What is an Electronic Signature? It is a modern digital authentication system that allows you to authenticate contracts and documents electronically with complete security and in accordance with applicable legal standards. It serves as a modern alternative to traditional handwritten signatures and uses advanced encryption technologies to confirm document authenticity and accurately identify the signatory.
In this article, we explore together the different types of electronic signature and their importance in the Egyptian electronic invoicing system, in addition to the steps to obtain them and their technical requirements, as well as their advantages and disadvantages, and the differences between electronic signature, digital signatures, electronic seals, and other important details.
What is an Electronic Signature?
An electronic signature is an advanced digital mechanism that enables you to authenticate documents and contracts electronically in a secure and legal manner.
This type of signature represents an effective alternative to traditional signatures, as it relies on advanced encryption technologies to ensure document authenticity and signatory identity.
The signature takes the form of an encrypted message that complies with applicable legal standards and ensures a high level of protection that prevents any attempts at manipulation or forgery. This signature works as a unique digital fingerprint that proves the signatory’s identity with complete accuracy and in a way that cannot be circumvented.
Uses of electronic signature
In the modern business system, electronic signature are used in many vital areas, including:
- Financial and commercial transactions.
- Government services.
- Administrative services.
Electronic signature in Egypt have become an integral part of the electronic invoice system, where the Egyptian Tax Authority requires the presence of this signature to approve any tax invoice. This makes understanding the definition of electronic signature an urgent necessity for every business owner in the Arab Republic of Egypt.
Importance of Electronic Signature
The real importance of electronic signature lies in being:
- A fundamental pillar for completing transactions in the electronic tax invoice system.
- Having high security features that protect your rights as a business owner and prevent any attempts at forgery or manipulation of your financial documents.
- Strong and approved evidence in all legal and commercial dealings.
- According to what the Egyptian Tax Authority states, no electronic invoice can be approved without an electronic signature on it.
- Accelerating and simplifying your commercial procedures, where you can complete transactions at exceptional speed without the need for personal attendance or using traditional papers.
Types of electronic signature
Electronic signature forms vary according to the level of security and protection required, allowing you to choose the most appropriate type according to the nature of your work and your specific requirements. These types include:
Simple Electronic Signature
Simple electronic signature is the most widespread and commonly used type of electronic signature, providing an easy and direct way to approve documents or accept terms and conditions. However, it does not include detailed information about the signatory’s identity or details of the signing process, such as timing and date.
Despite the ease of use of this type, it features a low level of security compared to other types, as unauthorized persons may be able to use it without strong mechanisms to verify the signatory’s true identity.
Advanced Electronic Signature
This type can accurately identify the signatory’s identity and is uniquely linked to their person. What distinguishes it is that the signatory maintains complete control over it, and it can be linked to electronic documents to monitor any modifications that may occur to the data.
Qualified Electronic Signature
The qualified electronic signature is the most advanced and secure type, combining the advantages of the previous two types with the addition of advanced protection technologies. This type is created using specialized and qualified devices that ensure the highest security standards.
The basic requirement for using this signature is that you must obtain a qualified electronic signature certificate from an accredited authority. This type is actually used in the electronic invoice system in Egypt, making it the optimal choice for companies and institutions.
Advantages of electronic signature
electronic signature offer an exceptional package of advantages that benefit both individuals and companies, including:
- Ease of use and procedure simplification: Simply by accessing the appropriate signature platform, you can complete the signing process in a few minutes, without long waiting or complicated procedures.
- Time and effort savings and increased efficiency: Instead of printing documents, signing them manually, then scanning and resending them, you can complete the entire task electronically with high efficiency.
- Increased productivity: Studies indicate that using this signature saves up to 80% of the time spent on traditional signing, leading to productivity increases of up to 85%.
- Cost savings: This system radically reduces costs associated with printing, ink, scanning, and storing paper documents. It also reduces postal and shipping costs that may arise from delivering documents through traditional methods.
- Increased security and credibility: this signature technologies allow for easy and effective verification of signature authenticity and reliability, reducing risks of manipulation and forgery.
- Error reduction: electronic signature contribute to reducing errors by up to 85% with each document signed electronically, ensuring data accuracy and integrity while maintaining the credibility of your transactions.
- Easy tracking and monitoring: Electronic documents can be stored and managed centrally and securely, enabling you to track signature records and know who signed documents and when the process took place.
How is Electronic Signing Done?
According to the head of the Egyptian Tax Authority, the electronic signing method requires achieving several specific steps and requirements to ensure obtaining an accredited and documented certificate, including:
First: Sending Registration Request to Tax Authority
1- To join the electronic system, you need to send a registration request to the Authority’s email, attaching copies of the following necessary documents:
- Personal ID of the company owner or authorized representative.
- Tax card of the establishment.
- Tax registration certificate.
- Official authorization letter from the company.
2- After receiving the Authority’s response with an appointment to open the digital file, you go to your affiliated tax office to submit original documents. The specialist employee reviews the documents and verifies their accuracy, and the file is created within only 48 hours.
3- The Tax Authority sends an electronic invitation to your email, and you must open the invitation and complete the required data.
Second: Providing Required Documents to Obtain Electronic Signature Certificate
1- The process of obtaining an electronic signature certificate begins by going to the issuance center, filling out the application form with taxpayer data, then submitting the following documents and paying application fees:
- Copy of the establishment’s tax card.
- Copy of identity proof for the responsible manager.
- Copy of investment certificate or company establishment contract
- Copy of official commercial register extract or establishment decree.
2- It is important to submit the application for obtaining the certificate and sign it by the responsible manager or legal representative of the company, with the necessity of authenticating the signature with the seal of the dealing bank.
Third: Providing Technical Requirements
1- Before starting to use electronic signature, the necessary technical requirements must be provided:
- HSM Device: You must provide an HSM device that enables you to easily sign various documents and invoices and authenticate them electronically, without the need for traditional handwriting.
- Enterprise Resource Planning (ERP) Program: This comprehensive administrative program is linked with the electronic invoice system through application programming interfaces to achieve complete integration. This signature device must be installed on this program to be able to sign invoices before sending them to the system.
Electronic Signature Problems
Despite the numerous advantages of electronic signature, they face some challenges and disadvantages that you should be aware of as a business owner, such as:
1- Self-Registration Restrictions
electronic signature cannot be used in self-registration for electronic invoices, as they are not suitable for approving invoices when choosing this type of registration, which limits your options in some cases.
2- Technical Complexity
People unaccustomed to using technology may face difficulty in obtaining or using electronic signature correctly. This complexity may require additional training or technical assistance, increasing initial costs.
3- Security Risks
Despite electronic signature relying on strong encryption systems, there are potential risks that may threaten security, such as virus attacks and other cyber threats. These risks require continuous investment in updating protection systems.
4- Internet Dependency
Obtaining and using electronic signature requires a stable internet connection, which may pose a problem in case of weak connection or service interruption, potentially affecting workflow.
5- Verification Problem
Sometimes, you may face difficulty in efficiently verifying the authenticity of electronic signature, making them susceptible to unauthorized manipulation or modification. This requires using advanced and accredited verification tools.
Best Electronic Signature Software
When looking for reliable electronic signature software, Mofawtar program stands out as one of the best solutions available in the Egyptian market.
This program provides integrated solutions that meet the needs of companies of all sizes, including:
- Easy and flexible user interface that enables you to manage electronic signature operations with high efficiency.
- Support for all types of electronic signature.
- Compatible with Egyptian Tax Authority requirements to ensure full compliance with local laws.
- Complete integration with the electronic invoice system, facilitating the process of issuing and signing invoices electronically.
- Ability to track documents and manage signature records in an organized and secure manner.
- Providing distinguished technical support and comprehensive training to ensure you get maximum benefit from all program features.
What’s the Difference Between Electronic Signature and Digital Signature?
You might wonder about the differences between electronic signature and digital signatures, especially since both are done through modern electronic methods. Understanding these differences is important for choosing the appropriate type for your needs.
Electronic Signature
Electronic signature is a digital simulation of traditional handwritten signatures. Instead of using paper and pens, you use electronic devices to insert your signature on documents.
This type of signature provides a higher level of security and accuracy than its manual counterpart thanks to its connection with modern technologies.
Digital Signature
Digital signature differs in method and concept, where you don’t need to enter or draw your actual signature. This type is based on complex mathematical algorithms that ensure the integrity of data transmitted over the internet and protect it from forgery and document manipulation.
What’s the Difference Between Electronic Seal and Electronic Signature?
There is a fundamental difference between electronic seals and electronic signature, although both are used in the same digital system. This difference is explained as follows:
Electronic Seal
The electronic seal is linked to the company’s registration number in the commercial register and is used in two specific cases: self-registration in the electronic invoice system, and in case the taxpayer has an Enterprise Resource Planning (ERP) system.
This type of seal provides greater flexibility for companies that prefer to manage their invoices independently, or that have advanced technical systems requiring integration with the Tax Authority system.
Electronic Signature
The electronic signature is linked to the national ID number of the person authorized to sign for the company and is used in only one case: using the government portal to issue invoices. Therefore, it is not suitable for self-registration in the system.
This restriction makes electronic signature more suitable for small and medium companies that prefer to rely on the government portal for managing their electronic invoices.
Conclusion
electronic signature have become an indispensable necessity in the modern business world, especially with the trend toward comprehensive digitization in Egypt. If you’re looking for an integrated solution that ensures full compliance with Egyptian Tax Authority requirements, Mofawtar program offers you the optimal solution.
The program provides all types of electronic signature, with an easy and flexible user interface, and complete integration with the electronic invoice system.
Don’t let technical complexities hinder your business growth. Start your digital transformation journey with Mofawtar and benefit from the distinguished technical support and comprehensive training we provide.
