6 Demand for electronic authentication and authentication systems

(1) Details of the questionnaring

To study the need for establishment of electronic authentication and notarization systems, it is indispensable to investigate how often electronic commerce is conducted, how companies actually engaged in electronic commerce identify an originator of data, and what kind of systems are expected for secure electronic commerce. Though private certification authorities are established both in Japan and in such foreign countries as the United States, it is not clear to what degree and in what fields such certification authorities are used.

Further, We thought it necessary to ask companies which do not conduct electronic commerce at present what kind of environmental improvements would be made to realize electronic commerce, and to investigate the need for electronic notarization systems and preservation of electronic data which are not conducted in reality.

In establishing electronic authentication and notarization systems, which seems indispensable in order for electronic commerce to be widespread, we have to make such systems easily available for users: corporations and consumers.

For such reasons, this Study Group conducted a questionnairing on the actual situations of electronic commerce and the need for electronic authentication and notarization systems in order to collect information as to what kind of systems are required as electronic authentication and notarization systems.

Because issuance of the copies of the register book, certificates of qualification, and certificates of impressions of seals is regarded as a kind of authentication system in paper-based transactions, the Study Group investigated how often such copies and certifications are used in the questionnairing to expect availability of electronic authentication systems.

In the questionnairing we showed a blueprint of systems established as electronic substitutes for present paper-based authentication and notarization systems and asked for opinions on the need for them, their availability, and room for improvement. Because electronic authentication systems operated by private companies would be used, we also researched into availability of such private systems other than systems shown in the questionnairing which are operated by the Ministry of Justice or commercial registries

The questionnairing was conducted on such prospective users as corporations and consumer cooperative society. We also received consumers' opinions through the Internet and asked various organizations, scholars of law, encryption, and telecommunications, and information media for general opinions, which would not be limited on questions listed in the questionnaire.

(2) Results of the questionnairing

We received 618 responses mainly from enterprises and 44 general opinions from such institution as law schools.

Details of the results of the questionnaire are listed in annex 1 " the Results of the questionnairing on the electronic authentication and notarization systems "(omitted). Their outline is as follows:

a. electronic authentication systems

In the questionnairing, more than the half of the respondents, 54.7%, answered that it was necessary to establish a system to issue a public key certificate for corporations, but on the other hand, less than the half, 47.7%, answered it was not necessary as for certificate for individuals. A system to issue a public key certificate seems to be deemed necessary as a substitute for the present system to issue a copy of the registry book, a certificate of qualification, and a certificate of an impression of a seal. Some of the respondents answered on a systems for a certificate for individuals as follows:

"There seems no problems on present situations" or "There are so small number of Individuals involved in transactions concerning my conpany". So it is presumed that electronic commerce conducted by individuals are not widespread and the need for certificate for individuals is relatively small. When such electronic commerce are widespread, the demand for such systems will increase.

64.4% of the respondents said the system to certify the validity of the issued electronic certificate was necessary. It seems that such system is indispensable for the system to issue a certificate.

b. the electronic notarization system

44.5%, less than the half of the respondents, answered that it was necessary to establish a system for notarization of private electronic messages and 39%, a relatively large proportion of the respondents, answered that it was not necessary. On necessity for a system to prepare electronic notarial documents, 44.5% answered positively and 37.2% did not. The main reason for such negative answers is "There are no opportunities to use it", which seems to reflect insufficient spread of electronic commerce. Some pointed out issues associated with security such as control of information, which indicated that some people were apprehensive about the security of such systems.

53.7% of the respondents answered that it was necessary to establish a system to attach a fixed date to an electronic data, which indicated that the necessity of the system has been recognized.

c. Others

As a whole, the demand for electronic authentication and notarization systems is smaller than expected in planning the questionnairing. Such conclusion seems mainly resulted from the fact that electronic commerce is in its early stage of diffusion and a lot of companies which are not involved in electronic commerce are not in the position to feel its necessity at all.

On this point, opinions that " now we are not studying on electronic authentication and notarization systems enough, but we think we must study issues on electronic authentication and notarization in the future." seem to indicate the present circumstances of many companies. What attracts our attention is an answer from an organization related to financial service, saying "it is our urgent task to introduce electronic authentication and notarization systems, because the demand for electronic authentication and notarization by a public office will increase as more and more financial transactions will be conducted electronically. In this questionnairing, many of the respondents would answer it was not necessary to establish such systems, but it is not appropriate to take only such present circumstances into consideration and to deal with the situations. Even if 99% of the respondents answered negatively, the Ministry should be engaged in the study positively for future Japan".

There will be increasing demand for electronic authentication and notarization systems as electronic commerce will be brisk and discussion on electronic authentication in such international organizations as United Nations Committee for International Transaction Law (UNCITRAL), Organizations for Economic Cooperation and Development (OECD), European Unity (EU), and Asia Pacific Economic Cooperation Conference (APEC) will improve.