COD1998/191: Electronic communication, open networks safety: electronic signatures, common regulatory framework
*Mattila and Lane’s coding of voting outcome: 1 (NO VOTE) and it is under Unanimity.
#1. Recital 3 in EP 1st Reading(not important)
EP 1st reading replaced the word, “digital” with “electronic” but Commission and Council did not adopt this change.
ORIGINAL PROPOSAL (Recital 3):
Whereas on 1 December 1997, the Council invited the Commission to submit as soon as possible a proposal for a
Directive of the European Parliament and the Council on digital signatures;
COUNCIL COMMON POSITION(Recital 3):
SAME AS ORIGINAL PROPOSAL
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#2. Recital 4 in EP 1st Reading (important)
EP 1st reading made it clear that “clear common framework conditions for electronic signatures will strengthen confidence in the new technologies” and Member States’ divergent actions “must not be allowed to hinder the free movement of goods and services in the internal market” whereas Original Proposal simply stated that non-harmonization of standards “hinders the development of the internal market” and harmonization at Community level is needed given divergent actions in Member States. Amended proposal adopted EP 1ST READING and Council Common Position almost adopted EP 1ST READING except for slight changes in wording (e.g. it uses “legislation” rather than “divergent actions” in Member States). EP 2ND READING and Final Act adopted Council’s Common Position.
ORIGINAL PROPOSAL (Recital 4):
Whereas electronic communication and commerce necessitate electronic signatures and related services allowing data authentication; whereas divergent rules with respect to legal recognition of electronic signatures and the accreditation of certification service providers in the Member States may create a significant barrier to the use of electronic communications and electronic commerce and thus hinder the development of the internal market; whereas divergent actions in the Member States indicate the need for harmonisation at Community level;
EP 1ST READING (Recital 4):
Whereas electronic communication and commerce necessitate electronic signatures and related services allowing data authentication; whereas divergent rules with respect to legal recognition of electronic signatures and the accreditation of certification service providers in the Member States may create a significant barrier to the use of electronic communications and electronic commerce; whereas clear common framework conditions for electronic signatures, on the other hand, will strengthen confidence in and general acceptance of the new technologies; whereas divergent actions in the Member States must not be allowed to hinder the free movement of goods and services in the internal market;
AMENDED PROPOSAL (Recital 4):
SAME AS EP 1ST READING
COUNCIL COMMON POSITION(Recital 4):
Whereas electronic communication and commerce necessitate "electronic signatures" and related services allowing data authentication; whereas divergent rules with respect to legal recognition of electronic signatures and the accreditation of certification-service providers in the Member States may create a significant barrier to the use of electronic communications and electronic commerce; whereas, on the other hand, a clear Community framework regarding the conditions applying to electronic signatures will strengthen confidence in, and general acceptance of, the new technologies; whereas legislation in the Member States should not hinder the free movement of goods and services in the internal market;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
HARD TO TELL / GREEN
#^3. Recital 5 in Common Position (IMPORTANT)
Council Common Position adds two relevant regulations to be conditioned on. EP 2ND READING and Final Act adopted Council Common Position.
ORIGINAL PROPOSAL (Recital 5):
Whereas the interoperability of electronic signature products should be promoted; whereas, in accordance with Article 7a of the Treaty, the Internal Market is to comprise an area in which the free movement of goods is to be ensured; whereas essential requirements specific to electronic signature products used by certification service providers must be met in order to ensure free circulation within the Internal Market and to build trust in electronic signatures;
COUNCIL COMMON POSITION(Recital 5):
Whereas the interoperability of electronic-signature products should be promoted; whereas, in accordance with Article 14 of the Treaty, the internal market comprises an area without internal frontiers in which the free movement of goods is ensured; whereas essential requirements specific to electronic-signature products must be met in order to ensure free movement within the internal market and to build trust in electronic signatures, without prejudice to Council Regulation (EC) No 3381/94 of 19 December 1994 setting up a Community regime for the control of exports of dual-use goods (5) and Council Decision 94/942/CFSP of 19 December 1994 on the joint action adopted by the Council on the basis of Article J.3 of the Treaty on European Union concerning the control of exports of dual-use goods (6);
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
GREEN / GREEN
#4. Recital 6 in EP 1st Reading (not IMPORTANT)
EP 1ST Reading deleted the last sentence stating that “digital signatures based on public-key cryptography are currently the most recognized form of electronic signature” and Amended Proposal, Council Common Position, EP 2nd Reading, and Final Act adopted it.
ORIGINAL PROPOSAL (Recital 6):
Whereas the rapid technological development and the global character of the Internet necessitate an approach which is open to various technologies and services capable of authenticating data electronically; whereas, however, digital signatures based on public-key cryptography are currently the most recognised form of electronic signature;
EP 1ST READING (Recital 6):
Whereas the rapid technological development and the global character of the Internet necessitate an approach which is open to various technologies and services capable of authenticating data electronically;
COUNCIL COMMON POSITION(Recital 8):
SAME AS EP 1ST READING
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#5. Recital 6a(new) in EP 1st Reading (important)
EP 1ST READING newly introduced this recital calling for the Commission’s review of this Directive before 2003 and its examination of the implications of associated technical areas such as confidentiality and its submission of a report to the EP and the Council. Amended Proposal adopted EP 1st reading with slight changes in wording. Council Common Position replaced “before 2003” with “two years after its implementation” and deleted the word, “confidentiality” from its goals. EP 2ND READING and Final Act adopted Council Common Position.
COUNCIL COMMON POSITION(Recital 27):
Whereas two years after its implementation the Commission will carry out a reviewof this Directive so as, inter alia, to ensure that the advance of technology or changes in the legal environment have not created barriers to achieving the aims stated in this Directive; whereas it should examine the implications of associated technical areas and submit a report to the European Parliament and the Council on this subject;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
GREEN / GREEN
#^6. Recital 9(new) in Common Position (not important)
Council Common Position newly introduced this recital stating the range of new services and products related to or using electronic signatures. EP 2ND READING and Final Act adopted this.
COUNCIL COMMON POSITION(Recital 9):
Whereas electronic signatures will be used in a large variety of circumstances and applications, resulting in a wide range of new services and products related to or using electronic signatures; whereas the definition of such products and services should not be limited to the issuance and management of certificates, but should also encompass any other service and product using, or ancillary to, electronic signatures, such as registration services, time-stamping services, directory services, computing services or consultancy services related to electronic signatures;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#^7. Recital 10 in Common Position (not important)
Council Common Position deleted the phrase stating that “there is no immediate need to ensure the free circulation….” And instead, it added a new phrase defining “prior authorization” in detail. EP 2ND READING and Final Act adopted it.
ORIGINAL PROPOSAL (Recital 7):
Whereas the internal market enables certification services providers to develop their cross-border activities with a view to increasing their competitiveness, and thus to offer consumers and business new opportunities to exchange information and to trade electronically in a secure way, regardless of frontiers; whereas in order to stimulate the Community-wide provision of certification services over open networks, certification service providers should in general be free to offer their services without prior authorization; whereas there is no immediate need to ensure the free circulation of certification services by harmonizing justified and proportionate national restrictions on the provision of those services;
COUNCIL COMMON POSITION(Recital 10):
Whereas the internal market enables certification-service-providers to develop their cross-border activities with a view to increasing their competitiveness, and thus to offer consumers and businesses new opportunities to exchange information and trade electronically in a secure way, regardless of frontiers; whereas in order to stimulate the Community-wide provision of certification services over open networks, certification-service-providers should be free to provide their services without prior authorisation. Prior authorisation means not only any permission whereby the certification-service-provider concerned has to obtain a decision by national authorities before being allowed to provide its certification services, but also any other measures having the same effect.
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#^8. Recitals 12 and 14 in Common Position (important)
Council Common Position adds a new phrase stating that “certification services can be offered either by a public entity or a legal or natural person, when it established in accordance with the national law” and it replaced “such” with “voluntary.” EP 2ND READING and Final Act adopted it.
ORIGINAL PROPOSAL (Recital 8, last sentence):
….whereas Member States should not prohibit certification service providers from operating outside such accreditation schemes;whereas it should be ensured that accreditation schemes do not reduce competition for certification services; whereas it is important to strike a balance between consumer and business needs;
COUNCIL COMMON POSITION(Recital 12):
Whereas certification services can be offered either by a public entity or a legal or natural person, when it is established in accordance with the national law; whereas Member States should not prohibit certification-service-providers from operating outside voluntary accreditation schemes; whereas it should be ensured that such accreditation schemes do not reduce competition for certification services; (LAST SENTENCE IS RELOCATED TO RECITAL 14 VERBATIM)
COUNCIL COMMON POSITION(Recital 14):
Whereas it is important to strike a balance between consumer and business needs;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
GREEN / RED
#^9. Recital 13(new) in Common Position (not important)
Council Common Position newly introduces this recital on the supervision of compliance. It is up to Member States. EP 2nd Reading and Final Act adopted it.
COUNCIL COMMON POSITION(Recital 13):
Whereas Member States may decide how they ensure the supervision of compliance with the provisions laid down in this Directive; whereas this Directive does not preclude the establishment of private-sector-based supervision systems; whereas this Directive does not oblige certification-service-providers to apply to be supervised under any applicable accreditation scheme;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#^10. Recital 15(new) in Common Position (important)
Council Common Position newly introduces this recital on Annex III covering requirements for secure signature-creation devices. EP 2nd reading and Final Act adopted it.
COUNCIL COMMON POSITION(Recital 13):
Whereas Annex III covers requirements for secure signature-creation devices to ensure the functionality of advanced electronic signatures; whereas it does not cover the entire system environment in which such devices operate; whereas the functioning of the internal market requires the Commission and the Member States to act swiftly to enable the bodies charged with the conformity assessment of secure signature devices with Annex III to be designated; whereas in order to meet market needs conformity assessment must be timely and efficient ;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
GREEN / GREEN
#^11. Recitals 16 in Common Position (important)
**note: I don’t think this relieves restrictions but what do you think? Original Proposal states that the framework does not apply to the closed systems (expansion) but Council Common Position introduces exceptions to it (adds restrictions). EP 2nd reading basically adopts it with more precise wordings.
Council Common Position adds new phrase calling for exceptions where this regulatory framework should be applied even for electronic signatures within closed user-groups. EP 2ND Reading defines “closed systems” such that “the one based on voluntary agreements under private law between a specified number of participants.” It highlights that “the legal effectiveness of electronic signatures used in such systems and their admissibility as evidence in legal proceedings must be recognized.” Final Act adopted EP 2nd Reading with slight wording changes.
ORIGINAL PROPOSAL (Recital 9, first-third sentence):
Whereas this Directive should therefore contribute to the use and legal recognition of electronic signatures within the Community; whereas a regulatory framework is not needed for electronic signatures exclusively used within closed systems; whereas the freedom of parties to agree among themselves the terms and conditions under which they accept electronically signed data should be respected to the extent allowed by national law…
FINAL ACT (Recital 16):
This Directive contributes to the use and legal recognition of electronic signatures within the Community; a regulatory framework is not needed for electronic signatures exclusively used within systems, which are based on voluntary agreements under private law between a specified number of participants; the freedom of parties to agree among themselves the terms and conditions under which they accept electronically signed data should be respected to the extent allowed by national law; the legal effectiveness of electronic signatures used in such systems and their admissibility as evidence in legal proceedings should be recognised;
GREEN / GREEN
#^12. Recitals 17 in Common Position (not important)
Council common position largely adopted Original Proposal but there are some slight changes in wording. EP 2nd Reading and Final Act adopted it.
ORIGINAL PROPOSAL (Recital 9, fourth and fifth sentences):
…whereas this Directive is not intended to harmonize national rules concerning contract law, particularly the formation and performance of contracts, or other non-contractual formalities requiring signatures; whereas for this reason the provisions concerning the legal effect of electronic signatures should be without prejudice to formal requirements prescribed by national law with regard to the conclusion of contracts or the rules determining where a contract is concluded;
COUNCIL COMMON POSITION(Recital 17):
Whereas this Directive does not seek to harmonise national rules concerning contract law, particularly the formation and performance of contracts, or other formalities of a non-contractual nature concerning signatures; whereas for this reason the provisions concerning the legal effect of electronic signatures should be without prejudice to requirements regarding form laid down in national law with regard to the conclusion of contracts or the rules determining where a contract is concluded;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#^13. Recital 18(new) in Common Position (not important)
Council Common Position newly introduces this recital warning that the storage and copying of signature-creation data could cause a threat to the legal validity of electronic signatures. EP 2nd Reading and Final Act adopted it.
COUNCIL COMMON POSITION(Recital 18):
Whereas the storage and copying of signature-creation data could cause a threat to the legal validity of electronic signatures;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#^14. Recital 19(new) in Common Position (important)
Council common position newly introduces this recital calling for electronic signature’s usage in the public sector. EP 2nd Reading and Final Act adopted it.
COUNCIL COMMON POSITION(Recital 19):
Whereas electronic signatures will be used in the public sector within national and Community administrations and in communications between such administrations and with citizens and economic operators, for example in the public procurement, taxation, social security, health and justice systems;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
GREEN / GREEN
#^15. Recital 20 in Common Position (not important)
Council Common Position adds new paragraphs stating that national laws lay down different requirements for the legal validity of hand-written signatures and defining the relationship between qualified certificates and advanced electronic signatures. EP 2ND READING and Final Act adopted it.
ORIGINAL PROPOSAL (Recital 10, last sentences):
… whereas harmonized rules concerning the legal effect of electronic signatures will preserve a coherent legal framework across the Community;
COUNCIL COMMON POSITION(Recital 20):
Whereas harmonised criteria relating to the legal effects of electronic signatures will preserve a coherent legal framework across the Community; whereas national law lays down different requirements for the legal validity of hand-written signatures; whereas certificates can be used to confirm the identity of a person signing electronically; whereas advanced electronic signatures based on qualified certificates aim at a higher level of security; whereas advanced electronic signatures which are based on a qualified certificate and which are created by a secure-signature-creation device can be regarded as legally equivalent to hand-written signatures only if the requirements for hand-written signatures are fulfilled;
FINAL ACT:
SAME AS COUNCIL COMMON POSITION
#^16. Recitals 21 in Common Position (important)
Council Common Position deleted the phrases on the case where an electronic signature should not be denied legal validity. Instead, it newly adds the phrases asking for national law and courts to govern the use of electronic signatures. It replaces the word, “signatures” with “authentication methods.” EP 2ND READING AND Final Act largely adopted Council Common Position.
ORIGINAL PROPOSAL (Recital 10, first-fifth sentences):
Whereas in order to contribute to the general acceptance of electronic signatures, an electronic signature should not be denied legal validity solely on the grounds that it is in the form of electronic data,not based upon a qualified certificate or upon a certificate issued by an accredited certification service provider, or that the service provider who has issued the related certificate is from another Member State;whereas electronic signatures which are related to a trustworthy certification service provider who complies with the essential requirements should have the same legal effect as hand written signatures; whereas it has to be ensured that electronic signatures can be used as evidence in legal proceedings in all Member States; whereas the legal recognition of electronic signatures should be based upon objective criteria and not be linked to authorization of the service provider involved;…