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The Ministry of Digital Affairs is Pushing for an Amendment to the "Electronic Signatures Act" to Create a Trusted Digital Environment.

The Ministry of Digital Affairs (moda) stated that the current "Electronic Signatures Act" has not been amended for over 20 years. To cope with the global digital transformation trend and the rapid development of the digital economy and services, the moda has proposed an amendment to the "Electronic Signatures Act," which clearly defines the functions of electronic documents and electronic signatures as equivalent to physical documents and signatures, confirming the legal effectiveness of electronic signatures. The Executive Yuan approved the draft amendment today (29th) and forwarded it to the Legislative Yuan for examination.

In addition to promoting the digital economy and smart government, the moda also actively discusses with the Ministry of Economic Affairs the addition of "virtual network advertising" business items. In the future, the moda will promote the verification of digital signatures (a type of electronic signature) before advertising investment publication, expecting to effectively reduce investment fraud and ghost advertising accounts, creating a trusted digital environment.

The moda explained that after completing the amendment of the Electronic Signatures Act, it would help the general public choose different electronic signatures according to application needs, fully realizing the advantages of improving efficiency, reducing costs, ensuring transaction security, and alleviating environmental burdens. It will promote the development of the digital economy industry and significantly elevate the convenience of cross-border e-commerce, which is applicable daily.

To cope with the global digital transformation trend, The moda pointed out that an urgent need for amendment is required. 

The electronic signature refers to a digital technique attached to an electronic document that can identify the signatory's identity and ensure the document's integrity through encryption technology and various signature records. It meets the regulation of the "Electronic Signatures Act". It has legal effectiveness, such as signing electronic documents with the Ministry of the Interior's Citizen Digital Certificate (TW FidO) or a business certificate. If purely using handwritten signatures on electronic documents with mobile phones or tablets or signatures stored as images, such signatures can be easily forged, and the recipient cannot verify whether it is signed by the person, which may also have the risk of being separated from the document. Therefore, it does not belong to the electronic signatures definition defined by the "Electronic Signatures Act."

The current "Electronic Signatures Act" has been implemented since April 1, 2002. With the global digital transformation trend, the current network environment is more prevalent than when the law was enacted. Lifestyles and work patterns are gradually changing, and the government and enterprises continue to innovate digital application services, steering the demand for electronic signature use. The "Electronic Signatures Act," which has not been amended for more than 20 years, urgently needs to be revised to cope with the rapid developments of the digital economy and digital services. Since the moda's establishment in August 2022, it has actively studied amendments, conducted amendment announcements, and consulted various sectors from June to August last year.

The draft amendment of the "Electronic Signatures Act" has six main points:

1. Specify that electronic documents, electronic signatures, physical documents, and physical signatures have the same functions, and their legal effectiveness cannot be denied solely because of their electronic form.

2. Specify digital signatures as a type of electronic signature to clarify the relationship between electronic signatures and digital signatures.

3. Stipulate that digital signatures must have certificates issued by government-licensed certificate authorities and have the legal "presumption" of being signed or stamped by the signators.

While electronic signatures are like stamps in traditional paperwork, digital signatures use certificates issued by certificate authorities and are similar to the seal in conventional paperwork.

4. To balance digital needs and digital inclusion, the draft amendment stipulates that before adopting an electronic form, reasonable opportunities shall be given to the opposing parties reasonably; if the opposing parties do not object, it is presumed that they agree to adopt the electronic form.

5. To increase the application of electronic documents and electronic signatures by the smart government, the draft amendment removed the current provision that administrative agencies can announce the exclusion of the use of electronic signatures and set a 3-year sunset clause, which means that within three years of the implementation of the amendment, administrative agencies must apply this law.

6. Considering the opportunity for future mutual recognition of electronic signatures internationally, the competent authority can recognize the effectiveness of certificates issued by international certificate authorities under the condition of equivalent security prerequisite, compliance with international reciprocity, or technical interoperability cooperation principles.

Digital signatures save time and effort, making life and business more convenient. 

Government-licensed certificate authorities issue the existing Ministry of the Interior's Citizen Digital and business certificates. The amendment makes it possible to use the certificates for signing electronic documents, which will legally belong to digital signatures with the presumption of "signed by the signatory in person," and the application scope will be more extensive.

For example, documents between two companies can be "stamped" online, and quotations no longer need to be exchanged quickly by courier. Individuals dealing with the government and banks can only sign a few documents physically, and they can quickly complete online signatures through electronic records.

In terms of international applications, as long as the certificates of both parties are interoperable and the security conditions are equivalent, our courts can recognize the effectiveness of electronic documents. Famous international services such as Acrobat Sign, DocuSign, or electronic document signature verification service verified by TWCA, Chunghwa Telecom's Quick Ease Sign A+Sign, and DottedSign can all obtain the same benefits. The signing of international contracts, document exchanges for overseas nationals, etc., no longer need to go through multiple rounds of signing and stamping by mail; it can now be completed by online signatures, saving time and effort.

For example, last year, the National Institute for Cyber Security, an Independent Administrative Institution supervised by the moda, signed a memorandum of cooperation with Lithuania through online signing. Lithuania recognized the "Organization and Group Certificate" (miXed organization Certification Authority, XCA) issued by the moda as having complete legal effect through online signing.

In addition, the amendment will improve the regulations related to electronic signatures and will also effectively help in dealing with the fraud issues that the public is concerned about. As a co-organizer of the Executive Yuan's "New Generation Anti-Fraud Strategy Action Plan 1.5 Version," the moda actively prevents fraud from the source. It is currently discussing with the Ministry of Economic Affairs the addition of "virtual network advertising" business items. In the future, online advertising platforms will need to verify the digital signatures of advertisers, providing platforms with more convenient mechanisms to verify customer identities, effectively reducing fake accounts from the source, and quickly removing online fraud advertisements through cross-platform joint defense mechanisms.

For example, when posting political advertisements on social platforms like Facebook and Instagram, Meta will conduct KYC (Know Your Customer) checks. Advertisers need to provide copies of their IDs, etc., for manual review. After the amendment is passed, KYC can recognize digital signatures, automate the review process, reduce the review costs of online advertising platforms, and allow more advertisements to apply this practice.

For example, investment advertisements posted on Meta do not require KYC. Although a one-page scam recognized by the police has been able to block the domain in real-time and remove the advertisement within 24 hours, the ad is still on the platform before its removal. At this time, although clicking on the link will only display a fraud alert from 165 without any substantial losses, it still causes inconvenience. The moda will work with the Financial Supervisory Commission and the Criminal Investigation Bureau of the Ministry of the Interior to develop related mechanisms. In this way, when the police determine fraud, various platforms will receive information synchronously through the joint defense platform and then quickly remove other advertisements published by the same signatory, achieving the cross-platform joint defense goal.

The moda is committed to leveraging digital technology to create a safe, reliable, and trustworthy digital environment, which includes launching the 111 government-specific shortcode SMS platform and government-specific short URLs and promoting advanced technologies such as zero trust and mobile Citizen Digital Certificate (TW FidO). The "Electronic Signatures Act" amendment aims to build the critical foundation of digital trust. The moda will assist the digital economy-related industries under its jurisdiction in promoting the popularization and application of electronic signatures, accelerating the digital transformation of various sectors. The moda will also actively communicate and coordinate with the Legislative Yuan, hoping to complete the legislative process as soon as possible to meet the expectations of various sectors of society for this bill.

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