Legality of eSignatures in Indonesia
Background
Electronic signatures have transformed the way documents are verified, streamlining the process of concluding agreements both within Indonesia and globally. These digital mechanisms facilitate prompt, environmentally friendly signing procedures that diminish paper consumption and expedite commercial dealings. Nonetheless, it is essential to grasp the critical factors to consider when implementing eSignatures in Indonesia.
Choosing an eSignature service in compliance with Indonesian laws [specifically Government Regulation Number 71 of 2019 on Operation of Electronic Systems and Transactions] is critical to ensure its legal standing as an equivalent to traditional handwritten signatures for in-country transactions. However, some documents may still necessitate a physical signature, and local legal stipulations can vary, making consultation with a legal expert vital.
Security is paramount. The chosen eSignature platform must offer robust security measures such as encryption, identity verification, and comprehensive audit trails to prevent unauthorized use and establish the authenticity of signed documents. BoldSign offers these security provisions to meet regulatory compliance and security.
In essence, although eSignatures offer many advantages, adherence to legal norms, a focus on security, and the selection of a user-friendly platform are critical to their successful adoption in Indonesia.
Overview of eSignature regulations in Indonesia
The use of eSignatures in completing transactions is regulated by:
- Government Regulation Number 71 of 2019 concerning implementing Electronic Systems and Transactions.[1]
- Law No. 11 of 2008 on Electronic Information and Transactions (ITE Law) as amended by Law No. 19 of 2016 (EIT Law)[2]
Art 1 (12) of the regulation[1] defines an eSignature as a signature comprising electronic data attached to, associated with, or related to another electronic information used as a verification or authentication tool.
Under Indonesian regulations, eSignatures are categorized into two[1]:
- Certified Electronic Signature
- Uncertified Electronic Signature
A certified electronic signature under the Certified eSignature regulation:
- Fulfils the statutory validity standards.
- Uses an electronic certificate generated by an Indonesian Certification Authority.
- It was made by a certified electronic creation device.
Non-certified electronic signatures are created independently of the services offered by an Indonesian CA and operate without any certification from the authority.
Both certified and uncertified eSignatures are held legally valid, though the Indonesian system considers certified eSignatures more admissible in court proceedings with regard to their evidentiary value.
Validity and reliability standards
A reliable and valid electronic signature under the Electronic Transactions Regulation [S.59 & Art 11] must meet conditions such as[1]:
- Uniquely linked to the signatory.
- Able to identify the signatory.
- Able to show user consent.
- Created using means that the signers can maintain their control.
- Linked to the data it relates to so that any subsequent change is detectable.
- Indicates the time of signing.[2]
- There are specific methods to indicate that the signers have given consent to the associated electronic data.
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 remain in their sole control
This often involves managing a set of encryption keys or using two-factor authentication, with the private key securely in the user’s possession to avoid unauthorized use of the signature.
Able to 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, personal identification number (PIN), email address, or company registration number.
Easy to track down any alterations made after signing
It is critical to be able to detect any changes made to the document after the signature has been applied. Such changes should be traceable, typically through an audit trail that logs the signer’s internet protocol (IP) address, the timing of significant signing events, and the signer’s location to establish proof of identity, time, and location of signing. The audit trail also helps in knowing the time of signing.
Additionally, the services issue a pop-up for the signer to agree to the use of an electronic signature in executing their transaction.
Type of Signature
Governing Regulation
Reliability Standards
Validity Rating
Certified Electronic Signature
Government Regulation Number 71 of 2019 on the Implementation of Electronic Systems and Transactions.
Law No. 19 of 2016 (EIT Law)
- Uniquely linked to the signatory.
- Able to identify the signatory.
- Able to show user consent.
- Developed using means that the signatory can maintain in their sole control.
- Attached to the data it relates to so that any subsequent change is detectable.
- Indicates the time of signing.
- Methods exist to demonstrate the signer's consent to the associated electronic information.
Valid unless the contrary is proven.
Uncertified Electronic Signature
Government Regulation Number 71 of 2019 on the Implementation of Electronic Systems and Transactions.
Law No. 19 of 2016 (EIT Law)
- Independent of the services offered by the Indonesian certification authority.
Depends on the evidentiary weight.
| Type of Signature | Governing Regulation | Reliability Standards | Validity Rating |
|---|---|---|---|
| Certified Electronic Signature | Government Regulation Number 71 of 2019 on the Implementation of Electronic Systems and Transactions. Law No. 19 of 2016 (EIT Law) |
| Valid unless the contrary is proven. |
| Uncertified Electronic Signature |
| Depends on the evidentiary weight. |
The scope and limitations of eSignature transactions
Electronic signature transactions and their utilization do not have universal legal acceptance for document finalization. Consequently, there are specific types of transactions and uses for which electronic signatures are suitable and others are not. Below is an analysis of this matter, accompanied by a summarized table of the transactions.
Documents that can be signed
Electronic signatures can be employed to affix signatures and provide countersignatures on a diverse 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.
Additionally, the following documents can be signed through a certified electronic signature:
- Government-related transactions.
- High-risk contracts (e.g., financial, healthcare, legal matters).
Exemptions
The following transactions cannot be completed in electronic signature:
- Wills
- Marriage agreements
- Land and real estate transactions requiring notarization
Summary scope of limitations
Permissible transactions
Exemptible transactions
- Human resources
- Procurement
- Non-disclosure agreements (assuming they are contracts, not formal deeds)
- Software license agreements
- Insurance industry
- Educational field
- Etc.
- Government-related transactions
- High-risk contracts (e.g., financial, healthcare, legal matters)
- Wills
- Marriage agreements
- Land and real estate transactions requiring notarization
| Permissible transactions | Exemptible transactions | |
|---|---|---|
| Any type of eSignature | Certified eSignature | |
|
|
|
To ensure the credibility of an electronic signature, it is advisable to follow these best practices in addition to complying with all applicable regulations:
- Confirm the signer’s identity and, in business dealings, verify that the individual is duly authorized to act on behalf of the company in affixing their signature.
- Secure explicit agreement from the individual signing, which may be incorporated in the contract itself or in a separate accord, to signify their intention to use the specified electronic signature for the document in question.
- Safeguard the document to prevent any modifications after the application of the signature.
- Keep an exhaustive log of the signing procedure, recording each step the signer performs.
How does BoldSign comply with eSignature laws in Indonesia?
The following elements of compliance available within BoldSign can be used to comply with Indonesian 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 helps ensure 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 a 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 helps ensure that the signer is aware of the implications of signing electronically and has consented to do so.
- Custom terms: Getting 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.
Disclaimer: The information on this page is intended to help businesses understand the legal framework of electronic signatures for this particular country.
However, Syncfusion, its 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 respect 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[ https://jdih.komdigi.go.id/produk_hukum/view/id/695/t/peraturan+pemerintah+nomor+71+tahun+10+oktober+2019 Government Regulation Number 71 of 2019 ]
2 [ Machine Translation of “Act No. 19-Year 2016” (Indonesia) Government Regulation Number 71 of 2019 ]
3 Government Regulation Number 71 of 2019 on Implementation of Electronic Systems and Transactions
4 Ibid Article 60 (2)
5 Ibid Section 59, (3)
6 Government Regulation Number 71 of 2019 concerning Implementation of Electronic Systems and Transactions Article 62, (5)
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