Facsimile as Electronic Document under the Electronic Commerce Law

A fax or facsimile machine, while not readily embraced by everybody unlike the ubiquitous cellphone, is a routine part of transactions, especially in business. Many people are still uncomfortable in operating a fax machine. Why would one pay attention to a fax machine other than learning how to insert the paper, enter the recipient’s number and push the send button. We take it for granted.

The problem is how to operate a fax machine, not the effect of what’s sent through it. We’re usually not concerned if the fax message constitutes something legally binding or if it will stand in court. We pay particular attention to it only when there’s a problem, just like in the case of MCC Industrial Sales Corporation vs. Ssangyong Corporation (G.R. No. 170633, 17 October 2007).

The point of contention in this case is whether certain invoices, which are mere photocopies of invoices sent by fax, are admissible in evidence. Boring stuff, it is. If you’ve decided to read on, I can think of four possibilities: you’re having the same problem, you just want to know new things, you’re bored and has nothing else to do, or you just want to know if my discussion is wrong.

Going back to that case, the Supreme Court was faced with the issue of whether “an original printout of a facsimile transmission an electronic data message or electronic document.”

An “electronic data message” or an “electronic document” is the functional equivalent of an original written document for evidentiary purposes. This is provided in Republic Act 8792, also known as the Electronic Commerce Act of 2000, was approved on 14 June 2000. What, then, is an “electronic data message” or an “electronic document”?

The SC concluded that a facsimile transmission cannot be considered as electronic evidence. The terms “electronic data message” and “electronic document” do not include a facsimile transmission. It is not the functional equivalent of an original under the Best Evidence Rule and is not admissible as electronic evidence. With greater reason is a photocopy of such a fax transmission not electronic evidence. The photocopies of the original fax transmittals are not electronic evidence.

Before proceeding, it might be relevant to note that the terms “electronic document” and “electronic data message, while used interchangeably in the law, have a “slight difference”. While “data message” has reference to information electronically sent, stored or transmitted, it does not necessarily mean that it will give rise to a right or extinguish an obligation, unlike an electronic document.

Definition under the UNCITRAL’s Model Law on Electronic Commerce

Majority of the provisions of R.A. No. 8792 were taken from the Model Law on Electronic Commerce (“Model Law”) adopted by the United Nations Commission on International Trade Law (UNCITRAL), which defines a “data message” in the following manner:

“Data message” means information generated, sent, received or stored by electronic, optical or similar means including, but not limited to, electronic data interchange (EDI), electronic mail, telegram, telex or telecopy.

The underscored portion appears in the UNCITRAL Model Law and the original text of the bill that became RA 8792. The phase was later removed by the Senate.

The Senate bill that subsequently became RA 8792 used the term “data message”, patterned after the UNCITRAL Model Law. During the period for amendments, the term “data message” was substituted with “electronic data message”, which in turn was patterned after the definition of “electronic record” under Canadian law. The changes were explained during the Senate deliberations:

The explanation for this term and its definition is as follows: The term “ELECTRONIC RECORD” fixes the scope of our bill. The record is the data. The record may be on any medium. It is electronic because it is recorded or stored in or by a computer system or a similar device.

The amendment is intended to apply, for example, to data on magnetic strips on cards or in Smart cards. As drafted, it would not apply to telexes or faxes, except computer-generated faxes, unlike the United Nations model law on electronic commerce. It would also not apply to regular digital telephone conversations since the information is not recorded. It would apply to voice mail since the information has been recorded in or by a device similar to a computer. Likewise, video records are not covered. Though when the video is transferred to a website, it would be covered because of the involvement of the computer. Music recorded by a computer system on a compact disc would be covered.

In short, not all data recorded or stored in digital form is covered. A computer or a similar device has to be involved in its creation or storage. The term “similar device” does not extend to all devices that create or store data in digital form. Although things that are not recorded or preserved by or in a computer system are omitted from this bill, these may well be admissible under other rules of law. This provision focuses on replacing the search for originality proving the reliability of systems instead of that of individual records and using standards to show systems reliability.

Paper records that are produced directly by a computer system such as printouts are themselves electronic records being just the means of intelligible display of the contents of the record. Photocopies of the printout would be paper record subject to the usual rules about copies, but the original printout would be subject to the rules of admissibility of this bill.

However, printouts that are used only as paper records and whose computer origin is never again called on are treated as paper records. In that case, the reliability of the computer system that produces the record is irrelevant to its reliability.

This explains the addition of the word “electronic” to the original “data message”, and the deletion of the phrase “but not limited to, electronic data interchange (EDI), electronic mail, telegram, telex or telecopy” as used under the UNCITRAL Model Law. The final definitions under the Electronic Commerce Act of 2000 are as follows:

“Electronic Data Message” refers to information generated, sent, received or stored by electronic, optical or similar means. (Sec. 5[c])

“Electronic Document” refers to information or the representation of information, data, figures, symbols or other modes of written expression, described or however represented, by which a right is established or an obligation extinguished, or by which a fact may be proved and affirmed, which is received, recorded, transmitted, stored, processed, retrieved or produced electronically. (Sec. 5[f])

The deletion by Congress of the phrase “including, but not limited to, electronic data interchange (EDI), electronic mail, telegram, telex or telecopy”, and its reinstatement under the Implementing Rules and Regulations (IRR).

Definition under the Implementing Rules and Regulations

The Electronic Commerce Act of 2000 requires a number of government agencies, including the DTI, DBM and BSP, to prepare the Implementing Rules and Regulations (IRR) of R.A. 8792. The IRR was signed on 13 July 2000. It defines the terms as follows:

“Electronic Data Message” refers to information generated, sent, received or stored by electronic, optical or similar means, but not limited to, electronic data interchange (EDI), electronic mail, telegram, telex or telecopy. Throughout these Rules, the term “electronic data message” shall be equivalent to and be used interchangeably with “electronic document.”(Sec. 6[e]; Underscoring supplied, showing the addition made under the IRR)

(h) “Electronic Document” refers to information or the representation of information, data, figures, symbols or other modes of written expression, described or however represented, by which a right is established or an obligation extinguished, or by which a fact may be proved and affirmed, which is received, recorded, transmitted, stored, processed, retrieved or produced electronically. Throughout these Rules, the term “electronic document” shall be equivalent to and be used interchangeably with “electronic data message.”(Sec. 6[h]; Underscoring supplied, showing the addition made under the IRR)

The definition of “electronic data message” under the IRR is substantially the same with that of UNCITRAL. As noted above, the phrase “but not limited to, electronic data interchange (EDI), electronic mail, telegram, telex or telecopy”, which is lifted from the UNCITRAL Model Law, was removed by Congress and reinstated in the IRR’s definition of “electronic data message”.

The IRR cannot go against the law. Congress deleted the phrase, “but not limited to, electronic data interchange (EDI), electronic mail, telegram, telex or telecopy,” and replaced the term “data message” (as found in the UNCITRAL Model Law ) with “electronic data message.” The term “electronic data message” has assumed a different context form the UNCITRAL Model Law.

Is a facsimile transmittal an electronic document?

The law, according to the SC, is patterned after Canada law which excludes telexes or faxes, except computer-generated faxes. In an “ordinary facsimile transmission, there exists an original paper-based information or data that is scanned, sent through a phone line, and re-printed at the receiving end.” This is contrary to the intention of Congress, which is for virtual or paperless writings to be the functional equivalent of paper-based documents. “In a virtual or paperless environment, technically, there is no original copy to speak of, as all direct printouts of the virtual reality are the same, in all respects, and are considered as originals.”

One comment

  1. are contracts which are signed by hand, scanned and attach to an email and sent in somebody’s email add considered an electronic document?

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