Signing a contract by electronic communication means in Azerbaijan
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According to Article 324 of the Civil Code, the parties need an agreed expression of a will to conclude a contract. According to Article 405.1 of this Code, this agreement must be about all the important terms of the contract and in the required form. Thus, in order for a contract to be considered concluded, it is not enough for the parties to agree on all the important terms of the contract, but also to express this consent in the required form.
According to Article 406 of the Civil Code, which sets out the rules for the form of a contract, a contract may be concluded in any form provided for the conclusion of contracts, if otherwise provided that this Code does not specify a specific form for that type of contract.
One of the forms of contract is contracts concluded in written form, which, according to Article 407.2 of the Civil Code, are considered concluded from the moment of their signing. Thus, a written contract is concluded both by compiling documents and exchanging them by mail, telegraph, teletype, telephone, electronic communication, and other means of communication. However, when such contracts are concluded, there are a number of disputes over the validity of the contract. When concluding a contract by electronic exchange of documents, as permitted by the article, the signatures of the parties may be invalid, or the document may not allow determining whether it came from the party under the contract. This raises questions about the exchange of documents by e-mail in practice, especially about the usage of international electronic signature platforms such as DocuSign and E-sign, which have been mostly used in recent practice.
These issues are generally reflected in the Plenum Decision of the Constitutional Court dated 12 August 2020 on the interpretation of Article 407.2 of the Civil Code. Thus, the court noted that one of the important conditions for concluding a written agreement is that the parties sign it. A signature is a sign that identifies the person declaring the intention. The main condition for contracts concluded by electronic means is to accurately determine that the document came from the contract party, which can be determined either by a graphic or electronic signature. Thus, written contracts can be concluded:
In short, an enhanced signature with an advanced certificate created by a certified signature means has the same legal force as a handwritten signature. In addition, the court notes that the terms of such agreements should be as clear, honest, and understandable as possible.
Regarding the development of this issue in modern times on the above-mentioned platforms, it is noted that the security capabilities of e-signatures are much wider than handwriting signatures. Thus, e-signatures contain records of electronic verification trials. The main purpose of the electronic verification trail is to contain the history of all actions taken on the document, including time of opening, review, and signing of the document to be signed. Even if the user allows access to his/her location, at the same time, these records will show the location of all actions performed on the document to be signed. However, if there is a case of abuse of the exchanged document, it is possible to prove and prevent the abuse by looking at the above-mentioned records, or more precisely, by looking at the place, time and other characteristics of the actions.
As for the main issue, there are a number of methods that allow determining the authenticity of the electronic signature, in other words, to determine accurately and honestly whether it came from the party under the contract.