It has now become a real possibility in Russia to operate a fully automated electronic document flow system both between contracting parties and in relation to state authorities.
The law enables electronic execution of contracts, digital signature, e-invoices and all features of electronic accounting including electronic VAT invoices and other electronic source documents for tax compliance purposes.
This information letter will give an overview of the relevant laws and their application in practice.
Specialized service provider
Electronic documents can generally be exchanged through the intermediary of a specialized service provider who acts as an electronic courier in order to enable electronic document exchange. The special service providers are referred to as electronic document exchange operators (“Operators”) and they usually also functions as Certification Centers. Operators do not only furnish the technical possibility for electronic document exchange, but also ensure legal compliance. The provider records the dates when electronic documents are issued or received, ensures the safety of the document transfer, and also acts as an independent third party in case of disputes and legal proceedings. Among such Operators are the following companies: Taxcom, Diadoc (Kontur), Sbis++, Corus, Kaluga-Astral.
Participation in electronic document exchange requires the receipt of a personalized electronic signature at the Certification Center depending on the level of required legal surety. The authorized Operators are included in a so-called Network of Trusted Electronic Document Circulation Providers. Certification Centers can be both accredited and non-accredited with an authorized federal body.
The activity of functioning as an Operator and Certification Center requires licenses from Ministry of Communications and the Federal Security Service.
For the purpose of electronic exchange of VAT invoice the Federal Tax Service practices a system of authorizing the Operators that can participate in this.
Nowadays only users served by one provider due to the technical compatibility of systems may exchange documents. The issue of roaming organization among different providers is now at the stage of technical development and is only a matter of time. That is why it is advisable to inform contractors which provider you intend to use.
The use of electronic signatures is regulated by the Law on Electronic Signature on 1 July 2012.
There are two types of officially sanctioned electronic signatures, a so-called simple signature and a reinforced signature. The latter is further divided into two types: unqualified and qualified signatures. In essence of these two only the latter, that is, reinforced qualified signature is actually used.
The simple signature is not very relevant for actual electronic document exchange, rather it is usually used only as a means of identifying users for communicating with state and municipal organs through official web portals. A simple signature is received in connection with registration at the relevant portal. It is not intended for the purpose of concluding legal agreements or legally valid signing of documents as this kind of signature is not a part of a system that guarantees that changes to a document cannot be done after signature. This type of signature is used in connection services consisting of releasing reference information.
A reinforced qualified signature is used together with a qualification certificate (certificate of verification of the electronic signature) created by an accredited Certification Center. Together with the cryptographic protection tool certified by the Federal Security Service this qualifies this kind of signature as the most protected.
The use of a reinforced qualified signature is at present envisaged in the following cases:
- Electronic VAT invoices
- Submission of tax returns, financial statements, and request of recovery of funds
- Filing of reports with the pension and social funds
- Filing of reports with the statistics authority
- Filing of various kinds of notifications and official reports with other authorities
- Conducting transactions with the customs authorities;
- Use of in online-banking systems. Banks are granted the discretion to designate the type of electronic signature to be used in a contract with a client. In practice, most banks require the use of a reinforced qualified electronic signature;
- Exchange of electronic documents between an employer and a remote employee (Labor Code, art. 312.1 ).
An electronic document bearing a reinforced qualified electronic signature is considered equivalent to a paper document bearing a handwritten signature (excepting the cases when law requires one to produce a document in hard copy, for example, when issuing a promissory note). But the reverse is true for electronic documents with simple and reinforced unqualified signatures: a document bearing such signatures may be considered equivalent to a paper document with a handwritten signature only in those cases when the law or legal regulations explicitly stipulate so, or when such is established in an agreement between the parties (art. 10 and 11 of the Electronic Signature Law). Therefore, only a qualified electronic signature is recognized as equivalent to a paper document in all cases where it is permitted to create an electronic document.
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Federal Law No. 63-FZ of 6 April 2011 On Electronic Signature