COVID-19 North Macedonia Update

E-Signature in North Macedonia

This article provides a general legal overview of the applicable laws and use cases pertaining to electronic signatures in North .

Legal framework

In the Republic of North Macedonia, electronic signatures are regulated by the Law on Data in Electronic Form and Electronic Signature (Macedonian Закон за податоците во електронски облик и електронски потпис; “Current Law”).

The Current Law defines two types of signatures: an electronic signature (“Electronic Signature”) and an advanced electronic signature (“Advanced Electronic Signature”).

The Electronic Signature represents data in an electronic form which are attached to or logically associated with other electronic data and which serve as a method of authentication.

The Advanced Electronic Signature, on the other hand, represents an electronic signature which meets the following requirements:

  • it is uniquely linked to the signatory;
  • it is capable of identifying the signatory;
  • it is created using means that the signatory can maintain under his/her sole control; and
  • it is linked to the data to which it relates in such a manner that any subsequent change of the data is detectable.

Please note that in 2019, the Republic of North Macedonia enacted the Law for Electronic Documents, Electronic Identification and Confidential Services (“New Law”), which is in line with the Regulation (EU) No. 910/2014 on electronic identification and trust services for electronic transactions in the internal market. The New Law will start to apply as of 1 September 2020 and will replace the Current Law. The New Law will introduce several changes, for example:

  • it will explicitly differentiate between three types of electronic signatures: “simple” electronic signature, advanced electronic signature, and qualified electronic signature;
  • it will regulate trust services and electronic identification schemes which will be registered in a separate registry; and
  • it will introduce electronic registered delivery services.

The information provided herein is based on the provisions of the Current Law.

When are electronic signatures allowed?

The Advanced Electronic Signature certified with a qualified certificate is equal to a handwritten signature and therefore has equal validity and evidentiary value.

Use cases where electronic signatures are typically allowed include:

  • documents that have a statutorily required written form – in line with local practice only the Advanced Electronic Signatures (and not the Electronic Signature) can be used. However, in line with the letter of the Current Law, the Electronic Signature should be acceptable in these situations as well. Such documents could include: (i) construction agreements; (ii) license agreements; (iii) consumer agreements, etc.
  • documents that do not have a statutorily required written form – either the Electronic Signature or the Advanced Electronic Signatures can be used. Some examples include: (i) commercial agreements; (ii) NDAs; (iii) distribution agreements; (iv) services agreements; (v) loan agreements, etc.

When are electronic signatures not appropriate?

In certain cases, the Current Law explicitly excludes the use of electronic signatures. Such cases include:

  • documents requiring notary certification/solemnization – neither the Electronic Signature nor the Advanced Electronic Signatures can be used (a handwritten signature is required). Some examples would include: (i) agreements for sale and purchase of real estate; (ii) agreements for the gift of real estate; (iii) agreements for the assignment of real estate during the person’s life; (iv) agreements for lifelong support; (v) agreements for transfer of industrial property rights; (vi) share purchase agreements; (vi) registered pledge agreements such as share pledge agreements, mortgage agreements, etc.
  • documents requiring handwritten signatures before a competent court (e.g. court testament, minutes, etc.) – neither the Electronic Signature nor the Advanced Electronic Signatures can be used.

Can blockchain technology be used for electronic signatures?

Even though not explicitly regulated, the wording of the applicable legislation suggests that blockchain technology can be used for electronic signatures if it satisfies requirements of the Current Law, or the New Law after its application.

From the perspective of the Current Law, blockchain technology could satisfy the requirements for the Electronic Signature, if it is able to establish the authenticity of the data and the identity of the signatory.

As for the Advanced Signature, blockchain technology would need to fulfil the following requirements: (i) being uniquely linked to the signatory, (ii) being capable of identifying the signatory, (iii) being created using means that the signatory can maintain under his/her sole control, and (iv) being linked to the data to which it relates in such a manner that any subsequent change of the data is detectable.

It would need to be assessed on a case-by-case basis whether blockchain technology satisfies the requirements of the Current Law for electronic signatures. There are blockchain frameworks which would not satisfy the above criteria by their very nature. For example, certain frameworks employ pseudo-anonymity, so it could be argued these frameworks are not capable of identifying the signatory.

If you have any questions related to this article, please do not hesitate to contact:

macedonia@karanovicpartners.com

 

The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only. In addition, each electronic signature solution using blockchain or other similar technology should be analysed from a perspective of different legal areas (e.g. especially from the perspective of data privacy).