The evidential force of electronic contracts and signatures for companies

A company's dealings by electronic means are read from Electronic Signature and Electronic Transactions Law No. 78 of 2012, and from article 223 of the Companies Law in dealings before the Registrar. The wording of a bargain is prepared on the contract-drafting page. A document written in two languages is reviewed on its page. The office takes the question from its seat in Baghdad, al-Yarmouk.

Scope and exclusions

The Law applies to electronic transactions carried out by natural or legal persons, to transactions the parties agree to carry out by electronic means, and to electronic securities and commercial papers, under article 3, first paragraph. A legal person falls within the definition of the signatory: the holder of signature-creation data who signs the electronic document for that person, or for a person whom the signatory represents, under article 1. The Minister, for the purposes of this Law, is the Minister of Communications, and a certification-service provider is a legal person licensed to issue certificates authenticating an electronic signature.

Article 3, second paragraph, takes certain matters out of the Law. Among them are personal-status questions, the making or later amendment of a will or a waqf, and dealings that transfer immovable property — including a power of attorney for that purpose, a title deed, or the creation of a real right — while a lease of that property remains inside the Law. Also excluded are dealings for which a statute imposes a special form, what takes place in court (procedure, notices, summonses, search or arrest orders, and judgments), and a document that a statute requires a notary public to authenticate. If a company's dealing falls within one of these exclusions, the evidential force of this Law is not relied on in that respect.

The Law aims to provide a framework for the use of electronic means, to give legal evidential force to electronic transactions and signatures and to regulate their rules, and to strengthen confidence in their correctness and integrity, under article 2.

The force of the signature and of the document

An electronic signature is treated as valid and as issued by the signatory if means are available to identify the signatory and to indicate that signatory's agreement to what is stated in the electronic document, and according to the agreement between the signatory and the addressee on how the electronic transaction is to be carried out, under article 4, first paragraph. In civil, commercial and administrative dealings, an electronic signature is given the proving force of a signature in ink once the conditions in article 5 have been observed in making it, under article 4, second paragraph. That force arises in evidence when a certification-service provider has certified the signature and all of the following are present: a link to that signatory only; exclusive control of the electronic medium by that signatory; the possibility of detecting any later change; and creation under procedures laid down by the Ministry of Communications in instructions of the Minister, under article 5.

Electronic commercial and financial papers have the same evidential force as their paper counterparts unless the law provides otherwise, and the rules on paper instruments apply to them in a manner consistent with this Law, under article 23. That provision is read with the page on bills of exchange and promissory notes, without extending the scope of article 3 to an excluded matter.

Suspension of a certificate, and dealings before the Registrar

The licensed provider is bound to suspend a certification certificate at once at the signatory's request, and may suspend it if it appears that it has been used for an unlawful purpose or that the information it contains has changed, and must inform the signatory at once, under article 11. The signatory or a third party may challenge the decision to suspend from the date it is published in the electronic register. The official text uses a generic description of the competent court. Licensed providers are to supply the company, or a court, with such reports as are requested about their activity, while signature data remain confidential except for the purpose for which they were provided, under article 12, without repeating a description of a court.

Dealings before the Registrar of Companies may be carried out by electronic circulation within the limits of article 223, as set out on electronic registration. The evidential force of a signature does not stand in for the Registrar's authentication where the Companies Law requires it, or for the exclusions in article 3 above.

The reading is followed from Baghdad, al-Yarmouk.

Legal basis and sources

1. Electronic Signature and Electronic Transactions Law No. 78 of 2012
2. Companies Law No. 21 of 1997, article 223

Frequently asked questions

Related topics and articles

• 01Electronic registration of a company through the Registrar's platformElectronic registration before the Registrar of Companies under article 223, with no button-by-button platform guide.
• 02Obligations that recur after a company is recordedFinal accounts, the audit, the general-assembly meeting and copies sent to the Registrar, distinct from post-incorporation steps and from branch duties.
• 03The address of a company or branch, a lease and a title deedThe company's address in its contract, before the Registrar and in the commercial register; a lease or deed may evidence it. Not a real-estate page.
• 04Registering a company in Basra: which department is approached, and what differs from Baghdad?Registering a company when dealing in Basra under the federal Companies Law, followed from Baghdad.
• 05Company forms under the Iraqi Companies LawCompany types under Companies Law No. 21 of 1997 as amended: joint-stock, limited, partnership, simple, sole proprietorship and holding.

Always check the text in force and its amendments in the official source.

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