E-signature is recognized as legitimate signatures and is admissible in a court of law. E-signatures or digital signatures produced by a Certifying Authority are recognized as being valid in Nepal because of the country’s hierarchical root of trust system. In addition, the Electronic Transactions Act specifies particular use cases for E-signatures. 

The Electronic Transactions Act, 2006 

According to Electronic Transaction Act 2006, the prevailing law requires any information, document, record, or other matters to be certified by affixing a signature or any document to be signed by any person. Then, suppose the digital signature accredits such information, documents, records, or values after fulfilling the procedures stipulated in this Act or the rules thereunder. In that case, such a digital signature shall also have legal validity. 

Use Cases for E-signatures

Use of eSignature in case of Simple Electronic Signature (SES): 

• • Quick drafting of HR Documents using pre-approved templates 

• • Sample updating of each employee and new hire onboarding procedures. 

• • 360-degree views of employees’ files.  

• • End-user agreements include sales and service terms, contracts for opening new retail accounts, invoices, shipment information, user manuals, EULAs, and policies. 

Use of eSignature in case of Advance Electronic Signature (AES): 

• • Purchase, procurement, and commercial agreements 

• • Acknowledgments of orders, invoices, trade and payment terms, certificates, and NDAs. 

• • Residential and commercial real estate lease agreements 

Use Cases in which Electronic Signatures Are Not Appropriate: 

Use cases that expressly forbid the usage of digital or electronic processes or include explicit requirements, such as formal notarial procedures or handwritten (for example, with wet ink) signatures, are typically incompatible with electronic signatures or digital transaction management. 

• • Trust deed and power of attorney both prepared by hand 

• • Wills and other testamentary dispositions that have been handwritten. 

• • Any contract for sale, real estate transfer, or interest in such a deal must be written by hand. 

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