On July 2, 2020, three Senators – John Thune (R-S.D.), Jerry Moran (R-Kan.), and Todd Young (R-Ind.) – introduced a bill to update the law regarding the use of electronic documents in commerce.
The Electronic Signatures in Global and National Commerce Act (E-Sign Act), 15 USCS § 7001 et seq., was originally enacted in 2000 to facilitate the use of electronic records and electronic signatures in interstate and foreign commerce. Under the E-Sign Act, “a signature, contract, or other record relating to such transaction may not be denied legal effect, validity, or enforceability solely because it is in electronic form.” § 7001(a). But the current form of the law requires consumers to reasonably demonstrate that they can access documents electronically before they can receive an electronic version.
The proposed amendment, the E-Sign Modernization Act, Senate Bill 4159, is intended to streamline how consumers consent to receiving electronic documents such as bank statements, account information, and contracts. In a press release July 2, 2020 press release, Senator Thune explained the purpose of the proposed legislation as follows:
As technology continues to advance and transform, so too should the laws that govern it, computers, smart phones, and other devices are more reliable and accessible than ever before. This legislation makes necessary updates to E-SIGN to reflect these advancements in technology and make it easier for consumers to receive documents electronically.”
We will continue to monitor the progress of the proposed legislation and keep you apprised of the latest changes to this and other laws affecting how businesses may interact with consumers.