Legality of eSignatures in Estonia

Background

As technology rapidly evolves, there is an increased demand for contemporary methods to authenticate document signatories. This demand has significantly influenced the adoption of electronic signatures. Nonetheless, it is essential to understand the importance of using electronic signatures within Estonia.

Individuals should opt for an electronic signature provider that complies with Estonia’s legal system, particularly adhering to the Electronic Identification and Trust Services for Electronic Transactions Act (as amended in 2023) and E.U. Regulation 910/2014, to ensure their legal validity is on par with conventional handwritten signatures. It is also critical to recognize that certain documents still mandate a physical signature, and legal requirements can vary locally.

The integrity of electronic signatures is paramount. It is crucial to choose a service provider that offers strong security measures, including encryption, user authentication, and a detailed audit trail, to thwart unauthorized access and preserve the integrity of the document. BoldSign is a provider that includes these security measures, helping users meet both legal and security standards.

To sum up, although electronic signatures provide considerable advantages and are widely recognized, adhering to legal standards, focusing on security, and selecting an intuitive service are key for their successful implementation in Estonia.

What is an eSignature

Under Estonia’s electronic signature laws, an eSignature is defined as a digital form of signature that includes letters, characters, numbers, or symbols associated with an electronic document and holds legal validity. To authenticate signatures on the majority of documents, they must be verifiably linked to the signer and safeguarded against alterations or fraud. Additionally, the signer must demonstrate a clear intention to consent to the document’s contents. Fulfilling these conditions equates the electronic signatures’ legal status with that of handwritten signatures.

Overview of the regulation of electronic signatures in the European Union

Operations entailing the use of electronic signatures within Estonia are regulated by the following:

Electronic Identification and Trust Services for Electronic Transactions Act (as amended in 2023)¹
Electronic Identification and Trust Services Regulation [eIDAS]².

As a rule, the regulation deems electronic signatures legal when completing transactions. eSignatures under the regulation are categorized into three categories:

Simple Electronic Signature
Advanced Electronic Signature
Qualified Electronic Signature

A simple electronic signature is defined as electronic data that allows the signatory to be identified and attaches or associates data with other data in the signatory’s electronic format.

An advanced electronic signature is explained as an electronic signature meeting the requirements set out in Article 26³(of the E.U. Regulation 910/2014). It decrees that advanced electronic signatures must be:

Uniquely linked to the signer.
Capable of identifying the signatories.
Developed using means that the signatory can maintain his control.
Linked to the data it relates to so that any subsequent change is detectable.

Uniquely linked to the signer

A secure electronic signature must be uniquely connected to the person using it. The signature must be uniquely made with methods only the signer can access, like a private key and confidential information, to verify their identity.

Use and incorporation remaining in their sole control

The person using the secure electronic signature must have sole control over the means of creating the signature. Typically, this requires managing a key pair or two-factor authentication, with the signer exclusively holding the private key to prevent signature forgery.

Identify the person using the technological process

The process used to create the signature must be capable of identifying the person signing. This may include using a biometric signature, a Personal Identification Number (PIN), an email address, or even a company registration number.

Track down any alterations made after signing

It is essential to preserve the authenticity of the signed document. Modifications made to the document post-signature should be identifiable. This is commonly accomplished through an audit trail. Audit trails record the signer’s I.P. address, timestamps of key signing events, and location, providing proof of identity, timing, and signature place.

A qualified electronic signature⁴ is an advanced electronic signature that is generated using a certified device to create electronic signatures. It relies on an accredited certificate specific to electronic signatures.

Article 32⁵ sets out a validation criteria to be met by the one for a qualified eSignature. These are:

Statutory compliant certificate at the time of signing.
A qualified trust service provider issued a valid certificate when signing.
Signature validation data aligns with the data provided to the relying signer.
The unique set of data representing the signatory in the certificate was correctly provided to the relying party.
The use of any pseudonym is clearly indicated to the relying party if a pseudonym was used at the time of signing.
A qualified electronic signature creation device creates the electronic signature.
The integrity of the signed data has not been compromised.
Meets validity standards of an advanced eSignature.

Summary

Estonia Electronic Identification and Trust Services for Electronic Transactions Act (as amended in 2023) & Regulation (E.U.) 910/2014

Type of Signature	Unique Features	Legal Validity	Special Consideration on Use
Simple Electronic Signature	• No unique features other than being data in electronic form.	Validity is dependent on the evidentiary weight.	N/A
Advanced Electronic Signature	Uniquely linked to the signatory. Capable of identifying the signatory. Created using means that the signatory can maintain his control. Linked to the data it relates to so that any subsequent change to the data is detectable.	Validity is dependent on evidentiary weight across jurisdictions.	N/A
Qualified Electronic Signature	Certificate compliant with laws provided at signing. The trust service provider issued a valid certificate at signing. Signature validation matches the data given to the recipient. The signatory's unique data is accurately given to the recipient. Any pseudonym used is disclosed to the recipient. Signature made with a qualified electronic signature device. Signed data integrity maintained. Meets all features of an advanced eSignature.	Deemed valid in jurisdictions across the E.U. Deemed to bear the validity granted to a handwritten signature.	Administrative proceedings Referendum Vote Voting

Execution of notaries under the Notarisation of Acts

Section 1(3) of the legislation stipulates that notarization can be performed in person or via remote means, and it must be on paper. Additionally, section 38 regarding notarial notations mandates that when certifying a fact, a notary is required to create a notarial notation. This notation must contain the notary’s declaration of verified facts, signature, and colored seal; without these components, the certification is considered invalid. The notation must also detail the date and location of its creation.

According to the Act, notarial notations can be generated electronically. In such instances, the notary’s digital signature replaces their handwritten signature and colored seal. However, a digital notation can only be created for a digital document.

Scope and limitations of eSignature transactions

The use of electronic signatures for concluding transactions is not uniformly recognized as legally valid. As a result, certain types of transactions and applications are appropriate for electronic signatures, while others are not. An examination of this issue is presented below, along with a concise table outlining the relevant transactions.

Documents that can be signed

Electronic signatures can be employed to affix signatures and provide countersignatures on an array of documents, such as:

Human resources
Procurement
Non-disclosure agreements (assuming they are contracts, not formal deeds)
Software license agreements
Public petitions
Insurance industry
Educational field, etc.

Cases where only qualified eSignatures & wet-ink signatures are authentic

Under Article 25 of the eIDAS⁶, qualified electronic signatures are deemed to bear the same legal validity granted to wet-ink signatures as such the following can only be signed in either wet ink signature or qualified electronic signature

Acknowledgement of an obligation⁷
Suretyship contracts⁸
Administrative proceedings⁹
Contracts concluded with consumers and relating to the purchase of the right to use a building on a timeshare basis, long-term holiday product contracts, exchange system contracts, and agency agreements (Law of Obligations Act Art. 381 Sect. 1).
Life annuity contracts (Law of Obligations Act Art. 570)
Employment contracts¹⁰
Agreement on proprietary liability¹¹
Referendum electronic voting¹²
Agreement on restraint of trade after expiry of employment contract¹³
Copyright authorship contract¹⁴
Possessory pledge contracts (where the value of the pledged thing exceeds 50 euros)¹⁵
Transactions between a public limited liability company and its sole shareholder¹⁶
Agreement for delivery of a non-monetary contribution into the share capital unless the transfer of relevant property is subject to notarization ¹⁷

Exemptions

Even though the Estonian legislation lacks an expressed provision on what constitutes the transactions that cannot be completed in the electronic signature, caution is to be taken when dealing with documents whose drawing up is spelled out in a given law, such as

Statutory declarations
Contracts under family law¹⁸
Testamentary trust documents – will, codicils¹⁹
Applications submitted to certain public registers such as the Commercial Register or the Land Register²⁰
Tansactions on foundation agreement/resolution of a limited liability company, merger and division agreements of limited liability companies²¹
Consent of a trademark owner for the use of the trademark in a business name²²
Trademark pledge agreements²³
Creation/transfer of rights in immovable property ²⁴
Electronic voting²⁵

Summary scope and limitations

Permissible transactions

Transactions that may be exempted

Human resources
ProcurementNon-disclosure agreements (assuming they are contracts, not formal deeds)
Software license agreements
Public petitions
Insurance industry
Educational field, etc.

Statutory declarations
Testamentary trust documents – will, codicils
Contracts under family law
Applications submitted to certain public registers such as the Commercial Register or the Land Register
Transactions on foundation agreement/resolution of a limited liability company, merger and division agreements of limited liability companies
Consent of a trademark owner for the use of the trademark in a business name
Trademark pledge agreements
Creation/transfer of rights in immovable property.

To ensure the validity of an eSignature, it is advised to follow these best practices while also fulfilling all applicable legal requirements:

Ascertain the identity of the signatory and, when it involves corporate transactions, verify that the person has the authority to act on behalf of the corporation in signing the document.
Secure explicit approval from the signatory, which can be documented in the contract or a separate agreement, to confirm their consent to use the specified electronic signature for the document.
Protect the document from any changes after the electronic signature has been affixed.
Keep a comprehensive log of the signing process that captures every step the signatory performs.

How does BoldSign help

The following elements of compliance available within BoldSign can be used to comply with Estonia’s eSignature laws:

Secure and unique signing link: A secure and unique link to sign a document is sent directly to the signer’s email address. This ensures that the document is only accessed by the intended signer and cannot be tampered with.
Password protection: Senders can specify a password that needs to be entered before viewing and signing a document. This adds another layer of security to the signing process.
Audit trail: The IP address of the signer and timestamps for all significant events in the signing process are recorded in an audit trail. This provides a record of who signed the document, when, and where.
Digital signature: The final document is digitally signed with an AATL-compliant certificate. This ensures that the document cannot be tampered with without invalidating the signature.
Consent: Signers are asked to confirm their intent to sign electronically and informed that they could opt out. This ensures that the signer is aware of the implications of signing electronically and has consented.
Custom terms: Get your signers to agree to a custom set of terms. This can be useful to ensure additional security or that the signer understands the terms of the document.
QES compliance: BoldSign offers fully compliant qualified electronic signatures (QES) that are simple, secure, and legally binding across the EU. QES guarantees that your essential documents are protected with the highest level of e-signature security, giving you peace of mind in your digital transactions. Using BoldSign, you can confidently manage your important documents while ensuring compliance with EU regulations.

Disclaimer: The information on this page is intended to help businesses understand the legal framework of electronic signatures for this particular country.

However, Syncfusion’s officers, directors, stockholders, affiliates, attorneys, accountants, employees, or agents cannot provide legal advice. You should consult your personal attorney regarding your specific legal questions. Laws and regulations change frequently, and this information may not be current or accurate. To the maximum extent permitted by law, Syncfusion provides this material on an “as-is” basis. Syncfusion disclaims and makes no representation or warranty of any kind with respect to this material, express, implied, or statutory, including representations, guarantees, or warranties of merchantability, fitness for a particular purpose, or accuracy.

Syncfusion makes no warranties of any kind, including but not limited to the information or the product, whether express, implied, statutory, or otherwise. To the maximum extent permitted by law, Syncfusion disclaims all conditions, representations, and warranties, whether express, implied, or statutory, with respect to this information without limitation any implied warranty of merchantability, fitness for a particular purpose, accuracy, or currentness of this information.

Syncfusion nor their officers, directors, stockholders, employees, affiliates, attorneys, accountants, or agents shall be liable for indemnification, nor does this create an express or implied, contractual or statutory, equitable or otherwise, under this Agreement. The officers, directors, stockholders, affiliates, attorneys, accountants, or agents will not have any liability in any form.

¹ Electronic Identification and Trust Services for Electronic Transactions Act [2016] – Electronic Identification and Trust Services for Electronic Transactions Act [2016]https://www.riigiteataja.ee/en/eli/ee/518102021002/consolide/current
² Regulation (E.U) 910/2014 (Regulation (E.U) 910/2014http://data.europa.eu/eli/reg/2014/910/oj)
³ Ibid
⁴ Electronic Identification and Trust Services for Electronic Transactions Act (as amended in 2023) Article 25 ( Electronic Identification and Trust Services for Electronic Transactions Act (amended in 2023) Article 25https://www.riigiteataja.ee/en/compare_original/506032023001)
⁵ Electronic Identification and Trust Services Regulation 910/2014
⁶ Regulation (E.U) No 910/2014 Of The European Parliament And Of The Council, S. 4, Art. 25 [ Regulation (E.U) No 910/2014, S. 4, Art. 25https://eur-lex.europa.eu/eli/reg/2014/910/oj ]
⁷ Law of Obligations Act Art. 30 Sect. 2 (Law of Obligations Act Art. 30 Sect. 2Law of Obligations Act–Riigi Teataja)
⁸ Ibid. 144, S. 2 & Art. 153 S.2
⁹ Administrative Procedure Act S. 5 (6) (Administrative Procedure Act S. 5 (6)https://www.riigiteataja.ee/en/eli/527032019002/consolide)
¹⁰ Employment Contracts Act Art. 4 S. 1 ( Employment Contracts Act Art. 4 S. 1Employment Contracts Act–Riigi Teataja)
¹¹ Ibid, Art. 75
¹² Referendum Act Section 41-3(4) (Referendum Act Section 41-3(4)https://www.riigiteataja.ee/en/eli/ee/514112016003/consolide)
¹³ Employment Contracts Act, Art. 24, S. 1 (2)
¹⁴ Copyright Act, Art. 49 Sect. 1 (Copyright Act Art. 49 Sect. 1Copyright Act–Riigi Teataja )
¹⁵ Law of Property Act Art. 282 S. 2 (Law of Property Act Art. 282 S. 2Law of Property Act–Riigi Teataja)
¹⁶ Commercial Code Art. 303 S. 2 (Commercial Code Art. 303 S. 2Commercial Code–Riigi Teataja)
¹⁷ Ibid Art. 520, S.2
¹⁸ Family Law Act Art. 60
¹⁹ Inheritance Law Act Art. 100
²⁰ Commercial Code Art. 32.1 Sect. 1 & Land Register Act Art. 34 Sect. 2.1
²¹ Commercial Code Art. 32.1 Sect. 2
²² Ibid Art. 12 Sect. 3
²³ Trademark Act Art. 50.6 Sect. 2
²⁴ Law of Property Act Art. 64.1, Art. 119 Sect. 1, Art. 120 Sect. 1
²⁵ Election Act Section 48 (4)] (Election Act Section 48 (4)https://www.riigiteataja.ee/en/eli/ee/506052016002/consolide )

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