The Value of Electronic Signatures in Real Estate Contracts in Mexico

What Is an Electronic Signature and Why Trust It?

An electronic signature is a key tool that allows individuals to formalize agreements through digital means with the same validity as a handwritten or wet signature, under the principle of functional equivalence (equivalencia funcional). In Mexico, there are two main types:

• Simple Electronic Signature (firma electrónica simple): Links a person to a document without official certification and is frequently used in commercial and civil contracts.
• Advanced Electronic Signature (firma electrónica avanzada): Requires validation by authorized certification service providers (prestadores de servicios de certificación, or PSC), ensuring authenticity, integrity, and non-repudiation, making it ideal for transactions that require greater legal certainty.

Both types of signatures are valid under Mexican legislation. However, it is important to analyze each case to determine which is more suitable based on the needs and objectives of the transaction.

Additionally, advanced electronic signatures offer crucial advantages for ensuring traceability and preventing alterations in documents. Platforms like Weetrust or Firmamex enable the issuance of time stamps and data preservation, increasing the reliability of digital agreements.

The use of electronic signatures in real estate contracts represents a significant advancement in efficiency, especially in preliminary stages such as purchase promissory agreement or letters of intent, as well as for signing lease agreements or construction contracts without requiring the physical presence of individuals or representatives.

Challenges and Concerns in Mexico

Despite their benefits, important challenges remain:

• Authority Acts: While some institutions, like the Tax Administration Service (Servicio de Administración Tributaria or SAT) or certain judicial bodies, have adopted digital means, most procedures are still conducted in person.
• Acts Between Private Parties: Although the use of electronic signatures increased due to the COVID-19 pandemic, there are still sectors that do not fully trust this tool.
• Public Faith (fe pública): It is important to note that, by law, definitive purchase and sale agreement or encumbrance of real estate must be formalized before a notary public. This implies that although much of the process can be carried out electronically —including preliminary agreements signed through electronic signature platforms— final validation requires the physical presence of the parties. Similarly, lease agreements formalized before a public attester can offer advantages in enforcement by facilitating legal procedures in case of disputes. However, it is important to note that these enforcement advantages do not necessarily extend to electronically signed contracts, as current regulations still prioritize physical and notarial documents when asserting rights in a legal process. This is an area that deserves greater legislative attention to ensure that electronic tools are equally effective in terms of security and legal enforcement. Finally, although some legal provisions—such as the Notary Law for Mexico City (Ley del Notariado para la Ciudad de México)—consider the use of electronic tools, such as the "Electronic Appendix of Comparisons" (Apéndice Electrónico de Cotejos) and the "Electronic Archive" (Archivo Electrónico), which allow for the digitization and management of notarial documents, the use of electronic signatures seems to be primarily intended for notaries and not necessarily for the parties involved in the legal act itself. This reinforces the importance of considering both technological modernization and practical implications when entering into real estate contracts.

Recommendations for Adopting Electronic Signatures

To leverage the benefits of electronic signatures and mitigate concerns about their use, we recommend:

• Incorporating clauses in contracts that recognize and accept the use of electronic signatures.
• Determining if the transaction requires an advanced signature based on the client's needs or the nature of the transaction.
• Identifying cases where, due to the nature of the legal act, public attesters are required.
• Using secure browsers and avoiding sharing access data or electronic signature creation information.

The use of electronic signatures in real estate contracts represents an opportunity to modernize the sector, aligning legal processes with the demands of a constantly evolving digitalized market.

This article at all times refers to the electronic signature for acts that have legal effect in Mexico.