Electronic signatures could save $400m a year
Originally published in the Australian Financial Review.
Written by Jacob Greber.
The use of electronic signatures and digital witnessing of documents – which has flourished under emergency pandemic rules – should be made permanent across the nation, according to a federal deregulation taskforce.
With more than 4.5 million deeds and 3.8 million statutory declarations signed each year by small and medium firms, the greater use of digital execution would save more than $400 million in direct cost and time wasted, it says.
As the pandemic struck last year, most jurisdictions allowed a wider use of electronic signatures and audio-visual verification of important documents. The changes would be a boon for lawyers and contract negotiators, and would accelerate trends that are already under way in sectors such as property.
Michael Pallier, from Sothebey’s International Realty in Sydney, was reported by The Australian Financial Review on Monday saying that contracts on homes were increasingly being signed through digital platforms such as DocuSign. “People don’t want to touch documents because of the virus,” he said.
“The disruptions from COVID-19 showed that we can use technologies to create secure, accessible and consistent pathways for executing these important documents, while maintaining the paper-based option,” said Attorney-General Michaelia Cash.
The federal government will on Tuesday release a consulting paper, which argues that Commonwealth and state laws have not kept pace with technology and highlights how Australians increasingly seek to settle contracts and other vital paperwork.
Ms Cash reiterated the federal government’s plan to make permanent under the Corporations Law a series of temporary measures that are due to expire in March next year.
“These measures replaced requirements for company officers to physically sign the same hard copy of a document to execute a document, including deeds, on behalf of a company,” the government said in the paper.
“These reforms not only allowed companies to continue to operate during the height of the COVID-19 crisis but also demonstrated the value these reforms provided through increased flexibility and a reduction in time and costs for business.”
A key push is to ensure greater use of electronic signatures and witnessing is available across jurisdictions with a common set of standards.
The government has invited businesses and individuals to give their views on how technology can streamline important paperwork. It hopes to present a final report to state, federal and territory ministers in November.
Modelling done for the government showed that 34 per cent of small business owners had signed a statutory declaration over the past year, and a similar proportion had dealt with deeds.
Consumers and small to medium-sized companies spent about 9 million hours printing and collecting stat declarations, travelling to the locations of legitimate witnesses such as justices of the peace, discussing and filling out declarations with witnesses, producing copies and submitting completed declarations.
Deeds sucked up another 6 million hours.
“This provides us an opportunity to go back to first principles with stakeholders, to future‑proof legislation and, for the first time in the history of federation, provide a common approach to document execution,” Ms Cash said in a statement.
“The government is committed to its plan for economic recovery, and modernising document execution will complement our Digital Economic Strategy and other reforms underway to modernise business communications.”
Ben Morton, Assistant Minister to the Prime Minister and Cabinet, said the government was committed to modernising document execution.
“Giving businesses and individuals access to technologies that make document execution easier, while maintaining safeguards, is the way Australians want to engage digitally,” Mr Morton said.
The submissions close on October 8.
Jacob Greber writes about politics, economics and business from Canberra. He has been a Washington correspondent and economics correspondent. Connect with Jacob on Twitter. Email Jacob at firstname.lastname@example.org