The signature requirements pertain the legal or contractual requirements in order to make a legally effective declaration of intent or a legally binding contract.
Possibility to replace a specific formal requirement of making a binding declaration of intention
Unless the law expressly provides that an agreement is subject to formal requirement in which the matters to be set forth in the document and method are prescribed by law, a particular form is not required. The contract may be signed, sealed, or may be concluded verbally by the contracting party.
Presence of any specific formal requirements to effectively conclude a loan agreement
Since a loan agreement can be concluded upon mutual agreement of the parties, a specific form is not required in order to conclude a loan agreement.
Process of conclusion of a contract by using a qualified electronic signature in practice
The term "electronic signature" refers to electronic information attached to or logically combined with electronic documents to indicate the identity of the signer and the fact that the signer has signed such electronic document, and the term "electronic signature generation information" refers to electronic information used by the signer to create an electronic signature (Article 2 of the Electronic Signature Act).
In order to form a valid contract using an electronic signature, an "electronic signature certification" that confirms and proves that the electronic signature generation information solely belongs to the subscriber is needed.
In order to ensure the stability and reliability of the "electronic signature certification" services and to protect subscribers and users, the "electronic signature certification services provider" must be accredited by the Korea Internet and Security Agency (Article 9 of the Electronic Signature Act and the Operation Standard for Electronic Signature Certification Services).
Legal consequences to a contract in case of not fulfilling formal requirements
If formal requirements are not fulfilled even though the law prescribes a specific form in order to conclude an agreement, the agreement may not be concluded.
Usual practice of signing contractual agreements in the B2B sector
As the law does not prescribe a specific form to conclude contractual agreements, such signature shall be determined by agreement between the parties. In our recent experience, contracts in the B2B sector are typically signed with an electronic signature for convenience.
Usual practice of signing contractual agreements in the B2C sector
As the law does not prescribe a specific form to conclude contractual agreements, such signature shall be determined by agreement between the parties.
With respect to agreements regarding electronic commerce subject to the Act on the Consumer Protection in Electronic Commerce, electronic documents may be utilized (Article 5), and as such, electronic signatures are mostly used for convenience. In the B2C sector, we are not aware of any particular agreements that must be signed with a handwritten signature. However, Article 428-2 (1) of the Civil Act provides that "A guarantee takes effect only where the intention to provide it is indicated in writing, affixing the guarantor's name and seal thereon or signed by the guarantee: Provided, that the intention to provide guarantee indicated in an electronic form has no effect." Thus, electronic signatures on agreements regarding guarantees are not valid, and handwritten signatures are required for electronic commerce guarantee services.