unavoidably detained. Had I been present, I would have voted 
``no.''
  The CHAIRMAN pro tempore (Mr. Miller of Florida). It is now in order 
to consider amendment No. 2 printed in House Report 106-462.


  Amendment No. 2 In The Nature Of A Substitute Offered by Mr. Dingell

  Mr. DINGELL. Mr. Chairman, I offer an amendment in the nature of a 
substitute.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment in 
the nature of a substitute.
  The text of the amendment in the nature of a substitute is as 
follows:

       Amendment No. 2 in the nature of a substitute offered by 
     Mr. Dingell:
       Strike out all after the enacting clause and insert the 
     following:

     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, 
     nonregulatory, 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 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, reasonable national baseline or 
     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 contract formation;
       (4) to facilitate the ability of private parties engaged in 
     interstate transactions to agree among themselves on the 
     appropriate electronic signature technologies for their 
     transactions; 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 relating to 
     technology having electrical, digital, magnetic, wireless, 
     optical, electromagnetic, or similar capabilities.
       (2) Electronic agent.--The term ``electronic agent'' means 
     a computer program or an electronic or other automated means 
     used to initiate an action or respond to electronic records 
     or performances in whole or in part without review by an 
     individual at the time of the action or response.
       (3) Electronic record.--The term ``electronic record'' 
     means a record created, generated, sent, communicated, 
     received, or stored by electronic means.
       (4) Electronic signature.--The term ``electronic 
     signature'' means an electronic sound, symbol, or process 
     attached to or logically associated with a record and 
     executed or adopted by a person with the intent to sign the 
     record.
       (5) Governmental agency.--The term ``governmental agency'' 
     means an executive, legislative, or judicial agency, 
     department, board, commission, authority, or institution of 
     the Federal Government or of a State or of any county, 
     municipality, or other political subdivision of a State.
       (6) 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.
       (7) Transaction.--The term ``transaction'' means an action 
     or set of actions relating to the conduct of commerce, 
     between 2 or more persons, neither of which is the United 
     States Government, a State, or an agency, department, board, 
     commission, authority, or institution of the United States 
     Government or of a State.
       (8) Uniform electronic transactions act.--The term 
     ``Uniform Electronic Transactions Act'' means the Uniform 
     Electronic Transactions Act as provided to State legislatures 
     by the National Conference of Commissioners on Uniform State 
     Law in the form or any substantially similar variation.

     SEC. 5. INTERSTATE CONTRACT CERTAINTY.

       (a) In General.--In any commercial transaction affecting 
     interstate commerce, a contract may not be denied legal 
     effect or enforceability solely because an electronic 
     signature or electronic record was used in its formation.
       (b) Methods.--Parties to a transaction are permitted to 
     determine the appropriate electronic signature technologies 
     for their transaction, and the means of implementing such 
     technologies.
       (c) Presentation of Contracts.--Notwithstanding subsection 
     (a), if a law requires that a contract be in writing, the 
     legal effect or enforceability of an electronic record of 
     such contract shall be denied under such law, unless it is 
     delivered to all parties to such contract in a form that--
       (1) can be retained by the parties for later reference; and
       (2) can be used to prove the terms of the agreement.
       (d) Specific Exclusions.--The provisions of this section 
     shall not apply to a statute, regulation, or other rule of 
     law governing any of the following:

[[Page 29219]]

       (1) The Uniform Commercial Code, as in effect in a State, 
     other than section 1-107 and 1-206, article 2, and article 
     2A.
       (2) Premarital agreements, marriage, adoption, divorce or 
     other matters of family law.
       (3) Documents of title which are filed of record with a 
     governmental unit until such time that a State or subdivision 
     thereof chooses to accept filings electronically.
       (4) Residential landlord-tenant relationships.
       (5) The Uniform Health-Care Decisions Act as in effect in a 
     State.
       (e) Electronic Agents.--A contract relating to a commercial 
     transaction affecting interstate commerce may not be denied 
     legal effect or enforceability solely because its formation 
     involved--
       (1) the interaction of electronic agents of the parties; or
       (2) the interaction of an electronic agent of a party and 
     an individual who acts on that individual's own behalf or as 
     an agent, for another person.
       (f) Insurance.--It is the specific intent of the Congress 
     that this section apply to the business of insurance.
       (g) Application in UETA States.--This section does not 
     apply in any State in which the Uniform Electronic 
     Transactions Act is in effect.

     SEC. 6. PRINCIPLES GOVERNING THE USE OF ELECTRONIC SIGNATURES 
                   IN INTERNATIONAL TRANSACTIONS.

       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. 7. STUDY OF LEGAL AND REGULATORY BARRIERS TO ELECTRONIC 
                   COMMERCE.

       (a) Barriers.--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 by 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 barriers to electronic 
     transactions 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.

  The CHAIRMAN pro tempore. Pursuant to House Resolution 366, the 
gentleman from Michigan (Mr. Dingell) and a Member opposed each will 
control 15 minutes.
  The Chair recognizes the gentleman from Michigan (Mr. Dingell).
  Mr. DINGELL. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, my old dad taught me to measure twice and cut once. He 
said that that was better carpentry, and he was right.

                              {time}  1445

  This amendment is essentially a bipartisan agreement reached in the 
Senate between Senators Abraham and Leahy. It is supported by the 
administration and it does not bear with it the threat of veto of the 
legislation without this amendment. It recognizes the validity of 
electronic signatures and contracts. It stays out of the more 
complicated questions and controversy associated with electronic 
records attendant on those contracts. It also avoids the problem of 
telling the contracting parties exactly what they do.
  Here is what the substitute does do. It says a contract may not be 
denied legal effect or enforceability solely because of electronic 
signature or an electronic record was used in the formation. It allows 
parties to the transaction to determine appropriate electronic 
signature technologies for their transaction. It protects parties by 
requiring that the electronic record be delivered in the form that can 
be retained by the parties for later reference, and it can be used to 
prove the terms of the agreement. It sets forth principles to guide the 
Federal Government in expanding the use of electronic signatures in 
international transactions. It requires the Federal Government to study 
legal and regulatory barriers to electronic contracts.
  Now, here is what it does not do. It does not hurt the ability of 
States to establish safeguards, such as consumer protection laws for 
electronic commerce. It does not wipe out the ability of Federal 
regulators to eliminate abuses that may occur when electronic records 
are used. It does not wipe out State laws and regulations on the 
maintenance of records critical to protection of individual rights and 
claims. It does not preempt State and Federal records signature 
requirements, including those in tax laws and regulatory statutes.
  We do not need to sacrifice consumer protections to facilitate 
electronic commerce. The concerns that I pointed out earlier are 
avoided. Electronic commerce will go forward, the parties will define 
the terms under which they will function, State laws will be protected, 
consumers will be protected, and entrepreneurs on the Internet will 
also be protected. And consumers will know that they have the means to 
protect themselves on terms of contracts in which they enter.
  Mr. Chairman, may I inquire as to how much time I have consumed?
  The CHAIRMAN pro tempore (Mr. Miller of Florida). The gentleman from 
Michigan (Mr. Dingell) has used 2\1/2\ minutes and will have 12\1/2\ 
minutes remaining.
  Mr. DINGELL. Mr. Chairman, I reserve the balance of my time.
  The CHAIRMAN pro tempore. Does the gentleman from Virginia (Mr. 
Bliley) seek the time in opposition?
  Mr. BLILEY. I do, Mr. Chairman.
  The CHAIRMAN pro tempore. The gentleman from Virginia is recognized 
for 15 minutes.
  Mr. BLILEY. Mr. Chairman, I yield myself 5\1/2\ minutes, and I rise 
in opposition to the substitute offered by the gentleman from Missouri 
(Mr. Gephardt), the gentleman from Michigan (Mr. Dingell), the 
gentleman from Michigan (Mr. Conyers), and the gentleman from New York 
(Mr. LaFalce).
  Just last week the House leadership and the administration pulled out 
all the stops to defeat H.R. 1714 when it was considered under 
suspension. In spite of their opposition, we fell just a few votes shy 
of a two-thirds majority. Just this past week an amazing conversion has 
taken place. Not only has the majority leadership stopped opposing 
electronic signature legislation, but it now supports the concept of 
providing legal validity to electronic signatures, and even went so far 
as to introduce a bill, H.R. 3220.
  I commend my colleagues for their conversion and for recognizing the 
importance of this Congress approving electronic signature legislation. 
Unfortunately, their amendment, as the old saying goes, is a day late 
and a dollar short. The amendment only provides

[[Page 29220]]

for electronic signatures on contracts and is, thus, substantially 
narrower than 1714. The amendment does not provide for the use or 
acceptance of electronic records, such as warranties, notices of or 
disclosures in electronic form.
  The offerers of this amendment have leveled charges that the 
inclusion of records in H.R. 1714 would bring harm to consumers. Such a 
charge is completely false. H.R. 1714 contains important provisions 
protecting consumers who choose to accept an electronic document. This 
makes H.R. 1714 a broader bill, covering a wide range of electronic 
commerce transactions. Indeed, we just passed an amendment to improve 
this bill dealing with records by a vote of 418 to 2. Why would we want 
to strike the provision now?
  Coupled with the records provision in H.R. 1714 are key consumer 
protections. In short, the key consumer protections are an opt-in 
system for consumers who want to accept electronic documents; standards 
to ensure that electronic documents are accurate and can be printed for 
use for future reference, and a requirement that key notices, such as 
termination of a utility service, cancellation of health insurance or 
life insurance, and foreclosure or eviction must still be delivered in 
writing.
  The amendment before us also fails to address the need for uniformity 
in electronic signature laws. Currently, Mr. Chairman, 44 States have 
enacted some sort of electronic signature law. However, all 44 are 
different and many are inconsistent. With such a patchwork of differing 
laws, electronic commerce is nearly impossible. This amendment will 
only perpetuate that patchwork of laws by allowing States to enact any 
law, any law, regulating electronic signatures, no matter how 
nonuniform or how inconsistent with the laws of other States.
  In contrast, H.R. 1714 allows States to enact a uniform electronic 
signature law provided that it meets minimum standards consistent with 
promoting electronic commerce. Two of the key principles are that State 
laws must be technology neutral and that States cannot limit the 
offering of electronic signature services to specific types of 
businesses. H.R. 1714 will encourage States to enact uniform laws while 
ensuring that States do not inhibit interstate commerce.
  In addition, the amendment does not fully address the concerns I have 
about the use and acceptance of electronic signatures internationally. 
As other speakers have pointed out, some nations have enacted or are 
proposing electronic signature legislation that would be harmful to 
American interests. Title II of H.R. 1714 provides guidance to the 
Secretary of Commerce to work against any barriers to promote American 
principles in this area.
  I would also like to point out that H.R. 1714 has been the subject of 
long and substantial negotiations with the minority. Prior to its 
consideration at the subcommittee and full committee level, we engaged 
in lengthy negotiations with the minority. The substitute amendments 
offered in committee by the gentleman from Ohio (Mr. Oxley), the 
gentleman from Louisiana (Mr. Tauzin), and myself contain important 
provisions that enjoyed bipartisan support. In fact, H.R. 1714 was 
approved through two subcommittees and the full committee by a voice 
vote.
  We are also hearing that we should support this amendment because it 
is identical to the compromise legislation that has been agreed to in 
the other body. First, if such a compromise has been reached, it 
certainly has not been cleared for floor consideration. I think it is 
premature to refer to this as the so-called compromise until it is 
voted on and approved by the full committee of the other body.
  Second, I am surprised to hear my colleagues say that we should 
merely accept the work of the other body without thoroughly considering 
this issue in the House. We should not blindly accept any legislation 
merely because the other body has supposedly reached a compromise on 
the text of a bill.
  I am pleased to see that many of my colleagues from across the aisle 
have seen the light and decided to support rather than oppose 
electronic signature legislation. Unfortunately, their amendment falls 
far short of what is needed to promote electronic commerce.
  Mr. Chairman, I reserve the balance of my time.
  Mr. DINGELL. Mr. Chairman, I yield 2 minutes to the gentleman from 
New York (Mr. LaFalce).
  Mr. LaFALCE. Mr. Chairman, I do not believe there is a representative 
in this body who does not favor electronic signatures. That is not the 
issue before us. The issue before us is should we pass Federal 
legislation that, A, preempts consumer rights; and, B, preempts States 
rights. I think the answer to that is no.
  So there is another question. Why not this substitute? Why not this 
substitute that the administration favors, that is the agreed-upon 
compromise at least between Senator Abraham, the chairman of the 
relevant Judiciary Subcommittee in the Senate, and Senator Wyden and 
Senator Leahy?
  With respect to consumer rights, every consumer group believes that 
we must pass this substitute in order to keep the consumer protections 
that are presently in existing law. Industry, the Microsofts, the 
Yahoos of this world, would embrace the substitute if it were to be 
before the President for his signature. It is just that if they can get 
a better bill that preempts consumer rights, why not?
  I remember when I first studied law, the Uniform Commercial Code was 
to be adopted by the States. Nobody suggested that because contracts 
are interstate in nature there should be a Federal law preempting the 
ability of States to adopt the Uniform Commercial Code sometime, with a 
little change here or a little change there, and that is how it has 
evolved.
  The present bill that is before us would preempt any State law unless 
it is fully consistent with the Federal bill. In other words, it 
preempts it totally. The substitute would pass this legislation, 
protect the consumer, but also protect the abilities to enact consumer 
protections that might be even greater. I think that is something we 
want to preserve.
  We will get the signature of the President on the substitute. It is 
probably going to be the virtual identical bill that passes the Senate. 
Why not vote for this substitute, get a law, and get the law passed 
immediately?
  Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentleman from Utah 
(Mr. Cannon).
  Mr. CANNON. Mr. Chairman, I rise in opposition to the substitute. I 
do not support the substitute because it fails to simplify, clarify, 
and modernize the law governing electronic commerce. It fails to 
promote uniformity of law among the States, and it fails to advance 
American interests worldwide by promoting a uniform legal regime 
addressing the use of electronic and similar technological means of 
effecting and performing commercial and governmental transactions.
  The substitute will not accomplish what should be the basic objective 
of any legislation on this subject; that is, bringing legal certainty 
to electronic transactions in commerce. The substitute fails in this 
regard because, instead of promoting uniformity of law among the 
States, it will lead to the balkanization of applicable law. This will 
lead to greater uncertainty.
  Balkanization will occur because, even with its most narrow scope, 
the substitute does not apply to States where the Uniform Electronic 
Transactions Act, UETA, is adopted in whole or any substantially 
similar variation. Between Section 3(b)(5) of UETA, which permits a 
State to exclude any of its laws from the application of UETA, and the 
substitute's substantially similar variation language, a State is 
completely free to institute its own electronic commerce laws 
regardless of such laws' effect on interstate commerce.
  That is exactly what happened in California, the first State to adopt 
UETA. Relying on Section 3(b)(5) of the UETA, better known in some 
circles UETA's black hole, California excluded many laws from the 
application of UETA's principles. Those laws include most sections of 
the following California codes: Uniform Commercial

[[Page 29221]]

Code, the Business and Professions Code, the Civil Code, the Financial 
Code, the Insurance Code, Public Utilities Code, and the Vehicle Code.
  If every State was to take California's approach, the effect would be 
to further remove legal certainty. Rather, 50 separate legal regimes 
may arise governing electronic transactions in commerce. This outcome 
is counterproductive and unacceptable. I therefore urge my colleagues 
on both sides of the aisle to vote ``no'' on the substitute.
  Mr. CONYERS. Mr. Chairman, I yield myself 2 minutes.
  My colleagues, this substitute is just what we need. It has come not 
a moment too soon, because I think we can now bring a marriage to the 
rights of consumers and the high-tech necessities of e-signature. It 
satisfies the need of the high-tech community by recognizing the 
validity of the electronic signatures in contracts, but it does not go 
as far as the base bill in getting into the controversial issue of 
other electronic records that might arise from electronic contract 
formation.

                              {time}  1500

  In other words, this steers a midcourse. It has a counterpart in the 
United States Senate. And it also has the assurance that the President 
will sign it into law.
  So I am asking my colleagues, please, if we are supporting e-
signatures and want to move high tech forward, here is the substitute 
that we can do this by.
  The substitute deals only with the formation of electronic contracts 
and not other types of records. It does not undermine the important 
consumer protection laws. For example, regulations implementing the 
Truth in Lending Act require creditors to provide consumers with 
periodic statements that include information essential to a consumer in 
managing a credit card account.
  Now, this cannot be accomplished unless we have the substitute. 
Creditors could request on a consumer's consent to receive all 
disclosures electronically under H.R. 1714. That is exactly what we are 
trying to make the distinction between the substitute and the base 
bill. Please support this substitute.
  Mr. BLILEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Louisiana (Mr. Tauzin).
  Mr. TAUZIN. Mr. Chairman, I thank the gentleman for yielding me the 
time. I rise in opposition to this substitute.
  Mr. Chairman, members of the committee, the substitute, if adopted, 
will rob this body of one of its rare opportunities to do good not only 
by our generation of Americans but by generations yet unborn.
  We are about to enter a new millennium that, in large measure, is 
going to be governed by the enormous possibilities of not only the 
current Internet as we know it but as broadband, high-speed, always-on, 
always-available, supercontent-rich, broadband Internet services that 
are going to merge with television and provide us with new means of 
communicating and entertaining ourselves and indeed conducting 
electronic commerce across the span of the globe. It is going to make a 
smaller world and make possible enormous opportunity for citizens of 
this country and citizens of the word.
  But in order for that to flourish, the legal rules that are to govern 
electronic commerce ought to be made clear. The bill does that.
  The problem with the substitute is that it limits the bill only to 
those matters dealing with the formation of an electronic contract.
  Now, in the earlier discussions, I tried to point out to my 
colleagues that many things that happen in electronic commerce do not 
involve the formation of a contract. The best example is when we write 
a check and that check has to be physically delivered by the bank to 
the bank of the recipient to whom we are sending the money. Just the 
physical transfer of all those checks, all that paperwork, costs 
consumers in America $4 billion a year just moving that paper around.
  The substitute would do nothing to provide for digital signature in 
the electronic commerce of transferring money around in the form of 
payments and checks.
  I urge that this substitute be defeated and we stick with the main 
body of the bill.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the distinguished 
gentleman from New York (Mr. Weiner), a member of the Committee on the 
Judiciary.
  Mr. WEINER. Mr. Chairman, I rise in support of the amendment and the 
substitute being offered by the gentleman from Michigan (Mr. Dingell) 
and the gentleman from Michigan (Mr. Conyers) and others. I would 
appeal to my colleagues on perhaps a different level than this issue 
has been debated for some time.
  We still have relatively small numbers of American citizens 
participating in Internet commerce, but that number continues to rise 
almost exponentially each year. And the reason for that rise in 
participation in the Internet commerce world is people are developing 
more confidence. Each time they go make a purchase and they get their 
product and their credit card number is not stolen and their 
information not shopped around, people are more likely to come back in 
future years to partake in that activity again.
  That is why it is so absolutely important during this period when 
Internet commerce is growing that we do everything we can to reassure 
consumers and reassure those in the States that when they pass laws 
that they are going to be protected. The substitute adheres to the most 
stringent consumer protection while still allowing digital signatures.
  For those of my colleagues who are like me who on some level do 
believe that the banking community and the insurance and financial 
services community should have easier access to this world, I believe 
we have to do this in a thoughtful way while preserving consumers' 
rights and, of course, while preserving the rights of States and 
localities to do what they need to do to reassure those who do partake 
in the Internet commerce that they will be safe in doing so.
  The substitute does that. It does not jeopardize the basic things 
that the sponsor of the bill would like to do. I urge a yes vote on the 
substitute.
  Mr. BLILEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Ohio (Mr. Oxley).
  Mr. OXLEY. Mr. Chairman, I rise in opposition to the substitute 
offered by my good friend, the gentleman from Michigan (Mr. Dingell).
  As I said in my statement in supporting the underlying bill, we will 
do irreparable harm to the future of electronic commerce if we are 
unable to provide the basis for uniformity and legal certainty. And, 
indeed, that is really what this legislation is all about.
  Those of us who study law understood that the Uniform Commercial Code 
really for the first time turned loose this great engine of economic 
opportunity and contracts throughout our 50 States when we had some 
degree of certainty when we are dealing with the Uniform Commercial 
Code.
  In many ways, this legislation sponsored by our good friend, the 
chairman of the Committee on Commerce, is a natural consequence of 
following along with the Uniform Commercial Code, but we are doing it 
as it relates to electronic commerce. Electronic commerce is that 
natural consequence of what we are doing. So, essentially, that is 
really what this bill is all about.
  The substitute amendment only provides legal certainty if the 
transaction was conducted as a result of a contract. And indeed, a lot 
of commerce takes place without formal contracts. And that is what 
really this legislation is all about.
  This substitute, I would tell my good friend from Michigan, is over 
regulatory, it is industrial policy legislation that is contrary to 
what electronic commerce is really all about.
  Mr. Chairman, the substitute amendment is simply a failure in regards 
to trusting people who are becoming more and more sophisticated in 
dealing with electronic commerce and more and more feeling comfortable 
with what is

[[Page 29222]]

happening out there in the marketplace. This would be a huge step 
backwards in the name of consumer protection, when in fact it is quite 
the opposite and trusts government and trusts regulations and trusts 
bureaucrats far more than we trust the consumer in making these very 
important decisions in the marketplace.
  So, for that reason, I would ask the substitute be defeated.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the distinguished 
gentleman from New York (Mr. LaFalce).
  Mr. LaFALCE. Mr. Chairman, the gentleman from Ohio (Mr. Oxley) made 
reference to the Uniform Commercial Code bringing uniformity. I point 
out that it was not by Federal legislation; it was by the adoption of 
the individual States. We retain States' rights.
  There is such a thing as the Uniform Electronic Transactions Act. The 
National Conference of State Legislators wants the individual States to 
adopt that.
  Now the issue is not whether we should adopt UETA on a Federal level, 
because we are not doing that. We are adopting it with some changes 
here, some changes there. What changes are we making? Those that don't 
benefit the consumers.
  We are also saying to the States that they can pass whatever law they 
want, but it cannot in any way be inconsistent with what we pass, which 
is not the UETA.
  Support the substitute. Defeat the main bill. Because if it goes 
before the President for his signature as it is before the House right 
now, it will be vetoed. The substitute will be signed.
  Mr. BLILEY. Mr. Chairman, I reserve the balance of my time.
  Mr. DINGELL. Mr. Chairman, I yield myself 4 minutes.
  Mr. Chairman, this bill in its original form passed from the 
Committee on Commerce unanimously. Now, what happened between now and 
then is really very interesting. The bill has been changed. The Members 
on the minority side consulted extensively with our good friend, the 
chairman of the committee, and we were negotiating with him; and there 
were a number of agreements made to change the bill to make it still 
more acceptable and more workable.
  But then something funny happened on the way to the floor. The 
distinguished gentleman from Virginia, or somebody else, all of a 
sudden decided they are going to put the bill on the floor, and they 
decided they were going to terminate the negotiations without any 
notice to the minority.
  They then took the step of making some significant changes in the 
bill. It is not the bill that came out of the Committee on Commerce to 
which the minority objects. We will be happy to vote for that right 
this minute. But what we are confronted with here is the unfortunate 
situation where our dear friends on the majority side have changed the 
bill with no notice, and it is quite different than the original bill.
  Now, what is the basic objection to the bill? Let us try and 
understand to what does the minority really object.
  The minority objects not to the idea that we should authorize under 
law a uniform system of recognizing the electronic signature of 
contracts. What is objected to here is something quite different, and 
that is that all of the matters which are associated with the contract 
and with contracting are with one swoop of the pen or one click of the 
computer changed so that they immediately go into force and that no 
right on the part of the individual who contracts remains intact after 
the original electronic signature has taken place.
  Now, what can happen? A number of matters of notice come 
electronically. They are not in hard copy and in writing. The right of 
the contracting parties to say but certain other things have to be 
under signature and on paper in the conventional fashion as required by 
existing State law and by even things going back to common law and 
ordinary business practices and transactions are no longer permitted. 
Those are done once they have made the initial electronic contracts by 
a further electronic transaction.
  Now, what is wrong with that? First of all, the hard drive may crash. 
Second of all, the Y2K bug may strike. Third of all, these notices may 
get lost in cyberspace. The individual may do a bad job of notifying 
the other party of an address change. Or the computer may crash. Or any 
of many things may transpire. The parties cannot even agree to these 
questions amongst themselves. That is wrong.
  If we want to go forward, let us proceed and go forward on the bill 
that was adopted by the Committee on Commerce. Let us adopt this, which 
allows everything that the original legislation would have done and 
which was supported by both sides, majority and minority. Let us 
proceed in that fashion.
  I see no benefit to moving forward with a bill which is so strongly 
objected to, which is not in the Senate language, and which is 
threatened with a veto by the President.
  All I am suggesting is that they listen to the words of my old dad. 
When we are going to make this size of massive change, do it sensibly. 
Know what we are accomplishing. As my dad used to warn me when I was 
doing carpentry, he would say, ``Measure twice. Cut once. Be careful.''
  That is what I am suggesting to this body. Measure twice. Cut once. 
Adopt the amendment. Get the bill signed. And then let us proceed 
forward to such other matters as may be required.
  Mr. BLILEY. Mr. Chairman, how much time do I have remaining?
  The CHAIRMAN pro tempore (Mr. Miller of Florida). The gentleman from 
Virginia (Mr. Bliley) has 3\1/2\ minutes remaining, and the gentleman 
from Michigan (Mr. Dingell) has 2\1/2\ minutes remaining.
  Mr. BLILEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Mississippi (Mr. Pickering).
  Mr. PICKERING. Mr. Chairman, I rise in opposition to the substitute. 
Again, with great respect to the ranking member from the other side, I 
rise in opposition.
  I do so because the substitute fails in its own objective of 
eliminating barriers to electronic commerce by recognizing the validity 
of electronic signatures and contracts.
  The fact is that the substitute does very little to remove barriers 
that result from the legal uncertainty associated with electronic 
signatures and contracts.
  Actually, the substitute further exacerbates the uncertainty 
associated with the legal effect and enforceability of electronic 
mediums such as electronic contracts, agreements, signatures, and 
records.

                              {time}  1515

  Under the substitute, electronic signatures and records will enjoy 
legal effect and enforceability only if they are used in the formation 
of an electronic contract. Thus, an electronic signature or record is 
not accorded legal validity unless used in the context of contract 
formation. The net positive effect of the substitute on e-commerce is 
minimal at best. Moreover, as the substitute enables a State to exclude 
any of its laws from the application of the substitute's rule, even 
that minimal positive effect is at risk of further diminishment. Still 
another disconcerting fact is that permitting a State to exclude any or 
all of its laws, the substitute actually undermines the growth of 
electronic commerce by exacerbating uncertainty by codifying that 
uncertainty in Federal law.
  The simple fact is that the substitute fails to facilitate and 
promote electronic commerce by validating and authorizing the use of 
electronic contracts, agreements, records and signatures. And 
resultantly, it fails to promote public confidence in the validity, 
integrity and reliability of electronic commerce. H.R. 3220 may 
actually hinder the development of legal and business infrastructure 
necessary to implement electronic commerce and therefore retard growth 
in e-commerce.
  Mr. Chairman, I rise in support of the underlying bill and in 
opposition to the substitute.
  Mr. DINGELL. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, I have here a Floor Alert from the National Conference 
of State Legislatures, Office of State-Federal Relations, in which they 
point out

[[Page 29223]]

that the substitute offered by my friends and colleagues and me will 
accomplish the purposes of ensuring the proper recognition of 
electronic signatures without trampling on the rights of consumers and 
without engaging in the completion of legislation which will be opposed 
and vetoed by the administration.
  Our proposal here is fair. There is no significant trampling on State 
laws. There is a piece of legislation which will be accepted by the 
administration and which will protect the rights of consumers. Messages 
which would be transported in cyberspace and perhaps lost to the 
detriment of consumers who might find as a result of that foreclosures 
of mortgages and other hurtful actions by the seller will not be 
occurring.
  I think this is a sensible way to proceed. Let us know what we are 
doing. We embarked upon this process in the idea that we would have a 
bill which would approve electronic signatures. The original committee 
bill did that. Declarations were festooned upon the committee bill. 
This amendment gives all of the rights to the parties that they want. 
An individual to that contract may waive contract rights to carry the 
matter more far and further forward, but this proposal that we confront 
and seek to amend will impose upon innocent persons conditions which 
will only be understood by lawyers and experts in electronic matters.
  Be fair to your constituents and to the people. Allow them to proceed 
slowly into the time of cyberspace. Do not put them at risk because all 
of a sudden they are going to find to their vast surprise, somewhere 
hidden in a contract which they had signed electronically are a waiver 
of a whole plethora of rights that are very important to them.
  Accept the amendment. Vote for it. And in failing that, reject the 
bill. It is not in the interests of your constituents.
  Mr. BLILEY. Mr. Chairman, I yield myself the balance of my time.
  I again rise in opposition to this amendment. Records are important 
to add to this, it is voluntary, and we have been into that over and 
over.
  In addition to that, what this amendment would do would be to allow 
States to enact any kind of legislation they want on this subject, and 
44 States have already acted. There is a wide variety of difference 
between the 44 States. The one thing about electronic commerce, it is 
certainly interstate commerce and that has always been reserved to the 
Congress.
  I would hope that we would reject this amendment and adopt the 
underlying bill. I would like to point out that the gentleman from 
Michigan (Mr. Conyers) is a cosponsor of H.R. 2626, a bill that allows 
electronic delivery of consumer disclosures under a variety of banking 
laws, including the Truth-in-Lending Act, the Equal Credit Opportunity 
Act, the Fair Credit Reporting Act, the Real Estate Settlement Act, and 
yet we have the gentleman opposing the inclusion of records in H.R. 
1714. Passing strange.
  I urge the defeat of this amendment and the adoption of the 
underlying bill.
  The CHAIRMAN pro tempore (Mr. LaTourette). The question is on the 
amendment in the nature of a substitute offered by the gentleman from 
Michigan (Mr. Dingell).
  The question was taken; and the Chairman pro tempore announced that 
the noes appeared to have it.


                             Recorded Vote

  Mr. DINGELL. Mr. Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 126, 
noes 278, not voting 29, as follows:

                             [Roll No. 578]

                               AYES--126

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baldacci
     Baldwin
     Barrett (WI)
     Becerra
     Berman
     Blagojevich
     Bonior
     Borski
     Brady (PA)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Clayton
     Clyburn
     Conyers
     Costello
     Coyne
     Danner
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Dixon
     Doyle
     Duncan
     Edwards
     Engel
     Eshoo
     Evans
     Farr
     Fattah
     Filner
     Frank (MA)
     Green (TX)
     Gutierrez
     Hall (OH)
     Hastings (FL)
     Hilliard
     Hinchey
     Hinojosa
     Hoeffel
     Hoyer
     Jackson (IL)
     Kanjorski
     Kaptur
     Kennedy
     Kildee
     Kilpatrick
     Kleczka
     Klink
     Kucinich
     LaFalce
     Lampson
     Lantos
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lowey
     Luther
     Maloney (NY)
     Markey
     Martinez
     Mascara
     McCarthy (MO)
     McDermott
     McGovern
     McKinney
     McNulty
     Meehan
     Menendez
     Miller, George
     Mink
     Moakley
     Mollohan
     Nadler
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Pallone
     Pastor
     Paul
     Phelps
     Pomeroy
     Rahall
     Rangel
     Reyes
     Rivers
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanders
     Sawyer
     Schakowsky
     Scott
     Serrano
     Slaughter
     Smith (MI)
     Spratt
     Stark
     Strickland
     Stupak
     Tierney
     Towns
     Turner
     Velazquez
     Vento
     Visclosky
     Waters
     Watt (NC)
     Waxman
     Weiner
     Wexler
     Wise
     Woolsey
     Wynn

                               NOES--278

     Aderholt
     Archer
     Armey
     Bachus
     Baird
     Baker
     Ballenger
     Barcia
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bentsen
     Bereuter
     Berkley
     Biggert
     Bilbray
     Bilirakis
     Bishop
     Bliley
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Boswell
     Boucher
     Boyd
     Brady (TX)
     Brown (FL)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Cannon
     Castle
     Chabot
     Chambliss
     Chenoweth-Hage
     Clement
     Coble
     Collins
     Combest
     Condit
     Cook
     Cooksey
     Cox
     Cramer
     Crane
     Crowley
     Cubin
     Cunningham
     Davis (FL)
     Davis (VA)
     Deal
     DeLay
     DeMint
     Deutsch
     Diaz-Balart
     Doggett
     Dooley
     Doolittle
     Dreier
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Etheridge
     Everett
     Ewing
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Fowler
     Franks (NJ)
     Frelinghuysen
     Frost
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Gonzalez
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Green (WI)
     Greenwood
     Gutknecht
     Hall (TX)
     Hansen
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hill (IN)
     Hill (MT)
     Hilleary
     Hobson
     Hoekstra
     Holden
     Holt
     Hooley
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hyde
     Inslee
     Isakson
     Istook
     Jenkins
     John
     Johnson (CT)
     Johnson, Sam
     Jones (NC)
     Kasich
     Kelly
     Kind (WI)
     Kingston
     Knollenberg
     Kolbe
     Kuykendall
     LaHood
     Larson
     Latham
     LaTourette
     Lazio
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lofgren
     Lucas (KY)
     Lucas (OK)
     Maloney (CT)
     Manzullo
     McCarthy (NY)
     McCollum
     McCrery
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     Metcalf
     Mica
     Miller (FL)
     Miller, Gary
     Minge
     Moore
     Moran (KS)
     Moran (VA)
     Murtha
     Myrick
     Napolitano
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Ose
     Oxley
     Packard
     Pease
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pickett
     Pitts
     Pombo
     Porter
     Portman
     Price (NC)
     Pryce (OH)
     Quinn
     Radanovich
     Ramstad
     Regula
     Reynolds
     Riley
     Roemer
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Salmon
     Sanchez
     Sandlin
     Sanford
     Saxton
     Schaffer
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Sherwood
     Shimkus
     Shows
     Shuster
     Simpson
     Sisisky
     Skeen
     Skelton
     Smith (NJ)
     Smith (WA)
     Souder
     Spence
     Stabenow
     Stearns
     Stenholm
     Stump
     Sununu
     Sweeney
     Talent
     Tancredo
     Tanner
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thompson (CA)
     Thornberry
     Thune
     Thurman
     Tiahrt
     Toomey
     Traficant
     Udall (CO)
     Udall (NM)
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Weygand
     Whitfield
     Wicker
     Wilson
     Wolf
     Wu
     Young (AK)
     Young (FL)

                             NOT VOTING--29

     Berry
     Carson
     Clay
     Coburn
     Cummings
     Davis (IL)
     Dickey
     Gephardt
     Hutchinson
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     King (NY)
     Largent
     Matsui
     Meek (FL)
     Meeks (NY)
     Millender-McDonald
     Morella
     Owens
     Pascrell
     Payne
     Rodriguez
     Rogan
     Scarborough
     Smith (TX)
     Snyder
     Thompson (MS)

                              {time}  1547

  Messrs. REGULA, WEYGAND, GEJDENSON, SCHAFFER, SHOWS, and HEFLEY, Mrs. 
CHENOWETH-

[[Page 29224]]

HAGE, and Mrs. THURMAN changed their vote from ``aye'' to ``no.''
  Mr. WEXLER and Mr. SPRATT changed their vote from ``no'' to ``aye.''
  So the amendment in the nature of a substitute was rejected.
  The result of the vote was announced as above recorded.
  Stated for:
  Mr. BERRY. Mr. Speaker, I was unavoidably detained for rollcall vote 
578. Had I been present, I would had voted ``yes'' on rollcall vote 
number 578.
  Stated against:
  Mr. ROGAN. Mr. Chairman, on rollcall No. 578, I was attending the 
Little Rock Nine Congressional Medal of Honor Ceremony at the White 
House. Had I been present, I would have voted ``no.''
  The CHAIRMAN pro tempore. The question is on the amendment in the 
nature of a substitute, as amended.
  The amendment in the nature of a substitute, as amended, was agreed 
to.
  The CHAIRMAN pro tempore. Under the rule, the Committee rises.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
LaHood) having assumed the chair, Mr. LaTourette, Chairman pro tempore 
of the Committee of the Whole House on the State of the Union, reported 
that that Committee, having had under consideration the bill (H.R. 
1714) to facilitate the use of electronic records and signatures in 
interstate or foreign commerce, pursuant to House Resolution 366, he 
reported the bill back to the House with an amendment adopted by the 
Committee of the Whole.
  The SPEAKER pro tempore. Under the rule, the previous question is 
ordered.
  Is a separate vote demanded on the amendment to the amendment in the 
nature of a substitute adopted by the Committee of the Whole? If not, 
the question is on the amendment in the nature of a substitute.
  The amendment in the nature of a substitute was agreed to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. LaFALCE. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on passage of the bill are postponed until later today.

                          ____________________