Lithuania to get digital signature law

VILNIUS - A breath of fresh air has been delivered to Lithuanian electronic commerce, thanks to the government's approval of a draft law on electronic signatures.

The law would grant legal status to a system of digital certification verifying the identity of persons making purchases and doing other transactions on the digital highway. Drafted by the informatics department of Vilnius University and approved by the government on May 24, the law should improve the environment for the nascent digital commerce industry in Lithuania, which, like most European states, has been lagging far behind the United States in terms of commercial usage of the Internet.

"The main reason for the electronic signature is to secure special transactions over the Internet, especially financial," explains Martynas Bieliunas, acting director of Vilnius University's informatics department. "The idea is, when you're sending some document with an electronic signature, you ensure that if the signature is not broken, the recipient is getting the same document, non-modified, sent by same person at the same time. The possibility to forge an electronic signature is quite small. From my point of view, it's much easier to forge a handwritten signature."

The system to be employed in Lithuania is the system used in most other digitalized climes - a public/private key system.

A "key," explains Valdas Undzenas, head of the information systems section in the Vilnius University informatics department, is a unique string of special characters that allows sensitive documents to be transferred privately on the Internet. One key is public, stored in a worldwide digital certification center, and needs a corresponding private key, to which only the user's computer has access, to decode a particular document. When information is sent to other people, the user is actually giving them a public key so they can send the user encrypted information that the user only can decrypt and read with the private key.

The timing of this law coincides with the European Union's efforts to create a digital environment capable of competing with the wide-open U.S. Web community.

"Because the EU has an electronic signature directive it is necessary to have the same ideas in Lithuanian law," Bieliunas says. "But I should emphasize that the Lithuanian government began work in this field almost two and a half years ago, when this European directive was not even drafted. These are parallel processes."

Bieliunas adds that the Parliament has an obligation to pass this law by the end of this session.

"So it's a question of month, two months maybe, but not more," he said.

Article 7 of the draft law, says Egle Gudelyte, a legal advisor for Lietuvos Telekomas, will make it possible to use digital signatures in legal action.

"It consolidates the admissibility of electronically signed documents as evidence in legal proceedings," said Gudelyte, in written responses to TBT's questions.

"This will be the precedent for legislative institutions to change other related laws so that electronically signed or maybe even electronically concluded documents will obtain the same legal power as traditional documents," he wrote

Gudelyte suggests that the law will bring a level of credibility to the Lithuanian Internet.

"At the moment one of the biggest concerns and obstacles of development of the Internet is that it lacks trust/reliability. Electronic signatures would verify that you communicate with the person/company you intended to. The law would especially help the financial sector of the Lithuanian market - electronic payments will definitely be a take-off in starting "real" e-commerce."

The law will also promote safety for businesses getting ready to hitch on to the info highway.

"Business-wise the new law would open up the gateways for confident electronic business bringing the safety feature to it for consumers as well as traders," Gudelyte adds.

The law also represents a mode of survival for Lithuanian businesses, says Vygaudas Usackas, vice minister of foreign affairs and chief negotiator for EU membership.

"It is obvious that a company that isn't involved in the Internet and e-commerce will not be able to compete and soon will be condemned to disappear," he told Parliament in April.