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Federal Electronic Signatures in Global and National Commerce Act |
Ms. PELOSI.
…
I am pleased that language was added to S. 761 which established
"consumer consent'' provisions requiring that consumers be given a
choice as to whether they want to receive legal notices and records
electronically or in writing. In order to prevent fraud, consumers
would also have to grant or confirm their consent electronically
before they would be allowed to receive electronic notices and
records.
Source: Congressional Record - Extension of Remarks, Thursday,
June 15, 2000, 106th Congress, 2nd Session, 146 Cong Rec E 1026.
Mr. SESSIONS.
Under current law, contracts and agreements among businesses and
individuals are considered binding when the second party indicates
agreement to terms with that signature. This system has worked fine
for many years. However, the widespread use of computers and
electronic means of communication have made this system antiquated
and inefficient. The Electronic Signatures in Global and National
Commerce Act will ensure that the United States will remain the
leader in the 21st Century marketplace by giving legal and uniform
status to electronic signatures. Electronic signatures would become
binding, just like a handwritten signature.
Under the legislation, Americans would still be covered by the
existing consumer protection laws should they choose to use this type
of signature. Additionally, the legislation requires consent of the
consumer to use electronic signature. No consumer would be forced
into using electronic signature if they would feel more comfortable
using a handwritten or normal signature.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4347.
Mr. HALL.
…
The measure before us would give legal validity to electronic
signatures on business transactions, and this will help e-commerce by
providing a uniform standard among the states. I am pleased that this
conference agreement includes protections aimed at reducing consumer
fraud.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4347.
Mr. TAUZIN.
…
I am the first to tell Members it is not perfect in that regard.
It literally goes overboard to make sure that when people consent to
be part of the electronic age, that they really consent. It even has
language in it that says that we have to prove that we are capable of
receiving all the documents and notices and information that we are
consenting to be part of in the electronic age; not just giving our
e-mail address as we would give our phone number and address in the
paper age, but actually proving that our computer is capable of
handling all the information that is going to be faxed or e-mailed to
us as part of the electronic transaction.
…
But the bottom line is that nothing requires an American to use
the services of the Internet or to use this bill to sign
electronically for purchases and sales. This is purely voluntary.
It is an opt-in system. We have to consent to it. We have to know
what we are consenting to. We have to prove we are capable of
literally giving the consent, prove we have the equipment and means
by which to engage in electronic business in this new age. It is a
pretty extensive consent agreement provision.
It also contains language making sure that the consumer protection
laws of every State are incorporated, that they are maintained.
Noting takes away from the protection that consumers now enjoy from
those who would like to defraud us.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4348.
Mr. DREIER.
…
For example, under the conference report, consumers who initially
consent in paper and ink to receive electronic records will need to
either reconsent or reconfirm or confirm their consent by electronic
means. Then each time there are changes in any of the hardware or
software requirements for accessing a record that consumers have
consented to receive electronically, the provider must obtain new
consents from all of the affected consumers.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4349.
Mr. MARKEY.
…
Without question many existing requirements for written records
are antiquated whose provision or availability in an electronic
version of the same information can suffice to meet any legal
requirements or policy goals.
However, there are many other existing requirements for written
records which are not antiquated and whose provision or availability
in written form serves clear consumer protection goals. As we
progress into the digital future, this conference report is careful
not to jettison prematurely many important consumer protection
provisions simply to demonstrate our enthusiasm for all things
digital.
The legislation strikes the right balance by clarifying that
electronic contracts or agreements that are otherwise required to be
in writing must accurately reflect the information set forth in the
contract after it was first generated and must remain accessible for
later reference, transmission, and printing. The conference report
also preserves a consumers right to receive records in writing. If a
consumer wants a record that is required to be in writing to be
provided in writing, a consumer still has that right while allowing
other consumers, who may prefer to receive records in electronic
form, to elect to do so.
This conference report also fixes and vastly improves the process
by which consumers may "opt-in'' to receiving electronic records. A
consumer wishing to receive specific records in electronic form must
separately and affirmatively consent to the provision of such records
in electronic form in order for a vendor to provide electronic
records.
In addition this legislation also safeguards the consumer
protection policies that have historically served to adequately
inform consumers of potentially life-changing events or safety
issues. The conference report wisely requires written notices for
any notice dealing with court orders and official court
documents--including legal briefs and court pleadings, any notice
concerning the cancellation of utility services such as water, heat
or power service, for foreclosure or eviction notices. It also would
require the continuation of written notices for the cancellation or
termination of health insurance or benefits or life insurance
benefits.
…
Section 101(d) recognizes the importance of accuracy and
accessibility in electronic records, which is of utmost importance
for investor protection and prevention of fraud. Section 104(b)(3)
recognizes the need for agencies, such as the SEC, to provide
performance standards relating to accuracy, document integrity, and
accessibility in their electronic recordkeeping and retention rules.
This is intended to preserve requirements such as the SEC's existing
electronic recordkeeping rule, Rule 17a-4(f), which specifies that
electronic recordkeeping systems must preserve records in a
non-rewriteable and non-erasable manner. The Conferees also expect
the SEC to work with the securities SROs to the extent necessary to
ensure that accuracy, accessibility, and integrity standards also
cover SRO recordkeeping requirements in an electronic environment.
Section 104 of the Conference Report specifically permits federal
regulatory agencies, such as the SEC, to interpret the law to require
retention of written records in paper form if there is a compelling
governmental interest in law enforcement for imposing such
requirement, and if, imposing such requirement is essential to
attaining such interest. For example, we specifically expect the SEC
would be able to use this provision to require brokers to keep
written records of all disclosures and agreements required to be
obtained by the SEC's penny stock rules.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4349-4350.
Mr. BLILEY.
…
Mr. Speaker, I do want to take a moment to discuss the important
consumer provisions in this bill which were the subject of much
discussion throughout the negotiating process. First, under E-Sign,
engaging in electronic transactions is purely voluntary.
No one will be forced into using or accepting an electronic
signature or record. Consumers that do not want to participate in
electronic commerce will not be forced or duped into doing so.
Second, all existing Federal and State consumer protection laws
remain in place.
Third, we have included a strong consumer consent provision
whereby consumers are provided clear disclosure of terms before they
consent to any agreement. We also have included an important
provision to ensure that consumers will be able to access any
electronic record that is sent to them.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4351
Mr. DINGELL.
…
These joint efforts led to the adoption of strong consumer consent
provisions. These provisions require that consumers affirmatively
consent to receive information in electronic form. Furthermore, these
provisions require that the consumer actually demonstrate its ability
to be open and to gain access to the information in the format that
it will be transmitted. Other consumer protections contained in the
conference report include requirements relating to integrity of
records and security to guard against tampering. Federal regulatory
agencies may grant exemptions from the consent requirements under
certain limited circumstances. Businesses may be required to maintain
paper copies of contracts or records, if there is a compelling law
enforcement or national security interest.
Moreover, many critical documents continue to be provided and
retained on papers, such as wills, adoption, divorce matters, court
orders, utility termination notices, foreclosure and eviction
notices, insurance cancellation, product recalls, and warnings
required to accompany transportation of hazardous materials.
…
Preservation of Rights and Obligations.--Section 101(b)(1). The
Conferees added a new Section 101(b)(1) which provides that this
Title I does not "limit, alter, or otherwise affect any requirement
imposed by a statute, regulation, or rule of law relating to the
rights and obligations of persons under such statute, regulation, or
rule of law other than a requirement that contracts or other records
be written, signed, or in nonelectronic form.'' This savings clause
makes clear that existing legal requirements that do not involve the
writing, signature, or paper form of a contract or other record are
not affected by Title I. Thus, for example, a transaction into which
a consumer enters electronically is still subject to scrutiny under
applicable State and Federal laws that prohibit unfair and deceptive
acts and practices. So, if a consumer were deceived or unfairly
convinced in some way to enter into the electronic transaction, State
and Federal unfair and deceptive practices laws might still apply
even though the consumer was properly notified of their rights under
Section 101(c) and consent to the electronic notices and contracts
was properly obtained. In other words, compliance with the Act's
consumer consent requirements does not make it unnecessary for the
transaction and parties to the transaction to comply with other
applicable statutes, regulations or rules of law.
…
Preservation of Consumer Protections.--Section 101(c)(2)(A). The
Conferees preserved an important provision from the House bill which
provides that: "nothing in this title affects the content or timing
of any disclosure or other record required to be provided or made
available to any consumer under any statute, regulation, or other
rule of law.'' So, for example, if a statute requires that a
disclosure be provided within 24 hours of a certain event and that
the disclosure include specific language set forth clearly and
conspicuously, that requirement could be met by an electronic
disclosure provided within 24 hours of that event, which disclosure
included the specific language, set forth clearly and conspicuously.
However, simply providing a notice electronically does not obviate
the need to satisfy the underlying statute's requirements for timing
and content.
…
Exemptions to Preemption.--Section 102(a). This subsection
expressly gives the States the authority to modify, limit or
supersede provisions of Section 101 in certain ways if the State
enacts the provisions of the Uniform Electronic Transactions Act as
approved and recommended for enactment by the National Conference of
Commissioners on Uniform State Laws in 1999 (UETA).
Prevention of Circumvention.--Section 102(c). Under Section
102(a), States may supersede this Act if they adopt UETA, subject to
certain limitations section forth in Section 102(a). Section 8(b)(2)
of UETA allows States to impose delivery requirements. Section 102(c)
makes clear that States retain the authority provided under Section
8(b)(2), provided that the State does not circumvent Titles I or II
of this Act by imposing nonelectronic delivery methods. Thus,
provided that the delivery methods required are electronic and do not
require that notices and records be delivered in paper form, States
retain their authority under Section 8(b)(2) of UETA to establish
delivery requirements.
It is impossible to envision all of the ways in which this Act
will affect existing statutory requirements. This interpretative
authority will allow regulatory agencies to provide legal certainty
about interpretations to affected parties. Moreover, this authority
will allow regulatory agencies to take steps to address abusive
electronic practices that might arise that are inconsistent with the
goals of their underlying statutes. For example, if a broker were to
deceive a person into pledging equity in their home for a loan based
on false representations about the loan's terms and conditions, the
broker's action could be challenged under any applicable statute that
prohibited such deception and false representations, even if the
consumer executed the loan documents electronically and consented to
the use of the electronic contract and records in compliance with the
terms of this Act. Without this authority, predators might argue
that this Act somehow immunizes the abusive practice, notwithstanding
the underlying statutory requirement, and consumers and competitors
would have to wait for resolution of the issue through
litigation.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4757-4358.
Mr. TAUZIN.
S. 761, I must also mention, provides for extensive consumer
protection. Not only are existing state and federal consumer
protection laws unaffected, but the provisions regarding consent
afford consumers with the greatest possible safeguards against fraud
imaginable. Consumers must opt-in to electronic transactions,
receive full disclosure of terms and conditions, and ultimately prove
that they can electronically access and retain the information that
is the subject of the consent. I submit that in all my time in
Congress, I have never seen a more involved statutory framework for
purposes of manifesting consent.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4360.
Mr. BERMAN.
…
Our efforts to oppose the worst of this legislation have led to a
very good result. The conference has reshaped the bill to protect
consumers from fraud and to provide assurances that consumers will
know their legal rights before they opt-in in receiving electronic
records, understand what records will be affected, and to be able to
get the records in paper should they need to.
Further, the report preserves State and Federal unfair deceptive
practices laws.
The conference report establishes a principle that the Internet
must be a safe place for consumers. I credit my Democratic
colleagues, the gentleman from Michigan (Mr. Dingell) and his other
colleagues on the conference committee, for defending the need to
preserve consumer protections and the excellent leadership of the
gentleman from Virginia (Chairman Bliley) in achieving an appropriate
balance in an excellent piece of legislation.
I am confident that, in passing this report, we will be passing a
bill that will enable electronic conference to go ahead without
undermining consumer protections or the Government's ability to
fulfill its role in industry oversight. A very good job has been
done by the conference committee.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4363.
Mrs. MORELLA.
…
This conference report, however, does not take this step lightly.
There is an understanding of the newness of the medium. And to
balance the concerns of cautious consumers, the legislation includes
provisions meant to protect their interests.
For instance, businesses must receive the consumer's consent
before they conduct their dealings electronically. Also, very
sensitive information still must be transmitted physically.
Cancellation or termination of health insurance cannot be done via
e-mail.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4363-4364.
Mr. INSLEE.
…
Secondly, Mr. Speaker, I want to say that we have achieved a
market success in making sure that consumer rights are protected when
this new technology is used.
Several of us had an amendment when the bill was in the House that
made sure that all consumer protections in the country, all the
substantive notices and consumer protections, in fact those
protections of consumers will remain in under this new law.
In addition, it will make sure that only when consumers want to
use electronic measures will they be used. So it is a great day.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4364.
Mr. DINGELL.
…
He offered the amendment which very significantly improved the
legislation by affording very significant protections to consumers
and to the public who would use this legislation. That amendment
remains in the legislation, and it is going to be very helpful.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4364.
Mr. SANDLIN.
…
The new federal law, as proposed in this conference agreement,
would allow states to modify the law, provided that the modifications
are consistent with the federal standard and technology neutral.
Not only does the proposed national standard give states
flexibility with regards to its implementation, but it also protects
the consumer. Under this agreement, a business must present the
consumer with a statement informing them of their right to have
notices and records provided electronically or in writing. Consumer
protections are further ensured by allowing the consumer to withdraw
the original consent agreement and requiring the business to provide
the alternative source of transmission.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4365.
Mr. LAFALCE.
…
The legislation achieves the important objective of facilitating
the use of electronic records and signatures in interstate and
foreign commerce. The bill also provides that agreements, records,
or contracts entered into have the same legal effect and recognition
as paper transactions. Both of these objectives are complemented
with provisions to ensure that consumers receive the same level of
legal protection regardless of whether they conduct their
transactions on paper or on line. For example, consumers must
affirmatively consent electronically to receiving electronic records
in a manner that reasonably demonstrates that they can access the
information provided. In addition, the legislation provides that
certain notices must be provided in paper, such as notices critical
for the protection of consumers and public health and safety, notices
of cancellation of all forms of insurance and insurance benefits,
notices of default or actions to collect debts, and others.
When this legislation was initially debated on the House floor
last year, I expressed concerns about its impact on existing consumer
and fair lending laws and regulations. My concern centered on the
potential for consumers to receive one level of protection for
in-person, paper transactions, and another for on-line transactions.
I was also concerned about the potential for unscrupulous and
predatory practices. As a result, Banking Committee Chairman Leach
and I, at my behest, wrote to the Federal Reserve to elicit their
views on the legislation. The Federal Reserve, which administers
consumer financial services and fair lending laws, shared my concerns
and agreed that preserving its regulatory authority was essential to
protecting consumers under existing consumer laws. I am happy to
note that the conference report preserves this important regulatory
authority, which has the dual benefit of protecting consumers from
predatory practices, and providing the legal clarity that spares
businesses from unnecessary litigation.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4365.
Mr. LEAHY.
…
I think that this is a good piece of legislation. I think it
should pass. It includes consumer protections and balance that were
lacking from the House-passed bill and builds upon the narrower
provisions of the Senate-passed bill to include some additional
provisions regarding record retention.
…
I think most of those in the various industries that will be
affected, who want an electronic signature bill, realize they have to
have something that would have consumer protection in it. Otherwise,
we could see companies that do not have a strong sense of consumer
ethics misuse the bill. The public reaction would be such that a
subsequent Congress would wipe out all the gains we made.
What has happened now is we have written in good protections. The
best companies, those companies that value their reputation and are
in for the long haul, will follow these rules without any hesitation.
But companies that may think of this as a chance to make
profits--sudden profits--from people who are not computer literate,
people who are just coming across the digital divide, they will be
stopped from preying on the innocent.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5176.
Mr. WYDEN.
…
At the end of the day, this is not a perfect bill. I do not think
any of the conferees would argue that it is. But it is a very good
bill. It is a very good bill because, as a result of three Senate
committees and thousands of hours, we took key principles of what was
known as the old economy--consumer protection, informed consent,
making sure that the vulnerable, the elderly, and people for whom the
home and health care are lifeline concerns--we ensured that they will
be protected, while at the same time allowing those in the financial
services industry, who came to us with sensible suggestions for
saving time and money--by taking records from paper to the electronic
world--to have their concerns addressed, while at the same time being
true to fundamental values of consumer protection and the fusing
together of the new and the old economy. That is what I think makes
this legislation so special.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5217.
Mr. MCCAIN.
…
And this bill recognizes that without consumer confidence, the
Internet can never reach its full potential. Thus, this bill empowers
consumers to conduct transactions or receive records electronically
without foregoing the benefits of State consumer disclosure
requirements.
Specifically, the bill would provide that when consumers choose to
conduct transactions or receive records electronically, electronic
records can satisfy laws requiring a written consumer disclosure if:
consumers have been given a statement explaining what records they
are agreeing to receive electronically, the procedures for
withdrawing consent, and any relevant fees, and consumers consent, or
confirm consent electronically, in a manner that reasonably
demonstrates that they can actually access the information.
The goal of these consumer protection provisions is basic
fairness. To that end, if a business changes hardware or software
requirements in a way that precludes the consumer from accessing or
retaining the records, the consumer can withdraw consent--without a
fee.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5218.
Mr. LEAHY.
…
It avoids facilitating predatory or unlawful practices.
This is not rocket science. But they want to make sure the
American people can trust the electronic world as they trust
paperwork. The American public have enough concern when they go
online. They worry whether their privacy will be protected and
whether damage by a computer virus will hurt their computer, whether
a computer hacker will steal personal information or adopt their
identity, wreak havoc with their good name, or whether their children
will meet a sexual predator. These are all drags on electronic
commerce and show the people have to be concerned.
The AARP found that of consumers over the age of 45, half of them
worry that electronic contracts will give them less protection than
paper contracts. That is what we want to avoid.
The United States has been the incubator of the Internet
throughout its infancy. And the world closely watches whenever we in
our country debate or enact policies that affect the Internet. That
is another reason why we must act carefully and intelligently when we
pass Internet-related laws. The rest of the world watches and
follows our example.
We have produced a charter for the next growth phase of
e-commerce. This bill will be closely watched, widely read, and will
be emulated across the world. Because of that and because most
Americans want to make sure we can take our consumer laws for
granted, we are presented the most significant consumer issues of a
decade or longer. We have improved what the bill almost became
considerably, to the benefit of consumers and in the interests of the
smooth and sensible forward progress of Internet commerce.
This bill does strike a constructive balance. It advances
electronic commerce but doesn't terminate or mangle the basic rights
of consumers.
…
It ensures effective consumer consent to the replacement of paper
notices with electronic notices.
It ensures that electronic records are accurate, and relevant
parties can retain and access them.
It avoids unintended consequences in areas outside the scope of
the bill by providing clear federal regulatory authority for records
not covered by the bill's "consumer'' provisions.
And, it avoids facilitating predatory or unlawful practices.
…
I will now describe how the conference report give effect to the
Democratic Senators' five basic principles.
First, the conference report will ensure informed and effective
consumer consent to the replacement of paper notices and disclosures
with electronic notices and disclosures, so that consumers are not
forced or tricked into receiving notices and disclosures in an
electronic form that they cannot access or decipher.
Under the House bill, a business could obtain a consumer's
"consent'' simply by specifying the hardware and software needed to
access the notices and disclosures. This approach would have done
little or nothing to protect technologically unsophisticated
consumers, who may not know whether they have the necessary hardware
and software even if the technical specifications are provided.
I maintained that any standard for affirmative consent must
require consumers to consent electronically to the provision of
electronic notices and disclosures in a manner that verified the
consumer's capacity to access the information in the form in which it
would be sent. Such a mechanism provides a check against coercion,
and additional assurance that the consumer actually has an operating
e-mail address and the other technical means for accessing the
information.
Section 101(c) of the conference report requires the use of a
technological check, while leaving companies with ample flexibility
to develop their own procedures. The critical language, which
Senator Wyden and I developed and proposed, provides that a
consumer's consent to the provision of information in electronic form
must involve a demonstration that the consumer can actually receive
and read the information. Section 101(c) also provides that if there
is a material change in the hardware or software requirements needed
to access or retain the information, the company must again verify
that the consumer can receive and read the information, or allow the
consumer to withdraw his or her consent without the imposition of any
conditions, consequences or fees. In addition, prior to any consent,
a consumer must be notified of his or her rights, including the right
to receive notices on paper and any available option for reverting to
paper after an electronic relationship has been established.
…
I should also explain the significance of section 101(c)(6), which
was added at the request of the Democratic conferees. This provision
makes clear that a telephone conversation cannot be substituted for a
written notice to a consumer. For decades, consumer laws have
required that notices be in writing, because that form is one that
the consumer can preserve, to which the consumer can refer, and which
is capable of demonstrating after the fact what information was
provided. Under appropriate conditions, electronic communications
can mimic those characteristics; but oral notice over the telephone
will never be sufficient to protect consumer interests.
Second, the conference report will ensure that electronic
contracts and other electronic records are accurate and that relevant
persons can retain and access them. Consumers must be able to retain
electronic records and must have some assurance that they provide
reasonable guarantees of the accuracy and integrity of the
information that they contain.
Under section 101(e) of the conference report, the legal effect of
an electronic contract or record may be denied if it is not in a form
that can be retained and accurately reproduced for later reference
and settlement of disputes. This means that the parties to a
contract may not satisfy a statute of frauds requirement that the
contract be in writing simply by flashing an electronic version of
the contract on a computer screen. Similarly, product warranties
must be provided to purchasers in a form that they can retain and use
to enforce their rights in the event that the product fails.
…
The conference report raises no such concerns. For one thing, it
specifically excludes from its scope any documents required to
accompany the transportation or handling of hazardous materials,
pesticides, and other toxic or dangerous materials. For another
thing, it expressly preserves all Federal and State requirements that
information be posted, displayed or publicly affixed. In addition to
allaying concerns about OSHA-warnings, this provision ensures that
the bill will not inadvertently undermine Federal and State labeling
requirements, such as requirements that poisonous products be labeled
with the skull and crossbones symbol.
…
Fifth and finally, the conference report avoids the problem
created by many earlier drafts, including the House bill, of
potentially facilitating unfair and deceptive practices. It does
this through a broad savings clause which clarifies that the bill
does not limit any legal requirement or prohibition other than those
involving the writing, signature, or paper form of a contract.
Laws--including common law rules--that prohibit fraud, unfair or
deceptive trade practices, or unconscionable contracts are not
affected by this Act. A wrongdoer may not argue that fraudulent
conduct that complies with the technical requirements of section
101(c) is beyond the reach of anti-fraud laws. By the same token, a
consumer is always entitled to assert that an electronic signature is
a forgery, was used without authority, or otherwise is invalid for
reasons that would invalidate the effect of a signature in written
form.
…
That being said, the conference report appropriately rejects the
massively preemptive approach taken by earlier versions of this
legislation, including the House-passed bill. As the National
Governors' Association observed in a letter to Congress dated March
14, 2000, "H.R. 1714's ambiguity with respect to preemption was very
troubling''. It authorized States to "modify, limit, or supersede''
the Federal statute by adopting the Uniform Electronic Transactions
Act (UETA), but then rendered this authorization irrelevant by
stating that no State law (including UETA) was effective to the
extent that it was inconsistent with the Federal statute or
technology specific.
By contrast, the conference report does not preempt the laws of
those States that adopt UETA, so long as UETA is adopted in a uniform
manner. Such exceptions to UETA as a State may adopt are preempted,
but only to the extent that they violate the principle of
technological neutrality or are otherwise inconsistent with the
Federal statute. This affords States considerable flexibility: for
example, a State may enact UETA to incorporate the consumer consent
procedures set forth in section 101(c).
…
The conference report touches upon the issue of delivery in
section 101(c)(2)(B), but only with respect to specified methods that
require verification or acknowledgment of receipt, such as registered
or certified mail. What happens to State law requirements that a
notice be sent by first-class mail or personal delivery? How about a
law that requires information to be provided, sent, or delivered in
writing, but does not specify a particular method of delivery? I
raised these questions during the conference, but the conference
report provides few answers.
The conference report does provide some guidance in the case of
States that enact UETA. In such States, section 8(a) of UETA will
govern with respect to general delivery requirements, and section
8(b)(2) of UETA will govern with respect to requirements that
information be delivered by a specified method, subject to section
102(c) of the federal legislation. Section 102(c) prevents States
that enact UETA from circumventing the federal legislation through
the imposition of new nonelectronic delivery methods. Thus, States
enacting UETA may continue to prescribe specific delivery methods, so
long as there is an electronic alternative for any nonelectronic
delivery methods.
This leaves the question of how the Federal legislation will
affect Federal delivery requirements and State delivery requirements
in non-UETA States. Because our bill is silent on this question, and
because repeal and preemption by implication are disfavored, a court
or agency interpreting the legislation could reasonably conclude that
these Federal and State delivery requirements remain in full force
and effect. Indeed, this interpretation is practically compelled by
the plain language of the legislative text. It does, however, have
the potential to undermine one of our key legislative
objectives--that is, the elimination of unintended and unwarranted
barriers to electronic commerce. For this reason, it will be
tempting to discern in this legislation some sort of plan to permit
electronic delivery of information whenever delivery is required by
law, even when the law specifies a particular method by which
delivery must be made. Let me assure the courts and regulators that
have occasion to read these words that this legislator had no such
plan.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5219-5222.
Mr. HOLLINGS.
…
I am proud to say that the final conference report includes major
protections for consumers and the States. Does it include all I would
have liked for it to? Of course not. However, it does represent a
commendable effort by Republican and Democratic conferees to put
forth a law that accomplishes the original goal of establishing a
legal framework for the new digital world, while maintaining
important protections for American consumers. I have joined with
Senators Sarbanes and Wyden introducing an explanatory statement of
the legislation, which details how the bill affects consumers and
State governments. I would, however, like to highlight a few
important provisions:
(1) The agreement ensures that consumers, when giving consent to do a transaction electronically, before their consent can be valid, must be informed of their right to receive records in paper, and of the right to withdraw their consent once given, and that there be some demonstration that the consumer can actually access and retain the document.
(2) It ensures that consumers are able to withdraw consent to receive their required notices under the contract in the event the provider changes the hardware or software in a manner which prevents the consumer from accessing and retaining the document, without costs and fees.
(3) It preserves state unfair and deceptive trade practices laws, so as to ensure that the use of electronic signatures and electronic transactions cannot be used to evade the requirements and prohibitions of these laws.
(4) It preserves important aspects of Federal and State record retention laws and requirements, and gives States some reasonable time to conform their regulations in light of the legislation's affirmation of electronic record retention by regulated industries.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5228.
Mr. SARBANES.
…
The Commerce Department reports that the digital divide is
actually growing.
For example, the gap between white and minority households has
grown 5 percentage points in just one year, from 1997 to 1998.
The gap, based both on education and income increased by 25 and 29
percent in the past year, respectively.
These dramatic and disturbing findings underline the importance of
ensuring that, as we move to an electronic world, we make sure that
longstanding consumer protections survive the transition. Many of us
made clear from the beginning that our goal was to ensure equivalent
consumer protections for transactions conducted in the paper and
electronic worlds. We have largely achieved that goal.
First among these protections is the common sense provision
incorporated in the report that consumer consent to engage in
electronic commerce be given electronically. This is a protection
against unscrupulous and abusive practices as well as inadvertent
mistakes by well meaning vendors.
Electronic consent will greatly enhance the consumer confidence to
do business on-line, without resulting in additional burden on
businesses--they are, after all, already committed to communicating
with the consumer electronically.
The best demonstration of the importance of electronic consent is
the fact that the initial conference draft that was provided to
Conferees was circulated via e-mail. Yet, despite the fact that our
staff is more technologically sophisticated than the average American
consumer, many of them were unable to download the document and had
to have paper copies hand delivered.
Now, imagine if that was a notice of change in mortgage servicing,
or a notice that health insurance benefits are being cut back, or
that auto insurance is being cancelled. That family could very well
find itself with a sick child on [sic] no health
insurance.
Electronic consent would have avoided that problem by ensuring
that the consumer is able to read the records provided.
Electronic consent is not, as some people have sought to portray
it, relevant only for a transitional period. Compatibility among
systems is always important to check, given the significance of the
records being transmitted. In addition, the U.S. mail is free to
receive and comes to your door. You do not need a computer to
receive the mail. You do not need to pay for an internet service
provider, and you do not need to go to a public library to fain
[sic] access to a computer if you don't have one at home.
For all these reasons, electronic consent will be as important in the
future as it is today.
Finally, we narrowed the scope of the legislation to ensure that
certain notices that simply cannot effectively be made
electronically, such as documents carried by vehicles hauling
hazardous materials, will continue to be in paper form.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5229.
Statement of Senators Hollings, Wyden, and Sarbanes Regarding the
Electronic Signatures in Global and National Commerce Act
We want to make a number of points about some of the important
provisions in the Act we are passing today.
…
General Rule of Validity. Section 101(a)(1) and (2). The Conferees
added the word "solely'' in both sections 101(a)(1) and (2) to ensure
that electronic contracts and signatures are not inadvertently
immunized by this Act from challenge on grounds other than the
absence of a physical writing or signature. Companies and consumers
should only be able to agree to reasonable electronic signature
technologies. As the definition of the electronic signature makes
clear, the electronic signature is only valid under this Act if the
person intended to sign the contract. A person accepting an
electronic signature should have a duty of care to determine if the
signature really was created by the person to whom it is
attributed.
Preservation of Rights and Obligations. Section 101(b)(1). The
Conferees added a new Section 101(b)(1) which provides that this
Title I does not "limit, alter, or otherwise affect any requirement
imposed by a statute, regulation, or rule of law relating to the
rights and obligations of persons under such statute, regulation, or
rule of law other than a requirement that contracts or other records
be written, signed, or in nonelectronic form.'' This savings clause
makes clear that existing legal requirements that do not involve the
writing, signature, or paper form of a contract or other record are
not affected by Title I. As a result, laws or regulations or common
law rules that prohibit fraud or unfair trade or deceptive practices
or unconscionable contracts are not affected by this Act. The use of
the word "solely'' throughout section 101(a) is intended to ensure a
contract, notice or disclosure which is provided electronically gains
no additional validity or sanctity against challenge just because it
is in electronic form. The validity of a consent obtained as the
result of an unfair or deceptive practice can be challenged and found
to be invalid, in which case any records which were provided
electronically will be deemed to not have been provided to the
consumer. Thus, for example, a transaction into which a consumer
enters electronically is still subject to scrutiny under applicable
state and Federal laws that prohibit unfair and deceptive acts and
practices. So, if a consumer were deceived or unfairly convinced in
some way to enter into the electronic transaction, state and Federal
unfair and deceptive practices laws might still apply even though the
consumer was properly notified of their rights under Section 101(c)
and consented to the electronic notices and contract was properly
obtained. In other words, compliance with the Act's consumer consent
requirements does not make it unnecessary for the transaction and
parties to the transaction to comply with other applicable statutes,
regulations or rules of law. The basic rules of good faith and fair
dealing apply to electronic commerce.
…
Consent to Electronic Records. Section 101(c)(1). The House bill
included an amendment that required that consumers affirmatively
consent before they can receive records (included required notices
and disclosures and statements) electronically that are legally
required to be provided or made available in writing. Special rules
apply to electronic transactions entered into by consumers. It is
the Congress' intent that the broadest possible interpretation should
be applied to the concept of "consumer.'' The definition in Section
106(1) is intended to include persons obtaining credit and insurance,
even salaries and pensions--because all of these are "products or
services which are used primarily for personal, family or household
purposes'' as the word is defined in the Act. Amongst the other
changes to this section made in Conference, the Conferees added an
important new element: Section 101(c)(1)(C) of the Conference Report
requires that the consumer "consents electronically, or confirms his
or her consent electronically, in a manner that reasonably
demonstrates that the consumer can access information in the
electronic form that will be used to provide the information that is
the subject of the consent.'' The purpose of this provision is to
ensure that, when consumers agree to receive notices electronically,
that they can actually open, read, and retain the records that they
will be sent electronically. The Act requires that consumers consent
electronically--or confirm their consent electronically--in either
case, in a manner that allows the consumer to test his capacity to
access and retain the electronic records that will be provided to
him. The consumer's consent to receive electronic records is not
valid unless it is confirmed electronically in a manner meeting the
specific requirements of Section 101(c)(1)(C)(ii).
Today, many different technologies can be used to deliver
information--each with its own hardware and software requirements.
An individual may not know whether the hardware and software on his
or her computer will allow a particular technology to operate. (All
of us have had the experience of being unable to open an e-mail
attachment.) Most individuals lack the technological sophistication
to know the exact technical specifications of their computer
equipment and software. It is appropriate to require companies to
establish an "electronic connection'' with their customers in order
to provide assurance that the consumer will be able to access the
information in the electronic form in which it will be sent. This
one-time "electronic check'' can be as simple as an e-mail to the
customer asking the customer to confirm that he or she was able to
open the attachment (if the company plans to send notices to the
customer via e-mail attachments) and a reply from the customer
confirming that he or she was able to open the attachment. This
responsibility is not unduly burdensome to e-commerce. As a matter
of good customer relations, any legitimate company would want to do
confirm that it has a working communications link with its
customers.
Preservation of Consumer Protections. Section 101(c)(2)(A). The
Conferees preserved an important provision from the House bill which
provides that: "nothing in this title affects the content or timing
of any disclosure or other record required to be provided or made
available to any consumer under any statute, regulation, or other
rule of law.'' State and federal law requirements on delivering
documents have not been addressed in this Act. The underlying rules
on these issues still prevail. It is our view that records provided
electronically to consumers must be provided in a manner that has the
same expectation for the consumer's actual receipt as was
contemplated when the state law requirement for "provided'' was
passed. So, for example, if a statute requires that a disclosure be
provided within 24 hours of a certain event and that the disclosure
include specific language set forth clearly and conspicuously. That
requirement could be met by an electronic disclosure if provided
within 24 hours of that event, which disclosure included the specific
language, set forth clearly and conspicuously. However, simply
providing a notice electronically does not obviate the need to
satisfy the underlying statute's requirements for timing and
content.
Retention of Contracts and Records. Section 101(d)(1) and Section
104(b)(3). The Conferees added provisions that state: "if a statute,
regulation, and other rule requires that a contract or other record
relating to a transaction... be retained,'' the requirement is met by
retaining an electronic record of the information that "accurately
reflects the information'' and "remains accessible'' to all who are
entitled to it "in a form that is capable of being accurately
reproduced for later reference....'' Moreover, Federal or State
regulatory agencies may interpret this requirement to specify
performance standards to "assure accuracy, record integrity, and
accessibility of records that are required to be retained.''
Moreover, these performance standards can be specified in a manner
that does not conform to the technology neutrality provisions,
provided that the requirement serves, and is substantially related to
the achievement of, an important governmental objective. These
record retention provisions are essential to the capacity of Federal
and State regulatory and law enforcement agencies to ensure
compliance with laws. For example, the only way in which a
government agency can determine if participants in large government
programs are complying with financial and other requirements of those
programs may be to require that records be retained in a form that
can be readily accessible to government auditors. Similarly,
agencies must be able to require that companies implement
anti-tampering protections to ensure that electronic records cannot
be altered easily by money launderers or embezzlers or others seeking
to hide their illegal activity. Without the ability of these
agencies to ascertain program compliance through electronic record
retention, taxpayers could be exposed to far greater risk of fraud
and abuse. Similarly, bank and other financial regulators need to
require that records be retained in order that their examiners can
insure the safety and soundness of the institutions and their
compliance with all relevant regulatory requirements.
Accuracy and Ability to Retain Contracts and Other Records,
101(e). The Conferees added new language in section (e) of 101 to
establish that a contract or record which is required under other law
to be in writing loses its legal validity unless it is provided
electronically to each party in a manner which allows each party to
retain and use it at a later time to prove the terms of the
record.
Exemptions to Preemption. Section 102(a) allows a state to
"modify, limit or supersede section 101'' in one of two ways: (1) by
passing the Uniform Electronic Transactions Act ("UETA'') as approved
and recommended for enactment by the National Conferences of
Commissioners on Uniform State Laws in 1999, or (2) by passing
another law which specifies the requirements for use or acceptance of
electronic records and electronic signatures which is consistent with
this Act. These choices for states are not mutually exclusive. Of
course, the rules for consumer consent and accuracy and retainability
of electronic records under this Act shall apply in all states that
pass the Uniform Electronic Transaction Act or another law on
electronic records and signatures in the future, unless the state
affirmatively and expressly displaces the requirements of federal law
on these points. A state which passed UETA before the passage of
this Act could not have intended to displace these federal law
requirements. These states would have to pass another law to
supercede or displace the requirements of section 101. In a state
which enacts UETA after passage of this Act, without expressly
limiting the consent, integrity and retainability subsections of 101,
those requirements of this Act would remain in effect. The general
provisions of UETA, such as the requirement for agreement to receive
electronic records in UETA are not inconsistent with and do not
displace the more specific requirements of section 101, such as the
requirement for a consumer's consent and disclosure in section
101(c).
It is important to note that Section 103(b) lists certain notices
which are exempted from the coverage of section 101 (such as notices
of cancellation of utility service or insurance coverage). The legal
result is that section 101 simply does not apply to the notices
listed in section 103. Under section 102(a) a state only has the
authority to modify, limit or supercede the coverage of section 101.
We specifically intend that a state may not use its authority under
section 102, to authorize solely electronic records of those notices
listed in section 103.
Source: Congressional Record - Senate, Thursday, June 15, 2000,
106th Congress, 2nd Session, 146 Cong Rec S 5229-5230.
Mr. BLILEY.
…
The following statement is intended to serve as a guide to the
provisions of the conference report accompanying S. 761, the
Electronic Signatures in Global and National Commerce Act. The
differences between the Senate bill, House amendment, and substitute
agreed to in conference are noted below, except for clerical
corrections, conforming changes made necessary by agreements reached
by the managers, and minor drafting and clerical changes.
…
General Rule of Validity
Conference Substitute
…
The conference report includes an opt-in provision allowing
consumers to consent to receive electronic records as described
below. If a statute, regulation, or other rule of law requires that
a record relating to a transaction in or affecting interstate or
foreign commerce be provided or made available to a consumer in
writing, an electronic record may be substituted if (1) the consumer
affirmatively consents to receive an electronic record and has not
withdrawn such consent, (2) the consumer, prior to consenting, is
provided with a clear and conspicuous statement informing the
consumer of rights or options to have the record provided or made
available on paper, and the right of the consumer to withdraw the
consent to electronic records and of any conditions, consequences
(which may include termination of the parties' relationships), or
fees in the event of withdrawal of consent. Further, the consumer is
informed of whether the consent applies only to the initial
transaction or to identified categories of records that follow the
initial transaction. Disclosure must also be made describing the
procedures the consumer must use to withdraw consent and to update
information needed to contact the consumer electronically. The
consumer must also be informed of how after the consent, the consumer
may, upon request, obtain a paper copy of electronic records, and
whether any fee will be charged for such copy.
Pursuant to subsection (c)(1)(C)(i), the consumer must be
provided, prior to consenting, with a clear and conspicuous statement
describing the hardware and software requirements to access and
retain electronic records.
Subsection (c)(1)(C)(ii) requires that the consumer's consent be
electronic or that it be confirmed electronically, in a manner that
reasonably demonstrates that the consumer will be able to access the
various forms of electronic records to which the consent applies.
The requirement of a reasonable demonstration is not intended to be
burdensome on consumers or the person providing the electronic
record, and could be accomplished in many ways. For example, the
"reasonable demonstration'' requirement is satisfied if the provider
of the electronic records sent the consumer an e-mail with
attachments in the formats to be used in providing the records, asked
the consumer to open the attachments in order to confirm that he
could access the documents, and requested the consumer to indicate in
an e-mailed response to the provider of the electronic records that
he or she can access information in the attachments. Similarly, the
"reasonable demonstration'' requirement is satisfied if it is shown
that in response to such an e-mail the consumer actually accesses
records in the relevant electronic format. The purpose of the
reasonable demonstration provision is to provide consumers with a
simple and efficient mechanism to substantiate their ability to
access the electronic information that will be provided to them.
Subsection (c)(1)(D) requires that after the consent of a consumer
if a change in the hardware or software requirements needed to access
or retain electronic records creates a material risk that the
consumer will not be able to access or retain a subsequent electronic
record that was the subject of the consent, the person providing the
electronic record must provide the consumer with a statement of the
revised hardware and software requirements for access to and
retention of the electronic records, and the right to withdraw
consent without the imposition of any fees for such withdrawal and
without the imposition of any condition or consequence that was not
disclosed. Further, the provider must, pursuant to subparagraph
(C)(ii) perform the consumer access test again.
Subsection (c)(2) includes a savings clause making clear that
nothing in this title affects the content or timing of any disclosure
or other record required to be provided or made available to any
consumer under any statute, regulation, or other rule of law.
Further, subsection (c)(2) provides that if a law that was enacted
prior to this Act expressly requires a record to be provided or made
available by a specified method that requires verification or
acknowledgment of receipt, the record may be provided or made
available electronically only if the method used provides
verification or acknowledgment of receipt (whichever is
required).
…
Subsection (c)(6) provides an oral communication or a recording of
an oral communication shall not qualify as an electronic record for
purposes of this subsection except as otherwise provided under
applicable law.
Section 101(d) addresses statutory and regulatory record retention
requirements. It states that when a statute, regulation, or other
rule of law requires that a record, including a contract, be retained
that requirement is satisfied by the retention of an electronic
record, if two criteria are met. First, the electronic record must
accurately reflect the information set forth in the contract or
record required to be retained. Second, that electronic record must
remain accessible to all parties who by law are entitled to access
the record for the period set out in that law. Moreover, the
electronic record must be in a form capable of accurate reproduction
for later reference. The reproduction may be by way of transmission,
printing or any other method of reproducing records.
Section 101(e) addresses statutory and regulatory requirements
that certain records, including contracts, be in writing. The
statute of frauds writing requirement exemplifies one such legal
requirement. The section states that an electronic record or
contract may be denied legal effect and enforceability under section
101(a) of this Act, if such an electronic record is not in a form
that is capable of being retained and accurately reproduced for later
reference by all parties entitled to retain that contract or record.
This provision is intended to reach two qualities of "a writing'' in
the non-electronic world. The first such quality of "a writing'' is
that it can be retained, e.g., a contract can be filed. The second
such quality of "a writing'' is that it can be reproduced, e.g., a
contract can be copied.
Subsection (f) clarifies that nothing in title I affects the
proximity requirement of any statute, regulation, or other rule of
law with respect to any warning, notice, disclosure, or other record
required to be posted, displayed, or publicly affixed.
Authority to Alter or Supercede General Rule
…
Conference Substitute
The conference report adopts a substitute provision. Section 102
of the conference report provides a conditioned process for States to
enact their own statutes, regulations or other rules of law dealing
with the use and acceptance of electronic signatures and records and
thus opt-out of the federal regime. The preemptive effects of this
Act apply to both existing and future statutes, regulations, or other
rules of law enacted or adopted by a State. Thus, a State could not
argue that section 101 does not preempt its statutes, regulations, or
other rules of law because they were enacted or adopted prior to the
enactment of this Act.
Section 102(a) provides that a State statute, regulation or other
rule of law may modify, limit, or supersede the provisions of section
101 only if that State action: (1) constitutes an adoption or
enactment of the Uniform Electronic Transactions Act (UETA) as
reported and recommended for enactment by the National Conference of
Commissioners on Uniform State Laws (NCCUSL) in 1999; or (2)
specifies alternative procedures or requirements (or both) for the
use or acceptance of electronic signatures or electronic records for
establishing the legal effect, validity and enforceability of
contracts or records.
It is intended that any State that enacts or adopts UETA in its
State to remove itself from Federal preemption pursuant to subsection
(a)(1) shall be required to enact or adopt UETA without amendment.
Any variation or derivation from the exact UETA document reported and
recommended for enactment by NCCUSL shall not qualify under
subsection (a)(1). Instead, such efforts and any other effort may or
may not be eligible under subsection (a)(2). Thus, a State that
enacted a modified version of UETA would not be preempted to the
extent that the enactment or adoption by a State met the conditions
imposed in subsection (a)(2).
Subsection (a)(1) places a significant limitation on a State that
attempts to avoid Federal preemption by enacting or adopting a clean
UETA. Section 3(b)(4) of UETA, as reported and recommended for
enactment by NCCUSL, allows a State to exclude the application of
that State's enactment or adoption of UETA for any "other laws, if
any, identified by State.'' This provision provides a potential
enormous loophole for a State to prevent the use or acceptance of
electronic signatures or electronic records in that State. To remedy
this, subsection (a)(1) requires that any exception utilized by a
State under section 3(b)(4) of UETA shall be preempted if it is
inconsistent with title I or II, or would not be preempted under
subsection (a)(2)(ii) (technology neutrality).
As stated above, subsection (a)(2) is designed to cover any
attempt except a strict enactment or adoption of UETA (which would be
covered by subsection (a)(1)), by a State to escape Federal
preemption by enacting or adopting specific alternative procedures or
requirements for the use or acceptance of electronic signatures or
records. This includes any regulations or State action taken to
implement a clean enactment or adoption of UETA. Thus, a regulation
or other rule of law issued to implement a State's enactment or
adoption of a clean UETA would fall under and be tested against the
standards contained in subsection (a)(2) if it strays in any manner
from the strict, specific text of UETA, as reported and recommended
for enactment by NCCUSL.
Further, some States are enacting or adopting a strict, unamended
version of UETA as well as enacting or adopting a companion or
separate law that contains further provisions relating to the use or
acceptance of electronic signatures or electronic records. Under
this Act, such action by the State would prompt both subsection
(a)(1) (for the strict enactment or adoption of UETA) and subsection
(a)(2) (for the other companion or separate legislation). Subsection
(a)(2) would also apply for any amendments made by a state in the
future to their statutes, regulations or rules of law pertaining to
the original enactment or adoption of UETA that qualified under
subsection (a)(1).
Subsection (a)(2) contains two important conditions that limit the
extent to which a state could utilize it to opt-out of the federal
regime. Specifically, such alternative procedures or requirements:
(1) must be consistent with this title and title II; and (2) do not
require, or accord greater legal status or effect to, the
implementation or application of a specific technology or
technological specification for performing the functions of creating,
storing, generating, receiving, communicating, or authenticating
electronic signatures or records. It is not intended that the
singular use of technology or technological specification in
subsection (a)(2)(A)(ii) allows a State to set more than one
technologies at the expense of other technologies in order to meet
this standard. Instead, this limitation is intended to prevent
States from setting any specific technology or technological
specification, unless otherwise specifically permitted. Further,
inclusion of the "or accord greater legal status or effect to'' is
intended to prevent a state from giving a leg-up or impose an
additional burden on one technology or technical specification that
is not applicable to all others.
In addition, subsection (a)(2)(B) requires that a State that
utilizes subsection (a)(2) to escape federal preemption must make a
specific reference to this Act in any statute, regulation, or other
rule of law enacted or adopted after the date of enactment of this
Act. This provision is intended, in part, to make it easier to track
action by the various States under this subsection for purposes of
research.
…
Specific Exclusions
…
Conference Substitute
The conference report adopts a substitute provision that follows
the House amendment.
Section 103(a) excludes from the application of section 101 any
contract, agreement or record to the extent that it is covered by:
(1) a statute, regulation or rule of law governing the creation and
execution of wills, codicils, or testamentary trusts; (2) a statute,
regulation or other rule of law governing adoption, divorce, or other
matters of family law; (3) the Uniform Commercial Code as in effect
in any state, other than sections 1-107 and 1-206 and Articles 2 and
2A.
Section 103(b) excludes from the application of section 101: (1)
court orders or notices or official court documents (including
briefs, pleading and other writings) required to be executed in
connection with court proceedings; or (2) any notice of: (A) the
cancellation or termination of utility services, (B) default,
acceleration, repossession, foreclosure or eviction, or the right to
cure under a credit agreement secured by, or a rental agreement for,
a primary residence of an individual or the cancellation or
termination of health insurance or benefits or life insurance
benefits (excluding annuities).
The exclusion pertaining to utility services applies to essential
consumer services including water, heat and power. This provision
does not apply to notices for other broadly used important consumer
services, such as telephone, cable television, and Internet access
services, etc. Electronic cancellation or termination notices may be
used in association with those other services, assuming all of the
other elements of Section 101 are met.
Source: Congressional Record - House, Wednesday, June 14, 2000,
106th Congress, 2nd Session, 146 Cong Rec H 4352-4355.
Excerpts prepared by:
Gail Hillebrand
Consumers Union of U.S., Inc.
West Coast Regional Office
1535 Mission St.
San Francisco, CA 94103
(415) 431-6747
hillga@consumer.org
Consumers Union's West
Coast Regional Office
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