Michigan Administrative Code › Department - Licensing and Regulatory Affairs › Corporations, Securities, and Commercial Licensing › Securities › Securities › Part 4 - BROKER-DEALERS, AGENTS, INVESTMENT ADVISERS, INVESTMENT ADVISER REPRESENTATIVES, AND FEDERAL COVERED INVESTMENT ADVISERS › Section R. 451.4.4 - Electronic signatures

Current through Vol. 24-12, July 15, 2024
Rule 4.4.
(1) As
					 used in this rule "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.
(2) Electronic signatures may be used or
					 accepted, or both, for investment securities if the legal effect, validity, or
					 enforceability of contracts or other records are consistent with
					 ESIGN.
(3) This rule does not
					 require a record or signature be created, generated, sent, communicated,
					 received, stored, or otherwise processed or used by electronic means or in
					 electronic form.
(4) This rule
					 applies only to transactions between parties each of which has agreed to
					 conduct transactions by electronic means. Whether the parties agree to conduct
					 transactions by electronic means is determined from the context and surrounding
					 circumstances, including the parties' conduct.
(5) If a party agrees to conduct a
					 transaction by electronic means, this rule does not prohibit the party from
					 refusing to conduct other transactions by electronic means. This subrule may
					 not be modified by agreement.
(6)
					 Whether an electronic record or electronic signature has legal effect is
					 determined by this rule and other applicable law.
(7) A signature may not be denied legal
					 effect solely because the record or signature is in electronic form.
(8) A contract may not be denied legal effect
					 solely because an electronic record was used in the contract's
					 formation.
(9) If a law requires a
					 record to be in writing, an electronic record satisfies the law.
(10) If a law requires a signature, an
					 electronic signature satisfies the law.
(11) If parties have agreed to conduct
					 transactions by electronic means, and a law requires a person to provide, send,
					 or deliver information in writing to another person, the requirement is
					 satisfied if the information is provided, sent, or delivered, in an electronic
					 record capable of retention by the recipient at the time of receipt. An
					 electronic record is not capable of retention by the recipient if the sender,
					 or the sender's information processing system, inhibits the ability of the
					 recipient to print or store the electronic record.
(12) If a senders information processing
					 system inhibits the ability of a recipient to print or store an electronic
					 record, the electronic record is not enforceable against the
					 recipient.
(13) An electronic
					 record, or electronic signature, is attributable to a person if it was the act
					 of the person. The act of the person may be shown in any manner, including a
					 showing of the efficacy of any security procedure applied to determine the
					 person to which the electronic record, or electronic signature, was
					 attributable.
(14) The effect of an
					 electronic record, or electronic signature, attributed to a person is
					 determined from the context and surrounding circumstances at the time of the
					 record's or signature's creation, execution, or adoption, including the
					 parties' agreement, if any, and otherwise as provided by law.
(15) If a change or error in an electronic
					 record occurs in a transmission between parties to a transaction, both of the
					 following apply:
(a) If the parties have
					 agreed to use a security procedure to detect changes or errors, and 1 party has
					 conformed to the procedure, but the other party has not, and the nonconforming
					 party would have detected the change or error had that party also conformed,
					 the conforming party may avoid the effect of the changed or erroneous
					 electronic record.
(b) In an
					 automated transaction involving an individual, the individual may avoid the
					 effect of an electronic record that resulted from an error made by the
					 individual in dealing with the electronic agent of another person if the
					 electronic agent did not provide an opportunity for the prevention or
					 correction of the error and, at the time the individual learns of the error,
					 the individual does all of the following:
(i)
					 Promptly notifies the other person of the error and that the individual did not
					 intend to be bound by the electronic record received by the other
					 person.
(ii) Takes reasonable
					 steps, including steps that conform to the other person's reasonable
					 instructions, to return to the other person or, if instructed by the other
					 person, to destroy the consideration received, if any, as a result of the
					 erroneous electronic record.
(iii)
					 Has not used or received any benefit or value from the consideration, if any,
					 received from the other person.