Electronic signatures and communications in Italy during COVID-19

Amidst the COVID-19 emergency, we are all required to stay home and abide by the orders of the authorities. But business continuity must be preserved, and we must do all necessary to ensure that this continuity is consistent with applicable rules and laws.

It is therefore worth keeping in mind the available tools that EU and local legislation have granted to benefit from technology so that people are not required to travel around or congregate (to the maximum extent that this is possible).

Some of these tools are electronic signatures and, more generally, means of electronic communication.

A. How does it work in EU?

Electronic signature means data in electronic form which is attached to or logically associated with other data in electronic form and which is used by a natural person who creates an electronic signature. eIDAS Regulation 910/2014 (eIDAS Regulation) differentiates between three sorts of electronic signature, i.e. Simple Electronic Signature (SES), Advanced Electronic Signature (AES) and Qualified Electronic Signature (QES).

• QES has the equivalent legal effect of a handwritten signature.
• SES and AES can also have the equivalent legal effect of a handwritten signature. However, the party presenting the SES or AES may need to have sufficient evidence to prove that it is valid.

Member States shall also recognize and admit other types of electronic signatures, as eIDAS sets minimum, and not maximum, requirements.

B. How does it work in Italy?

eIDAS Regulation was implemented in Italy through Legislative Decree no. 82/2005, also known as the Digital Administration Code (DAC), then amended by Legislative Decree no. 179/2016 and by Decree no. 217/2017 (2017 Decree) that mainly concern technical and administrative aspects.

C. Are QES, AES and SES, as contained in the eIDAS Regulation, valid and effective also in Italy?

Yes, they were fully transposed into the DAC and are therefore valid.

D. Something else / new definitions?

DAC also contains a definition of digital signature (DS) in the following terms: “a particular kind of qualified electronic signature based on a system of two cryptographic keys (a public one and a private one) which allows the signatory - by means of the private key - and the recipient - by means of the public key- to make evident and verify the provenance and integrity of an electronic document or a set of electronic documents”.

E. So, can we remotely sign a contract?

DS, AES and QES can be validly used also to sign documents and contracts for which the law mandatorily requires the written form for the validity thereof.

Therefore, an electronic document (including a contract) signed by means of AES, QES and DS satisfies the written form requirement and it is given the fullest probative effect.

SES can be used for any other document, but when an electronic document is signed with a SES, its capability of meeting the written form requirement and its probative value are freely assessable by the judge within a trial in relation to its security, integrity and non-modifiability.

F. What about authentication processes and cases in which the presence of a notary is required?

The authentication procedure of the electronic signature consists in the certification, by the notary, that the signature was signed in the notary’s presence and subject to prior assessment of signatory’s personal identity, the validity of the electronic certificate used (if any) and that the signed document is not against the law.
A number of deeds must be mandatorily made by the Notary in the presence of all the parties, under penalty of nullity, with the notary certifying both the identity of the signatories and the contents of their declarations.
However, Law no. 110/2010 tried to partially overcome the issue of physical presence by creating the “electronic public deed” (atto pubblico informatico).

G. What is an electronic public deed?

An electronic public deed enables the creation of a deed that can be signed with a DS.

Once completed, electronic public deeds have the same legal effect as those signed with wet-ink signatures. For example, deeds concerning extraordinary corporate transactions (eg transformations, mergers and demergers, transfers of going concerns) can be in the form of an electronic public deed.

The hurdle is that Notary legislation impose the notary must physically see and be in the presence of the party using the DS, and this requires the party to be physically before the notary, even if the deed is electronic.

The very interesting part is that notary authentication can occur in different locations (with different notaries), to limit the need for people to move around and congregate. In practical terms, this means that an electronic public deed can be signed with a DS before a notary in location 1 and then sent (via email) to location 2, where the other party can then sign with a DS, and the second notary completes the deed.

H. What happens in the banking system?

Electronic signatures have been implemented and adopted into the Italian banking system, and this complies with DAC rules. DS is the most preferred and used means of execution.

Below are some examples of the use of DS in banking activities:

• forms concerning front office operations;
• forms concerning securities dealings /MiFID questionnaires;
• privacy consent;
• forms for customer identification and verification;
• contractual documents concerning products/services offered by a bank:
• current accounts;
• credit cards, debit cards, reloadable cards, and prepaid cards;
• multichannel bank services;
• custodian services;
• certificates of deposit and savings;
• other documents (to be verified by the bank).

I. Can we run anti-money laundering activities without a physical presence?

According to Article 19, paragraph 1 of Legislative Decree no. 231/2007 (AML Decree), proof of identity can be presented in paper or electronic form. However, for identification purposes, the customer must be physically present (and provide his/her I.D. either in paper or electronic form). The need for a customer to be physically present for identification purposes can be only circumvented in a few cases, including:

• clients who have already been identified by the bank and whose data is being updated;
• clients whose identification data can be found from public deeds, private authenticated deeds, or through qualified certificates used for the generation of a DS, associated with electronic documents;
• clients who have a digital identity or a certificate for the generation of a digital signature released under an electronic identification scheme published by the European Commission under Article 9 of the eIDAS Regulation.

J. How does this work with public contracts and related filings?

The Law on Public Contracts no. 50/2016 (which entered into force in 2018) introduced the concept of e-procurement, e-notification and e-access in order to guarantee the digitalisation of the entire public sector and guarantee that every step of a public contract is executed digitally.

For applications to be submitted to public administrations and public service operators, according to the DAC, advanced, qualified, and digital electronic signatures are considered valid as well as other types of identification, such as the "Spid” (another kind of e-signature approved by the guidelines set forth in the DAC), in addition to the submission of a wet-ink signature together with a copy of a valid form of I.D.

K. Digitalisation amidst COVID-19

The Italian government is working tirelessly to implement new provisions to handle the emergency. The brand-new Law Decree No. 18 of 17 March 2020 (Law Decree) focused on enhancing digitalisation to facilitate citizens and enterprises during this period, with the following articles in particular being important:

• Articles 75 and 76 encourage home working, also within public administration, and the purchase of greater IT infrastructures, such as SaaS solutions.
• Article 82 includes a recommendation that Telco companies provide and improve their services and connections with no interruptions to guarantee the public interest.
• Article 106 envisages corporate law principles (please see below and our previous article, which examines this matter in detail)
• Articles 117 and 118 envisaged the extension of the powers of the Italian Telecommunications Authority and the Italian Data Protection Authority to May 2020.

With reference to corporate law aspects, the government’s actions have had a huge impact on the regulation of shareholders' meetings of companies in order to balance their needs with the needs arising from the national health emergency.

Specifically, all shareholders’ meetings that are to be called by 31 July 2020 or (if later) the date on which the state of emergency still exists, the Decree envisages the possibility, also by way of any derogation from applicable articles of association, to vote electronically or by correspondence, as well as to attend shareholders’ meetings virtually, without the need for the chair, secretary, or notary to be in the same place.

Skype, WhatsApp and all other digital video conferencing platforms are among those that can easily be used to carry on shareholders’ meetings in compliance with corporate regulations.

Notices of call: creation of a group and invitation link to be sent to all shareholders; the connection between the owner of the phone number and the shareholder is the same as the use of an email account.

Meeting: chair, secretary or notary are in different places. The chair asks the members to confirm their identity through pictures, videos or by sending a copy of their ID. Once the meeting is declared valid, the chair starts the discussion by following the agenda (also by sending documents to the group). The group expresses its vote through a written text message or voice message, and the chair declares the results and the end of the meeting.

Finally, the notary drafts the meeting minutes and signs the minutes (when the meeting is an extraordinary meeting as per the Italian Civil Code, requiring the notary to be present and to sign).

Find out more about remote execution of e signatures in Luxembourg and in Ireland.

See our Coronavirus (COVID-19) feature for more information generally on the possible legal implications of COVID-19.