PUBLIC LAW 106–229—JUNE 30, 2000

ELECTRONIC SIGNATURES IN GLOBAL AND

NATIONAL COMMERCE ACT

114 STAT. 464 PUBLIC LAW 106–229—JUNE 30, 2000

Public Law 106–229

106th Congress

An Act

To facilitate the use of electronic records and signatures in interstate or foreign

commerce.

Be it enacted by the Senate and House of Representatives of

the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Electronic Signatures in Global

and National Commerce Act’’.

TITLE I—ELECTRONIC RECORDS AND

SIGNATURES IN COMMERCE

SEC. 101. GENERAL RULE OF VALIDITY.

(a) IN GENERAL.—Notwithstanding any statute, regulation, or

other rule of law (other than this title and title II), with respect

to any transaction in or affecting interstate or foreign commerce—

(1) a signature, contract, or other record relating to such

transaction may not be denied legal effect, validity, or enforceability solely because it is in electronic form; and

(2) a contract relating to such transaction may not be

denied legal effect, validity, or enforceability solely because

an electronic signature or electronic record was used in its

formation.

(b) PRESERVATION OF RIGHTS AND OBLIGATIONS.—This title does

not—

(1) limit, alter, or otherwise affect any requirement imposed

by a statute, regulation, or rule of law relating to the rights

and obligations of persons under such statute, regulation, or

rule of law other than a requirement that contracts or other

records be written, signed, or in nonelectronic form; or

(2) require any person to agree to use or accept electronic

records or electronic signatures, other than a governmental

agency with respect to a record other than a contract to which

it is a party.

(c) CONSUMER DISCLOSURES.—

(1) CONSENT TO ELECTRONIC RECORDS.—Notwithstanding

subsection (a), if a statute, regulation, or other rule of law

requires that information relating to a transaction or transactions in or affecting interstate or foreign commerce be provided or made available to a consumer in writing, the use

of an electronic record to provide or make available (whichever

15 USC 7001.

15 USC 7001

note.

Electronic

Signatures in

Global and

National

Commerce Act.

Contracts.

June 30, 2000

[S. 761]

PUBLIC LAW 106–229—JUNE 30, 2000 114 STAT. 465

is required) such information satisfies the requirement that

such information be in writing if—

(A) the consumer has affirmatively consented to such

use and has not withdrawn such consent;

(B) the consumer, prior to consenting, is provided with

a clear and conspicuous statement—

(i) informing the consumer of (I) any right or option

of the consumer to have the record provided or made

available on paper or in nonelectronic form, and (II)

the right of the consumer to withdraw the consent

to have the record provided or made available in an

electronic form and of any conditions, consequences

(which may include termination of the parties’ relationship), or fees in the event of such withdrawal;

(ii) informing the consumer of whether the consent

applies (I) only to the particular transaction which

gave rise to the obligation to provide the record, or

(II) to identified categories of records that may be

provided or made available during the course of the

parties’ relationship;

(iii) describing the procedures the consumer must

use to withdraw consent as provided in clause (i) and

to update information needed to contact the consumer

electronically; and

(iv) informing the consumer (I) how, after the consent, the consumer may, upon request, obtain a paper

copy of an electronic record, and (II) whether any fee

will be charged for such copy;

(C) the consumer—

(i) prior to consenting, is provided with a statement

of the hardware and software requirements for access

to and retention of the electronic records; and

(ii) consents electronically, or confirms his or her

consent electronically, in a manner that reasonably

demonstrates that the consumer can access information

in the electronic form that will be used to provide

the information that is the subject of the consent;

and

(D) after the consent of a consumer in accordance

with subparagraph (A), if a change in the hardware or

software requirements needed to access or retain electronic

records creates a material risk that the consumer will

not be able to access or retain a subsequent electronic

record that was the subject of the consent, the person

providing the electronic record—

(i) provides the consumer with a statement of (I)

the revised hardware and software requirements for

access to and retention of the electronic records, and

(II) the right to withdraw consent without the imposition of any fees for such withdrawal and without the

imposition of any condition or consequence that was

not disclosed under subparagraph (B)(i); and

(ii) again complies with subparagraph (C).

(2) OTHER RIGHTS.—

(A) PRESERVATION OF CONSUMER PROTECTIONS.—

Nothing in this title affects the content or timing of any

disclosure or other record required to be provided or made

114 STAT. 466 PUBLIC LAW 106–229—JUNE 30, 2000

available to any consumer under any statute, regulation,

or other rule of law.

(B) VERIFICATION OR ACKNOWLEDGMENT.—If a law that

was enacted prior to this Act expressly requires a record

to be provided or made available by a specified method

that requires verification or acknowledgment of receipt,

the record may be provided or made available electronically

only if the method used provides verification or acknowledgment of receipt (whichever is required).

(3) EFFECT OF FAILURE TO OBTAIN ELECTRONIC CONSENT

OR CONFIRMATION OF CONSENT.—The legal effectiveness,

validity, or enforceability of any contract executed by a consumer shall not be denied solely because of the failure to

obtain electronic consent or confirmation of consent by that

consumer in accordance with paragraph (1)(C)(ii).

(4) PROSPECTIVE EFFECT.—Withdrawal of consent by a consumer shall not affect the legal effectiveness, validity, or

enforceability of electronic records provided or made available

to that consumer in accordance with paragraph (1) prior to

implementation of the consumer’s withdrawal of consent. A

consumer’s withdrawal of consent shall be effective within a

reasonable period of time after receipt of the withdrawal by

the provider of the record. Failure to comply with paragraph

(1)(D) may, at the election of the consumer, be treated as

a withdrawal of consent for purposes of this paragraph.

(5) PRIOR CONSENT.—This subsection does not apply to

any records that are provided or made available to a consumer

who has consented prior to the effective date of this title to

receive such records in electronic form as permitted by any

statute, regulation, or other rule of law.

(6) ORAL COMMUNICATIONS.—An oral communication or a

recording of an oral communication shall not qualify as an

electronic record for purposes of this subsection except as otherwise provided under applicable law.

(d) RETENTION OF CONTRACTS AND RECORDS.—

(1) ACCURACY AND ACCESSIBILITY.—If a statute, regulation,

or other rule of law requires that a contract or other record

relating to a transaction in or affecting interstate or foreign

commerce be retained, that requirement is met by retaining

an electronic record of the information in the contract or other

record that—

(A) accurately reflects the information set forth in the

contract or other record; and

(B) remains accessible to all persons who are entitled

to access by statute, regulation, or rule of law, for the

period required by such statute, regulation, or rule of law,

in a form that is capable of being accurately reproduced

for later reference, whether by transmission, printing, or

otherwise.

(2) EXCEPTION.—A requirement to retain a contract or other

record in accordance with paragraph (1) does not apply to

any information whose sole purpose is to enable the contract

or other record to be sent, communicated, or received.

(3) ORIGINALS.—If a statute, regulation, or other rule of

law requires a contract or other record relating to a transaction

in or affecting interstate or foreign commerce to be provided,

PUBLIC LAW 106–229—JUNE 30, 2000 114 STAT. 467

available, or retained in its original form, or provides consequences if the contract or other record is not provided, available, or retained in its original form, that statute, regulation,

or rule of law is satisfied by an electronic record that complies

with paragraph (1).

(4) CHECKS.—If a statute, regulation, or other rule of law

requires the retention of a check, that requirement is satisfied

by retention of an electronic record of the information on the

front and back of the check in accordance with paragraph

(1).

(e) ACCURACY AND ABILITY TO RETAIN CONTRACTS AND OTHER

RECORDS.—Notwithstanding subsection (a), if a statute, regulation,

or other rule of law requires that a contract or other record relating

to a transaction in or affecting interstate or foreign commerce

be in writing, the legal effect, validity, or enforceability of an

electronic record of such contract or other record may be denied

if such electronic record is not in a form that is capable of being

retained and accurately reproduced for later reference by all parties

or persons who are entitled to retain the contract or other record.

(f) PROXIMITY.—Nothing in this title affects the proximity

required by any statute, regulation, or other rule of law with

respect to any warning, notice, disclosure, or other record required

to be posted, displayed, or publicly affixed.

(g) NOTARIZATION AND ACKNOWLEDGMENT.—If a statute, regulation, or other rule of law requires a signature or record relating

to a transaction in or affecting interstate or foreign commerce

to be notarized, acknowledged, verified, or made under oath, that

requirement is satisfied if the electronic signature of the person

authorized to perform those acts, together with all other information

required to be included by other applicable statute, regulation,

or rule of law, is attached to or logically associated with the signature or record.

(h) ELECTRONIC AGENTS.—A contract or other record relating

to a transaction in or affecting interstate or foreign commerce

may not be denied legal effect, validity, or enforceability solely

because its formation, creation, or delivery involved the action of

one or more electronic agents so long as the action of any such

electronic agent is legally attributable to the person to be bound.

(i) INSURANCE.—It is the specific intent of the Congress that

this title and title II apply to the business of insurance.

(j) INSURANCE AGENTS AND BROKERS.—An insurance agent or

broker acting under the direction of a party that enters into a

contract by means of an electronic record or electronic signature

may not be held liable for any deficiency in the electronic procedures

agreed to by the parties under that contract if—

(1) the agent or broker has not engaged in negligent, reckless, or intentional tortious conduct;

(2) the agent or broker was not involved in the development

or establishment of such electronic procedures; and

(3) the agent or broker did not deviate from such procedures.

SEC. 102. EXEMPTION TO PREEMPTION.

(a) IN GENERAL.—A State statute, regulation, or other rule

of law may modify, limit, or supersede the provisions of section

101 with respect to State law only if such statute, regulation,

or rule of law—

15 USC 7002.

Applicability.

114 STAT. 468 PUBLIC LAW 106–229—JUNE 30, 2000

(1) constitutes an enactment or adoption of the Uniform

Electronic Transactions Act as approved and recommended for

enactment in all the States by the National Conference of

Commissioners on Uniform State Laws in 1999, except that

any exception to the scope of such Act enacted by a State

under section 3(b)(4) of such Act shall be preempted to the

extent such exception is inconsistent with this title or title

II, or would not be permitted under paragraph (2)(A)(ii) of

this subsection; or

(2)(A) specifies the alternative procedures or requirements

for the use or acceptance (or both) of electronic records or

electronic signatures to establish the legal effect, validity, or

enforceability of contracts or other records, if—

(i) such alternative procedures or requirements are

consistent with this title and title II; and

(ii) such alternative procedures or requirements do not

require, or accord greater legal status or effect to, the

implementation or application of a specific technology or

technical specification for performing the functions of creating, storing, generating, receiving, communicating, or

authenticating electronic records or electronic signatures;

and

(B) if enacted or adopted after the date of the enactment

of this Act, makes specific reference to this Act.

(b) EXCEPTIONS FOR ACTIONS BY STATES AS MARKET PARTICIPANTS.—Subsection (a)(2)(A)(ii) shall not apply to the statutes, regulations, or other rules of law governing procurement by any State,

or any agency or instrumentality thereof.

(c) PREVENTION OF CIRCUMVENTION.—Subsection (a) does not

permit a State to circumvent this title or title II through the

imposition of nonelectronic delivery methods under section 8(b)(2)

of the Uniform Electronic Transactions Act.

SEC. 103. SPECIFIC EXCEPTIONS.

(a) EXCEPTED REQUIREMENTS.—The provisions of section 101

shall not apply to a contract or other record to the extent it is

governed by—

(1) a statute, regulation, or other rule of law governing

the creation and execution of wills, codicils, or testamentary

trusts;

(2) a State statute, regulation, or other rule of law governing adoption, divorce, or other matters of family law; or

(3) the Uniform Commercial Code, as in effect in any State,

other than sections 1–107 and 1–206 and Articles 2 and 2A.

(b) ADDITIONAL EXCEPTIONS.—The provisions of section 101

shall not apply to—

(1) court orders or notices, or official court documents

(including briefs, pleadings, and other writings) required to

be executed in connection with court proceedings;

(2) any notice of—

(A) the cancellation or termination of utility services

(including water, heat, and power);

(B) default, acceleration, repossession, foreclosure, or

eviction, or the right to cure, under a credit agreement

secured by, or a rental agreement for, a primary residence

of an individual;

15 USC 7003.

PUBLIC LAW 106–229—JUNE 30, 2000 114 STAT. 469

(C) the cancellation or termination of health insurance

or benefits or life insurance benefits (excluding annuities);

or

(D) recall of a product, or material failure of a product,

that risks endangering health or safety; or

(3) any document required to accompany any transportation

or handling of hazardous materials, pesticides, or other toxic

or dangerous materials.

(c) REVIEW OF EXCEPTIONS.—

(1) EVALUATION REQUIRED.—The Secretary of Commerce,

acting through the Assistant Secretary for Communications

and Information, shall review the operation of the exceptions

in subsections (a) and (b) to evaluate, over a period of 3 years,

whether such exceptions continue to be necessary for the protection of consumers. Within 3 years after the date of enactment

of this Act, the Assistant Secretary shall submit a report to

the Congress on the results of such evaluation.

(2) DETERMINATIONS.—If a Federal regulatory agency, with

respect to matter within its jurisdiction, determines after notice

and an opportunity for public comment, and publishes a finding,

that one or more such exceptions are no longer necessary for

the protection of consumers and eliminating such exceptions

will not increase the material risk of harm to consumers, such

agency may extend the application of section 101 to the exceptions identified in such finding.

SEC. 104. APPLICABILITY TO FEDERAL AND STATE GOVERNMENTS.

(a) FILING AND ACCESS REQUIREMENTS.—Subject to subsection

(c)(2), nothing in this title limits or supersedes any requirement

by a Federal regulatory agency, self-regulatory organization, or

State regulatory agency that records be filed with such agency

or organization in accordance with specified standards or formats.

(b) PRESERVATION OF EXISTING RULEMAKING AUTHORITY.—

(1) USE OF AUTHORITY TO INTERPRET.—Subject to paragraph

(2) and subsection (c), a Federal regulatory agency or State

regulatory agency that is responsible for rulemaking under

any other statute may interpret section 101 with respect to

such statute through—

(A) the issuance of regulations pursuant to a statute;

or

(B) to the extent such agency is authorized by statute

to issue orders or guidance, the issuance of orders or guidance of general applicability that are publicly available

and published (in the Federal Register in the case of an

order or guidance issued by a Federal regulatory agency).

This paragraph does not grant any Federal regulatory agency

or State regulatory agency authority to issue regulations,

orders, or guidance pursuant to any statute that does not

authorize such issuance.

(2) LIMITATIONS ON INTERPRETATION AUTHORITY.—Notwithstanding paragraph (1), a Federal regulatory agency shall not

adopt any regulation, order, or guidance described in paragraph

(1), and a State regulatory agency is preempted by section

101 from adopting any regulation, order, or guidance described

in paragraph (1), unless—

(A) such regulation, order, or guidance is consistent

with section 101;

15 USC 7004.

Deadline.

Reports.

114 STAT. 470 PUBLIC LAW 106–229—JUNE 30, 2000

(B) such regulation, order, or guidance does not add

to the requirements of such section; and

(C) such agency finds, in connection with the issuance

of such regulation, order, or guidance, that—

(i) there is a substantial justification for the regulation, order, or guidance;

(ii) the methods selected to carry out that

purpose—

(I) are substantially equivalent to the requirements imposed on records that are not electronic

records; and

(II) will not impose unreasonable costs on the

acceptance and use of electronic records; and

(iii) the methods selected to carry out that purpose

do not require, or accord greater legal status or effect

to, the implementation or application of a specific technology or technical specification for performing the

functions of creating, storing, generating, receiving,

communicating, or authenticating electronic records or

electronic signatures.

(3) PERFORMANCE STANDARDS.—

(A) ACCURACY, RECORD INTEGRITY, ACCESSIBILITY.—

Notwithstanding paragraph (2)(C)(iii), a Federal regulatory

agency or State regulatory agency may interpret section

101(d) to specify performance standards to assure accuracy,

record integrity, and accessibility of records that are

required to be retained. Such performance standards may

be specified in a manner that imposes a requirement in

violation of paragraph (2)(C)(iii) if the requirement (i)

serves an important governmental objective; and (ii) is

substantially related to the achievement of that objective.

Nothing in this paragraph shall be construed to grant

any Federal regulatory agency or State regulatory agency

authority to require use of a particular type of software

or hardware in order to comply with section 101(d).

(B) PAPER OR PRINTED FORM.—Notwithstanding subsection (c)(1), a Federal regulatory agency or State regulatory agency may interpret section 101(d) to require

retention of a record in a tangible printed or paper form

if—

(i) there is a compelling governmental interest

relating to law enforcement or national security for

imposing such requirement; and

(ii) imposing such requirement is essential to

attaining such interest.

(4) EXCEPTIONS FOR ACTIONS BY GOVERNMENT AS MARKET

PARTICIPANT.—Paragraph (2)(C)(iii) shall not apply to the statutes, regulations, or other rules of law governing procurement

by the Federal or any State government, or any agency or

instrumentality thereof.

(c) ADDITIONAL LIMITATIONS.—

(1) REIMPOSING PAPER PROHIBITED.—Nothing in subsection

(b) (other than paragraph (3)(B) thereof) shall be construed

to grant any Federal regulatory agency or State regulatory

agency authority to impose or reimpose any requirement that

a record be in a tangible printed or paper form.

PUBLIC LAW 106–229—JUNE 30, 2000 114 STAT. 471

(2) CONTINUING OBLIGATION UNDER GOVERNMENT PAPERWORK ELIMINATION ACT.—Nothing in subsection (a) or (b)

relieves any Federal regulatory agency of its obligations under

the Government Paperwork Elimination Act (title XVII of

Public Law 105–277).

(d) AUTHORITY TO EXEMPT FROM CONSENT PROVISION.—

(1) IN GENERAL.—A Federal regulatory agency may, with

respect to matter within its jurisdiction, by regulation or order

issued after notice and an opportunity for public comment,

exempt without condition a specified category or type of record

from the requirements relating to consent in section 101(c)

if such exemption is necessary to eliminate a substantial burden

on electronic commerce and will not increase the material risk

of harm to consumers.

(2) PROSPECTUSES.—Within 30 days after the date of enactment of this Act, the Securities and Exchange Commission

shall issue a regulation or order pursuant to paragraph (1)

exempting from section 101(c) any records that are required

to be provided in order to allow advertising, sales literature,

or other information concerning a security issued by an investment company that is registered under the Investment Company Act of 1940, or concerning the issuer thereof, to be

excluded from the definition of a prospectus under section

2(a)(10)(A) of the Securities Act of 1933.

(e) ELECTRONIC LETTERS OF AGENCY.—The Federal Communications Commission shall not hold any contract for telecommunications service or letter of agency for a preferred carrier change,

that otherwise complies with the Commission’s rules, to be legally

ineffective, invalid, or unenforceable solely because an electronic

record or electronic signature was used in its formation or authorization.

SEC. 105. STUDIES.

(a) DELIVERY.—Within 12 months after the date of the enactment of this Act, the Secretary of Commerce shall conduct an

inquiry regarding the effectiveness of the delivery of electronic

records to consumers using electronic mail as compared with

delivery of written records via the United States Postal Service

and private express mail services. The Secretary shall submit a

report to the Congress regarding the results of such inquiry by

the conclusion of such 12-month period.

(b) STUDY OF ELECTRONIC CONSENT.—Within 12 months after

the date of the enactment of this Act, the Secretary of Commerce

and the Federal Trade Commission shall submit a report to the

Congress evaluating any benefits provided to consumers by the

procedure required by section 101(c)(1)(C)(ii); any burdens imposed

on electronic commerce by that provision; whether the benefits

outweigh the burdens; whether the absence of the procedure

required by section 101(c)(1)(C)(ii) would increase the incidence

of fraud directed against consumers; and suggesting any revisions

to the provision deemed appropriate by the Secretary and the

Commission. In conducting this evaluation, the Secretary and the

Commission shall solicit comment from the general public, consumer

representatives, and electronic commerce businesses.

Public

information.

Reports.

Reports.

Mail.

Deadlines.

15 USC 7005.

Deadline.

Regulations.

114 STAT. 472 PUBLIC LAW 106–229—JUNE 30, 2000

SEC. 106. DEFINITIONS.

For purposes of this title:

(1) CONSUMER.—The term ‘‘consumer’’ means an individual

who obtains, through a transaction, products or services which

are used primarily for personal, family, or household purposes,

and also means the legal representative of such an individual.

(2) ELECTRONIC.—The term ‘‘electronic’’ means relating to

technology having electrical, digital, magnetic, wireless, optical,

electromagnetic, or similar capabilities.

(3) ELECTRONIC AGENT.—The term ‘‘electronic agent’’ means

a computer program or an electronic or other automated means

used independently to initiate an action or respond to electronic

records or performances in whole or in part without review

or action by an individual at the time of the action or response.

(4) ELECTRONIC RECORD.—The term ‘‘electronic record’’

means a contract or other record created, generated, sent,

communicated, received, or stored by electronic means.

(5) ELECTRONIC SIGNATURE.—The term ‘‘electronic signature’’ means an electronic sound, symbol, or process, attached

to or logically associated with a contract or other record and

executed or adopted by a person with the intent to sign the

record.

(6) FEDERAL REGULATORY AGENCY.—The term ‘‘Federal

regulatory agency’’ means an agency, as that term is defined

in section 552(f) of title 5, United States Code.

(7) INFORMATION.—The term ‘‘information’’ means data,

text, images, sounds, codes, computer programs, software, databases, or the like.

(8) PERSON.—The term ‘‘person’’ means an individual, corporation, business trust, estate, trust, partnership, limited

liability company, association, joint venture, governmental

agency, public corporation, or any other legal or commercial

entity.

(9) RECORD.—The term ‘‘record’’ means information that

is inscribed on a tangible medium or that is stored in an

electronic or other medium and is retrievable in perceivable

form.

(10) REQUIREMENT.—The term ‘‘requirement’’ includes a

prohibition.

(11) SELF-REGULATORY ORGANIZATION.—The term ‘‘selfregulatory organization’’ means an organization or entity that

is not a Federal regulatory agency or a State, but that is

under the supervision of a Federal regulatory agency and is

authorized under Federal law to adopt and administer rules

applicable to its members that are enforced by such organization or entity, by a Federal regulatory agency, or by another

self-regulatory organization.

(12) STATE.—The term ‘‘State’’ includes the District of

Columbia and the territories and possessions of the United

States.

(13) TRANSACTION.—The term ‘‘transaction’’ means an

action or set of actions relating to the conduct of business,

consumer, or commercial affairs between two or more persons,

including any of the following types of conduct—

(A) the sale, lease, exchange, licensing, or other disposition of (i) personal property, including goods and intangibles, (ii) services, and (iii) any combination thereof; and

15 USC 7006.

PUBLIC LAW 106–229—JUNE 30, 2000 114 STAT. 473

(B) the sale, lease, exchange, or other disposition of

any interest in real property, or any combination thereof.

SEC. 107. EFFECTIVE DATE.

(a) IN GENERAL.—Except as provided in subsection (b), this

title shall be effective on October 1, 2000.

(b) EXCEPTIONS.—

(1) RECORD RETENTION.—

(A) IN GENERAL.—Subject to subparagraph (B), this

title shall be effective on March 1, 2001, with respect

to a requirement that a record be retained imposed by—

(i) a Federal statute, regulation, or other rule of

law, or

(ii) a State statute, regulation, or other rule of

law administered or promulgated by a State regulatory

agency.

(B) DELAYED EFFECT FOR PENDING RULEMAKINGS.—If

on March 1, 2001, a Federal regulatory agency or State

regulatory agency has announced, proposed, or initiated,

but not completed, a rulemaking proceeding to prescribe

a regulation under section 104(b)(3) with respect to a

requirement described in subparagraph (A), this title shall

be effective on June 1, 2001, with respect to such requirement.

(2) CERTAIN GUARANTEED AND INSURED LOANS.—With

regard to any transaction involving a loan guarantee or loan

guarantee commitment (as those terms are defined in section

502 of the Federal Credit Reform Act of 1990), or involving

a program listed in the Federal Credit Supplement, Budget

of the United States, FY 2001, this title applies only to such

transactions entered into, and to any loan or mortgage made,

insured, or guaranteed by the United States Government thereunder, on and after one year after the date of enactment of

this Act.

(3) STUDENT LOANS.—With respect to any records that are

provided or made available to a consumer pursuant to an

application for a loan, or a loan made, pursuant to title IV

of the Higher Education Act of 1965, section 101(c) of this

Act shall not apply until the earlier of—

(A) such time as the Secretary of Education publishes

revised promissory notes under section 432(m) of the

Higher Education Act of 1965; or

(B) one year after the date of enactment of this Act.

TITLE II—TRANSFERABLE RECORDS

SEC. 201. TRANSFERABLE RECORDS.

(a) DEFINITIONS.—For purposes of this section:

(1) TRANSFERABLE RECORD.—The term ‘‘transferable record’’

means an electronic record that—

(A) would be a note under Article 3 of the Uniform

Commercial Code if the electronic record were in writing;

(B) the issuer of the electronic record expressly has

agreed is a transferable record; and

(C) relates to a loan secured by real property.

15 USC 7021.

15 USC 7001

note.

114 STAT. 474 PUBLIC LAW 106–229—JUNE 30, 2000

A transferable record may be executed using an electronic

signature.

(2) OTHER DEFINITIONS.—The terms ‘‘electronic record’’,

‘‘electronic signature’’, and ‘‘person’’ have the same meanings

provided in section 106 of this Act.

(b) CONTROL.—A person has control of a transferable record

if a system employed for evidencing the transfer of interests in

the transferable record reliably establishes that person as the person to which the transferable record was issued or transferred.

(c) CONDITIONS.—A system satisfies subsection (b), and a person

is deemed to have control of a transferable record, if the transferable

record is created, stored, and assigned in such a manner that—

(1) a single authoritative copy of the transferable record

exists which is unique, identifiable, and, except as otherwise

provided in paragraphs (4), (5), and (6), unalterable;

(2) the authoritative copy identifies the person asserting

control as—

(A) the person to which the transferable record was

issued; or

(B) if the authoritative copy indicates that the transferable record has been transferred, the person to which the

transferable record was most recently transferred;

(3) the authoritative copy is communicated to and maintained by the person asserting control or its designated custodian;

(4) copies or revisions that add or change an identified

assignee of the authoritative copy can be made only with the

consent of the person asserting control;

(5) each copy of the authoritative copy and any copy of

a copy is readily identifiable as a copy that is not the authoritative copy; and

(6) any revision of the authoritative copy is readily identifiable as authorized or unauthorized.

(d) STATUS AS HOLDER.—Except as otherwise agreed, a person

having control of a transferable record is the holder, as defined

in section 1–201(20) of the Uniform Commercial Code, of the

transferable record and has the same rights and defenses as a

holder of an equivalent record or writing under the Uniform

Commercial Code, including, if the applicable statutory requirements under section 3–302(a), 9–308, or revised section 9–330 of

the Uniform Commercial Code are satisfied, the rights and defenses

of a holder in due course or a purchaser, respectively. Delivery,

possession, and endorsement are not required to obtain or exercise

any of the rights under this subsection.

(e) OBLIGOR RIGHTS.—Except as otherwise agreed, an obligor

under a transferable record has the same rights and defenses as

an equivalent obligor under equivalent records or writings under

the Uniform Commercial Code.

(f) PROOF OF CONTROL.—If requested by a person against which

enforcement is sought, the person seeking to enforce the transferable record shall provide reasonable proof that the person is in

control of the transferable record. Proof may include access to

the authoritative copy of the transferable record and related business records sufficient to review the terms of the transferable

record and to establish the identity of the person having control

of the transferable record.

PUBLIC LAW 106–229—JUNE 30, 2000 114 STAT. 475

(g) UCC REFERENCES.—For purposes of this subsection, all

references to the Uniform Commercial Code are to the Uniform

Commercial Code as in effect in the jurisdiction the law of which

governs the transferable record.

SEC. 202. EFFECTIVE DATE.

This title shall be effective 90 days after the date of enactment

of this Act.

TITLE III—PROMOTION OF INTERNATIONAL ELECTRONIC COMMERCE

SEC. 301. PRINCIPLES GOVERNING THE USE OF ELECTRONIC SIGNATURES IN INTERNATIONAL TRANSACTIONS.

(a) PROMOTION OF ELECTRONIC SIGNATURES.—

(1) REQUIRED ACTIONS.—The Secretary of Commerce shall

promote the acceptance and use, on an international basis,

of electronic signatures in accordance with the principles specified in paragraph (2) and in a manner consistent with section

101 of this Act. The Secretary of Commerce shall take all

actions necessary in a manner consistent with such principles

to eliminate or reduce, to the maximum extent possible, the

impediments to commerce in electronic signatures, for the purpose of facilitating the development of interstate and foreign

commerce.

(2) PRINCIPLES.—The principles specified in this paragraph

are the following:

(A) Remove paper-based obstacles to electronic transactions by adopting relevant principles from the Model

Law on Electronic Commerce adopted in 1996 by the United

Nations Commission on International Trade Law.

(B) Permit parties to a transaction to determine the

appropriate authentication technologies and implementation models for their transactions, with assurance that

those technologies and implementation models will be recognized and enforced.

(C) Permit parties to a transaction to have the opportunity to prove in court or other proceedings that their

authentication approaches and their transactions are valid.

(D) Take a nondiscriminatory approach to electronic

signatures and authentication methods from other jurisdictions.

(b) CONSULTATION.—In conducting the activities required by

this section, the Secretary shall consult with users and providers

of electronic signature products and services and other interested

persons.

(c) DEFINITIONS.—As used in this section, the terms ‘‘electronic

record’’ and ‘‘electronic signature’’ have the same meanings provided

in section 106 of this Act.

15 USC 7031.

15 USC 7021

note.

114 STAT. 476 PUBLIC LAW 106–229—JUNE 30, 2000

LEGISLATIVE HISTORY—S. 761 (H.R. 1714):

HOUSE REPORTS: No. 106–341, accompanying H.R. 1714, Pt. 1 (Comm. on Commerce) and Pt. 2 (Comm. on the Judiciary).

SENATE REPORTS: Nos. 106–131 (Comm. on Commerce, Science, and Transportation) and 106–661 (Comm. of Conference).

CONGRESSIONAL RECORD:

Vol. 145 (1999): Nov. 19, considered and passed Senate.

Vol. 146 (2000): Feb. 16, considered and passed House, amended, in lieu of

H.R. 1714.

June 14, House agreed to conference report.

June 15, 16, Senate considered and agreed to conference

report.

WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 36 (2000):

June 30, Presidential remarks and statement.

Æ

TITLE IV—COMMISSION ON ONLINE

CHILD PROTECTION

SEC. 401. AUTHORITY TO ACCEPT GIFTS.

Section 1405 of the Child Online Protection Act (47 U.S.C.

231 note) is amended by inserting after subsection (g) the following

new subsection:

‘‘(h) GIFTS, BEQUESTS, AND DEVISES.—The Commission may

accept, use, and dispose of gifts, bequests, or devises of services

or property, both real (including the use of office space) and personal, for the purpose of aiding or facilitating the work of the

Commission. Gifts or grants not used at the termination of the

Commission shall be returned to the donor or grantee.’’.

Approved June 30, 2000.