Updated as at 3/10/2001.

1. Overview

Traditionally, there have been requirements at law for certain documents to be in writing and to be signed. There were also legal impediments preventing electronic documents and digital signatures from meeting these requirements.

The Electronic Transactions Act 1999 (Cth) and corresponding state and territory acts (some of which are yet to be enacted as set out below at “Sources of Law”) aim to remove some of these legal impediments.

The Act is based upon the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Commerce. The Act adopts the following principles:

* Functional equivalence - as far as possible, paper based commerce and electronic commerce should be treated equally by the law; and
* Technology neutrality - the law should not discriminate between different forms of technology.

2. Commencement and coverage

The Act primarily relates to dealings between persons and the Commonwealth government agencies, not dealings between private parties.

The Act covers Commonwealth legislation only and has a two step implementation process. Prior to July 2001 the Act only applies to laws of the Commonwealth specified in the regulations. After that time, the Act will apply to all laws of the Commonwealth unless specifically excluded from the application of the Act.

The States and Territories will need to enact their own corresponding legislation. Thus far, New South Wales, ACT, Victoria, Tasmania, the Northern Territory, South Australia and Queensland have enacted mirror legislation. The Western Australian legislation is currently at the Bill stage of the legislative process.

References in this fact sheet to the Commonwealth Act should be read as including a reference to the mirror legislation.

The Act does not:

* cover the enforceability or admissibility of Internet contracts as evidence in court proceedings; or
* determine whether an electronic agent can accept "click through" terms which have not been seen by a human.

See the Keeping Electronic Records Fact Sheet and Online Contracts Fact Sheet for more information.

3. Transaction Validity

For purpose of complying with a law, a transaction will not be invalid simply because it is made wholly or partly by an electronic communication unless regulations provide otherwise. A transaction includes a transaction of a non-commercial nature.(1)

4. What is an electronic communication?

An electronic communication is: * a communication of information in the form of data, text or images by means of guided or unguided electromagnetic energy; or
* a communication of information in the form of speech by means of guided or unguided electromagnetic energy, where the speech is processed at its destination by an automated voice recognition system.

5. Providing information electronically

If a Commonwealth law requires information to be given in writing, the requirement is deemed to be met if the information is given electronically provided:

* the information must be readily accessible for subsequent reference (ie recipient must be able to decipher it);
* if given to a Commonwealth entity, any particular technology requirements or receipt verification requirements specified by that entity are complied with; and
* if given to a non-Commonwealth entity, the recipient consents to the information being provided electronically.(2)

Similarly, if a Commonwealth law permits information to be given, that information may be given electronically if the requirements set out above are satisfied.

It must be reasonable to expect that the information would be readily accessible at the time the information is given and on subsequent occasions. This means that others should be able to read and access the message and that the legality of the transaction should not be questioned through lack of access.

Relevant factors in determining what is reasonable may include technologies available at the time of transmission and the appropriateness of the chosen technology for the purposes of the communication. For example, even if the technology necessary to access the information becomes unavailable at a later time, the requirement will be satisfied if it was reasonable to expect that the document would be able to be accessed.

It is not necessary to establish consent when giving information electronically to Commonwealth Government agencies (or State or Territory agencies under mirror legislation). This is consistent with the Commonwealth Governmentís preference for online dealings. Consent by non-Commonwealth entities does not have to be given to each individual message or even each type of electronic dealing. Consent may be inferred from a personís conduct (eg making available a means of electronic communication such as e-mail). Consent is only required in relation to the medium by which the information is communicated and does not relate to the content of the electronic communication.(3)

6. Production of document electronically

If a Commonwealth law requires a physical document to be produced (excluding certain citizenship and migration documents), an electronic communication will satisfy the requirements provided:

* the method chosen provides a reliable means of assuring the integrity of the information contained in the document (ie the document must remain complete and unaltered apart from "endorsements" and "immaterial changes" described below);
* the information contained in the electronic communication must be readily accessible for subsequent reference;
* if required to be produced to a Commonwealth entity, that entity may specify the use of a particular technology or method of verifying the receipt of the document; and
* if required to be produced to a non-Commonwealth entity, the recipient consents to the production of the document in electronic form.(4)

Similarly, if a law permits a document to be produced, it may be produced electronically if the above requirements are satisfied.

A reliable means of assuring the integrity of the information may involve processes which methodically record the information, capture the information without omissions and protect the information against alteration.

"Endorsements" include data automatically added by information systems at the beginning and end of communications in order to transmit them but do not include annotations, signatures or initials.

"Immaterial changes" cover formatting changes where they are not an important element of the document itself.

7. Electronic signatures

The Act does not state what standard will constitute an electronic signature. Parties are free to agree on what is acceptable under the circumstances.

A requirement for a physical signature is deemed to be met by an electronic communication provided:

* having regard to the circumstances at the time, a reliable and appropriate method is used to identify the person and to indicate the personís approval of the information communicated;
* if given to a Commonwealth entity, that entity's particular information technology requirements are met; and
* if given to a non-Commonwealth entity, the recipient consents to receiving the electronic signature.(5)

The electronic signature must identify the originator sufficiently for the purposes of that communication. The legislation does not require that the signature itself provide a means of verifying the integrity of the communication (as is the case with a digital signature).

The reliability of the signature method chosen would be determined having regard to all the relevant circumstances at the time of transmission (such as available technologies). The signature method used should provide a level of security appropriate for the transaction.

See Secure Electronic Transactions Fact Sheet for more information.

8. Keeping electronic records

If a Commonwealth law requires information to be recorded in writing, an electronic record will satisfy the requirement if at the time of recording the information it was reasonable to expect the information would be readily accessible for subsequent reference. If the use of a particular kind of data storage device is required, that must be used.

If a Commonwealth law requires a written document to be kept for a particular period, an electronic version of that document will satisfy the requirement if the above conditions are met and the method for recording it assures the integrity of the information contained in the document.

If a Commonwealth law requires an electronic communication to be kept for a particular period, a person retaining that information in electronic form will satisfy the requirement if all of the above conditions are met. Records must also be kept identifying the origin, destination, time of sending and time of receipt of the electronic communication.(6)

9. Time and Date Stamping

Many legal transactions require a determination of the time at which notification is considered to have been given or received (eg a tender received by the close of business on the specified date). The time and place of dispatch and receipt of electronic communications are determined as follows:

* unless otherwise agreed, the time of dispatch of an electronic communication is the time when it enters the first information system outside the control of the sender;
* unless otherwise agreed, the time of receipt of an electronic communication is the time when it enters an information system designated by the addressee for receiving them. If no such system has been designated, then the time of receipt is when the communication comes to the attention of the addressee; and
* in relation to the place of dispatch and receipt, the communication is taken to be dispatched and received at the respective places of business. Where the sender or recipient has more than one place of business, the office which has the closest relationship to the transaction (or otherwise the principal place of business, or failing that, their ordinary residence) will be assumed to be the place of business for the purpose of the Act.



Other relevant Fact Sheets:

Sources of Law
Electronic Transactions Act 1999 (Cth) commenced operation on15 March 2000.
Electronic Transactions Act 2000 (Vic) commenced operation on 1 September 2000.
Electronic Transactions (Northern Territory) Act commenced operation on 13 June 2001.
Electronic Transactions Act 1999 (Tas) commenced operation on 1 June 2001.
Electronic Transactions Act 2001 (ACT) commenced operation on 8 March 2001. (7)
Electronic Transaction Act 2000 (NSW) commenced operation on 7 December 2001.
Electronic Transaction Act 2000 (SA) received Royal Assent on 7 December 2000 and will commence operation on 1 November 2002.
Electronic Transactions (Qld) Act 2001 received Royal Assent on 7 June 2001 but has not commenced operation.
Electronic Transactions Bill 2001 (WA) is yet to be enacted.



End Notes
1. Electronic Transaction Act 1999 (Cth) (ETA) section 8
2. section 9(1)
3. section 5(1)
4. section 11
5. section 10
6. section 12
7. See endnote 3, p. 19 of the Electronic Transactions Act 2001 (ACT) for the Act's legislative history.