eSignature Legality in Denmark

eSignature Legality Summary

Under Danish law, a written signature is not necessarily required for a valid contract - contracts are generally valid if legally competent parties reach an agreement, whether they agree verbally, electronically or in a physical paper document (section 1 of the Danish Law of Contracts). To prove a valid contract, parties sometimes have to present evidence in court. Leading digital transaction management solutions can provide electronic records that are admissible in evidence under sections 344 and 880 in the Danish Administration of Justice Act, to support the existence, authenticity and valid acceptance of a contract.

In addition, Regulation (EU) No 910/2014 on electronic identification and trust services for electronic transactions in the internal market (the “eIDAS Regulation”) came into force on 1 July 2016. The eIDAS Regulation repealed and replaced the e-Signatures Directive (1999/93/EC) and is directly applicable in the 28 member countries of the European Union.

The eIDAS Regulation is technology neutral and defines three types of electronic signature (SES, AES, QES). Article 25(1) provides that an electronic signature shall not be denied legal effect and admissibility as evidence in legal proceedings solely on the grounds that it is in an electronic form or does not meet the requirements of a QES. Articles 25(2) and (3) give a QES the same legal effect as a handwritten signature and ensure that a QES recognized in one Member State of the EU is also recognized in other Member States. Finally, Recital 49 allows national law to set requirements regarding which type of electronic signature may be required in which circumstances.

Use Cases for Standard Electronic Signature (SES)

Use cases where an SES is typically appropriate include:

• HR documents, such as employment contracts, non-disclosure agreements, employee invention agreements, privacy notices, termination notices, benefits paperwork and other new employee onboarding processes

• commercial agreements between corporate entities, including NDAs, purchase orders, procurement documents, sales agreements, order acknowledgements, invoices, distribution agreements, service agreements

• consumer agreements, including new retail account opening documents, sales terms, services terms, software licenses, purchase orders, order confirmations, invoices, shipment documentation, user manuals, polices

• real estate documents, including lease agreements (except termination notices under residential leases), purchase and sales contracts, and other related documentation for residential and commercial real estate

• intangible property transfers copyright licenses

• licenses of intellectual property, including patent, copyright and trademark

• software licenses

Use Cases for Other Types of Electronic Signature (e.g. Digital Signature, AES

Use cases where an electronic signature other than SES may be required include:

• AES or QES – documents described in Section 478 of the Danish Administration of Justice Act

• AES or QES – documents described in Section 7 of the Danish Land Registration Act (“Tinglysningsloven”)

• AES or QES - certain loan agreements (section 36 of the Danish Act on Credit Agreements) (“Kreditaftaleloven”)

Use Cases That Are Not Appropriate For Electronic Signatures

Use cases that are specifically barred from digital or electronic processes or that explicitly require handwritten (e.g. wet ink) signatures or formal notarial process.

• Notary - certain wills (section 63 of the Danish Inheritance Act) (“Arveloven”)

• Registered in the Danish Register of Persons - marriage contracts (section 20 of the Danish Act on Spouses' Economic Conditions (“Ægtefælleloven")

• Registered in Danish Land Register - certain contracts regarding transfer of rights relating to real property, in order for the contract to be “protected” against creditors and other contracting parties (sections 1 and 7 of the Danish Land Registration Act) (except lease contracts and other contracts related to real estate, which can be signed validly via any form of electronic signature)

• Registered in the Danish Register of Persons - certain contracts regarding transfer of personal property, in order for the contract to be “protected” against creditors and other contracting parties (sections 42c, 42d, 42i and 43 in the Danish Land Registration Act)

• Paper/Handwritten - certain forms of termination notice regarding residential lease agreements (sections 4, 87 and 93, subsection 2 in the Danish Rent Act) (“Lejeloven”)

[1] An AES is an “advanced electronic signature”, a type of electronic signature that meets the following requirements: (a) it is uniquely linked to the signatory; (b) it is capable of identifying the signatory; (c) it is created using means that are under the signatory’s sole control; and (d) it is linked to other electronic data in such a way that any alteration to the said data can be detected.

[2] A QES is a specific digital signature implementation that has met the particular specifications of a government, including using a secure signature creation device, and been certified as ‘qualified’ by either that government or a party contracted by that government.

Local Technology Standards

As a Tiered eSignature Legal Model country, Denmark supports the concept of a QES (Qualified Electronic Signature), requiring independent accreditation for those signatures by an approved certification body. While QES is only legally required for limited types of transactions, as previously discussed, Denmark, as a member of the European Union, follows ETSI (European Telecommunications Standards Institute) standards to define the technical requirements for a QES. In addition, Denmark is one of a handful of countries in the world that defines an additional set of transactions where either a QES or an AES (Advanced Electronic Signature) is required to support legal validity. Denmark maintains a publicy accessible list of supervisory bodies for qualified certificated providers together with other countries in the European Union.