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Electronic Signatures. Legal and Technical Aspects of E-Commerce, Budapest, 7.-11.10.2002. ?. ?. Questions?. ?. ?. Please ask them immediately!. ?. ?. Content. Why the need? Cryptography basics Symmetric, asymmetric, hash; types of attacks Key distribution / Signature systems

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electronic signatures

Electronic Signatures

Legal and Technical Aspects of E-Commerce, Budapest, 7.-11.10.2002







Please ask them immediately!



  • Why the need?
  • Cryptography basics
    • Symmetric, asymmetric, hash; types of attacks
  • Key distribution / Signature systems
  • Requirements for and functions of signatures
  • Legal requirements
    • EU signature directive
  • Implementation in Austria
  • US Electronic Signatures Act
why electronic signatures
Why electronic signatures?
  • Certain contracts / acts require a signature
    • These should be also available online
  • Secure identification of the partner
    • Allows prosecution in case of fraud
  • Create evidence of transactions
    • E-Mail can easily be forged (or claimed to be)

Security & Trust

Know, whom you communicated with, and be able to provide evidence accordingly

types of attacks
Types of attacks

System for public transmission of data must cope with the following attacks:

  • Eavesdropping: Reading data during transmission
  • Manipulation: Changing data during transmission
  • Replay: Copying (legitimate) data and sending it again
  • Pretending different identity: Claiming to be someone else
  • Repudiation: Denying to have sent/received some data
  • Denial of service: Cutting off communication
  • Traffic analysis: Analyzing patterns of communication
types of protection
Types of protection

The following methods can be used for protecting systems for public transmission:

  • Authentication: Verifying the identity of a party
  • Isolation: Attributing rights of persons to objects and preventing unauthorized access
  • Encryption: Coding of data to be unreadable without some secret information
  • Checksums: Verifying no changes have been introduced
  • Signatures: Relating identities to messages
  • Steganography/Anonymizers: Hiding of a message
attacks vs protection
Attacks vs. Protection

D… Detection, P…Prevention, ()…restricted/partly/certain sense

cryptography basics symmetrical cryptosyst

Secret key






Cryptography basics:Symmetrical cryptosyst.

Symmetrical cryptography uses the same key for encryption and decryption

  • This key MUST be kept secret!
  • (Relatively) short key length
  • Always vulnerable to brute-force attack
  • Only knowledge of the key allows encryption
cryptography basics asymmetrical cryptosyst

Public key


Private key






Cryptography basics:Asymmetrical cryptosyst.
  • Asymmetrical cryptography uses different (but related) keys for encryption and decryption
    • The public key is really PUBLIC (directories, ...)
    • Long key length
    • Most vulnerable to new mathematical methods
    • Everyone can encrypt, only intended receiver decrypt
cryptography basics hash functions
Cryptography basics:Hash functions
  • One-way functions (= No recreating the input)!
    • Loss of information
      • Examples: Checksums (CRC), MAC, /etc/passwd, …
  • Used to reduced the amount of data to be signed
  • Problems:
    • Must be hard to find a document matching the hash-value
    • Should be rather large (at least 128 bit)
      • Testing slight modifications for a matching hash-value!







cryptography basics encryption signatures
Cryptography basics:Encryption / Signatures
  • Based on asymmetric cryptography
    • Usually (e. g. RSA): Signing = Encryption with private key, verification = decryption with public key
      • Some signature algorithms DO NOT allow encryption, e. g. DSA!
  • Everyone can verify the signature’s validity
  • Two functions of a signature:
    • Verifying the knowledge of the private key

= Identity of the signer

    • Checking that no later modifications took place
  • Problem: How do you verify the public key?
cryptography basics encryption signatures1
Cryptography basics:Encryption / Signatures
  • Certificate = Connects a public key to a person
    • Must be from a trusted source
    • Is usually signed itself ( Verify this signature,  ...)
  • Different systems for distributing these certificates
      • See key distribution later!


Private key


Public key


Plain + Signature






key storage 1
Key storage(1)
  • Keys for encryption/signatures should be...
    • stored encrypted to be useless if stolen
    • on physical tokens: Much harder to loose, importance of use is clearer if a card (or something else) is inserted
    • immediately marked as “invalid” if lost in any way
    • regularly changed to avoid too large sets of data
    • used only for one service: Encryption OR signatures; business OR private, door locks OR file encryption, ...
  • PBE: Passphrase Based Encryption
    • For avoiding the hen-egg problem when encrypting keys
    • Long (>20 characters) passwords are used as key
key storage 2
Key storage(2)
  • Important areas in life-cycle of keys + examples:
      • Generation: Use “real” randomness (physical generator), who/where are they created
      • Distribution: How to publish public keys/transmit secret keys
      • Storage: Preventing unauthorized access (tokens, encryption; see above)
      • Usage: Is the software / environment secure, viewer problem, usability
      • Administration: Which key(s) are used/required for an operation
      • Disposal: Secure destroying of keys, access to backups, buffers, storage for random identical keys, ...
key distribution trusted channels
Key distribution:Trusted channels
  • Easiest way of distributing keys: Trusted channels
    • Known to be secure / no eavesdropping
    • Examples: Couriers, personal meetings
  • Not usable for large groups, initially unknown partners, or when in a hurry
  • Can NEVER be exchanged using the untrusted channel on which they shall be used later
      • Except when a previous secret is shared, which is still secure
  • Only very rarely used
    • ONLY possibility for Vernam cipher
key distribution certificate authorities 1
Key distribution:Certificate Authorities (1)
  • Central authority vouches for the association of a public key to an individual
    • Depends on the trust of the users to this authority
    • Important to note, what the authority verifies/guarantees
      • Certification policy
      • E. g. Certificates for signing code DO NOT guarantee ANYTHING about the code; only the identity of the signer (which need NOT be the programmer!)
    • Usually under supervision by public administration
  • This model is used for signatures accepted by public administration in the EU  E-Government
key distribution certificate authorities 2



CA 1


CA n

User 1


User n



Key distribution:Certificate Authorities (2)
  • In theory, the hierarchy can be very deep, but in practice, it’s rather shallow:
      • CA=Certification Authority
key distribution web of trust
Key distribution:Web of Trust
  • No central authority; replaced by the users
  • If you know someone personally, you sign his public key and publish this combination
  • This results in a chain/web of trust:
    • A knows&trusts B, B k&t C; therefore A knows&trusts C
    • Based on transitivity of trust
    • Problem, if malicious users sign keys; if trusted by a single person, illegal certificates are introduced
      • Works rather well; seems to be only minor problem in practice
    • Might be impossible to verify the key of an unknown user
  • Advantage: No single point of failure
re signing
  • Electronic signatures loose their reliability over time
    • Today’s secure keys can be broken/forged easily in several years
    • Some signatures must be valid for long periods
      • E. g. Austria: Statute of limitations 30/40 years
  • Contracts are still valid, but the proof is lost!


Before method (not: certificate!) expires, a signature with a new (longer/more secure) key must be created, which includes a secure timestamp.

systems for el signatures
Systems for el. signatures
  • An electronic signature cannot be easily created; a whole system is needed
    • Every chain is only as strong as its weakest link!
    • 2048 Bit RSA are of no use if the private key is secured with a 4 digit password!
  • Main problems:
    • Technical: Signature terminals must be secure
      • =Trusted hardware + trusted software
    • Organizational: Verifying persons for issuing certificates
      • Lots of trusted persons needed in any scheme
    • Legal: Reduction of needs for signatures
      • At least in Austria signature-requirements were reduced later
requirements for signatures
Requirements for signatures

What something must fulfill to be called “signature”

  • Dependence on document: The signature cannot be transferred to another document
  • Unchangeability: The document cannot be changed anymore after the signature was created
  • Association with person: The signature is associated with exactly one singular person
  • Verifiability: Anybody can verify whether the signer is the person he/she claims to be
  • Unforgeable: Can only be created by a single person. The signer cannot deny having signed it
functions of signatures
Functions of signatures

What a signature should provide

  • Conclusion: Applying the signature changes the document from draft to final status (Unchangeability)
  • Authenticity: The signature serves as evidence that a certain person agreed with a declaration (=the content) (Association with person, legal presumptions)
  • Warning: Avoiding rashness by the signer; importance of the act
  • Identity: Allows identifying the person (Text of signature and non-repudiability, association with person, verifyability, unforgeable)
eu signature directive signatures
EU Signature directive:Signatures
  • According to the directive, two major classes of signatures exist:
  • “El. signature”: Every data used for authentication
      • E. g. name at the end of an E-Mail
  • “Advanced el. signature”: Complicated, secure
    • Unique link to signatory
      • Cannot be forged
    • Capable of identifying the signator
      • Must include the name or some other characteristic
    • Created with means, which can be kept under sole control
    • Linked to data so no later changes are possible
eu signature directive certificates
EU Signature directive:Certificates
  • Two types of certificates:
      • “Certificate” and “Qualified certificate”
  • “Qualified certificate”: Adv. signa. only with these
    • 10 requirements for the certificate itself
    • Issued by an CA for qualified certificates
      • 12 requirements + lots of rules
    • Allows limitations of scope or value of transactions
    • Pseudonym instead of name possible
    • Must contain country of CA (no central EU registry!)
    • Additional attributes can be incorporated
      • CA must explicitly verify those before issuing the certificate
eu signature directive revocation
EU Signature directive:Revocation
  • Sometimes certificates must be revoked
    • Private key lost, chipcard stolen, password disclosed, ...
  • Technical problems
    • No generally agreed upon standard; different solutions
    • No offline check for revocation possible
  • Legal regulations (Austria):
      • EU: CA must provide “secure & immediate revocation service”
    • Must also be possible in (hand-)written form
    • At most after 3 hours completed
    • Two types: Preliminary (Lock) and final (Revocation)
eu signature directive legal effects 1
EU Signature directive: Legal effects (1)
  • Advanced signature + qualified certificate + secure signature-creation device:
    • Must satisfy legal requirements in same manner as handwritten signatures on paper
      • Can be used as a replacement
    • Must be admissible as evidence in legal proceedings
      • But might be of less or more “value” than signatures on paper!
    • NO legal presumptions
      • Austria: Presumption that signed content is from the signator
  • Certificates: Admissible in proceedings and non-discrimination
eu signature directive legal effects 2
EU Signature directive: Legal effects (2)
  • Area where el. signatures are equal to handwritten ones (and have the same effect) are open to states
  • Restrictions are in the E-Commerce directive: It must be possible to conclude everything electronically, except
    • All real estate contracts excluding rental rights
    • All contracts requiring courts, public authorities or professions exercising public authority (e.g. notaries)
    • Contracts of suretyship by persons acting for purposes outside their trade, business or profession
    • Contracts of family law or the law of succession
eu signature directive liability
EU Signature directive: Liability
  • CA is liable to ANYONE who reasonably relied on a qualified certificate, for
    • all information in the certificate at the time of issuing,
    • that it is a valid qualified certificate,
    • the signator held the private key
    • private and public key match

unless the CA proves, he did not act negligently

  • failure to register revocation of a certificate
  • No liability over/outside limitations in the certificate
eu signature directive requirements for ca
EU Signature directive: Requirements for CA
  • General reliability
  • Ensure operation of secure and reliable directory and revocation services
  • Personnel with expert knowledge
  • Trustworthy systems and products
  • Sufficient financial resources
  • Extensive logging of all relevant actions
  • Informing customers

 Requires a secure computing center, large organization and numerous experts  Rare!

eu signature directive accreditation
EU Signature directive: Accreditation
  • Purely optional
  • A kind of “official seal”
  • States can set higher standards than in the directive for these CA’s
    • Austria: Exactly the same
  • “Replacement” for model “no licensing required”
    • Seal is only awarded AFTER verification!
eu signature directive various
EU Signature directive: Various
  • For public sector additional requirements for el. signatures can be prescribed
  • No prior authorization required for CA’s
  • CA’s may operate within the whole EU
  • Cert. from foreign CA’s are equal to national ones
  • Special rules for data protection
      • CA may collect ANY information ONLY from the subject itself

See the directive and the local laws/ordinances!

implementation in austria
Implementation in Austria
  • RTR: Broadcast & Telecomm. Regulation Incorp.
    • Public supervision, registration of CA’s
  • A-SIT: Secure Inform. Technology Center-Austria
    • Technical part: Inspection of CA’s for RTR
    • Association: University Graz, Ministry of Finance, Austrian National Bank
  • Currently 5 CA’s; 2 offering advanced signatures
  • Few certificates in use
    • Lack of applications
    • Only very recently advanced signatures available
us el signatures act 1
US El. Signatures Act(1)
  • Much broader than EU directive, much less technical
    • Electronic records
      • Allows electronic archiving of papers
    • Transferable electronic records
      • Person stated in evidencing system is the current owner
      • Single authoritative copy
    • Electronic signatures
      • = Sound, symbol, process attached to or logically associated with a record and attached with the intent to sign the record.
  • Non-discrimination of both
    • No invalidity solely because of electronic form!
us el signatures act 2
US El. Signatures Act(2)
  • Exemptions:
    • Creation/Execution of wills, codicils or testamentary trusts
    • Adoption, divorce or other matters of family law
    • All commercial transactions except sales, leases, waivers of renunciation
    • Court documents (orders, notices, pleadings, …)
    • Cancellation or termination of utility services, health insurance or life insurance
    • Certain notices regarding primary residences of individuals (repossession, eviction, ...)
    • Accompanying documents for hazardous goods
us el signatures act 3
US El. Signatures Act(3)
  • Transferable records:
    • Prove for ownership of a right is a record
      • E. g. “classic” shares, cash, …
    • Problem of perfect copies:
      • “Authoritative” copy needed
      • Owner / Later owner must be shown on it
      • System for evidencing transactions required
      • Actual control needed
      • Unalterable
      • Changes only possible with consent of current owner
    • Can be solved by signatures and trusted systems

Unknown whether actually in use or not!

literature links
  • EU Signature directive: 1999/93/EC, L 13/12-20 19.1.2000
  • EU E-Commerce directive:2000/31/EC, L 178/1-16 17.7.2000
  • Austrian Signature Law:SigG BgBl I Nr. 190/1999 idF BgBl I Nr. 152/2001
  • Austrian Signature Ordinance:SigVO BgBl II Nr. 30/2000
  • US El. Signature Act: http://www.dud.de/dud/documents/usesignact0608.pdf
  • Mayr-Schönberger/Pilz/Reiser/Schmölzer: Praxiskommentar Signaturgesetz. Wien: Orac 1999