Many organisations are taking processes and looking to see how they can do them electronically and automatically. Putting digital first or moving from a paper-based environment to a digital environment. There are obviously huge benefits to going digital – saving time and money being the most obvious. For example, many organisations are implementing the Companies Act electronically. As part of taking a physical or paper-based process and making it electronic, it is crucial to consider the laws that relate to the electronic transaction that is part of the process.
Lawyers should be measured on what they lawfully enable, not what they stop.
The laws that could be relevant to electronic processes
There are actually quite a few laws that relate to electronic transactions or processes. The interaction between these different laws is also very important. Here are a few of the laws that are relevant:
- The Electronic Communications and Transactions Act (ECT Act) facilitates and enables electronic transactions. It also contains consumer protection provisions that specifically relate to an electronic transaction. It is also the law that enables the use of electronic signatures.
- Data protection laws (including POPIA and the GDPR) are also relevant. Processes generally include the processing of personal information and therefore an organisation needs to ensure that it’s processing of personal information is in accordance with data protection laws.
- The Consumer Protection Act (CPA) relates to any transaction between a supplier and a consumer. It can, therefore, have a big impact on the transaction depending on various factors.
- There is some case law dealing with electronic contracting, including contracting by email and SMS.
- There are various other laws that could apply. For example, the Companies Act, the Rental Housing Act, or the National Credit Act could apply.
- The law related to electronic evidence.
The issues that could arise
There are many issues that could arise when you automate a process electronically. Here are some of the most important ones:
- Acceptance – when is an offer that you make electronically accepted? Is deemed acceptance (e.g. a ‘browsewrap agreement’ on a website) sufficient or is actual acceptance (e.g. a clickwrap agreement on a website) required?
- Proof – what information do you have to collect to prove that an offer was accepted?
- Authentication – how do you know who you are dealing with?
- Privacy – what information can you collect? What can you do with this information once it has been collected?
- Liability – what risks do you face if the process is not automated in compliance with the law?
Review and report
You have to consider all of these laws and the manner in which they interact to make sure that you comply with the law when you make a process automatic and electronic. We can review your process, identify the issues, and draft a report that sets out:
- the risk or issue,
- the laws that apply to the different aspects of that process, and
- our suggested solutions on how you can ensure that it complies with the law.