Body
The signature requirements pertain the legal or contractual requirements in order to make a legally effective declaration of intent or a legally binding contract.
Possibility to replace a specific formal requirement of making a binding declaration of intention
The use of electronic signature in Montenegro is regulated by the relevant local laws - Montenegrin Law on Electronic Identification and Electronic Signature (“Laws on E-Signature”) which are mostly harmonized with the EU eIDAS Regulation. The Laws on E-Signature differentiate three types of e-signatures: (i) simple, (ii) advanced, and (iii) qualified e-signature. Only qualified electronic signature represents a valid substitute for a handwritten/wet ink signature, although an electronic signature should not be denied legal effect and admissibility as evidence in legal proceedings only on the grounds that it is in an electronic form or does not meet the requirements of a qualified e-signature.
The Laws on E-Signature stipulate certain situations where the use of e-signature has been absolutely excluded. In particular, the use of e-signature is not possible in case of contracts which must be concluded in a mandatory prescribed form and solemnized by the notary public, such as share transfer agreements or real estate purchase agreements.
Presence of any specific formal requirements to effectively conclude a loan agreement
The law differentiates credit and loan agreements. Granting of credits is a regulated activity that can be performed in Montenegro only by the locally licensed banks (and, to a limited extent, by the locally licensed payment institutions). Under contract law rules, granting of loans is a separate type of transaction which is not subject to the licensing
A credit agreement must be concluded in written form. The applicable rules do not require a written form in case of a loan agreement. However, loan agreements are in practice concluded in written form.
Process of conclusion of a contract by using a qualified electronic signature in practice
With respect to qualified e-signature, this type of signature can be issued only by the local entities registered with the relevant institution and therefore DocuSign cannot be treated as an e-signature with this type of validity. When it is specifically required by local laws that certain documents/agreements should be hand-signed, as an equivalent, it is mandatory to use only qualified e-signature (e.g. for license agreements, employment agreements, filings with state bodies or agencies). In all other situations, when the local laws do not prescribe any form or do not require hand-signed signature, there are no formal obstacles for using the other two types of e-signature or DocuSign (e.g. for business-cooperation agreements, service agreements, distribution agreements, invoices, etc.).
Legal consequences to a contract in case of not fulfilling formal requirements
An agreement which is not concluded in the legally prescribed form or in the form agreed by the parties does not have a legal effect.
Usual practice of signing contractual agreements in the B2B sector
In B2B sector, the agreements are usually signed by exchanging scanned copies of the hand-signed agreement and subsequent exchange of originals. An increased use of electronic signatures can also be noticed.
Usual practice of signing contractual agreements in the B2C sector
In B2C sector, the agreements are usually signed with a handwritten signature.