Electronical signing of transaction documents and registration of the documents with the Trade Registry

COVID-19 ALERTS ELECTRONICAL SIGNING OF TRANSACTION

Table of contents

General context...... 3

Legal framework...... 4

Legal effects of a DocuSign signature...... 5

Can resolutions of the general meeting of shareholders and the articles of incorporation be signed via DocuSign?...... 6 ELECTRONICAL SIGNING OF TRANSACTION

1. General context

In the general context of COVID-19, in view of the measures to sign documents, instead of handwritten signatures. However, adopted by the authorities to prevent and control the spread the reluctance of some authorities to consider as validly signed of the virus, discussions on the possibility to sign transaction documents not including a handwritten signature or a qualified documents by electronic means are more topical and useful electronic signature meant that the electronic signature was than ever. doubled, in most cases, by the handwritten signature of the documents in order to be submitted to various authorities, Part of the Romanian entrepreneurial environment has quickly such as the Trade Registry. adapted to technological developments and has begun since several years ago to use various means of electronic signature

3 WWW.DLAPIPER.COM ELECTRONICAL SIGNING OF TRANSACTION

2. Legal framework

Electronic signatures are generally regulated in Romania by At the same time, starting with the entry into force of GEO (i) Regulation (EU) No 910/2014 of the and 38/2020 on 7 April 2020, the documents signed with advanced of the Council of 23 July 2014 on electronic identification and electronic signature, which are transmitted using substantial or trust services for electronic transactions in the internal market high level mechanisms, are assimilated, in terms and repealing Directive 1999/93/EC (“eIDAS Regulation”); and of their conditions and effects, with wet ink signed documents. (ii) Law no. 455/2001 on electronic signatures (“Law 455/2001”). In addition, in order to facilitate the development of the activity Therefore, after the adoption of GEO 38/2020, both the by public authorities and institutions in the context of the documents signed with a qualified/extended electronic restrictions currently imposed, GEO no. 38/2020 on the use signature, based on a qualified certificate which is not of electronic documents at the level of public authorities and suspended or revoked at that time and generated by means of institutions (“GEO 38/2020”) was adopted. a secure electronic signature creation device, and those signed with advanced electronic signature, which are transmitted by Both the eIDAS Regulation and Law 455/2001 provide for three using authentication mechanisms of a substantial or high level, types of electronic signatures (with definitions of a high degree are assimilated, in terms of their conditions and effects, with wet of similarity), i.e. (i) electronic signature; (ii) advanced/extended ink signed documents. electronic signature; and (iii) qualified/extended electronic signature based on the unsuspended or revoked qualified Since GEO 38/2020 only concerns the activity of the public certificate and generated by means of a secure electronic authorities and institutions, the question arises whether a signature creation device. document signed with advanced electronic signature and submitted by using authentication mechanisms of a substantial According to art. 25 of the eIDAS Regulation, a qualified or high level, will be assimilated with a wet ink signed document electronic signature has the equivalent legal effect of a also in case of legal relationships between private individuals handwritten signature. Moreover, a qualified electronic a question that will most likely be answered by future case law. signature based on a qualified certificate issued by a In addition, other subsequent questions will arise in this regard, Member State is recognized as a qualified electronic signature such as who is the competent person to determine whether the in all other Member States. The qualified trust service providers authentication mechanisms used have been of a substantial or are centralized and registered on eIDAS Trusted Lists. high level or what conditions should be met for this purpose.

In addition, the eIDAS Regulation also grants Member States In any case, the effects of different electronic signatures issued some degree of freedom of regulation in this field. In this by various providers (including their probative value) will be respect, Member States can also provide at national level for analyzed by the courts of law on a case-by-case basis, most likely the effects of other types of electronic signatures, so that an after a technical expertise, as to determine the type of electronic electronic signature would not be denied legal effect and the signature used and the validity thereof. possibility of being accepted as evidence in court proceedings only because it is in electronic format or does not meet the The fact that the electronic signature is a topical issue is also requirements for qualified electronic signatures. confirmed by the multiple legislative proposals registered for debate at the Chamber of Deputies, which concern the According to art. 5 of Law 455/2001, the document in electronic electronic signature and related issues, with the purpose of form, to which an extended electronic signature has been aligning national legislation with the European legislation. incorporated, attached to or logically associated, based on a qualified certificate not suspended or revoked at that time and generated by means of a secure electronic signature creation device, is assimilated, in terms of its conditions and effects, with wet ink signed documents.

1 https://webgate.ec.europa.eu/tl-browser/#/.

4 WWW.DLAPIPER.COM ELECTRONICAL SIGNING OF TRANSACTION

3. Legal effects of a DocuSign signature

In view of the above and given that in practice we have received After the document is signed by the sender and by the recipient, several requests for organizing the signing of documents the sender and the recipient will receive an electronically signed through DocuSign, the question arises what types of electronic copy by e-mail and will be able to access and download the signatures are provided by DocuSign, i.e. if the DocuSign certificate issued by DocuSign from the DocuSign platform. signature can be considered a qualified/advanced electronic The certificate issued by DocuSign contains the data of the signature, within the meaning of the eIDAS Regulation. sender and the recipient (name, e-mail address, IP), date and time of sending, date and time of receipt, date of access and date According to the information on the official website of DocuSign, of signing. At the same time, the certificate includes Envelope the platform claims to offer all types of electronic signatures ID (which can also be found on the final signed document) provided by the eIDAS Regulation, namely electronic signature, and the mention that the sent “envelope” has been encrypted advanced electronic signature and qualified electronic signature. (hashed). The electronically signed copy sent by DocuSign to the original sender and recipients, when opened in Acrobat Reader, Without performing a technical analysis of the multiple ways includes an indication that the document is electronically signed of signing via DocuSign, the electronic affixing via DocuSign and contains details regarding the applied signature. of a handwritten signature on a scanned document circulated by parties by e-mail seems to fall under the eIDAS Regulation According to the eIDAS Regulation, an advanced electronic as simple electronic signature, i.e. data in electronic format, signature is an electronic signature that meets the following attached to or logically associated with other data in electronic requirements: (a) refers exclusively to the signatory; (b) allows format and which are used by the signatory to sign. the identification of the signatory; (c) it is created using electronic signature creation data that the signatory can use, with a high However, DocuSign also offers the possibility to send the degree of confidence, exclusively under his control; and (d) is documents to be signed, to signatories and to other entities, related to the data used for signing so that any subsequent as “envelopes” from the DocuSign platform. In this situation, changes to the data can be detected. recipients will receive an email notification with a link to the DocuSign platform where they can sign the documents. Given the above aspects, without performing a specialized To the extent that the sender has also set an access code, technical analysis, the DocuSign signature applied by the the recipient will be able to access the link only on the basis method described above, in which documents are circulated of the access code sent by the sender separately (e.g. by sms in envelope format, would appear to meet the standards of or another e-mail). an advanced electronic signature within the meaning of the eIDAS Regulation.

2 https://www.docusign.com/sites/default/files/Standards-Based-Signatures-Data-Sheet.pdf

5 WWW.DLAPIPER.COM ELECTRONICAL SIGNING OF TRANSACTION

4. Can resolutions of the general meeting of shareholders and the articles of incorporation be signed via DocuSign?

Consequently, the question arises whether documents such Once printed, such a document does not lose its validity as the resolutions of the general meeting of shareholders and (the written form is not a requirement for the validity of a legal the articles of association of a company can be validly signed act, unless the law expressly requires such a form), but the by electronic signatures similar to the ones issued by DocuSign printed document will be considered a copy, and not an original. and submitted as such with the Trade Registry. However, in line with those ruled by the Supreme Court of Romania by Decision no. 6/2015 on the examination of an appeal In a case settled on the merits by the Cluj Specialized Tribunal in the interest of the law, when the document is received by its and maintained in appeal by the Cluj Court of Appeal prior to recipient on paper, the authenticity of the document, when the the entry into force of GEO 38/2020, having as subject matter written form is required by law ad validitatem, is ensured only by a complaint against the resolution of the Cluj Trade Registry applying, on this document, the handwritten signature, since the rejecting a registration, the courts considered the signing of the electronic signature would be incompatible with a hardcopy. resolution of the general meeting of the shareholders through DocuSign as being valid, and ascertained that the signature According to the Methodological Norms regarding the manner through DocuSign is a qualified electronic signature. Except for of keeping the trade registers, performing of the registrations the general assessment made by the court regarding the type of and issuing of the information, approved by the Minister of signature, we have no further information regarding the content Justice through Order no. 2594/2008 (“Norms”), requests for of the certificate that accompanied the DocuSign signature registration in the Trade Registry of certain operations are that was used. accompanied by the original decision of the general meeting of shareholders and the original articles of association, as well as In the free version of DocuSign for the signed document by other original documents or copies of the original documents, resulting through the use of the “envelope” method described as the case may be. above, the certificate appears to be issued by DocuSign, Inc., not by DocuSign France, a qualified trusted service provider Therefore, based on the above provisions, the judgements of listed on eIDAS Trusted Lists. Therefore, in this case, where the the Cluj Specialized Tribunal and by the Cluj Court of Appeal are signature is accompanied by a certificate issued by DocuSign, erroneous in relation to the submission of documents signed Inc., and not by DocuSign France, the signature applied through by DocuSign over the counter (as these are not deemed to be the “envelope” method could be considered an advanced originals), but could be relevant in terms of the possibility to sign electronic signature, but not a qualified electronic signature. the resolutions of the general meeting of shareholders and of the articles of association through DocuSign followed by their It could be stated, however, that, regardless of the qualification submission through the online portal of the Trade Registry. of the signature through DocuSign as a qualified electronic signature or advanced electronic signature, a document signed via DocuSign can be assimilated according to art. 5 of Law 455/2001 and art. 5 para. 3 of GEO 38/2020, with a wet ink signed document, producing the same effects, as long as the document circulates in the electronic environment.

3 Judgement No. 108/2020 pronounced by the Cluj Court of Appeal – Civil Section II

4 https://webgate.ec.europa.eu/tl-browser/#/tl/FR/9/4

6 WWW.DLAPIPER.COM ELECTRONICAL SIGNING OF TRANSACTION

According to art. 20 para. (1) of the Norms, the application portal of the Trade Registry, the extended (qualified) electronic submitted in electronic form will have incorporated, signature of the person entitled to file the request is affixed to attached to or logically associated the extended electronic the documents. However, in order to avoid potential hurdles signature. In practice, both the request and the documents when performing the registrations with the Trade Registry, attached to the request are signed by the person submitting we recommend confirming with the Trade Registry Office where the request by means of an extended electronic signature. the registration would take place, prior to the signing and filing of the documents, the acceptance of the above mentioned As resulting from the above, the Norms do not contain method of signing and submitting the request. provisions regarding the signing of the documents submitted in support of the registration request by the parties (e.g. signing Authors: of the resolutions of the general meeting of shareholders and Romina Iancu the articles of association by the shareholders). Therefore, in the Associate, Corporate absence of any clarification in this respect, one could argue that DLA Piper, Bucharest Office the documents can be signed by the parties either by wet ink signature or electronically, by qualified electronic signature or advanced electronic signature. Ciprian Frandeș In conclusion, DocuSign can be used to sign the resolutions Associate, Corporate of the general meeting of shareholders and the articles of DLA Piper, Bucharest Office association and filed as such with the Trade Registry, as long as the submission is made through the online portal of the Trade Registry and as long as prior to their upload in the online

7 WWW.DLAPIPER.COM ELECTRONICAL SIGNING OF TRANSACTION

DLA Piper is a global law firm operating through various separate and distinct legal entities. Further details of these entities can be found at www.dlapiper.com. This publication is intended as a general overview and discussion of the subjects dealt with, and does not create a lawyer-client relationship. It is not intended to be, and should not be used as, a substitute for taking legal advice in any specific situation. DLA Piper will accept no responsibility for any actions taken or not taken on the basis of this publication. This may qualify as “Lawyer Advertising” requiring notice in some jurisdictions. Prior results do not guarantee a similar outcome. Copyright © 2020 DLA Piper. All rights reserved. | MAY20 | A05653