Driving Digital Adoption in Trade Contracts ...
"... the increased use of electronic communications improves the efficiency of commercial activities, enhances trade connections and allows new access opportunities for previously remote parties and markets, thus playing a fundamental role in promoting trade and economic development, both domestically and internationally …"
- United Nations Convention on the Use of Electronic Communications in International Contracts
LexEcon eSME Initiative facilitates Small & Medium sized Enterprises (SMEs) in developing countries to gain multiple benefits of paperless trade in international business-to-business (B2B) transactions by providing support services to execute e-Contracts and e-sign trade documents with trading partners across different jurisdictions globally.
It is a pro bono initiative implemented by LexEcon Consulting Group in association with a global network of e-commerce consultants.
At a time when both governments and the private sector are increasingly looking for ways to implement paperless supply chains, the SMEs' ability to execute e-contracts and e-sign trade documents in different jurisdictions globally would help them gain efficiency, security and environmental benefits including:
> Secure access to new markets, enhanced trade connections & market share
> Better contractual and regulatory compliance
> Elimination or reduction of costs associated with paper-based transactions (i.e. travelling expenses, time, paper wastage, records management costs, postage or overnight courier charges)
> Improved supplier-customer relationships
> Enhanced operational efficiency & profitability, and
> Reduced carbon footprint
The existence of Small and Medium scale Enterprises (SMEs) are vital to the economies of all countries. SMEs represent over 90% of enterprises in most countries worldwide, and account for 60% - 70% of all employment in developing countries (WIPO and UNCTAD).
Over the past two decades, by adopting Information & Communication Technologies (ICTs), SMEs worldwide have gained considerable progress in enhancing productivity, profits and improving their relationship with customers and suppliers. It has been made possible due to the enabling legislation on electronic commerce (including e-payments, e-signatures, etc) and a number of 'e-readiness' programs for SMEs implemented by various government and non-governmental institutions.
Despite certain national legal differences that impede international transactions, legislatures have enacted electronic transaction laws based on the UNCITRAL model laws on e-commerce and e-signatures, and the Convention on the Use of Electronic Communications in International Contracts.
Nevertheless, SMEs in developing countries in particular are yet to take full advantage of the e-commerce practices due to reasons such as higher costs of access to the Internet, language barriers, lack of understanding of the legal and technical aspects relating to electronic transactions, etc.
In this context, the services provided by LexEcon eSME Initiative help ease the digital divide among SMEs in developed and developing countries.
Contact us _
We kindly invite SMEs and SME Associations to contact us and make use of our support services.
A quick guide to e-signatures and e-contracts:
Why sign e-Contracts in cross-border B2B transactions?
Except for the standard e-contracts for international sale of goods signed in B2B e-marketplaces or online stores, other forms of contracts (i.e. non-standard or bespoke contracts for international sale, manufacture & supply of goods, etc) are mostly signed manually on paper and exchanged between the parties either by fax or as scanned email attachments.
The security issues of this process can be minimized by executing contracts electronically on a secure platform (e.g. the Adobe Acrobat Pro DC) by using electronic signatures or certificate-based digital signatures in terms of the governing law of the contract.
What is an e-Contract?
An electronic contract is an agreement created and "signed" in the electronic form using an electronic signature.
What is an Electronic Signature?
Electronic signature is a broader term that refers to any electronic data that carries the intent of a signature. National legislation worldwide provides for the legal significance and validity of several different forms of electronic signatures:
Click signature: To buy something online, you fill in your personal information, enter a credit card number, and click a button to finalize the purchase. Clicking the button is equivalent to signing the register tape when you use a credit card at a brick-and-mortar store.
Typed signature: Some online agreements are executed by having the signer type his or her name into a browser-based form. Alternatively, a typed name in a contract can function as a signature. Like a click signature, a typed signature relies on a simple overt act to indicate the signer's acceptance of the terms of an agreement.
Digitized signature: This is what most people think of when they visualize an electronic signature -- accepting a package by signing with a stylus on a digitizer strip. A similar process allows someone to sign on a computer screen using a light pen. Another type of digitized signature is created by signing on paper, then scanning the signature into an image file (biometric signature).
Digital signature: It is a technologically advanced type of electronic signature, based on a digital certificate that is used to prove a communication originated from a particular sender and has not been tampered with. It is not a digitized image of the sender’s hand-written signature. A digital signature or digital signature scheme is a mathematical scheme for demonstrating the authenticity of a digital message or document. A valid digital signature gives a recipient reason to believe that the message was created by a known sender, and that it was not altered in transit (tamper-proof). Digital signatures are commonly used in financial transactions and other cases where it is important to detect forgery and tampering.
What are the countries where electronic signatures are legally recognized?
View the map Electronic and Digital Signatures Around the World, and the Database of Electronic Signature Legislation.
Also read the handbook Global Guide to eSignature Law: Country by country summaries of e-signature law and enforceability (Adobe Systems Inc). This guide covers the electronic signature laws of 47 countries, including all the largest economies. It gives a snapshot of each country’s electronic signature laws in the form of brief summaries, and provides a reference point for determining the scope of an organization’s use of electronic signatures in different jurisdictions. It is not meant to be an exhaustive or detailed legal analysis, but gives a solid place to start.
For more information, please visit the FAQ page.
Sustainable Development Goals
LexEcon e-SME Initiative supports Transforming our world: the 2030 Agenda for Sustainable Development by advancing the achievement of the following Goals and targets.
Goal 1. End poverty in all its forms everywhere
1.4: By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including microfinance.
Goal 2. End hunger, achieve food security and improved nutrition and promote sustainable agriculture
2.a Increase investment, including through enhanced international cooperation, in rural infrastructure, agricultural research and extension services, technology development and plant and livestock gene banks in order to enhance agricultural productive capacity in developing countries, in particular least developed countries
Goal 5. Achieve gender equality and empower all women and girls
5.b Enhance the use of enabling technology, in particular information and communications technology, to promote the empowerment of women
Goal 9. Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation
9.b Support domestic technology development, research and innovation in developing countries, including by ensuring a conducive policy environment for, inter alia, industrial diversification and value addition to commodities
9.c Significantly increase access to information and communications technology and strive to provide universal and affordable access to the Internet in least developed countries by 2020.
Goal 17. Strengthen the means of implementation and revitalize the Global Partnership for Sustainable Development
17.6 Enhance North-South, South-South and triangular regional and international cooperation on and access to science, technology and innovation and enhance knowledge sharing on mutually agreed terms, including through improved coordination among existing mechanisms, in particular at the United Nations level, and through a global technology facilitation mechanism.
17.7 Promote the development, transfer, dissemination and diffusion of environmentally sound technologies to developing countries on favourable terms, including on concessional and preferential terms, as mutually agreed
17.8 Fully operationalize the technology bank and science, technology and innovation capacity-building mechanism for least developed countries by 2017 and enhance the use of enabling technology, in particular information and communications technology
17.16 Enhance the Global Partnership for Sustainable Development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources, to support the achievement of the Sustainable Development Goals in all countries, in particular developing countries.
(Transforming Our World: the 2030 Agenda for Sustainable Development. United Nations,
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