Articles

Businesses have been using electronic technology such as email for years to conduct their business, so what difference does the ETA make? To understand this you need to understand that most business to business dealings are governed by common law (such as formation of contracts) and electronic methods have generally been regarded by the courts as acceptable for these purposes.

But there are many other transactions that are governed by statutory law. In the statutes of New Zealand (that is, Acts of Parliament and Regulations) there are thousands of requirements for information to be "in writing", "signed", "retained", "produced" and notices "given". Electronic methods cannot be used for these, because the law stipulates paper. Although many of us use Internet and phone banking, that is why the bank stills send us monthly statements on paper through the mail.

What the new Act will do is allow you to use electronic methods for meeting these statutory requirements. So once it comes into force, the bank will be able to send you statements electronically, for example, by email, so long as you consent to receiving the information in that way.

Bank statements are just one of thousands of such legal requirements for things to be done using paper-based methods that will now be able to done electronically. The idea is to help your business cut compliance costs by allowing the use of electronic transactions and the electronic storage of information instead of paper-based processes. It will also enable easier and more cost effective interactions with local and central government agencies through the implementation of e-government.

It is important to note, however, that according to the ETA both parties must consent to using electronic methods.

The new law closely follows the Australian Electronic Transactions Act, which will help minimise transaction costs for exporters across the Tasman.