The Timing of Smart Contract Formation from the Perspective of Iranian, English, and American Law

Abstract

In order to determine the timing of smart contract formation, which is considered a type of electronic contract, the authors initially examine the viewpoint of traditional contract law. In England and the United States, the doctrine of receipt of acceptance is accepted for instantaneous transactions, while the doctrine of dispatch of acceptance is applied to non-instantaneous contracts to determine the timing of contract formation. In Iran, a unified approach has not been adopted by legal scholars, and the authors advocate for the acceptance of the doctrine of declaration of acceptance. However, regarding the timing of electronic contract formation, the legal systems of England and the United States consider the time of sending the data message as the moment of contract formation, while the Iranian legal system, we claim, relies on the time of signing the acceptance letter as the criterion for contract formation. Various assumptions can be conceived regarding the timing of smart contract formation, and the authors argue that legal systems adhering to the theory of receipt of acceptance should rely on "receipt of the message containing acceptance of the smart contract," while legal systems favoring the theory of dispatch of acceptance should consider the "time of signing the contract with a private key by the acceptor" as the criterion for determining the timing of smart contract formation.

Keywords

• timing of smart contract formation
• timing of electronic contract formation
• timing of contractual communications
• smart contract
• blockchain