• news-banner

    Expert Insights

Document execution in the Kingdom of Bahrain - The use of Electronic Signatures

The prevalence and shift towards the use of digital documents in day-to-day transactions is both timely and relevant, particularly given current global circumstances which may render the physical signing and execution of key contracts and documents impossible or difficult to achieve.

Legality and Enforceability of Electronic Signatures in Bahrain

Pursuant to Legislative Decree No.(54) of 2018 on Electronic Transactions and Communications (the "Law"), Bahrain's digital technology framework is now in line with international market standards. The Law repeals Legislate Decree No.(28) of 2002 on Electronic Transactions and sets forth provisions governing transactions and dispositions of all types, including the legality and enforceability of electronic signatures in the formation of contracts. It must be noted though that the Law's implementing regulations have yet to be issued, currently leaving a number of issues as a matter of interpretation.

Electronic Records

Under the Law, electronic records (the "Record") in the context of civil and commercial transactions, are afforded the same level of evidential weight as paper documents and are therefore valid and enforceable. Where a document requires information to be in writing, such requirement will be met by codifying the information in electronic form provided that the information is accessible in the same way that a paper document is accessible.

In assessing the weight of a Record, consideration will be given to the reliability of the following:

  • the manner in which the Record was generated, stored or communicated;
  • the manner in which the Record was signed (please see below);
  • the reliability of the manner in which the integrity of the information was maintained; and
  • any other relevant factors pertaining to the integrity of the Record.

Electronic Signatures

Article 6 of the Law permits the use of electronic signatures provided that a method is used to identify that party and to indicate that party's intention to bind itself to the Record in question. Consent must therefore be obtained from a counterparty either expressly or through positive conduct. The signatory must also ensure that strong data protection regulations (including the security of hardware and software systems) are put in place. A declaration by a supervisory or accreditation body may also be required as a means of confirming the reliability of the method used to identify the signatory and the intention for the signed Record to be binding.

To create a digital signature, a signing certificate is required which proves identity. This certificate is usually issued by a public body or trust service provider, who itself should be authorised by the MOICT. There is a presumption under Article 7 of the Law that the signature on the Record is the signature of the person to whom it correlates by virtue of the certificate; that the date and time of the Record is accurate; and that the Record has been sent using a secure electronic delivery service provider and therefore the subsequent safe delivery and receipt of the Record by the recipient at the date and time of delivery. An accredited trust service provider shall not be liable where the person who relied on the certificate knew or ought reasonably to have known in the normal course of events that the certificate has expired or has been revoked or that the accreditation of the relevant trust service provider has been withdraw.

Other considerations

Given the current restrictions regarding physical proximity to one another there are various other provisions and techniques that can be implemented to avoid issues with the execution of documentation, namely:

  • Counterparts – counterpart provisions are fairly common boilerplate provisions in most agreements, but remain more essential than ever given that the effect of such a clause is that separate copies of an agreement may be executed by different parties and each copy with be considered an original;
  • Powers of attorney – existing powers of attorney provide an alternative solution to executing documents. However, executing new powers of attorney will present the same issues faced with executing other agreements; and
  • Witness provisions – guidance states that for documents that require execution in the presence of a witness, such witness needs to be physically present; the witness cannot observe execution by electronic means. A workaround would be to execute the document in a venue with internal glass partitions, so that the individual can witness the execution and also maintain social distancing.

When it comes to executing documents electronically, it is essential that the method of execution will be regarded as valid, should such method ever be questioned. This should be discussed and agreed between the parties and professional advice sought as to the correct method of execution in the relevant jurisdictions.

Our thinking

  • Drone deliveries: Be Prepared

    Emma Humphreys

    Quick Reads

  • Charles Russell Speechlys advises Puma Private Equity on its £3.5 million investment into TravelLocal

    David Coates

    News

  • Charles Russell Speechlys advises Zenzero’s management team on its majority acquisition by Macquarie Capital

    Mark Howard

    News

  • Charles Russell Speechlys expands commercial offering with the appointment of Rebecca Steer

    Rebecca Steer

    News

  • The Times quotes Gareth Mills on the CMA’s preliminary approval of the Activision Blizzard-Microsoft deal

    Gareth Mills

    In the Press

  • City AM quotes Gareth Mills on the CMA’s new set of principles for regulating AI

    Gareth Mills

    In the Press

  • Hamish Perry and Mike Barrington write for The Evening Standard on whether a merger between the CBI and Make UK can work

    Hamish Perry

    In the Press

  • Silicon quotes Gareth Mills on the UK consumer lawsuit against Google

    Gareth Mills

    In the Press

  • Enforcement of Foreign Judgments - UAE: DIFC

    Patrick Gearon FCIArb

    Insights

  • Enforcement of Judgments

    Patrick Gearon FCIArb

    Insights

  • City AM quotes Ashwin Pillay on the latest round of ONS M&A statistics

    Ashwin Pillay

    In the Press

  • Charles Russell Speechlys advises Predator Oil & Gas Holdings plc on its successful placing of New Ordinary Shares to the London Stock Exchange

    Andrew Collins

    News

  • Charles Russell Speechlys advises the discoverIE Group on its acquisition of Silvertel

    Mark Howard

    News

  • Bloomberg and The Washington Post quote Richard Davies on multiclub ownership in world sports

    Richard Davies

    In the Press

  • Charles Russell Speechlys advises Puma Private Equity on its £5m investment into Pockit Limited

    David Coates

    News

  • Product compliance and Brexit - UK Government concedes to CE markings indefinite recognition

    Jamie Cartwright

    Quick Reads

  • Contractor’s Notices and Claims

    Glenn Bull

    Insights

  • Conflicts of Interest in International Commercial Arbitration

    Dalal Alhouti

    Insights

  • UAE and the Grey List: Brief Update

    Karl Masi

    Insights

  • City AM quotes Tom Smitham on private equity investment into European football

    Tom Smitham

    In the Press

  • Charles Russell Speechlys advises Thomas Sandgaard on the sale of Charlton Athletic

    Keir Gordon

    News

  • A Summer of Sport - Top 5 Legal Considerations

    Anna Sowerby

    Insights

  • Has the Orpéa plan impaired shareholder's consent? - Le plan de sauvegarde d'Orpéa n'a-t-il pas vicié le consentement des actionnaires historiques ?

    Dimitri-André Sonier

    Quick Reads

  • Will the downturn in the Paris region property market lead property companies to turn to ad hoc proceedings, as they did in the 1990s?

    Dimitri-André Sonier

    Quick Reads

  • Les défaillances en France proches de leur niveau de 2019 - French insolvencies close to 2019 levels

    Dimitri-André Sonier

    Quick Reads

  • Casino Group: An agreement with investors and debt holders is expected at the end of July

    Dimitri-André Sonier

    Quick Reads

  • DIAC Issues First Annual Report

    Georgia Fullarton

    Quick Reads

  • One year on: "Influencer Culture: lights, camera, inaction" remains astonishingly accurate

    Caroline Swain

    Quick Reads

  • Saudi Center for Commercial Arbitration publishes new Arbitration Rules

    Peter Smith

    Quick Reads

  • WhatsAppGate - Should businesses be reviewing their social media policies?

    Anna Rogers

    Quick Reads

  • Missed deadline for registering on the overseas entity register

    Sarah Morley

    Quick Reads

  • Dubai announces its plan to streamline the enforcement of civil judgments and arbitral awards

    Peter Smith

    Quick Reads

  • Sign of the times - the British record football transfer which very nearly didn't happen

    Pei Li Kew

    Quick Reads

  • No love (island) lost for the #muffboss – #ad is great but don’t forget the other ad rules

    Caroline Swain

    Quick Reads

  • Is it really against the law to share your Netflix password?

    Quick Reads

  • Commercial service charges: "pay now, argue later"!

    Samuel Lear

    Quick Reads

  • Omnichannel innovation essential in the face of outlet decline

    Caroline Swain

    Quick Reads

  • Brand owners now required to police influencers

    Katie Bewick

    Quick Reads

  • Ten Years Since The 2012 Saudi Arbitration Law: Where Are We Now?

    Peter Smith

    Quick Reads

  • Strike a Pose - Usain Bolt files legendary victory celebration as a trademark

    Henry Cuthbert

    Quick Reads

Back to top