Electronic means are increasingly being used by businesses in the United Arab Emirates (UAE) to sign agreements. Working remotely appears to be the most common means of carrying out commercial activities during the pandemic.
In reality, many companies and government agencies are rapidly turning to digital solutions to sign papers electronically. A written signature is not usually necessary for an enforceable contract under UAE law; contracts are often binding if legally competent parties agree verbally, electronically, or in writing. In the event of a dispute, parties must submit the proof in court to confirm the contract’s authenticity. The UAE’s e-Commerce Law recognizes e-signatures. One of the essential principles of the e-Commerce Law is that a person can use electronic authentication.
Law relating to the Electronic Signature in the UAE
In reality, the UAE has recognized and regulated electronic signatures by Federal Law No. 1 of 2006 concerning Electronic Transactions and Commerce (the “E-Commerce Law”). According to Article 1 of the E-Commerce Law, electronic signatures are “any letters, numbers, symbols, voice, or processing system in electronic form applied to, integrated in, or logically coupled with an electronic communication with the goal of authenticating or demonstrating the same”
Resolution relating to E- signature by Ministry of Justice
As discussed further in this article, it should be noted that in 2019, the UAE Ministry of Justice published two decisions (the “MOJ Resolutions”), demonstrating the UAE’s willingness to embrace electronic transactions and electronic signatures.
The following are the two resolutions:
- Ministerial Resolution No. 259 of 2019 concerning the procedural manual for regulating litigation in criminal proceedings using electronic and remote communication technologies;
- Ministerial Resolution No. 260 of 2019 concerning the procedural manual for regulating litigation in civil proceedings using electronic and remote communication technologies.
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Legal provisions relating to electronic signature in the UAE
Electronic signatures and digital signatures are governed by the following laws and regulations in the United Arab Emirates:
- The Electronic Transactions Law (Law No. (1) of 2006 On Electronic Commerce and Transactions) is the primary piece of law in the UAE that governs the usage of electronic signatures. Ministerial Resolution No. 1 of 2008 (releasing the list of Electronic Certification Services Providers), which covers the Telecommunications and Digital Government Regulatory Authority’s regulation of Certification Service Providers (as specified under the Electronic Transactions Law).
- Federal Law No. 10 of 1992 Concerning the Law of Evidence in Civil and Commercial Transactions (as amended by Federal Law No. 36 of 2006) Civil Evidence Law (Federal Law No. 10 of 1992 Concerning the Law of Evidence in Civil and Commercial Transactions): It states that Electronic Signatures (as established by the Electronic Transactions Law) have the same evidentiary weight as handwritten signatures if they fulfil its requirements.
- According to Article 18 of the E-Commerce Law, a person has the right to rely on an electronic signature if the reliance is reasonable. The following factors must be examined when determining whether reliance is reasonable in any specific situation:
- The nature of the underlying transaction intended to be supported by the e-signature, and its value if known;
- Whether appropriate steps have been taken to determine reliability;
- Whether the person relying on the e-signature knew or ought to have known that the e-signature had been compromised or revoked;
- Dealings between the originator and the party rely on the e-signature.
When it comes to Dubai Law, the terms of Dubai Law No.2 of 2002 (Dubai Electronic Transactions Law) apply. The provisions of this regulation are based on the E-Commerce Law and reflect it in areas such as reasonableness standards and protected signatures. E-signatures are accepted as a replacement for handwritten signatures and can be relied on under the same reasonableness requirements (Articles 10 and 21). The idea of Protected Electronic Signatures is also applicable (Article 20). Furthermore, the Dubai Electronic Transactions Law makes e-signature acceptable as a piece of evidence in Dubai courts (Article 12).
DIFC Law requires a document to be signed or provides for particular penalties if a document or record is not signed. The DIFC Electronic Transactions Law recognizes e-signatures (Part 5, Article 21).
Recognition of e-signature on power of attorney by the UAE court
In a practical sense, the UAE Courts have also acknowledged the evidentiary strength and probative force of electronic signatures in several cases. For example, In the case of Dubai Court of Cassation 241/2007, the Dubai Court of Cassation decided that a Secure Electronic Signature could be relied on until otherwise proved. In a similar ruling, the Abu Dhabi Court of Cassation in case no. 472/2014, determined that depending on Secure Electronic Signatures is acceptable.
Given the many preventive measures implemented in the UAE due to the Coronavirus (COVID-19) epidemic, multiple resolutions on the federal and municipal levels relating to e-signatures have been published.
The UAE Cabinet, for example, enacted Resolution No. 18 of 2020 on March 31, 2020, authorizing the awarding of temporary permits for the use of digital transaction technology for notarial services. The UAE Cabinet approved the use of remote communication and e-signatures, as defined by the E-Commerce Law, for the conduct of notary public processes by this resolution.
Can power of attorney be signed digitally?
Resolution No. 18 of 2020 on March 31, 2020, further states that electronic signatures and electronic papers issued in compliance with its rules would have “the same validity as signatures or official paper documents provided in Federal Law No. 10 of 1992.”
Both the Dubai Courts and the Abu Dhabi Judicial Department have published circulars about the remote provision of notarial services resulting from this decision.
On the one hand, the Dubai Courts released a circular in April 2020 stating that the notary public will deliver the following services remotely using BOTIM (i.e. a telecommunication tool) following the submission of the required papers via the Dubai Courts online system:
- Notarization of Powers of Attorney,
- Notarization of Legal Notices;
- Notarization of Local Service Agreements; and
- Notarization of Articles of Association and Addendums for Civil Companies.
On the other side, the Abu Dhabi Judicial Department published Administrative Decision No. 61 of 2020, stating that all notarial services will be performed remotely by the notary public. Following that, the Abu Dhabi Judicial Department will undertake the notarization of papers using “WebEx Cisco” (i.e. a telecommunication tool) following submitting the required material via the Abu Dhabi Judicial Department online system.
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The purpose of this article is to provide a general overview of the subject. If you have a particular situation, you should seek professional counsel. It is recommended that you obtain the assistance of professionals to verify that you are following the POA’s legalization procedure appropriately. We frequently help our clients in getting POAs authorized across different ministries at Notary public Dubai.
Don’t hesitate to call our team of attestation specialists immediately if you have any questions.