1. Quanzhou City, June 11, 2009 IPR 2 Project H A R D E R R E C H T S A N W Ä L T E Munich EU-China Workshop on the Regulation of Online Business and Related Services 5. Presentation: Contract Closing

2. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 2 06/11/09 Legal Transactions are based on Declarations of Intent Power of Attorney Approval Notice of cancellation Contract Resolution (Company Law) In principle, there is no formal requirement! Bilateral Declaration of Intent Unilateral Declaration of Intent

3. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 3 06/11/09 A contract will be closed by two coincident Declarations of Intent Shop window is Invitation to make an offer You may have... Acceptance (= Declaration of Intent ) Offer (= Declaration of Intent) I would like... Customer:Dealer: 1 2 3

4. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 4 06/11/09 The same procedure applies to online contracting I would like... Customer: Online Dealer: You may have... iPod Accept. Offer Accept. GTCGTCOfferHomepage Dealer: Dealer`s homepage is an invitation to make an offer Customer: Makes offer by mouse-clicking purchase option Dealer: Presents General Terms and Conditions Dealer: Accepts offer 1.dealer‘s conditions Customer: Accepts GTC 2.Distance contracts Informations 2 functions of GTC: Step 1Step 2 Extra Step 3Extra Step 4 Step 5 Dealer`s Homepage

5. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 5 06/11/09 The Need for security is increasing in legal relations More than 90 % of all legally relevant actions are valid even without any formal requirement!... unfortunately they are often incapable of proof

6. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 6 06/11/09 § The Law on formal regulations from 13.07.2001 adresses the electronic signature § 126 a Civil Code (1)If electronic form is to replace the written form prescribed by law the issues of the declaration must add his name to it and provide the electronic document with a qualified electronic signature in accordance with the Electronic Signature Act (Signaturgesetz). (2)In the case of a contract, the parties must each provide a counterpart with an Electronic Signature as described in subsection (1).

7. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 7 06/11/09 Electronic signature security effort Data in electronic form, that are attached to other electronic data or logically linked to them and that are used for authentication. Little evidentiary value Electronic Signatures are available in different Quality (1)

8. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 8 06/11/09 electronic signature security effort advanced electronic signature Exclusivly dedicated to the owner of the electronic key for signature Allows the Identification of the owner of the electronic key Created with tools that are unter the sole control of the owner of the eletronic key Linked with the data they are related to in a manner that enables to recognise any subsequent manipulation of the Data Similar to PGP Electronic Signatures are available in different Quality (2)

9. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 9 06/11/09 electronic signature security effort advanced electronic signature In addition to the advanced electronic signature: -based on a qualified certificate valid at the time of creation -created by a secure signature generating unit Legal equivalence with handwritten signature Qualified electronic signature Electronic Signatures are available in different Quality (3)

10. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 10 06/11/09 electronic signature security effort advanced electronic signature Qualified electronic signature created by a trust center that has been accreditated by the responsible authority (Intention of the EU: Accreditation may be voluntarily!) Qualified electronic signature with Accreditation of provider Electronic Signatures are available in different Quality (4)

11. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 11 06/11/09 The functioning of the electronic signature with the asymmetric procedure Trust Center Hash- Algorithm Hash- value + Private Key A Electr. signature; attached to the document Dokument Document User A issues a certificate Public Key A Decoding signed hashvalue Authentication matching Identification Adressee B Calculation of the Hash value of the document

12. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 12 06/11/09 § Issue: How to control activities of minors (7 to 17 years old) as the contract is void if there is no approval by the representative § 110 Civil Code A contract entered by the minor without approval ot the legal representative is deemed effective from the beginning if the minor effects performance under the contract with means that were given to him for this purpose of for free disposal by the legal representative or by a third party with the ratification of the representative.

13. Bernd H. Harder H A R D E R R E C H T S A N W Ä L T E Munich Seite: 13 06/11/09 § Lots of Restrictions for the design of the Terms and Conditions due the AGB-Law § 305 Civil Code (1) Standard business terms are all contractual terms pre-established for a multitude of contracts which one party to the contract (the user) presents to the other party upon the conclusion of the contract. It is irrelevant whether the provisions appear as a separate part of a contract or are included in the contractual document itself, how extensive they are, what script is used for them, or what form the contract takes. Contractual terms do not constitute standard business terms where they have been individually negotiated between the parties. (2) Standard business terms are incorporated into the contract only if, during the conclusion of the contract, the user 1. expressly draws the other party’s attention to them, or if, on account of the way in which the contract is concluded, an express reference to them is unreasonably difficult, he draws his attention to them by means of a clearly visible sign at the place where the contract is concluded and 2.gives the other party, in a reasonable manner that also appropriately takes account of any physical handicap of the other party discernible by the user, the possibility of gaining knowledge of their content, and if the other party agrees that they are to apply. (3) Subject to observance of the requirements set out in subsection (2) above, the parties may agree in advance that particular standard business terms will apply to a particular type of legal transaction.

14. H A R D E R R E C H T S A N W Ä L T E Ottostraße 3, D-80333 Munich Tel.: ++49-(0)89-287 007-0 Fax: ++49-(0)89-287 007-29 www.harder-law.com