The Simplification Decree 2019 of the Italian Government (Decreto Semplificazioni 2019) will give legal value to the information stored on blockchain, associating the on-chain signatures to an electronic time stamp.
However, the Professor of Law of Digital Administration of the International Telematic University UniNettuno of Rome, Fulvio Sarzana of S.Ippolito, and the Member of the Centre for Economic and Legal Research of the University of Rome Tor Vergata, Massimiliano Nicotra, have expressed some concerns in this regard.
The problem is that the applications of the Distributed Ledger Technology (DLT) are very different from each other, so much so that in order to use them with legal value it may be necessary “to have a higher degree of probative certainty than the degree conferred by the simplification decree“.
For the moment, in fact, a draft of the decree law is circulating in which it will be necessary to define what characteristics DLTs must have to be able to be used for electronic time stamping.
The first paragraph of art. 2 contains the definition of the so-called “Technologies based on distributed ledgers“, which should act as a reference point to understand which DLT can be applied to this new legislation.
The definition speaks of
“Computer technologies and protocols that use a ledger with the following characteristics: shared, distributed, replicable, simultaneously accessible, architecturally decentralized which allows the precise recording, validation, updating and storage of data, furtherly protected by cryptography, verifiable by each participant, not alterable and not modifiable“.
The second paragraph, on the other hand, equates blockchain recording with the electronic time stamping referred to in Article 41 of the EU Regulation No 910/2014 (so-called eIDAS).
This electronic time stamp consists of
“data in electronic form linking other data in electronic form to a particular time and date, so as to prove that the latter existed at that time“.
The objective, therefore, is to make dates and times of the recording accurate and to certify the existence on that date of specific data in electronic form.
This qualified electronic time stamp is considered a service provided by qualified trust service providers.
According to the two experts, in the case of trustless blockchains like the Bitcoin one for example, the time stamp cannot be considered issued by providers of trust services, thus leaving it to the producer to demonstrate its reliability.
This could lead to litigation if the above definitions are not changed.
Therefore, it will be the task of the Digital Italy Agency (AGID) to clarify the technical specifications of the distributed ledgers so that their effectiveness related to electronic time stamping can be recognised.
In other words, the Simplification Decree alone will not be able to give full legal value to the information stored on blockchain. It will be necessary to wait for the issue of a special provision by the AGID.
In addition, the two experts point out that the very rapid evolution of these technologies risks rendering obsolete the standards that are defined and that the same specifications that will be identified by AGID could collide with other international regulations.