Scope and objectives:
The purpose of the guidelines is to specify the minimum standards which the FSC would expect its applicants and licensees to observe, with respect to the adoption of digital signatures as a means for electronically signing documents, during the conduct of their financial business activities.
One of the objectives of the guidelines is to specify the criteria and standards, which applicants and licensees shall observe, for the FSC to accept the use of digital signatures as a substitute for wet signatures.
The guidelines govern the use of digital signatures for signing documents related to:
- Application for a certification through the FSC One platform involving the electronic submission of PDF document(s) by an applicant which is digitally signed;
- Post-licensing requests through the FSC One platform, involving the electronic submission of PDF document(s) by a licensee, which are digitally signed;
- Inspections run by the FSC whereby licensees are required to provide documentary demonstrations of PDF documents that include digital signatures; and
- Submissions of other digitally signed PDF documents may be determined by the commission.
- The commission accepts the use of digital signatures for the above listed purposes subject to the seven criteria of usage listed in Appendix A and described in more detail in the guidelines.
- The FSC has adopted a vendor-neutral approach to digital signature software, as explained in section six of the guidelines. However, readers will note from section 6.2 that DocuSign’s EU Advanced Signature is being referred to as the benchmark.
- Tutorial videos are available for the following:
- Failure to comply with the requirement of the guidelines shall result in the non-acceptance of the digital signature by the commission, as well as other regulatory actions.
From the above guidelines and further to discussion with the FSC, we conclude that the guidelines are also applicable to:
- Customer due diligence documents are collected as certified true copies by local financial institutions to onboard clients. Following interactions with the FSC and industry association, we understand that the FSC Anti-Money Laundering and Countering the Financing of Terrorism Handbook will also be amended/updated in due course to reflect this option.
- Subscription/application documents. As per the Electronic Transactions Act, an agreement can be signed digitally, and it will not be denied legal effect. Subscription agreements and application forms can hence also be digitally signed, provided the licensee’s constitutive documents allow the same.
It is deemed when the guidelines were issued – Monday, October 23, 2023. For assistance with digital signatures, contact our team.
Issued by Compliance, November 2023
Appendix A – Criteria of use
- The signatory shall be a natural person.
- The digitally signed document shall be in the PDF format and the digital certificate used to sign the document shall have been issued by a certificate authority listed on the Adobe Approved Trust List.
- The digital signature shall meet the PDF Advanced Electronic Signatures Long Term Validation standard.
- The validity of the digital signature shall be automatically verifiable within Adobe Reader/ Adobe Acrobat through the “signature panel”, “certificate details” and “signature validation” capabilities.
- The security level of the digital signature must meet or exceed the security level required by the electronic Identification, Authentication, and trust services regulations for advanced electronic signatures.
- For record-keeping and auditing purposes, a certificate of completion (shall be generated and retained by the digital signature software for every digitally signed document.
- The signed document shall include an embedded timestamp.