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What is E-Sign ?

ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT (E-SIGN) – A United States federal law that defines and governs the use of digital signatures and records in electronic commerce.

The Electronic Signatures in Global and National Commerce Act (E-Sign Act), 1 signed into law on June 30, 2000, provides a general rule of validity for electronic records and signatures for transactions in or affecting interstate or foreign commerce.  The E-Sign Act allows the use of electronic records to satisfy
any statute, regulation, or rule of law requiring that such information be provided in writing, if the consumer has affirmatively consented to such use and has not withdrawn such consent.

Subject to certain exceptions, the substantive provisions of thelaw were effective on October 1, 2000.

Record retention requirements became effective on March 1, 2001. The E-Sign Act grandfathers existing agreements between a consumer and an institution to deliver information electronically. However,
agreements made on or after October 1, 2000, are subject to the requirements of the E-Sign Act.

Summary of Major Provisions Consumer Disclosures Prior Consent, Notice of Availability of Paper Records Prior to obtaining their consent, financial institutions must provide the consumer, a clear and conspicuous statement informing the consumer:

• of any right or option to have the record provided or made available on paper or in a non electronic form, and the right to withdraw consent, including any conditions, consequences, and fees in the event of such withdrawal;

• whether the consent applies only to the particular transaction that triggered the disclosure or to identified categories of records that may be provided during the course of the parties’ relationship;

• describing the procedures the consumer must use to withdraw consent and to update information needed to contact the consumer electronically; and

• informing the consumer how the consumer may nonetheless request a paper copy of a record and whether any fee will be charged for that copy.

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