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Signing contracts legally online (and having them signed) - what you need to know
Updated on 10.02.2023
Tedious contract processes are a thing of the past - but how does it work to sign contracts easily and securely online? In this article, you will learn how contracts are signed online or how signatures can be obtained on the web. What is important, what are the quality criteria? But a "spoiler" beforehand: Simple & secure can, but do not have to work together.
The electronic signature has come to stay
It's a matter of attitude. Signing a document has a certain aesthetic component. You seal a decision with something very personal: your own handwritten signature. This signature is often rehearsed and refined over years and, in most cases, remains unchanged over an entire business life. Often, the analog signature of a document is associated with a meeting, there are several parties to the contract, and there is often something social about it. People meet, shake hands, sign a document and then file it away in a more or less secure archive. In most cases, the parties are satisfied and go their separate ways.
The other side of the coin is obvious. Regardless of whether you want to map internal signature processes or external ones. It requires a very high level of resources, which can be wasted with the help of the digital signature.
The digitization of decision-making processes has already arrived even in very "old-established" industries and business fields. In the private context, the electronic signing of contracts has already been widespread for some time and is supported by state eIdentity providers in many European countries.
Accordingly, the integration of signature solutions in the corporate context very often starts from individual voices in the company who have long since become familiar with the advantages of electronic signatures in the private sector. Many government online services enable citizens to sign contracts digitally. Ultimately, this leads to entrepreneurs wanting the benefits of these online signature solutions for contract processing in their own companies as well.
How does the digital signature work?
There are more and more new, often small and free freeware signature tools circulating on the net, often keeping registration and use very low-threshold. It works just like larger tools: You have saved a digital document yourself locally, upload it to a web browser tool and sign it. With some tools, the document can also be downloaded and then sent on. In contrast, there are complex signature platforms that are often integrated into a comprehensive document management system or CRM or ERP system. This also enables the much more complex third-party signature or remote signature. This means that I can also release a self-signed document for signature, define complex signature sequences and workflows, and so on.
Especially in the professional environment, solutions are increasingly gaining acceptance that specialize in the comprehensive signing of PDF documents and offer the highest security standards and, above all, very simple user guidance. The digital signing of PDF documents via the web browser can basically be divided into three essential components.
Contract management:
Here, as mentioned, the gap is wide. The minimum criteria for a web tool is the ability to upload documents (with most applications, files are automatically converted into the common PDF format) and to download them again after the signature or to store them as securely as possible. Comprehensive tools also enable intelligent management and overview of all important documents in a central location.
The digital signature of documents:
The core element of all online signature tools is the application of the digital signature to a contract document. Applying a valid digital signature to a PDF document is a technical process that must be clearly distinguished from simply inserting an image of a manual signature without any further technical measures!
In particular, a valid digital signature allows subsequent changes to the document to be detected. This is not the case with the simple insertion of images.
Technically, for a digital signature, the content of the document is firmly linked to the applied signature. The visual appearance of the signature on the document is primarily informative and not relevant for the (technical) validity. sproof sign, for example, supports the insertion of images of a signature or the manual signature on the screen, but also creates a complete digital signature in the background.
Another level of digital signatures are qualified digital signatures. These involve verification of the signer by a trust service provider. These are organizations that perform an extensive identity check on a person or an organization and link the identity to the signature in the course of digital signing. Qualified digital signatures thus have a special legal status equivalent to that of handwritten signatures.
Signature Management & Workflows:
The full potential of signature platforms becomes apparent when it comes to sending out secure and compliant signature requests to others. E.g. sproof sign makes it possible to delegate different tasks (e.g. signing documents, viewing documents, forwarding documents) to different people. The communication happens on the one hand within the WebApp and on the other hand via mail traffic. In this way, nothing can get lost. The automated delegation also makes it easier to manage signature processes and to meet deadlines and time limits. In addition, it is possible to define substitutes, set absence notes, specify signature sequences, and define the standard that should be used for signing.
Quality first. - The quality criteria of web-based signature tools
The benefits of digital signatures are many and varied. Here is a list of the most important quality features of advanced e-signature tools:
Cloud availability and security:.
Online contracts are available anytime and anywhere as long as you have access to the Internet. The 24/7 availability is the great advantage of secure cloud solutions. However, very strict care should be taken to rely on a safe and secure storage environment that is protected from unauthorized access, loss and misuse. For cloud applications, special care should be taken to ensure that the tool is 100% hosted on European servers.
Trustworthiness of digital signatures:
In addition, attention should be paid to how one can or must prove one's own identity. A simple electronic signature (SES) offers no legal protection and should never be used for signatures in a corporate context. For the highest level of security, the qualified electronic signature (QES), which is the benchmark in Europe according to the eIDAS regulation, should be used. In fact, the choice of signature provider is of particular importance and a certain basic knowledge of the three different signature standards is required in order to be able to map the use cases in one's own company in the best possible way.
Verify applied electronic signatures:
Another great thing is that e-signatures are verifiable forever and ever. The information about every step of the signature process - from start to finish - including the applied signatures and the unique identity of the signer(s) are inseparably anchored in the pdf document for all time. Comprehensive e-signature solutions (such as sproof sign) allow verification directly on the platform.
Collaboration:
Signing is a team effort. Sign internally or get approvals from external stakeholders. It is important to be able to manage your team very easily with an admin account. New users should be able to be added very easily and the pool of available signature units must be able to be increased very easily.
Compliance:
It is mandatory for companies to comply with applicable laws and regulations, especially with regard to secure and legally compliant document and data storage in the European area. A few tools (e.g. sproof sign) rely on the very high PDF/A document standard.
Conclusion:
It's time to sign. Web-based e-signature services are an interesting and useful way to simplify business processes and save time and effort. In a business context, it is important that it meets all relevant requirements for the particular use case.
sproof sign is the highest-rated provider in the e-signature category on the independent evaluation platform OMR Reviews for Q3 and Q4 2023, as well as Q1 2024.