IMDA seeks feedback on review of Electronic Transactions Act

30 July 2019

On 27 June 2019, the Info-communications Media Development Authority (“IMDA”) launched a public consultation to seek feedback on the review of the Electronic Transactions Act (“ETA”). The deadline for submission of feedback is 27 August 2019.

The following are the key areas where feedback is sought:

  • Including more electronic transactions under the ETA
  • Offering more certainty on the use of new technologies
  • Updating the certification authority framework to ensure currency with latest international standards

Including more electronic transactions under the ETA

Part II of the ETA contains provisions supporting the legal enforceability of electronic records and signatures. Currently, certain kinds of documents and transactions such as wills, indentures, trusts and powers of attorney, negotiable instruments and other transferable documents or instruments, contracts for immovable property and conveyance for immovable property (as listed in the First Schedule to the ETA) are excluded from the scope of operation of Part II of the ETA. IMDA is proposing that most matters from the exclusion list under the First Schedule to the ETA be removed, unless there are overriding public interest considerations, e.g. if it is required as a safeguard to protect the vulnerable. Specifically, IMDA is proposing to remove the following documents and transactions from the exclusion list under the First Schedule to the ETA:

  • Wills (on the basis that safeguards under the Wills Act will be maintained);
  • Bills of lading, warehouse receipts, dock warrants or negotiable instruments such as bills of exchange, promissory notes or cheques;
  • Powers of attorney for the enforcement of security interests (all other types of powers of attorney (“True Agency POAs”) will remain excluded);
  • Lasting powers of attorney (on the basis that safeguards under the Mental Capacity Act will be maintained);
  • Indentures;
  • Testamentary trusts (on the basis that safeguards under the Wills Act will be maintained);
  • Contracts for the sale or disposition of immovable property (subject to the proposed requirement of accepting only secure electronic signatures or digital signatures for property transactions conducted electronically); and
  • The class of documents and transactions relating to the conveyance of immovable property or the transfer of any interest in immoveable property (subject to amendments to other relevant statutes such as the Conveyancing and Law of Property Act and Land Titles Act).

In summary, IMDA would remove all the exclusions under the First Schedule to the ETA for most business related transactions, while retaining personal or familial transactions which could require greater safeguards. This would mean the removal of all items in the exclusion list with the exception of trusts relating to immovable property or dispositions of equitable interest and True Agency POAs. To provide the relevant policy and implementing agencies with time to address any policy/implementation challenges or concerns, it is further proposed that a sunrise period until 2021 be introduced (where required). This would meet the objective where most transactions with the Government could be conducted digitally by 2023.

Offering certainty on the use of new technologies

IMDA is of the view that the ETA is technology neutral and does not prohibit the use of distributed ledger technology, smart contracts and biometrics and that no further amendments to the ETA are necessary to facilitate the usage of biometric technology in electronic transactions. IMDA seeks feedback on other possible technologies that enterprises or sectors may wish to deploy, but are unclear whether the ETA facilitates or prohibits these.

Updating the certification authority framework to ensure currency with latest international standards

The Electronic Transactions (Certification Authority) Regulations 2010 (“CA Regulations”) have been enacted under the ETA to provide a legal framework to facilitate the establishment of trusted certification authority (“CA”) services in Singapore. The CAs issue digital certificates that certify the electronic identities of users and organisations. The review of the ETA also includes a review of the CA Regulations to ensure the technical relevance of the CA Regulations in relation to international developments in this area.

IMDA proposes to update the Compliance Audit Checklist that accredited CAs must comply with, in order to adopt and align with established international standards such as WebTrust and those set by the European Telecommunications Standards Institute. The Compliance Audit Checklist covers areas such as the CA’s operational policies, procedures and security.

It is proposed that there will be no change to the current voluntary accreditation framework as this gives CAs the flexibility to determine if there is a business case for applying for accreditation by IMDA.

Reference materials

The following materials are available on the IMDA website www.imda.gov.sg:

 

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