SRC-SLL H.B. 984 75(R)BILL ANALYSIS


Senate Research CenterH.B. 984
By: Hochberg (Sibley)
Jurisprudence
5-12-97
Committee Report (Amended)


DIGEST 

Currently, state law does not recognize electronic equivalents for
handwritten signature.  Electronic data interchange and electronic
financial transactions are becoming more common in both the public and
private sector, and digital signatures are necessary to authenticate data
and verify the identity of participants.  This bill will provide
regulations regarding the use of digital signatures. 

PURPOSE

As proposed, H.B. 984 provides regulations regarding the use of digital
signatures. 

RULEMAKING AUTHORITY

Rulemaking authority is granted to the Department of Information Resources
in SECTION 2 (Section 2054.060(a), Government Code) and to the governing
body of a local government in SECTION 2 (Section 2054(b), Government Code)
of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 2A, Business & Commerce Code, by adding Section
2.108, as follows: 

Sec.  2.108.  DIGITAL SIGNATURE.  Provides that a written electronic
communication sent from within or received in this state in connection
with a transaction governed by this chapter is considered signed if a
digital signature is transmitted with the communication.  Provides that
this section does not preclude any symbol from being valid as a signature
under other applicable law, including Section 1.201(39).  Provides that
the use of a digital signature under this section is subject to criminal
laws pertaining to fraud and computer crimes, including Chapters 32 and
33, Penal Code.  Defines "digital signature." 

SECTION 2. Amends Chapter 2054C, Government Code, by adding Section
2054.060, as follows: 

Sec.  2054.060.  DIGITAL SIGNATURE.  Authorizes a digital signature to be
used to authenticate a written electronic communication sent to a state
agency if it complies with rules adopted by the Department of Information
Resources (department).  Requires the department, before adopting the
rules, to consult with certain persons regarding the content of the rules.
Requires the department, when adopting the rules, to consider certain
factors. Authorizes a digital signature to be used to authenticate a
written electronic communication sent to a local government if it complies
with rules adopted by the governing body of the local government
(governing body).  Requires the governing body, before adopting the rules,
to consider the rules adopted by the department and, to the extent
possible and practicable, to make the governing body's rules consistent
with the department's rules.  Defines "digital signature," "local
government," and "state agency."  Makes conforming changes. 

SECTION 3. Effective date: September 1, 1997.

SECTION 4. Emergency clause.


 SUMMARY OF COMMITTEE CHANGES

Amendment 1.

(1) On page 3, line 5, between "791.003" and the period, insert ", but
does not include an agency in the judicial branch of local government". 

(2) On page 3, after line 5, add the following new subsection:

"(3) "State agency" does not include an agency in the judicial branch of
state government."