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1.3. Institutional-legal context
The most important institutional contexts influencing electronic government concern the organization of the city government and formal requirements for citizen-administration interaction. Bremen is unique because it is not only a local government, but forms (together with the city of Bremerhaven) a city-state. It is Germany's smallest Land, as the federal states are called. Every city (and Land) is free to organize itself independently. The federal and the Länder level have delegated almost all direct interactions with citizens to local administrations, and rarely meet the citizens themselves. However, they remain in charge of the formal requirements.

Being a city-state means that Bremen is able to change laws governing the material content of formal requirements, for example in building/housing and education laws; a right which other cities do not have. However, a rather substantial amount of all regulations for citizen-administration interaction is drafted at the federal level and/or in cooperation with the other states, so that some coordination problems remain.

Electronic transactions in business life and in dealings with administrations have been legally practical for quite some time. However, when functions of authenticity, identification, (data) privacy, integrity, and (non-) repudiation are at stake, electronic equivalents have to be found for "paper-based" systems such as signatures, envelopes, and identity-cards. Because there is a considerable gap in legal expertise as to which technologies reliably deliver those functions, electronic government has been effectively hindered by an array of different and diverging opinions as to what is feasible and what not.

To address one of the most salient problems, reliance and trustworthiness of electronic signatures, Germany regulated their issuance in 1997. In 2000, the EU-directive on electronic signatures became effective (causing Germany to adapt its older law). At a much slower pace, the administration is now reforming the formal requirements in its many laws, allowing for more uses of electronic signatures in interactions with government. Most significantly, the general laws governing administration processes will introduce a new formal requirement beyond the "written form": the "textform", which can be met by electronic means as well.

With regard to cooperation with the private sector, one needs to emphasize that transactions with public administrations tend to be more complex than (the already comparatively wide spread) banking transactions. Instead of transfers from one account to another, sell-/buy-orders, or credit card debits one needs to support multi-step, time-distributed, and multiple-partner processes, such as an application for socially-assisted housing or starting a company. Many of these transactions include public and private sector organizations being subject to private and public law at the same time.