The law gives such signatures the legal status of handwritten signatures and allows the creation of companies to verify the identity of participants in an online transaction, the official Xinhua News Agency reported.
In China, 87 million people use the Internet. But E-commerce has grown slowly, held back by a low rate of credit-card use and a lack of other online payment options and legal structures.
The industry has begun to attract strong interest from foreign investors, however, with Amazon.com Inc. announcing plans this month to pay $75 million for Joyo.com Ltd., China's largest online seller of books, music and videos. E-Bay and others also have announced deals aimed at profiting from China's online commerce. China already has some 4,000 E-commerce Web sites, Xinhua said, with revenues last year totaling about $60 billion.
Chinese lawmakers have been working since April, 2003 on the electronic signature measure, which they passed on Saturday, Xinhua said.
Electronic signatures became legally binding in the United States in 2000.