Corporate

Remote execution of contracts

In situations in which face-to-face interaction for the execution of contracts is not legally and/or physically possible, as is currently the case during the "Social, Preventive and Mandatory Isolation", instruments using electronic means take on enormous significance, in order to avoid paralyzing trade and business activity.

In turn, while it is to be expected that restrictions on movement will soon disappear, this will not result in the end of the usefulness of these means, which may become convenient in the future when circumstances prevent physical proximity between the parties. 


I can't execute a contract in paper, neither sign it in my own handwriting... What can I do?

Firstly, it is important to note that contracts do not necessarily have to be executed on paper (with exceptions), neither do signatures have to be in handwriting. 

The Civil and Commercial Code establishes the principle of freedom of forms for legal acts in general and for contracts in particular, so that the parties may generally use whichever they deem appropriate. Eventually, the problem will arise with regard to proof, hence it is important to select a method that allows the execution of the agreement and it’s content to be fully evidenced.

Therefore, we can affirm that it is possible to execute contracts remotely, with a multiplicity of ways of doing so, the electronic means being the protagonists nowadays.

What options do I have for executing contracts electronically?

Some of the most used options are:

  • Digital signature.
  • Electronic signature.
  • Remote Notary Certificate.

What is the difference between digital and electronic signatures?

The digital signature is a certificate that associates a person (either natural or legal) with its private and public keys, and thus creates its digital identity. It allows the recipient of the document to: 

  • Identify the signatory in an irrefutable manner.
  • Ensure that the content could not be modified after execution without leaving evidence.
  • Have guarantees that the signature was made under the absolute control of the signatory.
  • Demonstrate the origin of the signature and the integrity of the document, so that the signatory cannot deny or repudiate its existence or authorship.

Conversely, an electronic signature is one made on a system that lacks the legal requirements to be considered a digital signature. It can be, for instance, a scanned signature attached to a document, those made on touch screens, or even an exchange of emails. To use the electronic signature it is enough to electronically write the name, initials, or any symbol that exteriorizes identity, or to use any of the platforms created for this purpose, which provide higher levels of security.

The main difference between these two types of signature lies in their evidential value:

  • The digital signature has a presumption of authorship and integrity.
  • The electronic signature does not enjoy these presumptions. If not acknowledged, it will be up to the person who invokes it to prove its authenticity.

What is the validity of the digital signature?

Documents executed with digital signature are valid within Argentine territory. However, their validity abroad will depend on the regulatory framework of each country.

Must any consent be signed in advance or a clause included in the contract?

None of this is necessary for the use of digital or electronic signatures. However, in order to use the digital signature, the corresponding certificate must be requested to a local certification authority, which requires the physical presence of the signatory for identification purposes. Unfortunately, certification authorities are not considered an essential activity; therefore during quarantine, it is not possible to obtain it.

The list of local companies that can issue the digital signature is available at the following link:

 https://www.argentina.gob.ar/jefatura/innovacion-publica/administrativa/firmadigital/acraiz

We do not have a digital signature and we are going to enter into a contract using an electronic signature. Any recommendations?

It may be a good idea to include a clause in the contract stating that within certain days after the end of quarantine, or whichever the circumstance may be, the parties shall send the original paper document handwritten signed by post. This clause could even include a daily penalty for the party that fails to do so (or the possibility of withholding payments, if it is a supplier).

Is there any other way?

Recently, public notaries have been declared as an “essential activity” and can therefore work during quarantine, but only on “essential activities”. If you are not included in such activities, or do not wish to go to a notary's office, an alternative when the parties do not have digital signature could be to use a Remote Notary's Certificate.

A Remote Notary Certificate is a certificate that states what the notary perceives remotely through audiovisual means, such as the signature of a certain document. The notary then records what he remotely witnessed, and attaches the document signed by the parties to his certificate.  

This is another way of proving signatures, which is relevant because it has been carried out, although remotely, in front of a notary public, and even though it does not replace the signature certification, it constitutes authorized evidence, that can hardly be questioned lightly. 

Any other advice?

It is important to analyze the particular case in order to define the best method to be used for the remote execution of contracts, taking into account the specific characteristics of the commercial relationship as well as other elements of that contract, such as its performance, the possibility of establishing a tacit acceptance mechanism, etc.

Moreover, the eventual impact of Stamp Tax will have to be analyzed, according to the chosen method of execution.

Please contact for further information Valeriano Guevara Lynch (vguevara@allende.com +54.11.4318.9902), or Laureano Genin (lgenin@allende.com +54.11.4318.9963).


For further information on this topic please contact Valeriano Guevara Lynch and Laureano Genin