COVID-19 Serbia Update

E-Signature in Serbia

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

Legal framework

In the Republic of Serbia, electronic signatures are regulated by the Law on Electronic Document, Electronic Identification and Trust Services in Electronic Business (Serbian Zakon o elektronskom dokumentu, elektronskoj identifikaciji i uslugama od poverenja u elektronskom poslovanju; “Law”).

The Law, which defines three types of electronic signatures (“simple” electronic signature, advanced electronic signature and qualified electronic signature), provides that an electronic signature shall not be denied legal effect and admissibility as evidence in legal proceedings solely on the grounds that it is in an electronic form or does not meet the requirements of a qualified electronic signature, which is explicitly given the same legal effect as a handwritten signature.

In terms of evidentiary value, in case of a “simple” electronic signature and an advanced electronic signature, a burden of proof for proving the authenticity of the electronic signature lies with a person claiming its authenticity. In case of a qualified electronic signature, its authenticity is presumed.

When are electronic signatures allowed?

The Law specifically confirms that an electronic form of a document shall be deemed equivalent to its written form, provided that the data in an electronic form is accessible and suitable for subsequent reference.

Use cases where electronic signatures are typically allowed:[1]

  • commercial agreements and documents, including NDAs, LOIs, purchase orders, order confirmations, invoices, sales agreements, distribution agreements, service agreements, loan agreements, lease agreements;
  • consumer agreements, including agreements for purchase of goods and services, consumer loan agreements, lease agreements;
  • intangible property agreements, including license agreements; and
  • HR documents, including employment contracts, NDAs and notices of termination.

A qualified electronic signature is specifically required for signing documentation related to the Serbian Business Registers Agency, e.g. for the submission of the registration form for incorporation of the company, registration of an ultimate beneficial owner or submitting annual financial statements.

When are electronic signatures not appropriate?

In certain cases, the Law explicitly excludes the equivalence of an electronic form of a document with a written form. The use of electronic signature is not possible with respect to agreements and other legal transactions where a special regulation provides that the signature of a person/document has to be certified or notarized before a notary public.

Such cases that are accordingly not appropriate for electronic signatures include:

  • legal transactions by which property rights to real estate are transferred or by which some other real right to real estate is established, including mortgage and loan agreements;
  • cases regulated by the inheritance law, such as a testament;
  • agreements regulating property relationships between spouses; and
  • other agreements that are to be concluded in the form of a notarial deed (e.g. share pledge agreements, share purchase agreements, etc.).

Serbia generally has limited practice regarding the use of a “simple” and advanced electronic signatures. It remains to be seen how the local courts will treat agreements that have to be executed in a written form pursuant to the statutory provisions but are signed with a “simple” or an advanced electronic signature (not qualified electronic signatures).

Can blockchain technology be used for electronic signatures?

Yes, provided that blockchain technology could satisfy the requirements set out in the eIDAS Regulation for electronic signatures.

At first glance, it seems that blockchain technology could easily satisfy the requirements for a “simple” electronic signature. Even a scanned signature that is attached to a document falls within the definition of a “simple” electronic signature under the eIDAS Regulation.

As for the advanced and qualified electronic signature, whether blockchain technology satisfies the requirements set out in the eIDAS Regulation needs to be assessed on a case-by-case basis. In order for an electronic signature to be recognized as an advanced, it must be (i) uniquely linked to the signatory, (ii) capable of identifying the signatory, (iii) created using electronic signature creation data the signatory can, with a high level of confidence, use under their sole control, and (iv) linked to the data signed therewith in such a way that any subsequent change in data is detectable. There are blockchain frameworks which would not satisfy the above-mentioned 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.

The bar is set even higher for qualified electronic signatures, as these need to satisfy the requirements for advanced electronic signatures and to have the signature created by a qualified electronic signature creation device. Whether this is feasible will also largely depend on the individual blockchain framework but does not seem impossible (at least not from a legal perspective).

[1] A qualified electronic signature might be required by the legislation or in cases where a written form is prescribed for the valid conclusion of the agreement, e.g. in case of employment contracts, construction contracts, license contracts, and others.

 

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

serbia@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).