Frontpage News 2013 Positive announcem...

Positive announcement from the Minister of Justice

25 November 2013

The Danish Bankers Association is pleased that there now is an approaching solution on the challenges with enforcement of digitally entered loan agreements.

By court decisions passed on 6 September and 13 November 2013, Vestre Landsret and Østre Landsret (two high courts of Denmark) have rejected that a digitally signed loan agreement - signed with NemID – is enforceable immediately without judgement. This means that there is no legal discrimination against loan arrangements entered into by signature on a paper document and digitally signed loan agreements signed with NemID in relation to the possibilities of enforcement.

The inequality of the Administration of Justice Act is inappropriate and an example of a law that is not digital-ready. 

Therefore, on 15 November 2013, the Danish Bankers Association sent an application to the Minister of Justice on the issue, as banks i.a. in trust of the single digital signature - NemID - have entered into a very large number of digital loan agreements.

In a response to the Parliamentary Legal Affairs Committee, on 18 November 2013, the Minister of Justice stated that there in the current parliamentary session is expected a bill to amend the Administration of Justice Act, so that there is a clear legal basis to enforce digitally signed loans.

The lack of enforcement has ultimately profound economic impact on a borrower who has not paid his loan, because the procedural costs that the recovery of the loan entails, to the extent possible, must be paid by the borrower. If there cannot be enforcement without a judgement, much higher legal expenses will incur.

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