High value requires high trust
Signing a document is what gives the document’s content authenticity and legal effect. It allows the receiving (relying) party to trust the content’s integrity and origin. For the longest time, this has been achieved by wax seals and similar techniques as well as handwritten signatures. An untrusted or missing seal (or signature) prevents the document from serving its purpose.
This is a lesson that Swiss train manufacturer Stadler Rail learned last month when handing in an electronic offer to the Austrian ÖBB. By using a Swiss electronic signature that is not recognized in the European Union, the document was formally not signed and thereby invalidated a 2.8 billion € offer. But the damage is also to the Austrian public, who depend on public transport and now will feel the effects of the delayed procurement and deployment of new trains.
Why did this occur? And is it just a formality or is there more behind it?
The European Union has identified that in the digital age we need to be able to make agreements online, without handwritten documents. The result is the eIDAS regulation and related ETSI standards. But more importantly, the member states reviewed this framework and agreed that the underlying verifications of the security and integrity of Trust Service Providers, such as ZealiD, is to such a high standard that a Qualified Electronic Signature under eIDAS is equivalent to handwritten signatures. This was put into legal effect for the whole European Union, thereby allowing its citizens to identify and sign online.
The signature framework used in Switzerland is established and recognized locally in its home country. But it has not gone through the same verification process between the EU member states and is therefore not recognized, i.e., trusted, in the same way as eIDAS is.
Of course, not all documents or actions require a high level of trust. Buying your groceries from the local supermarket is usually done anonymously and through a basic agreement, goods for money. But when it comes to agreements which are more severe, valuable, or in general have more risks attached, the legal profession has long ago agreed that a trusted identification of the contract parties and integrity of the content is needed. The contracting process by ÖBB is such a situation where high trust is required. By using a digital method that is not accredited for this purpose, the required trust was not established.
If you are operating on the European market, understand the level of trust that you need to put into your documents and agreements. Qualified Digital Certificates according to eIDAS can establish the necessary trusted relationship between you and your business partner.