Electronic signatures have become a popular method to efficiently execute documents, and the U.S. laws governing them are more than 15 years old. Fund managers are increasingly relying on electronic signatures for agreements with third-party vendors, as well as in certain operating and offering documents, such as subscription agreements. Nevertheless, understanding when and how an electronic signature works in the contracting process and navigating the variety of available technologies remain perplexing given that fund managers, along with the rest of the financial services sector, are governed by a complex regulatory backdrop. In this guest article, the first part of a two-part series on electronic signatures, Julia B. Jacobson and Madeline A. Lally, partner and associate, respectively, at K&L Gates, discuss the legal landscape for electronic signatures, how an electronic signature differs from a digital one and the legal risks associated with the use of electronic signatures. The second article
will include practical advice from other lawyers and consultants on how to implement an e‑signatures program while avoiding risks and how to vet and use vendors that provide these services. For additional insight from K&L Gates attorneys, see our two-part series on state and local pay to play laws: “State and Local Lobbying; Pay to Play; and Gifts and Entertainment Limitations
” (Mar. 23, 2017); and “Public Disclosure Risks Associated With Accepting State and Public Pensions As Investors and How to Mitigate Them
” (Mar. 30, 2017). See also “SEC Tackles Internal Cybersecurity Issues While Sharpening Cybersecurity Enforcement Focus
” (Oct. 5, 2017); and “Practical Steps That Commodity-Focused Hedge Fund Managers Can Take to Combat Cybersecurity Threats
” (Mar. 10, 2016).