E-Sign rules open for comment

Electronic Signatures in Global and National Commerce Act

The Office of Management and Budget is looking for comments on draft guidance

that will help agencies understand and use the new electronic signature

legislation passed by Congress in June.

In a memo sent to agency chief information officers last week, OMB asked

for comments by Aug. 11 on the draft guidelines developed for the Electronic

Signatures in National and Global Commerce Act. E-Sign provides a legal

basis for use of technology to sign contracts and perform other electronic

legal transactions.

The act primarily is focused on the private sector because it deals with

business-to-business and business-to-consumer transactions. Electronic transactions

within government are already covered by the Government Paperwork Elimination

Act.

However, under E-Sign, agencies will have to update regulations to indicate

that private parties must retain records electronically. Also, several agencies — including the Commerce, Treasury and Justice departments — deal with transactions

governed by E-Sign. These agencies already have already worked with OMB

to develop the draft guidance.

OMB wants to issue the guidance before the law takes effect Oct. 1, 2000;

related government requirements, such as the records-retention regulations,

kick in during 2001.

"Because these effective dates are very near at hand, agencies must begin

now to take steps necessary to implement the law," OMB director Jacob Lew

wrote in the draft guidelines. "Failure to immediately update requirements

could result in significant consequences for an agency; for example, if

an agency has a record-retention requirement but fails to update this requirement,

it may hinder the ability of auditors and [inspector generals] to access

important documents."

The guidance includes three parts:

* General overview and explanation of how E-Sign relates to federal agencies.

* Suggested steps for agencies' implementation of E-Sign.

* Ensuring agency compliance with the statutory requirements of E-Sign.

OMB is also working with the Regulatory Working Group, the President's Council

on Integrity and Efficiency, and the CFO and the Procurement Executive Councils

to hone the draft before issuing final guidelines.