Statement by Rep. Tom Bliley (R-VA). Hearing: House Telecommunications Subcommittee. Re: Markup of HR 1714, an electronic signatures bill. Date: July 29, 1999. Source: House Commerce Committee.

Throughout the many hearings this subcommittee has held on a wide range of electronic commerce issues over the past two years, we have frequently heard that Congress should not seek to regulate electronic commerce or place roadblocks on the information superhighway.

The legislation we have before us today does not seek to regulate electronic commerce. Rather, it seeks to remove one of the key roadblocks facing electronic commerce today and will help to promote the growth and development of electronic commerce.

As more and more commercial activities take place on the Internet and the value and complexity of those transactions grow, there is a need for certainty -- the certainty that your transaction is valid and legally binding, and the certainty that you are dealing with the correct parties.

That is where electronic authentication comes in. There are a number of current and existing technologies that can authenticate the parties to a transaction and electronically sign a contract or agreement online. These technologies also provide consumers and business with greater safety, security and privacy in their transactions.

Unfortunately, the legal status of an electronic signature is unclear. To remove this roadblock of uncertainty, H.R. 1714 establishes a uniform, nationwide standard that provides legal validity to electronic signatures and electronic records.

Today, this subcommittee will be considering Titles 1 and 2 of HR 1714. Title 3 of the bill, which deals with the use and acceptance of electronic signatures in the securities industry, was approved by voice vote last week by the Subcommittee on Finance and Hazardous Materials.

Title 1 lays out the general rule of equivalency between an electronic signature and electronic record and a physical signature and a written record.

It also lays out the procedures for states who choose to enact their own electronic signature legislation or adopt uniform electronic signature legislation that is currently in development.

This bill is based on the principles that a contract or agreement that is electronically signed or in the form of an electronic record should not be considered invalid because it is in electronic format. In addition, I do not believe that this legislation should not pick a specific technology or allow only certain types of companies to offer electronic signature services.

These are not just important principles for American companies, but they are important principles to promote overseas. There is concern that some foreign laws on electronic signatures designate specific technologies or methods and do not recognize other technologies or methods as valid.

Title 2 provides guidance to the Department of Commerce to promote the American principles on electronic signatures in discussions with foreign governments and in international fora.

It is my understanding that Mr. Tauzin will be introducing a manager's amendment that incorporates a number of changes that have been agreed to by the majority and minority.

I want to thank Mr. Tauzin for his efforts, and I also want to thank Mr. Dingell, Mr. Markey and Ms. Eshoo for their work on this amendment.

This amendment is another example of the bipartisan work of this committee."