Want to Use Electronic Signatures in Australia? Here's What You Need to Know

While electronic signatures are widely used in Australia, the laws are slightly different than those in the EU and US. Here's what you need to know and what to look out for when using eSignatures in Australia.

Electronic signature laws and regulations in Australia

The Electronic Transactions Act (ETA) provides a general legal framework for the use of electronic signatures. Under the ETA, electronic signatures are as legally valid as handwritten signatures, as long as:

• They confirm signer identity and their intention to sign

• They're as reliable as appropriate for the purpose of the transaction or the document signed

• They show consent to the method of signing used

However, the electronic signature situation in Australia gets more complicated. Due to its administrative division to States and Territories, electronic signature regulations can differ from one place to another.

While the ETA provides a national framework for electronic signature regulation, there are some exceptions. In Australia, there are State and Territory specific laws known as local ETAs that apply to transactions governed by the laws of specific States and Territories.

For example, local ETAs govern general contract law, property law, witnessing requirements, and deed execution. They also govern any documents submitted to the State or Territory government body.

What does "as reliable as appropriate" actually mean?

What's considered reliable is a matter of personal opinion, so you might see the condition of "as realiable as appropriate" as pretty vague. For context, the Australian courts have upheld the validity of signatures drawn on a computer trackpad, on the condition the electronic signature resembles a handwritten one sent by fax.

While this might seem like the threshold is low, what it really depends on is how electronic signature validity is assessed by specific State or Territory. So, when doing business with different jurisdictions with specific compliance requirements, your best bet for risk management is to use eSignature software.

What about the consent requirement?

The consent requirement for eSignatures in Australia means all parties involved understand the implications of signing electronically. This includes their rights, obligations, and the legal significance of using electronic signatures.

Consent can be express or inferred. For example, express consent would be ticking a checkbox agreeing to sign a document electronically. On the other hand, inferred consent means that, by using an eSignature, a signer consents to the use of that signature for its intended purpose.

Documents that can be signed electronically

In Australia, electronic signatures can be used to sign a wide range of documents across industries. Under Australian Commonwealth law, a transaction will not be invalid just because it was conducted electronically.

This means that, if you're legally required to provide a signature, produce a document, or record or retain information, you may do so electronically. This includes electronic signatures on:

• Legal agreements (contracts for services or goods, lease agreements, employment contracts, consent forms, NDAs)

• Government forms (tax declarations, applications for licenses)

• Financial documents (loan agreements, insurance policies)

That said, keep in mind that local electronic transactions regulations might contain additional conditions for electronic signing. In addition to that, there are several exemptions from the nation-wide Electronic Transactions Act prescribed by the Electronic Transactions Regulations. In other words, if you want to execute documents governed by a law exempt from the Electronic Transactions Act, you might have to stick to paper and ink.

Documents that usually can't be signed electronically

Seeing that each Australian jurisdiction has its own electronic signature laws, they also have their own specific exemptions. However, there are five general transaction categories that usually can't be electronic transactions. This includes:

• Documents for court proceedings

• Documents that must or are permitted to be served personally

• Powers of attorney

• Wills

• Documents that must be notarized

Additional considerations

To make sure your electronic documents are legally valid, sometimes you'll have to take extra precautions. For example, the national Corporations Act is entirely exempt from the national ETA.

Don't worry - in practical terms, this doesn't mean that a company can't execute an electronic document. However, the Corporations Act has its own regulations on what makes a valid electronic signature. To stay on the safe side, you might want to include wording confirming that the signer is authorized to sign electronically on behalf of the company.

Speaking of wording, when the law doesn't require the document to be a deed, sign an agreement instead. An agreement is less formal and implies a mutual exchange of value, so review your wording accordingly.

Last, but not least, inferred consent is great, but express consent is better. To make your documents iron-clad, consider including wording that states the electronic signature is confirmation of consent to the terms of your agreements.

Electronic execution of proposals in Australia

We're Better Proposals so, naturally, we have to touch on relevant laws guiding the proposal process. If you're wondering whether a signed proposal can be as valid as a contract, here's the lowdown.

While you can send your proposals electronically, individual electronic signature laws by jurisdiction define what makes them legally binding. Australian Capital Territory, New South Wales, Northern Territory, Queensland, South Australia, Victoria, and Western Australia are in agreement. A proposal will be seen only as an invitation to form a contract if:

• It is not specifically addressed (i.e., the recipient (company, person) is not clearly stated in the proposal)

• It is generally accessible to anyone (e.g., anyone with access to the internet can see it)

If any one of those two conditions is met, your proposal won't be legally binding even if someone signs it. So, to make sure a proposal holds the legal validity of an agreement, you need to show they intended to make the proposal binding by signing.

With Better Proposals, that's made easy for you. First off, all our templates come with a "terms and conditions" section so you don't forget to include it.

Second, you can specify who needs to sign and in what order. Third, our signature block already comes with wording that states the signature is legally binding. And, if that's not enough for you, you can also password protect your proposals for an extra level of security.

Ready to sign documents in Australia?

So are we. Besides being compliant with electronic signature regulations, Better Proposals also lets you do business your way.

Sell in multiple currencies and tailor your tax settings to fit your local regulations. Whether you're from Australia or anywhere else in the world, we've got you.