The FCA has set out its expectations of firms when dealing with the need for ‘wet-ink’ signatures (i.e. signing a document by hand using a pen).
Agreements: the FCA rules do not explicitly require wet-ink signatures in agreements, nor do they prevent firms from using electronic signatures in agreements. The validity of electronic signatures is a matter of law. Firms should consider the legal position themselves because the FCA cannot give legal advice.
Firms must also consider any related requirements set out in the FCA Principles for Businesses and general rules. For example:
- Firms should consider Principles 2, 3 and 6 and review the risks and harms of using electronic signatures, and take appropriate steps to minimise those.
- Firms should consider the client’s best interests rule (COBS 2.1.1R) and the fair, clear and not misleading rule (COBS 4.2.1R) to ensure that, when a client signs a document electronically, this does not make it more difficult for the client to understand what they are agreeing to.
Forms: The FCA have recently stated that it would accept electronic signatures for fund-related applications and on all applications from mutual societies. The FCA confirm that firms may use electronic signatures for all interactions with them.
https://www.fca.org.uk/news/statements/expectations-wet-ink-signatures-coronavirus-restrictions
