What are e-signatures?

When can e-signatures be used?
What requirements must be met for an e-signature to be valid?
When might the use of e-signature not be ideal?


Electronic signatures (e-signatures) provide flexibility and efficiency in cross-border transactions, are virtually accessible from anywhere in the world and, given the advancements in digital signature technology, provide arguably greater security than scanning and emailing wet signatures.

On July 1 2016 the European Union's legal framework for e-signatures came into effect via the eIDAS Regulation.(1)

In comparison, the British Virgin Islands (BVI) passed similar legislation 15 years ago and was one of the first jurisdictions to recognise the validity of e-signatures and electronic records. The BVI Electronic Transactions Act 2001 sets out the requirements for a legally binding e-signature under BVI law. This recognition of e-signatures along with other BVI statutory developments (eg, simplified requirements for the execution of contracts) provides flexibility in cross-border transactions involving BVI companies.

What are e-signatures?

The Electronic Transactions Act defines 'electronic' as electrical, digital, magnetic, optical, electromagnetic, biometric and photonic. In practice, e-signatures may take on a number of forms, including:

  • bitmap signatures (ie, scanned images);
  • biometric signatures which require a special writing pad that records strokes and pressure; and
  • digital signatures which utilise cryptography technology – the most advanced and widely used form of e-signature.

When can e-signatures be used?

E-signatures can be used in most transactions involving a BVI entity or the laws of the British Virgin Islands, with some exceptions.

Director and member resolutions
E-signatures can be used. The BVI Business Companies Act 2004 permits both director and member resolutions of BVI companies to take the form of written resolutions. They must be consented to in writing or by telex, telegram, cable or other written communication. Written resolutions can consist of several documents, including written electronic communications in like form that are each signed or assented to by one or more directors or members (as applicable).

Agreements signed under hand
E-signatures can be used.

The Electronic Transactions Act's definition of legally-binding e-signatures does not currently apply to deeds, although it is anticipated that the BVI legislative authorities will soon redress this to reflect the increasing use and development of e-signatures in the 15 years since the act was introduced.(2) In the absence of statutory guidance on valid e-signatures for deeds, specific BVI legal advice should be sought on a case-by-case basis on the e-signature execution of deeds by a BVI entity.

It is worth noting that:

  • a foreign entity can validly sign a BVI law deed using an e-signature, provided that the laws of the foreign entity permit the use of e-signatures;
  • it is fairly common to draft security documents as a deed when the security document does not actually have to be a deed; and
  • pursuant to the latest amendments to the BVI Business Companies Act, it is possible to pre-sign deeds and physically or electronically add them to the remainder of the deed – so a wet signature could be obtained from a signatory in advance of closing.

What requirements must be met for an e-signature to be valid?

Under the Electronic Transactions Act, the legal requirement for a signature is satisfied by an e-signature if:

  • the e-signature adequately identifies the signatory;
  • the electronic record adequately indicates either the signatory's approval of the information to which the signature relates or the witnessing of a signature or a seal;
  • the e-signature is as reliable as is appropriate given the purpose and circumstances in which the signature is required; and
  • the 'recipient/counterpart' of the e-signature consents to receiving the e-signature and the e-signature of each witness (if applicable).

It is also presumed that an e-signature is valid and enforceable if:

  • the means of creating the e-signature is linked to the signatory and no other person;
  • the means of creating the e-signature was under the control of the signatory and no other person;
  • any alteration to the e-signature made after the time of signing is detectable; and
  • where the purpose of the legal requirement for a signature is to provide assurance as to the integrity of the information to which it relates, any alteration made to that signature after the time of signing is detectable.

Most of today's digital signature technology is designed to meet the requirements set out above, by providing security measures that authenticate the signatory and preserve document integrity.

When might the use of e-signature not be ideal?

Notwithstanding the growing attractions of e-signatures, there are a number of other instances in which the use of wet signatures may be more appropriate. These include where:

  • parties prefer to exchange wet signatures at a formal closing;
  • documents need to be notarised (depending on the laws of the jurisdiction); or
  • the document must be filed with an authority or registry which requires wet signatures.

For further information on this topic please contact Hamish Masson or Kimberley Seagojo at Harney Westwood & Riegels by telephone (+1 284 494 2233) or email ([email protected] or [email protected]). The Harney Westwood & Riegels website can be accessed at


(1) EU Regulation 910/2014. Although it should be noted that irrespective of Brexit, the British Virgin Islands is not part of the European Union.

(2) Other categories of document for which the definition of legally binding e-signatures does not apply to include:

  • the creation, execution or revocation of a will or such other testamentary instrument;
  • the conveyance of real estate or the transfer of any interest in real property; and
  • any other matter prescribed by the Electronic Transactions Act regulations (currently none).

Unlike other e-signature legislation which provide for regulations to increase the use of e-signatures, the Electronic Transactions Act provides for regulations to reduce the scope of e-signatures, suggesting that the draftsmen intended to periodically overhaul the legislation to match a fast-evolving technology.