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					eContracting


                   An eLEGAL Approach:
   Exploiting XML for Markup and Signing of Electronic Contracts




               Michael Merz – Ponton Consulting
                      Merz@ponton-consulting.de



                         London, May 6th, 2003
 Content



                                   About e-Contracting

                                   The Art of Signing

                                   The Tool

                                   Examples




XML Europe 2003   www.ponton-consulting.de
                            -2-
                                                                  What is e-Contracting?


 Why e-Contracting?


  B2C: Security
       • Consumer Protection
       • Retailers Protection
       • Current Example: Payment transactions via Modem-dialer without
         any contract or payment authorisation
       • Characteristic: Many similar transactions – low volume


  B2B: Reduction of Process Costs
       •   Reduction of Time-to-Contract
       •   Document management
       •   Automatically re-use contract content
       •   Legal requirements (authentication, archiving, etc.)
       •   Few, individual transactions – high volume

XML Europe 2003                    www.ponton-consulting.de
                                             -3-
                                                                       What is e-Contracting?


 Benefits from e-Contracting



  Avoid media breaks
       • Although contracts are highly formalised, they are still managed by
         WinWord, eMail – and on paper

  Avoid errors
       • Media breaks lead to re-typing, cross-checking and consistency issues

  Reduce time-to-contract
       • Most time is wasted in wait states during contracting processes

  Content re-use after closing
       • Alongside the supply chain contracts bare data that is re-used by ERP
         systems and ordering applications – why not importing them directly from
         the XML document
       • EDI framework agreements may be used to directly parameterise Message
         Services ( ebXML CPPA)


XML Europe 2003                     www.ponton-consulting.de
                                              -5-
                                                                         What is e-Contracting?


 The eLEGAL Project:
 ICT-Contracts in the construction industry
                                                                       Contract on
                                                                       Contract on
                                                                        business
                                                                        business
                  User
                  User                                                   project
                                                                         project
                                      Client
                                      Client
                                                                       Facility mgr
                                                                       Facility mgr
      Architect
      Architect                                                               Contract
                                                                              Contract
                                                                             on the use
                                                                             on the use
                                                               Project
                                                               Project         of ICT
                                                                               of ICT
                                                                mgr
                                                                mgr
    Struc
    Struc
    engr
    engr
                                                 Main
                                                 Main
                           Blng
                           Blng                contractor
                                               contractor
                         services
                         services
  ICT based
  ICT based                engr
                           engr                                                 Supply
                                                                                Supply
   info flow
   info flow                                                                     chain
                                                                                 chain
                                           Sub-
                                           Sub-                Sub-C
                                                               Sub-C
                                         contractor
                                         contractor


XML Europe 2003                     www.ponton-consulting.de
                                              -6-
                                                                                             What is e-Contracting?


          Example: European Research Consortia /
          Periodical Reporting

  signs

                Reports to    Consolidates,
                              Counter-signs                              Verify Signatures



                                                                                         Transformation
                                                                                        for print/archive




                                                        Reports to



                                                                                                        Project
                                                                                                        Mgmt.
                                                                                                       Software
Project                      Co-ordinator
Partners                                                                     European Commission


      XML Europe 2003                         www.ponton-consulting.de
                                                        -7-
 Content



                                   About e-Contracting

                                   The Art of Signing

                                   The Tool

                                   Examples




XML Europe 2003   www.ponton-consulting.de
                            -8-
                                                               The Art of Signing


 To Sign and to be signed...



  Different contract patterns regarding signing

  „Signature Context“: A combination of
   • N SignedParts,
   • M Parties, and
   • K Signatures.

  Examples:
   • Multi-party contract (consortium agreement, company statutes, ...)
   • Counter-signing (vacation application, e-procurement, invoice
     checking, electronic cheques, ...)
   • Consolidation of sub-documents (project reports for consortia,
     consortia approvals, ...)


XML Europe 2003              www.ponton-consulting.de
                                       -9-
                                                                                               The Art of Signing


 Contract Signing Patterns

         Signature Context                                                       Signature Context



                                                             MCR        MCR      MCR         MCR
                                                            Party1     Party2   Party3      Party4
                      Signed Part




                                                                     MCR Coordinator Part




                  Signature Container
                                                                     Signature Container

              Multi-party Contract                         Consolidated Countersigning

XML Europe 2003                         www.ponton-consulting.de
                                                  - 10 -
                                                                     The Art of Signing


 What does XML Signature offer?

  Embedded Signature
                                                                      Signature
  Embedding Signature                                                Signed Part

  Detached Signature                                                 Unrelevant




       Embedded Signature   Embedding Signature         Detached Signature


XML Europe 2003              www.ponton-consulting.de
                                       - 11 -
                                                                                   The Art of Signing


     How to implement a Signature Context?

      Define a positive / negative list of references to the SignedPart

      Apply an XML Signature implementation, e.g., from the Apache Group

      Store the result somewhere in the document

     Question: How to make it usable for mortals???

                                                     <Signature>
                                                       <SignedInfo>
                      Ref. #2                             <Reference URI=„#1“>... <Reference>
Ref. #1                                                   <Reference URI=„#2“>... <Reference>
                                                     </SignedInfo>
                                                     <SignatureValue>jsr0tf7he... </SignatureValue>
                                                     <KeyInfo>... <KeyInfo>
                                                      ...
                                                     </Signature>

      Signed Part               Signature
    XML Europe 2003                         www.ponton-consulting.de
                                                      - 12 -
                                             The Art of Signing
 Current Implementation: An eAgreement




XML Europe 2003   www.ponton-consulting.de
                            - 13 -
                                                   The Art of Signing


       Current Implementation




...
      XML Europe 2003   www.ponton-consulting.de
                                  - 14 -
                                                    The Art of Signing


       Current Implementation (cont.)
...




      XML Europe 2003    www.ponton-consulting.de
                                   - 15 -
                                                                  The Art of Signing


 Future Implementation:
 Any Combination of Signature Contexts

          <Important ec:SignedPart=„Context1“>
             bla bla bla bla bla
             bla bla bla bla bla
             <Parties ec:SigningParties=„Context1“ ec:PartyRef=„Party/@Name“>
                <Party Name=„Ponton“>
                     <More party=„stuff“/>
                </Party>
                <Party Name=„FooBar“>
                     <More party=„stuff“/>
                </Party>
             </Parties>
             bla bla bla bla bla
          </Important>

          <Container ec:SignatureContainer=„Context1“>
             <ds:Signature ...>
             ...
             </ds:Signature ...>
          </Container>

XML Europe 2003                 www.ponton-consulting.de
                                          - 16 -
 Content



                                      About e-Contracting

                                      The Art of Signing

                                      The Tool

                                      Examples




XML Europe 2003   www.ponton-consulting.de
                            - 17 -
                                                                                              The Software Tool


     Technology Viewpoint: The Contract Editor
                        Edit,                                  Select
                      Negotiate,                              Clauses
                        Sign




                                                                              Contract Wizard
                                                                                                   validate
                                                                          Clause & Contract
                       validate                                           4 Repository
                                       Contract Editor
                                                                                                              5
                                                                           XSLT-
                                                                           Stylesheets
1   Contract                                                                                   Contract Rules
    Schema                                                            3


               2

              Contract Layout                                                    HTML

    XML Europe 2003                        www.ponton-consulting.de
                                   6   Model Contract
                                                     - 20 -
 Content



                                      About e-Contracting

                                      The Art of Signing

                                      The Tool

                                      Examples




XML Europe 2003   www.ponton-consulting.de
                            - 21 -
 Demo of Ponton X/E




XML Europe 2003   www.ponton-consulting.de
                            - 22 -
                                                                             Over 80
 The Ponton X Series                                                       installations
                                                                            world-wide


                                 User




                               Ponton
                                X/E

                                                                  ERP
                                                                  System
                  Ponton         XML                     Ponton
                   X/P         Document                   X/D
                                                                   DB

                           Ponton X Series


XML Europe 2003               www.ponton-consulting.de
                                        - 23 -
 Conclusions



  E-Contracting reduces process cost and complexity of work

  No document management system needed (peer-to-peer model)

  Platform independent

  Expect more in the next months...



 Download from: www.ponton-consulting.de,

 go to Download / Ponton X/E




  AND: Visit us on the XML2003 Expo next room!
XML Europe 2003                 www.ponton-consulting.de
                                          - 24 -
                                $




                  Any Questions?




XML Europe 2003    www.ponton-consulting.de
                             - 25 -
                                    Court
                  Law Texts                                        Directives
                                   Decisions




                                   Terms &
                                  Conditions
  Standard                                                                   Contract
  Clause DB                                                                 Templates
                                   Contracts



                                                    Online Dispute
                         Court Filing
                                                     Resolution

XML Europe 2003                         www.ponton-consulting.de
                                                  - 26 -
 Right Time for eContracting?

  A lot of know-how has been gained over the past years.

  Maturity of regulation, technology, and communication infrastructure has
   increased

  An ideal combination of legal / technology / business expertise represented
   within the subcluster



                     Marketplaces
Business
                                      E-Procurement
                                                                           Standard for
  Legal              Sig.-Directive                                       eContracting?
Framework                                      Sig.-Laws


                               XML
Technology                                          XML Dsig

                  1999         2000             2001               2002   2003

XML Europe 2003                         www.ponton-consulting.de
                                                  - 27 -

				
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