Why e-signatures will soon be used in every accountancy and legal practice. The first of two white papers which explore the current state of the market.
MyDocSafe is a technology firm that is building a digital office for a cloud-enabled professional service firm. With electronic signature and blockchain, MyDocSafe aims to transform the way documents are signed, verified and archived.
2. 2
Executive summary
• Wet ink signatures are not going to disappear anytime soon but we all
know how inconvenient they are if the contracting parties are not co-
located. The familiar algorithm of ‘receive a document by email, print it,
sign it, scan it, email it back, send original in a letter, wait for the
counterparty to send their signature, archive the digital copy’ is tedious,
expensive and frustrating.
• It is therefore not surprising that the electronic signature market is
expected to continue growing and attracting new innovative companies.
In this white paper we are looking at the current state of the e-signature
market from the regulatory and adoption perspectives. In the next one
we propose a how-to guide to selecting an e-signature provider.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
3. 1. Types of e-signature
3 This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
The UK government divides electronic signatures into
three groups:
• Simple electronic signatures - these include scanned
signatures and tickbox plus declarations
• Advanced electronic signatures - can identify the user, is
unique to them, is under the sole control of the user and is
attached to a document in a way that it becomes invalidated
if the contents are changed
• Qualified electronic signatures - an advanced electronic
signature with a digital certificate encrypted by a secure
signature creation device e.g. smart card
4. 2. Current regulatory regime
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From 1 July 2016 the current regulatory framework will change.
The Directive on Electronic Signatures (1999/93/EC) will be
replaced with a new framework, commonly called e-IDAS
(910/2014/EU). E-IDAS provides mutual recognition of e-
signatures, e-seals, time stamping, website authentication and
e-registered delivery services among EU member states which
adopt the regulation. E-IDAS also introduces the advanced
electronic signature concept as well as the definition of
qualified and non-qualified trust services. The aim of E-IDAS is
to build public confidence in the security of digital transactions
and to encourage them to use electronic signatures.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
5. 3. State of adoption
5
The US has been an early adopter of electronic signatures where paper saving and
customer experience are the primary drivers of adoption. In Europe, due to
fragmented regulatory frameworks, the adoption has been slower. Some EU
countries did not adopt the ‘advanced electronic signature’ type at all requiring all
signatories to purchase physical equipment from a handful of licenced providers to
be used for authentication (similar to Secure Key tokens used in electronic banking).
This clearly created a significant barrier to wider adoption.
In the UK the electronic signature is now gradually finding customer acceptability
especially in the context of signing of standard documents (such as purchase orders,
new client forms, dispatch documents, non-disclosure agreements, company
accounts). In more complex situations, such as venture capital transactions
electronic signatures are used if there are no deeds involved. If contracts are signed
as deeds, however, wet signatures are still the only option as there is no clarity
whether they can be executed electronically. Industries which seem to be the early
adopters include logistics (remember the squiggle you made with you finger to
acknowledge the delivery of that parcel?) and professional services (accountants,
lawyers, real estate agents, financial advisers), where time is expensive and slick
customer experience can impress clients.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
6. 4. What are the benefits of using e-
signature?
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How much benefit you want to get out of your e-signature is up
to you. Some accountancy practices, for example, use it on an
ad hoc basis, some use it regularly as part of their client
service. Others treat it as an integral part of their ‘paperless
strategy’ where the wet ink option is simply no longer available.
For a single contract
For efficient
document
management
For better client
service
Faster completion
Lower transaction
cost
Better user
experience
Cheaper compliance
(easier to audit
documents)
Easier KYC checks
and updates
Easier document
retrieval
Perception of better
value for money
Automation of
document archiving
Faster client on-
boarding
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
7. 5. What questions to consider?
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If you are thinking about imbedding electronic signature in the
DNA of your practice, you may want to consider a number of
questions related to your legacy IT systems, your customer base
and your price sensitivity.
What type of electronic signature do I need?
Probably ‘advanced electronic signature’ will work for most
people. The question of non-repudiation and authentication can
now be resolved with software alone. Also, it would be a difficult
ask to require your clients to buy a Smart Key device just to do
business with you.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
8. 5.1 What type of electronic signature
do I need?
8
Probably ‘advanced electronic signature’ will
work for most people. The question of non-
repudiation and authentication can now be
resolved with software alone. Also, it would be a
difficult ask to require your clients to buy a Smart
Key device just to do business with you.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
9. 5.2 Is my date going to leave the eu?
9
Since the end of the Safe Harbour framework, the onus of making
sure data is properly handled increasingly falls on European
companies who can no longer rely on the self-certification
mechanism that American suppliers could use to fall under the
Safe Harbour umbrella. Some clients may not want to have their
data leave the EU irrespective of who handles it. Others may be
relaxed about it and worry primarily about the price and
convenience. We expect several US providers to open EU based
data centres in the near future to resolve any concerns related to
data privacy.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
10. 5.3 How secure is my data?
10
Most software as a service providers (“SaaS”) such as e-
signature players use a handful of physical server specialists to
store their data, such as Amazon Web Services, Rackspace or
Microsoft Azure. That data is encrypted ‘at rest’ with keys that are
held by the storage company and in some cases by the SaaS
company. This might not be enough to some clients who worry
about unauthorised snooping or data theft due to a hack. To our
knowledge however, not a single company we reviewed
empowers their clients to control encryption keys to their data.
This might change in the near future as the privacy concerns,
especially in Europe, force companies to adapt.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
11. 5.4 Can I continue using my preferred
cloud storage?
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About half of companies we surveyed built integrations with
third party storage systems. The remaining ones hold the
documents themselves. It is likely that your clients are
using a different storage provider than you do. It may or
may not matter because a growing number of companies
(and most of those we surveyed) are increasingly open to
using ‘a special dedicated place’ for their most important
documents, especially signed contracts.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
12. 5.5 Is e-signature enforceable?
12
This is probably your main concern. The case law related to electronic signatures is
richer in the US than the UK. Still, quick desktop research reveals that several UK
law firms mention cases where electronic signatures were successfully used in court.
To quote Walker Morris:
“The provisions of the Electronic Communications Act 2000 (ECA) aim to ensure that
the legal effect of documents or signatures will not be denied simply because they
are represented electronically. For instance, section 7 of the ECA confirms that
electronic signatures are admissible in legal proceedings to determine the
authenticity of any electronic communication in which they are incorporated.
However, the ECA does not consider how a signature can demonstrate the
necessary authenticating intent. Instead, the courts must determine the evidential
weight to be granted to such signatures.”
Keeping electronic correspondence leading up to the signing of important contracts
can form part of that ‘evidential weight’ as it can demonstrate that parties were
negotiating a deal that they wanted to sign. It is common sense to store that
correspondence whether a contract was signed electronically or not.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
13. 5.6 Is e-signature only about the
signature?
13
Assuming that all e-signature providers are essentially
selling a commodity, it is user experience and ancillary
services that will make or break their business.
Do you need help creating the documents, managing
reminders, monitoring progress of the document journey,
archiving and distribution?
Do you need to manage encryption keys?
Do you need a paper version printed anyway and stored
somewhere just in case?
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
14. 5.7 Can I afford to wait?
14
E-signature is here to stay and is likely to transform your practice
not only by letting you sign deals faster but also by letting you
serve your clients better. The emergence of ‘digital only’
accountancies is an interesting innovation that should, through
competitive pressure, increase the speed of adoption by more
traditional firms. Some companies introduce e-signatures
gradually by, for example, initially offering digital onboarding
facilities to help them win business easier. Others take a more
conservative approach, yet others let their customers lead the
way. Where do you fit?
If you are prepared to try e-signature, wait for our second white
paper in which we will compare main market players, or simply
write to us directly.
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
15. 6. About mydocsafe
15
We are a UK-based angel-backed technology firm that is
building a digital office for professional service firms.
We solve the problem of divergent objectives:
convenience vs security/compliance vs sharing, by
offering innovative security features and clever value-
added services including electronic signature.
Sign up today for a free trial at
https://mydocsafe.com/signup
or write to:
Daniel Stachowiak at
dstachowiak@mydocsafehq.com
Convenience
Sharing
Security/
Compliance
This document is for information purposes only and not a solicitation for the purchase of any security.
DocSafe is a Community Trademark.
Editor's Notes
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.
My solution is an online secure and backedup storage system with clever email and AI features that can be used by service providers, advisers and family. So my vision for MyDocSafe is to not only digitize the filing cabinet that sits in my home office, but to persuade people who produce those documents, to keep it organized for me. I want this piece of kit to simplify people’s lives.