In 2014, the Electronic Identification and Trust Services Regulation (eIDAS), a European Union (EU) regulation regarding electronic identification and trust services, was published, and it aimed to diversify trust services. eIDAS, still in force, sets forth three different electronic signatures: Simple Electronic Signature, Advanced Electronic Signature, and Qualified Electronic Signature. Among these signatures, only the Qualified Electronic Signature (QES) has the same legal status and the same legal effect as a handwritten wet signature. Because in qualified electronic signatures, qualified certificates provided by Qualified Trust Service Providers (QTSPs) are used.
Qualified electronic signature is used in many sectors, from real estate contracts to financial services, loan agreements, and employment contracts. When blockchain technology began to become widespread, it was discussed whether the public and private keys used in blockchain networks qualified as qualified electronic signatures; however, since there is no certification institution in blockchain, this was not accepted in many countries.
The European Union has been working on a comprehensive EU digital identity wallet project in recent years. Pilot projects, including blockchain-based projects, were implemented to develop this wallet. Pilot projects aimed to test the entire ecosystem, from uniqueizing the wallet to the user, adding personal identification information, embedding additional documents, and presenting this information to service providers.
The EU Digital Identity Wallet is built upon the European Electronic Identification and Trust Services Initiative (eIDAS Regulation), the existing cross-border legal framework for trusted digital identities. This Regulation, adopted in 2014, is qualified as a basis for electronic identity verification and website certification in the EU, both within the borders of the member states and between member states (cross-border).
However, today, it is stated that only 14% of the main (public) utilities are suitable for verification with an electronic ID. Europe's digital transformation target by 2030 was revealed with the “Declaration on Digital Rights and Principles for the Digital Decade” published in the Official Journal of the European Union dated January 23, 2023.
According to the Digital Decade goals (Article 7), by 2030, all main (public) services should be provided online, and everyone should have access to online health records. It is underlined that no one should request more data than necessary when accessing and using digital public utilities. It is promised to offer people living in the European Union the opportunity to use a voluntary, secure, and reliable digital identity that provides access to various online services.
This is where eIDAS 2 comes into play. With this Regulation, the European Commission aims to turn cross-border electronic identity from a dream into a reality. The new version of the eIDAS Regulation is planned to make the EU Digital Identity Wallet available to all EU citizens, EU residents, and businesses who want to use it. Unlike eIDAS 1, which provides a preliminary framework for digital identity distribution and use in the EU, the eIDAS 2 regulation will focus on interoperability and mandate the implementation of the “EUDI” wallet for all member states.
Ursula von Leyen puts the Commission’s vision as follows: To create a secure European e-ID that every citizen can use anywhere in Europe ... where it is possible to control what data is used and how it is used.
Thus, all EU citizens will be offered the opportunity to have an EU Digital Identity Wallet to access public and private online services throughout Europe. The EU Digital Identity Wallet will be a digital version of identity documents and other personal documents. One of the main advantages of the EU Wallet is that it simplifies online authentication. In addition to securely storing digital identities, the digital wallet will also allow users to open bank accounts, make payments, and store digital documents such as mobile driver’s licenses, passports, payment cards, transportation cards, medical prescriptions, professional certificates, or travel tickets.
The EU Digital Identity Wallet aims for at least 80% of EU citizens to have a digital identity system by 2030, within the scope of securely facilitating transactions with public administrations and private businesses throughout the EU. In addition to public utilities, “Very Large Online Platforms” (such as Amazon, Booking.com, or Facebook) designated under the Digital Services Act and private services obliged to verify the identity of their users will have to accept the EU Digital Identity Wallet at the stage of logging into their online services.
Since this digital wallet will be standardized at the EU level and recognized by all member states, the EU Digital Identity Wallet is expected to pave the way for new cross-border use cases, such as opening a bank account, applying to a university, or being used for healthcare in another member state. This makes travel across Europe without physical identity documents possible for EU citizens. It is stated that border control authorities will only need a smartphone or tablet with a specific application to check the identity of the wallet owner.
It may also be possible for EUID to be integrated with the digital euro project of the EU.
EUDI will fully accommodate the user’s choice of whether to share personal data and offer the highest degree of security independently certified to the same standards, and relevant parts of its code will be published as open source. Thus, possibilities such as abuse, unlawful surveillance, or government intervention will be eliminated.