The use of electronic signatures and the validation thereof was previously regulated in terms of the Electronic Commerce Act (Chapter 426 of the Laws of Malta) (the “Act”); however, the relevant provision was repealed in 2016 by means of Act XXXV.2016.5. The amendments to this Act effectively repealing the provisions on electronic signatures were made in order to bring Maltese law in line with the European Regulation No 910/2014 on electronic identification and trust services for electronic transactions in the internal market (the “Regulation”). As a regulation, this has direct effect in all EU Member States, including Malta.
The repealing of the aforementioned legal provision however does not mean that electronic signatures are not recognised as valid in Malta. Indeed, an electronic signature may not be denied legal effect, validity or enforceability solely on the grounds that it is wholly or partly in electronic form or has been entered into wholly or partly by way of electronic communications or otherwise, as explained in article 25(1) of the Regulation.
As a starting point, one must make the distinction between the granting of consent to the entry into a contractual agreement, which consent may be given in writing, electronically or even verbally, and the execution of such contractual agreement, which may itself be subject to additional layers of formality. The general rule is that Maltese law does in principle allow contractual agreements to take place through electronic communication, meaning that contractual agreements may be consented to and then executed via electronic means. This general rule holds for, as long as the law itself does not require a specific formality for the execution and validity of the contract in question.
For instance, in the case of the acquisition of immovable property, which itself requires a public deed executed in front of and published by a notary public; a transfer of shares issued by a company registered and incorporated in Malta and the execution of a bill of exchange, Maltese law sets out particular and specific execution and validity formalities. In these cases, executing such contracts by electronic means is not permitted in terms of Maltese law. On the other hand, the execution of other documents may not be subject to such specific execution and validity formalities and may therefore, in principle, be consented to and executed through electronic means. One such example is the granting of consent to and the execution of a bank account opening form.
The Regulation defines three levels of electronic signatures; these being simple, advanced and qualified electronic signatures. The requirements of each level build upon those of the previous level – with the most basic electronic signature, simple electronic signatures, being “data in electronic form which is attached to or logically associated with other data in electronic form and which is used by the signatory to sign.” This defines a simple electronic signature, and a practical example of such signature would be simply signing off your name at the end of an email.
An advanced electronic signature is a simple electronic signature which is additionally uniquely linked to and capable of identifying the signatory. It is created using electronic signature creation data which allows the signatory to retain control thereof, and it is linked to the data signed in a way that any subsequent change of data is detectable.
A qualified electronic signature is an advanced electronic signature which is additionally (i) created by a qualified signature creation device, and (ii) is based on a qualified certificate for electronic signatures.
A qualified signature creation device is software used to protect the signature creation data which has been created, while a qualified certificate is a certificate for electronic signatures that is issued by a qualified trust service provider whilst also meeting the requirements laid down in the Regulation. Qualified certificates are provided by providers, either public or private, which have been granted a qualified status by a national competent authority; and it is important to note that a qualified electronic signature based on a qualified certificate issued in one Member State shall be recognised as a qualified electronic signature in all other Member States, as stated in article 25(3) of the Regulation.
Malta recognizes both advanced and qualified electronic signatures; neither type can be denied legal effect and admissibility as evidence in legal proceedings solely on the basis of the signature being in electronic form. A qualified electronic signature is considered to have legal effect equivalent to a handwritten signature. However, in the event that Maltese law provides for certain execution and validity formalities relating to the execution of a particular document, then the execution of such document by electronic means, even if through a qualified electronic signature, would not be permissible or sufficient in rendering the execution of such document valid in terms of law.