E-signatures and digital contracts: legal trends in Europe and beyond

For most international companies, electronic signatures have become a standard tool for working with counterparties, contractors, and corporate bodies. However, behind the apparent simplicity of such solutions lie significant legal complexities, including differences between types of signatures, requirements for signer identification, jurisdiction-specific regulatory constraints, and issues of evidentiary validity in the event of a dispute. An incorrect choice of signature format or the absence of a properly structured legal framework may ultimately undermine the enforceability of an agreement. In this article, we examine how electronic signatures are regulated in Europe and beyond, what legal risks they entail, and how businesses can build a legally robust digital contracting framework.

Legal framework for electronic signatures in the European Union

Electronic signatures in the European Union are governed by a unified supranational legal framework that ensures their legal validity and cross-border recognition. The cornerstone of this system is Regulation (EU) No 910/2014, better known as eIDAS, which establishes common rules for electronic signatures, electronic seals, and trust services. For businesses, this means the ability to use digital tools to conclude contracts between entities located in different EU Member States, provided that the established requirements for identification, security, and evidentiary reliability are met.

eIDAS as the core legal framework

The eIDAS Regulation enshrines the principle of technological neutrality, under which the legal effect of a document cannot be denied solely because it is in electronic form. Electronic signatures are recognised as admissible evidence in legal proceedings, provided that the applicable requirements for their creation and use are met.

The Regulation also creates a unified market for trust services by eliminating fragmentation between national regimes and ensuring mutual recognition of electronic signatures across EU Member States.

A key element of the regulatory framework is the clear allocation of roles among the parties involved: the signatory, the trust service provider, and the relying party. This structure enables a transparent chain of responsibility and facilitates the verification of the authenticity of electronic documents in the event of a dispute.

Types of electronic signatures and their legal effect

The eIDAS Regulation distinguishes three levels of electronic signatures, each offering a different degree of legal reliability and practical applicability.

Simple Electronic Signature (SES)

This type of signature is used in basic scenarios, ranging from email confirmations to online form acknowledgements. It does not require specialised identification tools and therefore provides a limited level of evidentiary value. In the event of a dispute, the burden of proving the authenticity of such a signature rests entirely with the party relying on it.

Advanced Electronic Signature (AES)

An advanced electronic signature must be uniquely linked to the signatory, enable their identification, and ensure control over the signature creation data. It is typically based on cryptographic mechanisms and offers a significantly higher level of trust. AES is widely used in corporate and commercial transactions where a balance between convenience and legal certainty is required.

Qualified Electronic Signature (QES)

A qualified electronic signature is created using a qualified signature creation device and a qualified certificate issued by a trusted service provider. Under Article 25(2) of the eIDAS Regulation, such a signature has the same legal effect as a handwritten signature and must be recognised across all EU Member States without additional formalities. This format is most commonly used in transactions involving heightened legal risk or regulatory scrutiny.

Regulatory developments: eIDAS 2.0 and digital identity in the EU

In recent years, the EU has moved from a basic framework for electronic signatures toward a broader concept of digital identity. The adoption of the updated regulatory framework known as eIDAS 2.0 reflects the ambition to create a unified digital environment in which legally binding actions can be carried out entirely online without compromising trust, security, or legal certainty. The revised framework is expected to be gradually implemented across Member States in the coming years, making early alignment with the new digital identity infrastructure increasingly important for cross-border businesses.

European Digital Identity Wallet and the New Identification Model

At the core of this reform is the European Digital Identity Wallet (EUDI Wallet), a universal tool designed to enable identity verification, storage of attributes, and the use of electronic signatures across the EU. Unlike the previous model, in which electronic identification remained fragmented, the new system aims to standardise and mutually recognise digital identities across Member States.

Key features of the new approach include:

• The ability to verify identity and legal status across all EU countries;
• The use of qualified attributes (such as corporate representation powers);
• Integration with electronic signatures and seals;
• Increased trust through mandatory requirements for digital identity providers.

For businesses, this marks a shift from fragmented local solutions toward a pan-European infrastructure in which the legal validity of actions is supported by trusted, EU-level mechanisms rather than internal company procedures.

Practical implications of eIDAS 2.0 for businesses

The implementation of eIDAS 2.0 directly affects how companies structure their contracting processes, verify counterparties, and manage evidentiary records. It goes beyond technological upgrades and requires a reassessment of internal compliance frameworks and operational workflows.

This is particularly relevant for businesses relying on remote onboarding, digital contracting platforms, and cross-border service delivery models.

In practice, this results in:

• The need to ensure that existing solutions are compatible with future eIDAS 2.0 requirements;
• Increased reliance on verifiable identity mechanisms for remote contracting;
• Greater importance of electronic attributes such as authority, role, and capacity;
• Higher standards for the storage and reproducibility of data evidencing parties’ intent.

As a result, companies that adapt their processes to the new digital identity framework at an early stage gain not only regulatory resilience but also a strategic advantage when operating across multiple jurisdictions.

Electronic signatures outside the EU: the international context

Despite the existence of a unified regulatory framework within the EU, cross-border transactions rarely remain confined to a single jurisdiction. Companies increasingly enter into contracts with counterparties operating under different legal regimes, which requires an understanding of how electronic signatures are treated across jurisdictions and how regulatory approaches may differ.

The UK approach to electronic signatures after Brexit

Following its withdrawal from the EU, the United Kingdom retained much of the regulatory approach developed under eIDAS while establishing its own legal framework. Electronic signatures are generally recognised as valid for most types of agreements, provided that the basic requirements of intent and signer identification are met.

Key features of the UK approach include:

• Recognition of the legal validity of electronic signatures where the parties clearly intend to be bound;
• No mandatory form of signature for most commercial contracts;
• Acceptance of various types of electronic signatures, including simple and advanced forms;
• Particular attention to evidentiary matters in the event of a dispute, including audit trails and metadata.

At the same time, certain categories of documents, such as wills or specific real estate transactions, continue to require compliance with formal execution requirements, which must be taken into account when structuring cross-border agreements.

International standards and the principle of technological neutrality

Beyond Europe, a key role in harmonising approaches to electronic signatures is played by the United Nations Commission on International Trade Law (UNCITRAL). Its model laws, including the Model Law on Electronic Commerce and the Model Law on Electronic Signatures, establish the fundamental principle of technological neutrality.

Under this principle, the legal assessment of an electronic signature should not depend on the specific technology used, but rather on functional criteria such as:

• The ability to identify the signatory;
• Confirmation of the signatory’s intent to sign;
• Assurance of data integrity after signing;
• The reliability of the method used, taking into account the context of the transaction.

This approach underpins many national legal systems, including those of the EU, the United Kingdom, the United States, and several Asian jurisdictions. For international businesses, it means that electronic signatures can retain legal validity across borders, provided that the chosen solution meets the relevant legal and technical standards of each applicable jurisdiction.

When can an electronic signature be challenged?

Despite the widespread use of electronic signatures, their legal validity is not absolute. In practice, it is shortcomings in the signing process, identification procedures, or data retention that most often give rise to challenges. Understanding these typical risks makes it possible to build a more resilient electronic document workflow in advance.

Limitations and vulnerable areas of electronic signatures

Even when formally acceptable tools are used, an electronic signature may be deemed invalid in the following situations:

• Insufficient identification of the signatory, particularly when simple electronic signatures are used without a verified link to a specific individual;
• Lack of control over the signature creation device, making it impossible to prove that the action was performed by the signatory;
• Compromise of document integrity after signing or the inability to confirm that the content remained unchanged;
• Non-compliance with legally prescribed form requirements, for example in corporate or registration-related documents that require a higher level of authentication;
• Absence of proper evidence retention, including log files, timestamps, and records of the signing process.

In judicial practice, it is the combination of these factors, rather than the mere use of an electronic signature, that most often leads to a contract being declared invalid or unenforceable.

Common mistakes in the use of e-signatures

In practice, companies frequently make the same mistakes that significantly weaken their position in the event of a dispute:

• Using the same type of signature for transactions with different risk profiles;
• Lacking internal policies defining who is authorised to use electronic signatures and in which circumstances;
• Disregarding applicable legal requirements in cross-border transactions;
• Relying on signatories whose authority has not been properly verified;
• Storing electronic documents without adequate audit and traceability mechanisms;
• Overreliance on generic cloud-based signing platforms without verifying their compliance with applicable legal and evidentiary requirements.

For this reason, when designing an electronic signing framework, it is essential to assess not only convenience but also the evidentiary strength of the chosen solution in potential disputes.

A practical approach to selecting an electronic signature

The choice of an appropriate type of electronic signature should be based not on technical preferences but on a legal assessment of the specific transaction, its risks, and potential consequences. There is no universal solution – the optimal format depends on a combination of factors.

Assessing risk level and transaction context

Before selecting a signature format, it is advisable to analyse:

• The value and strategic importance of the transaction;
• The number of parties involved and the jurisdictions concerned;
• The presence of regulatory requirements or industry standards;
• The likelihood of a dispute or regulatory review;
• The need for long-term storage and reproducibility of documents.

The higher the potential consequences of a breach, the higher the required level of the electronic signature and the evidentiary standard.

What should be addressed in contractual documentation

To mitigate risks, companies increasingly include specific provisions governing the use of electronic signatures. Key elements of such clauses typically include:

• Consent of the parties to use electronic means of signing;
• Specification of the permitted type of electronic signature;
• Description of the signatory identification procedure;
• Rules for storing electronic documents and audit logs;
• Recognition of the legal validity of electronically signed copies.

Well-structured contractual provisions not only reduce the likelihood of disputes but also significantly simplify the process of proving the validity of a transaction if a dispute arises.

How can Key2Law help build a legally sustainable e-signature model?

Effective use of electronic signatures requires not only the right technological solution, but also a comprehensive legal approach that takes into account applicable law, corporate structure, and the nature of the transactions involved. The Key2Law team supports clients at every stage of implementing and using electronic signatures, helping to minimise legal and operational risks in cross-border environments.

Our approach is based on an in-depth analysis of each client’s business model and the legal framework in which it operates, taking into account European and international regulatory requirements.

As part of our support, we help clients to:

• Assess the permissibility of using electronic signatures in light of applicable law, transaction type, and relevant jurisdictions;
• Select the most appropriate type of electronic signature (SES, AES, or QES) based on risk level and evidentiary requirements;
• Develop and adapt contractual provisions governing electronic signing, identification procedures, and evidence retention;
• Conduct legal audits of electronic document workflows, including the assessment of service providers and technologies used;
• Support the implementation of electronic signatures within corporate procedures, including internal policies and governance frameworks;
• Prepare for potential disputes by ensuring proper evidentiary structures and audit trails;
• Advise on cross-border transactions where alignment of different legal regimes is required.

This approach allows businesses not only to mitigate legal risks, but also to build a resilient and compliant digital contracting framework. If you would like to assess your current setup or implement a legally robust electronic signing model, our team is ready to assist.