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A company seal (also referred to as a ‘corporate seal’ or ‘common seal’) is a stamp that companies use to execute documents. The company seal has the company’s name and Australian Company Number (ACN). If the company uses its Australian Business Number (ABN) instead of the ACN, then the ABN should be on the company seal instead. In the past, the law required it to be affixed to share certificates and deeds. Below, we review the legality of company seals today particularly, the relevancy and the legal requirements which attach.

How Relevant is the Company Seal Today?

The Company Law Review Act 1988 (Cth) removed the requirement for companies to use company seals. Section 127 of the Corporations Act 2001 (Cth) (Corporations Act) now sets out that a company will have validly executed a document where:

  • two directors of the company have signed the document; or
  • one director and secretary of the company have signed the document; or
  • one director (if it is a proprietary company with a sole director who is also the sole company secretary) has signed the document.

Although most companies no longer use a company seal, those incorporated before 1988 still commonly use one. Their use will ultimately depend on whether the particular company has amended their constitution to remove the requirement to use a company seal. A company must still use its seal if the constitution requires. There are consequences for incorrectly executing a document.

Which Countries Use Company Seals?

There are still many jurisdictions around the world (particularly throughout Asia Pacific) where the law requires companies to use the company seal. For this reason, in cross-border transactions involving overseas companies and foreign government agents, the use of a company seal may be more appropriate when executing documents.

What are the Requirements Under the Corporations Act?

A company’s constitution, not the Corporations Act, specifies how a company may execute its corporate documents. The Corporations Act, however, does set out acceptable methods of execution which a counter-party may assume to be valid.

Regardless of whether a company executes a document with or without a company seal (sections 127(2) or 127(1) respectively), it will still require the signatures of the following parties either as a witness or as the person executing the document:

  • two directors of the company; or
  • one director and secretary of the company; or
  • one director (if it is a proprietary company with a sole director who is also the sole company secretary).

Where Can You Order a Company Seal?

Australia’s corporate regulator, the Australian Securities and Investments Commission (ASIC) does not make or issue common seals. Various company registration agents may provide the company seal when you seek to register your company through them. However, this will be an additional cost (usually not more than $100). There are also online companies that can manufacture a company seal.

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If you are looking to register a company or execute documents but are unsure of the process, get in touch with our specialist business lawyers on 1300 544 755.

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