Electronic signatures become legally valid in China Friday to facilitate growing online trading, the Ministry of Information Industry announced yesterday, and certification regulations come into effect to support the move.

"The regulations will help promote smooth implementation of the Electronic Signature Law, providing concrete rules on the behavior, supervision and management of online certification service organs," said a ministry official.

The legal change gives electronic signatures the same standing as handwritten signatures and seals for business transactions, the official said, and establishes a market access system for online certification providers to ensure e-commerce security.

The new law stipulates that governmental departments shall undertake "effective and appropriate" supervision and management over electronic certification service organs in accessing markets.

The accompanying regulations mainly cover the issue and management of licenses for online certification services, standardization of service behavior, handling of suspension or alteration of services, security, supervision and management, and penalties.

However, Alamusi, chief executive officer of Chinaeclaw.com, a professional website, said the law does not cover major issues such as electronic contracts, protection of consumers and legal liability of service providers.

He said another problem is that there are over 70 electronic signature authentication agencies in the country and, although the law requires them to get approval from the ministry, there is no regulation related to this.

He added that even if the public key infrastructure (PKI) encryption used in electronic signatures is believed to be extremely difficult to crack, more secure avenues must be found.

Wang Xiaoyun, a professor from Shandong University, cracked the MD5 encryption method, one of the two major PKI encryption methods, in last August.

She also found some loopholes in the other encryption method, SHA-1, in February.

Andy Qi, a spokesperson for 1pai.com, an online joint venture between US giant Yahoo! and major Chinese internet portal Sina Corp, also called on the government to pay more attention to customer-to-customer e-commerce, which has creditability problems.

(Xinhua News Agency, China Daily April 1, 2005)