A Utah law that allows legal documents to be transmitted electronically is being used as a model by governments across the country and around the world.
Oregon, Hawaii, Washington, California, Georgia, Chile and Germany are among the entities who have used or are using Utah's Digital Signature Act as a blueprint for laws of their own. Another half-dozen governments as well as Fortune 500 companies have contacted Utah officials for information about the act.In February 1995, Utah became the first legal entity in the world to adopt a comprehensive statute allowing electronic commerce using digital signature technology. The Legislature fine-tuned the law this year.
The act allows digital signature documents to be as legally binding as a signed piece of paper. It paves the way for court records, taxes, search warrants, bank loans and transfers, insurance and licensing papers, among other documents, to be filed electronically without fear of eavesdropping, fraud or tampering.
A digital signature is essentially a way of putting an electronic document in an envelope that only a person with a special letter opener can unseal.
It uses public key cryptography to scramble messages and documents, turning them into strings of 1's and 0's that can be 600 digits long. Paired keys are used to encode and then translate documents.
It's similar to the two keys needed to open a safety deposit box at a bank or, even, to launch a nuclear missile, said George Danielson, digital signatures coordinator for the Utah Division of Corporations and Commercial Code.
Each person or entity using public key crytography has two keys: one key is public, sometimes even widely known. The other is private, known only to its owner.
For example, a state court might publicize its public key - the code to be used to file court documents. But only the court could open the document, using its secret private key.
The sender would use her private key to "sign" the document. The court would verify who sent the document by comparing it to the sender's public key.
Cryptography has been used for thousands of years to keep information secret, particularly by the military. And public key cryptography has been around since 1976.
But public interest in cryptography has accelerated as the Internet has become the 20th century highway and, increasingly, the digital marketplace.
"The average consumer is more likely to see this when buying a parka over the Internet from Land's End," Danielson said. "It's (cryptography) probably a more secure method of signing a document than by doing ink on paper."
Utah expects to have the regulations, licensing process and a repository for storing the public and private keys in place by mid-summer, Danielson said.
The impetus for the Utah act came from the state courts, which needed an approved, secure way to authenticate digital documents.
"We primarily saw it as a convenience for people outside the Wasatch Front, but I'm sure the application would be useful here as well," Danielson said.
The banking industry also wants a digital signature infrastructure in place to safeguard electronic financial transactions.
"With technology the way it is going, we needed something to verify electronic documents and signatures," said Lawrence W. Alder, president of the Utah Bankers Association.
The American Bar Association had an early interest in Utah's digital signature law. After the act was adopted in 1995, the bar association began working with the state to tweak it into a model that could serve as the basis for legislation elsewhere.
Utah officials passed out copies of the act in a "model legislation" meeting two weeks ago at the Council of State Governments meeting in Lexington, Ky., according to the Office of Legislative Research and General Counsel.
"Everyone is now saying the standard is in place," said Richard North, director of the state's information technology commission.