A WORLD-WIDE OUTLOOK OF ELECTRONIC SIGNATURE
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A WORLD-WIDE OUTLOOK OF ELECTRONIC SIGNATURE SUMARY.-I. Introduction.-II. A world-wide vision.-2.1. European Union: Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures.-2.2. United States: Electronic Signature in Global and National Commerce Act-“E-Sign”.-2.3. Hong Kong: the Electronic Transactions Ordinance.-2.4. United Nations: UNCITRAL Model Law on Electronic Signature.- III. Digital signature and Public Key Infrastructure (PKI).-3.1. Digital signature: a type of electronic signature.-3.2. Cryptography: distinction between digital signature and in code.-3.3. Public key infrastructure.-Certification Authority (CA).-Accreditation and certification schemes.- Standards.-CSPs Registry.-IV. Conclusion.-V. Bibliography. I. INTRODUCTION Open networks such as the Internet are of increasing importance for world-wide communication. They offer the possibility of interactive communication between parties who may not have pre-established relationships. They offer new business opportunities by creating tools to strengthen productivity and reduce costs, as well as new methods of reaching customers. In order to make best use of these opportunities, a secure environment with respect to electronic authentication is needed. Digital signatures and Public Key Infrastructure seems to be essential tools for providing security and developing trust on open networks. Our aim here is to give a world-wide vision of electronic signature, and the main technical, functional and legal trends around it. Firstly, we will show a vision of the legal framework around the world; secondly, we will focus on some aspects and distinctions which are necessary to better understand both legal and technical documents regarding to electronic signatures. 1
II. A WORLD-WIDE VISION In general, the three different legal approaches adopted by countries world-wide with respect to the electronic signature have been the represented in the annexed table #11. As we can conclude from that table, the minimalist approach focuses on verifying the intent of the signing party rather than on developing particularised forms and guidelines. In other words, this approach wants private sector and market to impose the practice regarding to electronic signature. On the contrary, the second approach allows legislatures and regulatory agencies to play a direct role in setting standards for and influencing the direction of new technology. Finally, the third and –in our opinion- the most well-aimed approach wants both private and governmental sector to take part on this important project. After this general vision, we will study some of the main regulations on electronic signature in Europe, North of America, Asia, and internationally, the Law Model of the Union Nations. 2.1. European Union: Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures. The Directive on Electronic Signatures became effective in 2001 and still requires wide implementation among the Member States. The Directive professes technology- neutrality, establishing in article 5 that Member States shall ensure that an electronic signature is not denied legal effectiveness and admissibility as evidence in legal proceedings solely on the grounds that it is in electronic form, or not based upon a qualified certificate, or not based upon a qualified certificate issued by an accredited certification-service-provider, or not created by a secure signature-creation device. 1 Table #1 has been developed with information from the Internet Law and Policy Forum´s study An Analysis of International Electronic and Digital Signature Implementation Initiatives, September 2000. 2
However, the Directive also provides statutory preferences for “advanced electronic signatures” which are based on a qualified certificate and which are created by a secure- signature-creation device. In other words, the Directive provides statutory preferences for digital signatures based on a Public Key Infrastructure (PKI), stating in the same article 5 that Member States shall ensure that advanced electronic signatures which are based on a qualified certificate and which are created by a secure-signature-creation device, on one hand, satisfy the legal requirements of a signature in relation to data in electronic form in the same manner as a hand-written signature satisfies those requirements in relation to paper-based data; and on the other hand, are admissible as evidence in legal proceedings. 2.2. United States: Electronic Signature in Global and National Commerce Act – “E-Sign”2 E-Sign advocates technology-neutrality and places special limitation on the ability of states and both federal and state regulatory agencies to require or prefer the use of specific technologies. Section 101 establishes that “the legal effect, validity, or enforceability of such contract, agreement, or record shall not be denied – (1) on the ground that the contract, agreement, or record is not in writing if the contract, agreement, or record is an electronic record; or (2) on the ground that the contract, agreement, or record is not signed or is not affirmed by a signature if the contract, agreement, or record is signed or affirmed by an electronic signature”. State governmental efforts to establish limitations or exception form these general principles will be pre-empted. There are some states such as Utah, Missouri, and Washington, which favour digital signatures and are closely aligned in many respects with the UNCITRAL Model Law and the EU Directive. With E-Sign, the United States has resolve the tension by opting for technology-neutrality on a national level. However, it is curious how E-Sign provides an ironic result, putting the United States legislative framework somewhat out of step with the global trend. E-Sign does not serve 2 A US federal Act signed into Law June 30, 2000 and effective October 1, 2000. 3
as an obstacle for the use of digital signatures or the role of certificate authorities but neither does the law align closely3. 2.3. Hong Kong: the Electronic Transactions Ordinance. The article 6 of the Electronic Transactions Ordinance4 states that “if a rule of law requires the signature of a person or provides for certain consequences if a document is not signed by a person, a digital signature of the person satisfies the requirement but only if the digital signature is supported by a recognised certificate and is generated within the validity of that certificate”. Therefore, the legal effects of electronic signatures are only provided if the signature is supported by a recognised certificate issued by a recognised certification authority. Indeed, licensed CSPs will enjoy the benefits of trustworthiness, consumer confidence, and an evidentiary presumption for digital signatures, what it is to say that Hong Kong provides statutory preferences for digital signatures based on a PKI. A similar approach is taken by Singapore in its regulation. However, Japan has adopted a technology-neutral formulation, establishing a presumption of the authenticity of an electronic document if a specific person has applied an electronic signature. 2.4. United Nations: UNCITRAL Model Law on Electronic Signature. UNCITRAL completed the Model Law on Electronic Signature5 in 2001. This Model Law reaffirms the general principle of the validity of electronic signatures on technology-neutral basis and, on the other hand, provides statutory presumptions for the reliability of digital signature technologies. The Model Law strongly aligns to the EU Directive on Electronic Signatures in many of its features. 3 See B. RITTER, Jeffrey: New rules; New Realities: An annual Review of Electronic Commerce Law, 3rd Annual Advanced E-Commerce Institute, November 2001. 4 http://www.info.gov.hk/itbb/english/it/eto.htm 5 See http://www.uncitral.org/AdoptedTexts 4
Many nations have begun to enact laws providing an appropriate framework for validating electronic commercial transactions. Several of these jurisdiction have relied upon the UNCITRAL Model Electronic Commerce Law and Model Law on Electronic Signatures. III. DIGITAL SIGNATURE AND PUBLIC KEY INFRASTRUCTURE We have just seen that the general opinion is that PKI demonstrates great promise as a leading method for satisfying the requirements for a solid technical and legal foundation for secure e-commerce and communications. This main security requirements are: - Authentication: to verify the identity and authority of individuals and organisations communicating electronically. - Integrity: to provide assurances of the integrity of electronic communications and records and detecting unauthorised modifications to them. - Confidentiality: to protect electronic messages and records against interception, unauthorised access, and the disclosure of confidential or sensitive information within them. - Non repudiation: to prevent parties for successfully repudiating electronic transactions, messages, and records. 3.1. Digital Signature: a type of electronic signature. Several different methods exist to sign documents electronically varying from very simple methods –such as inserting a scanned image of a hand-written signature in a word processing document- to very advanced methods using cryptography. There is two types of cryptographic algorithms: symmetric (based on a only key to encrypt and decrypt) and asymmetric (based on two keys, a private one to encrypt, and a public one to decrypt). 5
An electronic signature is “data in electronic form which are attached to or logically associated with electronic data and which serve as a method of authentication”6. A digital signature, or “advanced electronic signature” in the context of the Directive 1999/93/EC, is a specific type of electronic signature, created using asymmetric or “public key” cryptography. Technology-neutrality is the reason why the Directive did not included in its text the concept of “digital signature”. Since a variety of authentication mechanisms is expected to develop, the scope of the Directive might be broad enough to cover a spectrum of electronic signatures based on public-key cryptography as well as other means of authentication data. The Directive grants enhanced legal effect to electronic signatures that satisfy certain technical criteria (i.e., “advanced electronic signatures” that are based on “qualified certificates” and created by “secure signature creation devices” as defined in a set of annexes). In other words, the Directive enhanced legal effect to digital signatures which work in certain secure environment. While under this scheme all signatures and certificates are admissible in court, in practice the evidentiary hurdles for signatures that meet the criteria for enhanced legal effect will be lower, which could create a powerful de facto incentive to use them instead of other procedures. 3.2. Cryptography: differentiation between Digital Signature and Encryption. It is necessary to differentiate between “digital signature services” and “encryption services7”. While digital signature is used to verify the source of data (authentication) and to determine if they have been altered (integrity), encryption is used to protect confidentiality of data and communications. Contrary to cryptography used for encryption, digital signature is merely annexed to data, leaving intact the content of the 6 Article 2.1 of the Directive 1999/93/EC. 7 See Council Regulation (EC) No 3381/94 of 19 December 1994 setting up a Community regime for the control of exports of dual-use goods (modified by Council Regulation (EC) No 837/95); and 94/942/CFSP Council Decision of 19 December 1994 on the joint action adopted by the Council of the basis of Article J.3 of the Treaty on European Union concerning the 6
signed electronic document or electronic transaction. Therefore, if we want to ensure confidentiality of the content of such document or transaction, we will have to “encrypt” data which form it, in other words, to go to “encryption services” instead of “signature services”. In the processing of the Directive on electronic signature, some sectors already declared their worry considering the possibility that the use of cryptography by delinquents and terrorists could become more difficult the fight against criminality. With the New York and Washington terrorist attacks, the debate returned to be part of everyday speech. However, we want to make clear here that this worry exclusively refers to confidentiality services. Digital signature does not impede data reading. Moreover, use of digital signature could be of benefit to the fight against cybercrime, since it allows to assign a message to a particular sender or recipient. An specially interesting document is the Guidelines for Cryptography Policy8 of the Organisation for Economic Cooperation and Development (OECD). 3.3. Public Key Infrastructure (PKI) A public key infrastructure, or PKI, is the sum total of the organisations, systems (hardware and software), personnel, processes, and agreements that allow public key technology to function for a given set of users9. A PKI provides authentication, integrity and confidentiality by means of digital signature and encryption respectively, and can also support efforts to control access to sensitive information and provide critical evidence tying a transaction, message, or record to its originator. In other words, PKI technology provides critical security functions that the Internet was not designed to provide and, indeed, cannot provide. Individuals, business, control of exports of dual-use goods, being its latest modification Council Decision 1999/193/EC. 8 Available in www.oecd.org 9 See American Bar Association, PKI Assessment Guidelines, PAG v0.30, Public Draft for Comment, Information Security Committee, June 18, 2001. 7
governments, and other organisations have adopted many different kinds of PKIs around the world. - Certification Authority (CA) Verification of the authenticity and integrity of data (provided by digital signature) does not necessarily prove the identity of the signatory who creates the electronic signature, thus the recipient of a message will not know if the sender is really the one he claims to be. The recipient may therefore wish to obtain more reliable information on the identity of the signatory. It is in this context where the notion of Certification Authority (CA) or “Certification-service-provider” (CSP) as called by the Directive emerges. A CSP is an entity or a legal or natural person who issues certificates or provides other services related to electronic signatures10, such as time stamping functions. A certificate is an electronic attestation which links signature-verification data to a person and confirms the identity of that person11. The Directive distinguishes between a regular “certificate” and a “qualified certificate”, being the latter a certificate which meets certain requirements and is provided by a certification-service-provider who also meets certain requirements. ITU-T12 Recommendation X.509 is the most internationally accepted standard for qualified certificates. - Accreditation or Certification Schemes According to the Directive 1999/93/EC13, Member States may introduce or maintain voluntary accreditation schemes aiming at enhanced levels of certification-service provision. Such schemes may offer CSPs the appropriate framework for developing further their services towards the levels of trust, security and quality demanded by the evolving market, and should encourage the development of best practice among CSPs, being the latter left free to adhere to and benefit from such accreditation schemes14. 10 Article 2.11 of the Directive 1999/93/EC. 11 Article 2.9 of the Directive 1999/93/EC 12 International Telecommunication Union (http://www.itu.int). 13 Article 3.2. of the Directive. 14 See Whereas (11) of the Directive. 8
As far as such measures are require by the market, this accreditation and certification schemes can give a clearer or more predictable level of legal security for both the CSP and the consumer. For example, under Spanish regulation there is three levels of legal effects for electronic signatures, depending on its nature, reliability and security: 1. Electronic signature may not be denied legal effects and admissibility as evidence in legal proceedings solely because it is in electronic form. However, difficulty in this cases will be to prove its reliability and security. Anyway, this electronic signatures which does not meet the requirements of any of the two sections below, will not match hand-written signature. 2. Advanced electronic signature, if based on a qualified certificate and created by a secure signature-creation-device, will match hand-written signature having the same legal effect, and will be admissible as evidence on trial, being appraising conforming to discretion by the trial judge. In this case, the burden of proof of the fulfillment of those requirements goes to the part who introduce the advanced electronic signature as an evidence. 3. There is a presumption of fulfillment of all those requirements for the advanced electronic signature which is based on a qualified certificate and created by a secure signature-creation-device, when CPS who provides the qualified certificate is accredited and the secure signature-creation-device is certified. In this cases, therefore, the burden of proof goes to the opponent. The use of accreditation and certification implies the existence of a mechanism to certify compliance. Under the Directive, the Member States are supposed to designate their own “bodies” to certify compliance with the Annexes, under the general rules set forth by a committee composed of the Members States and the European Commission. So far, it seems that some Member States will leave the task of certifying compliance to a voluntary, industry-led body (e.g. Ireland, The Netherlands, and the UK), while others (e.g. Germany, and Spain) will rely on a government agency. 9
Internationally, in those countries where accreditation or certification schemes for electronic authentication exist, the vast majority are also “voluntary” and very few have been found which are openly mandatory, such as the Ecuador´s one seems to be. However, many laws require the use of accredited CSPs in transactions with the government, which can have a powerful effect in forcing a particular standard or accreditation procedure on the market. In the context of accreditation and certification schemes, it is very important to establish the evaluation criteria which will be followed to provide the corresponding accreditation or certification. The use of recognised standards is an important means of objectively specifying the criteria governing such evaluation. With respect to assessment of IT products and systems security, functionality and the technical trustworthiness, two standards are widely accepted and anticipated to play a significant role in the future: the European Union´s Information Technology Security Evaluation Criteria (ITSEC) and the Common Criteria Project´s Common Criteria for Information Technology Security Evaluation (CC), being the latter the most likely candidate for long-term future use. Table # 2 shows some interesting aspects of both evaluation criteria. The CC provides a set of seven pre-defined assurance packages termed Evaluation Assurance Levels (EALs). The approximate relationship between these EALs and the assurance levels from ITSEC is shown in Table # 3. - Technologic Standards At their essence, computers communicate by duplicating and reproducing information. This requires a uniformity in the manner in which the information is structured and communicated. The need for uniformity is transcending; internetworking only occurs when there is sufficient critical mass around standard operating protocols, data structures and communication systems to permit scalable use of similar information by a community of users. In the European Union context, industry is supposed to take the lead with standardisation bodies in developing internationally agreed standards for electronic signatures. These standards should focus on establishing an open environment for interoperable products and services. The role of the European Commission in this 10
subject is to support this process. In this sense, the European Electronic Signature Standardisation Initiative (EESSI) is currently being developing. The drive toward standardisation is also occurring on a regional basis. In addition to European initiatives, Korea, Japan, China and the Association of Southeast Asia nations (ASEAN) are endeavouring to standardise PKI standards. There is, thus, understanding that interoperability can be achieved on a regional basis, unifying the Asian economies in a manner comparable to success being realised in the Americas and Europe. At an international level, besides ISO15 and ITU, the Internet Engineering Task Force (IEFT), and the World Wide Web Consortium (W3C) are the principal standardisation bodies which we must follow closely. Table # 4 shows some aspects of their developments as well as the European Union initiative. The majority of countries with laws on electronic authentication have not developed detailed standards, although they are working on them. It appears that many countries are waiting for either regional standards –as many European countries are awaiting finalisation of the EESSI project- or market standards -as seems to be the case in many South American countries- to emerge before finalising their own. - CSPs Registry Many countries also require CSPs to register in some way before starting their activities, such as Spain and Luxembourg. In the Spanish case, CSPs have to register before starting their business activity. The paradoxical thing is that such registry is not still created despite the regulation came effective more than two years ago. IV. CONCLUSION Legal interoperability is essential to realising the potential gains of electronic commerce. The growth of competing legal and technical frameworks could result in an intricate and unworkable maze of conflicting standards; divergent legal requirements 11
could effectively erect barriers to international trade; and a system in which each country prescribes its own standards could inhibit mutual recognition and cross- certification requirements. Nearly every country has at least initiated a national accreditation, certification, or standardisation scheme for electronic signature products and services, which could lead to a Babel that imperils international legal interoperability. Almost all the laws give basic legal effect to electronic documents and signatures, with the exception of certain types of documents or acts such as a will. Thanks to the pressure that the European Union could exert on the processing of the UNCITRAL Model Law on Electronic Signatures, many countries are adopting the hybrid approach of neutrality-technology with enhanced legal effects for digital signatures and PKI, and it seems that the United States are being obligated to joint this generalised trend. Anyway, there is still a long road to run towards communications and systems security. Security is very difficult, both to understand and to implement. For example, the security value of authentication is all but completely defeated by Single Sign-On. Authentication is supposed to prove that the user is present at the controlling computer at the time of the test. Under SSO, when the user has to rush to the washroom, any passing person can walk up to that user’s computer and sign on someplace via the SSO mechanism. 15 International Organisation for Standardisation (http://www.iso.ch/iso/en/ISOOnline.openerpage). 12
TABLE # 1: World-wide legal framework Approach Aim Motivation Legislation/ Regulation Countries 1) Minimalist ! To facilitate the use of electronic ! To remove existing legal obstacles to the ! They are generally limited to defining ! Traditional common signature generally, rather than advocate recognition and enforceability of electronic the circumstances under which an law countries: a specific protocol or technology. signatures and records, by ensuring that electronic signature will fulfill any such - Canada electronic signatures and records fulfill requirements, with a goal of - USA16 existing legal requirements for tangible establishing a standard of proof. - UK signatures. - Australia - New Zealand 2) More ! To advocate PKI technology. ! To establish a legal framework for the ! They contain the following ! Some civil law prescriptive operation of PKI –whether or not other characteristics: countries: forms of secure authentication are included - Adoption of asymmetric - Germany17 or permitted- as well as a reflection of form cryptography - Italy18 and handwriting requirements that apply in - Certificate Authorities (CAs) - Argentina the offline world. - Duties of key holders - Malaysia - Circumstances under which reliance on an electronic signature is justified. 3) “Two-tier” or ! To adopt a third approach representing a ! To achieve legal neutrality by granting at ! They generally take the form of ! Most notably in the hybrid method convergence and synthesis of the two least minimum recognition to most enacting laws that prescribe standards European Union: approaches above. authentication technologies, while at the for the operation of PKIs, and - EU Digital same time creating a better-defined, more concomitantly take a broad view of Signature predictable legal environment by what constitutes a valid electronic Directive19 incorporating provisions for an signature for legal purposes. - Singapore20 authentication technology of choice. 16 The United States, despite initial contrasting approaches among individual states, has largely resolved the tension by opting for the minimalist approach on a national level. The recently-adopted Electronic Sibnatures in Global and National Commerce Act (“E-sign”) represents an affirmation of the minimalist approach. 17 The original German Digital Signature Law, passed the 13rd of June of 1997, established stringent technical standards for what types of digital signatures are to be deemed “secure”. 18 Italy took this a step further in its legislation passed the 5th of August of 1997, by conveying legal effect only to signatures that have been authenticated by a licensed CA 19 At the minimalist level, the EU Digital Signature Directive prohibits EU Members States from denying legal effect to an electronic signature solely on the grounds that it is in electronic form, or on the grounds that it does not satisfy the standars set forth elsewhere in the directive for “advanced electronic signatures” that are based on “qualified certificates” and that are created by “secure signature creation devices”. 20 Singapore´s Electronic Transactions Bill takes a similar approach, and distinguishes between technologies based on levels of security by establishing one legal treatment for “electronic signatures”, and another for “secure electronic signatures”. The “electronic signatures” are generally given minimum legal effect, while the “secure electronic segnatures” are entitled to an additional presumption of intefrity, a presumption that the user affixed the signature with the intent of signing or approving the document. 13
Table # 2: Evaluation criteria of accreditation and certification schemes EVALUATION CRITERIA The Common Criteria for Information Security Evaluation21 is the standard for specifying and evaluating the security features of computer CC products and systems. The CC is intended to replace previous security criteria used in North America and Europe with a standard that can be used everywhere in the world. The Common Criteria project harmonises ITSEC, CTCPEC (Canadian Criteria) and US Federal Criteria (FC). CC has been adopted by ISO as standard 15408, and it is the most likely candidate for long-term future use. The CC is essentially a catalogue of security requirements with identified dependencies. Requirements are given for security features (or functionality) and for security assurance (defined as grounds for confidence). The CC provides a set of seven pre-defined assurance packages termed Evaluation Assurance Levels (EALs). During the 1980s, the United Kingdom, Germany, France and the Netherlands produced versions of their own national criteria. These were ITSEC harmonised and published as the Information Technology Security Evaluation Criteria (ITSEC)22. The last issue, Version 1.2. was published by the European Commission in June 1991. In September 1993, it was followed by the IT Security Evaluation Manual (ITSEM) which specifies the methodology to be follow when carrying out ITSEC evaluations. Council Recommendation of 7 April 1995 on common information technology security evaluation criteria recommended the application of the Information Technology Security Evaluation Criteria (ITSEC) within evaluation and certification schemes for an initial period of two tears, to meet immediate evaluation and certification needs in connection with the trade and use of information technology products, systems and services, and also recommended advancing international harmonisation and standardisation of information technology security evaluation criteria. 21 http://csrc.nist.gov/cc/ 22 http://www.cordis.lu/infosec/src/crit.htm 14
Table # 3: Approximate Assurance Correspondence CC ITSEC EAL1 --------------- EAL2 E1 EAL3 E2 EAL4 E3 EAL5 E4 EAL6 E5 EAL7 E6 15
Table # 4: Standardisation Organisations Organisation Who is it? Security IT Field Standards INTERNATIONAL STANDARDIZATION ORGANIZATIONS The Internet Engineering Task Force23 is a open international community of 1. Internet standards to support an X.509-based PKI. ! IP Security Protocol (ipsec)24 IEFT network designers, operators, vendors, and researchers concerned with the 2. Alternative certificate revocation methods. ! Secure HyperText Transfer (official) evolution of the Internet architecture and the smooth operation of the Internet. 3. Certificate name forms and extension usage for certificates Protocol (S-HTTP) designed for use in legally-binding non-repudiation contexts. Relevant Supervisory Body: Public Key Infrastructure (PKIX) Working Group 4. Protocols for time stamping and data certification. The Word Wide Web Consortium25 develops common protocols that promote 1. An industry standard for enabling web sites to express their ! Platform for Privacy W3C evolution and ensure interoperability of the World Wide Web privacy practices in a standardised format that can be Preferences Project (P3P)27 (private) automatically retrieved and interpreted by browsers. 2. An important specification affecting XML26-based content which allows programs and scripts to dynamically access and ! Document Object Model update the content and structure of documents. 3. UROPEAN UNION STANDARDIZATION ORGANIZATIONS This European Electronic Signature Standardisation Initiative28 is working on - ETSI29 is responsible for defining standards for EESSI EU-wide standards and accreditation for signature creation devices, signature qualified certificates, security management and .................................... (official) verification, and other areas such as the supervision of the CSPs issuing qualified certificate policy for CSP issuing qualified certificates to the public (registration/notification; self-declaration for fulfilling certificates; electronic signature syntax and encoding QC policy). formats (Annexes I and II of the EU Directive) - CEN/ISSS is responsible for creating standards for The standards-related work is carried out by CEN and ETSI (EU-wide signature creation and verification products and standardisation bodies). functional standards for certification service providers (Annexes III and IV of the EU Directive and also Annex II (f). 23 http://www.ietf.org 24 http://www.ietf.org/html.charters/ipsec-charter.html 25 http://www.w3.org/P3P/ 26 Extensible Markup Language. 27 Microsoft has incorporated P3P capabilities in Internet Explorer 6.0. The most recent public draft of the related standards was issued on September 28, 2001 and it is available in www.w3.org. 28 www.ict.etsi.org/eessi/EESSI-homepage.htm 29 European Telecommunications Standards Institute. The ETSI draft Technical Report “Electronic Signature Standardization Report” is available in www.etsi.org/SEC/ESRep042.pdf . 16
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