Coronavirus: digital contracts and solutions so as not to interrupt the operations of companies. Which ones are they?
To cope with the Coronavirus emergency without compromising the operations and productivity of companies, it is necessary to resort to specific instruments to complete daily operations and operations made difficult by containment measures. In particular, reference is made to electronic signature systems, digital public deeds, the implementation of closures with deeds carried out in front of several notaries in different locations and, lastly, the execution of the shareholders' meeting via telecommunication systems according to the new actions of the Cura Italia decree. How to use these tools?
Due to CoVid-19 emergency in Italy, the Government has approved several containment measures significatively affecting the business day-by-day operations, including the application of severe restrictive measures to the ability of the individuals to travel in the Italian national territory and abroad.
In this context, ensuring the business continuity of the companies operating in Italy represents a priority.
This article is aimed at providing an overview on certain useful instruments to which companies may recur (within the current energy context but also in the perspective of a more efficient and sustainable future business environment) in order to close ordinary and extraordinary transactions limiting the need to travel and/or to meet in person.
We specifically make reference to: (i) e-signed contracts and documents; (ii) digital public deeds; (iii) implementation of closings with deeds executed before more notaries located in different locations; and (iv) holding shareholders’ meetings by means of telecommunication systems.
E-signatures are regulated by the Regulation (EU) 910/2014 and in Italy by Legislative Decree No. 82/2005 ("CAD"); pursuant to the said provisions of law, documents and/or agreements may be digitally signed with four different types of e-signatures: (i) simple electronic signature ("SES"), (ii) advanced electronic signature (“AES”), (iii) qualified electronic signature (“QES”) and (iv) digital signature (“Digital Signature”).
Among the ones indicated, the e-signatures having the widest legal effect are QES and Digital Signature, since they:
a) ensure the evidentiary value of a written document pursuant to Article 2702 Italian Civil Code, as such e-signatures are considered reliable as to the identity of the signatory, unless an action for fraud (querela di falso) is brought;
b) may be generally used for the execution, inter alia, of employment contracts, non-disclosure agreements, commercial agreements between corporate entities, purchase orders, distribution agreements and service agreements, consumer agreements, sales and services terms, invoices, policies, software licensing agreements, patents, trademarks;
c) may be further used for the execution of those categories of agreements set forth under Article 1350 Italian Civil Code (so called, “contratti con forma ad substantiam”), which must be executed in the form of a public deed or of a private agreement, under penalty of nullity of the same. In such respect, the Agency for Digital Italy (Agenzia per l’Italia Digitale) (“AGID”) (See, AGID, “Firme e Sigilli Elettronici - Analisi comparativa delle varie tipologie presenti nella normativa nazionale e comunitaria”, published on December 2019) and certain Italian Courts (See, Court of Chieti, Decision of February 21, 2008), clarified that those type of contracts – if executed electronically – shall be signed by means of a QES or a Digital Signature.
E-signature systems may be also used for the the execution of notarial deeds (On such matter, see the article “L’atto notarile informatico” published by Sala Maurizio, in Immobili e proprietà, 2011, 1; “L’atto Pubblico Informatico”, published by Smaniottto Elisabetta and Porfiri Marcello, in Immobili e proprietà, 2012, 3), both in the form of an authenticated written agreement and a public deed. More in particular:
a) in case a public deed is concerned, the parties may sign the same by means of a Digital Signature (or other electronic qualified signatures) as well as by a SES, taking into account that the signature of the parties will be – in the final instance – acquired by the notary who will affix his Digital Signature on the document at hand (See, Law No. 89/1913, as amended by the Legislative Decree No. 110/2010);
b) in case an authenticated private agreement (“scrittura privata autenticata”) is concerned, pursuant to Article 25 CAD the public deed may be signed by the private signatories by means of an e-signature as well as any other type of advanced electronic signature, and the relevant document “shall be intended as recognized pursuant to Article 2703 ICC, provided that it has been authenticated by a notary or by another public official authorized thereto”. Indeed, CAD further clarifies that – once the e-signature has been properly authenticated by the notary – the affixation on the document of a Digital Signature by the notary determines the effect that such entire document shall be considered as signed with a Digital Signature.
The execution of a public deed by means of e-signature systems is perfectly compliant with the provisions of Legislative Decree No. 110/2010, according to which notarial deeds can be entirely executed in a digital form (i.e., literally, “atto pubblico elettronico”), in accordance with the provisions of the Italian Digital Agenda redacted by AGID.
In such respect, please also consider that Law No. 172 of December 4, 2017, Article 36, par. 1-ter further clarified that also certain notarial deeds concerning companies having a tax impact (i.e., transformation deeds, merger and de-merger deeds, deeds regulating the transfer or the use of a going concern) may be subscribed in the form of a digital public deed (It is remaining understood that recurring to the execution of digital public deeds will not avoid the application of the filings obligations with the Companies’ Register provided by the Italian Civil Code for these type of notarial deeds).
Among the practical effects of the application of the principles outlined above, a specific mention is worth with regard to the possibility to implement closings where the signatory parties may attend before different notaries, even located in very distant places. In this context, each notary will attest and authenticate the e-signatures respectively collected by the parties.
Indeed, Article 52- bis of Law No. 89/1913, as subsequently amended, (i.e., Italian Notarial Law) regulating the digital public deed states that the signatory parties will personally execute the digital public deed (in the form of a public deed or an authenticated private agreement) before the notary with “digital signature, e-signature, consisting also in the digital collection of an handwritten signature”. Therefore, the deed may not be executed completely by remote, it being necessary that each party sign the document before a notary, but the notaries may be more than one.
In other words, each notary will collect the signature of the party attending before him and ascertain the legal validity of the same by affixing his Digital Signature. The deed which has been signed by the first signatory and the first notary will be transmitted to the other notary who will collect the signature of the other signatory and carry out the same authentication process, so finalizing and perfecting the digital public deed by affixing his notarial steal.
Such electronic authentication process may be used also in relation to PoAs, which can be redacted in digital format, digitally signed by the subject granting the powers and then digitally authenticated by a notary, who will transmit the e-document to the competent subjects.
In the light of the above, it clearly appears that the execution of e-signature systems will entail significative advantages in the current context affected by CoVid-19 containment measures which strongly limit individual travels.
In addition to the instruments described above, it is noteworthy also the possibility to intervene in shareholders’ meetings by means of telecommunication systems.
The matter has been recently implemented by the latest Law Decree of March 17, 2020 containing measures to face CoVid-19 medical emergency (“Cura Italia Law Decree”).
In particular, Article 106 Cura Italia Law Decree expressly regulates the possibility for Italian companies to call and hold an ordinary and extraordinary shareholders’ meeting whose attendants may intervene (even only) by means of telecommunication instruments, even if (i) this results to be not in compliance with the relevant by-laws provisions, and (ii) the chairman and the secretary of the meeting are not physically present at the same place. In any case, it is remaining understood that the telecommunications systems so used shall ensure the proper identification of the attendants to the meeting, their participation to the same and the exercise of the relevant voting rights. It is worth to notice that just some days before the adoption of the Cura Italia Law Decree, the Council of Notaries of Milan expressed an equivalent position on the matter by means of the Decision No. 187 issued on March 11, 2020.