Net leaves the law behind

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Antiquated British laws are threatening to hold back the pace of electronic commerce.

Although digital signatures are now a legal means of signing a contract, some British laws state that a contract is binding only if it is on paper and signed with ink.
Business groups are now drawing up a list of the offending laws, and are calling for new legislation to bring them up to date.

In July, the Electronic Communications Act gave digital signatures the same legal standing as those written with a pen. Despite the name, a digital signature doesn’t resemble anything you write. Instead, it is an electronic system for checking identities and time-stamping any agreements made or signed online.

But the change in the law does not mean that digital signatures can be used to buy, sell and sign online. The Act suggests that it is possible to sign and exchange the contract to buy a house over the internet. However, under current property laws, the sale would be illegal.

Now the industry group, Alliance for Electronic Business (AEB), is pushing the government to update other laws that the internet is rendering outdated.

House-buying laws, legislation covering employment contracts and consumer-credit laws all need to be changed.
Government departments are examining which Acts need changing and are expected to report on their findings later this year.

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