On November 17, 2020, the Securities and Exchange Commission (SEC) adopted rules (which are now effective) permitting electronic signatures for SEC filings, provided that certain procedures are followed. There are potential advantages to the utilization of e-signatures by public companies in SEC filings, including from a facilitation perspective (particularly for filings such as registration statements and 10-Ks which need to be signed by a significant number of individuals) and a record-keeping perspective.
Overview of E-Signature Rules
Before the adoption of the SEC’s e-signature rules which recently became effective, SEC filings needed to be manually signed by the signatories to such filings, and public companies were required to retain such manual signatures for a period of at least five years (and provide such signatures to the SEC upon request). The amendments to Regulation S-T resulting from these new rules allow for e-signatures instead of manual signatures (manual signatures will continue to be permitted as well) for SEC filings, provided that the following conditions are met:
- The signatory must present a physical, logical, or digital credential that authenticates the signatory’s identity (this may involve a driver’s license, passcode or a credential chip on a workplace ID).
- The signature process must provide for non-repudiation, which is defined as “assurance that an individual cannot falsely deny having performing a particular action” (this may involve public-key encryption tools provided by commercially available e-signature platforms).
- The e-signature must be attached, affixed, or otherwise logically associated with the signature page or document being signed.
- There must be a timestamp to record the date and time of the signature.