Summary
- A company seal is a historic form of authentication used to confirm that an authorised person has signed a document on behalf of a company, but since 1989 the Companies Act removed the legal requirement to affix a seal to deeds and contracts in England and Wales.
- Whether your company must use a seal depends on its articles of association, and any document signed in a manner that contravenes those articles may not be valid or enforceable.
- In place of a company seal, documents can be validly executed by two directors, a director and company secretary, a power of attorney, or through an electronic signing platform.
- This article explains when and whether a company seal is required for business owners operating in England and Wales.
- LegalVision, a commercial law firm specialising in advising clients on corporate governance and commercial document execution, outlines how company seals work and the alternatives available.
Tips for Businesses
Check your articles of association before executing any deed or contract to confirm whether a company seal is required. If your company no longer uses a seal, ensure documents are executed by two directors or a director and company secretary. Consider granting a power of attorney where a specific individual regularly signs on the company’s behalf.
A company seal is a physical stamp used by some companies in England and Wales to authenticate the execution of documents such as deeds and contracts. Historically, company seals were a legal requirement, but modern company law has made them optional for most purposes. This article explains what a company seal is, when it might be used, and whether your company needs one.
What Is a Company Seal?
A company seal is an embossed or stamped mark that a company applies to documents to authenticate their execution. Historically, companies were required by law to use seals on important documents, including:
- deeds;
- contracts; and
- share certificates.
Modern company seals typically display the company’s registered name and company number. They may be made from metal or rubber and can be applied in various ways:
- embossing the paper;
- using an ink stamp;
- affixing a sticker; or
- applying wax (though this is now rare).
If your company uses a seal, ensure it is clearly legible. A document may be invalid if the seal is not properly affixed or cannot be read.
Do I Need to Use a Company Seal?
Since the Companies Act, companies in England and Wales are no longer required to have or use a company seal. A company can execute documents without one.
However, you should check your company’s articles of association. If your articles require the use of a seal for certain documents, you must comply with this requirement.
Most modern companies do not use seals and instead rely on alternative methods of execution.
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How Do I Execute a Document With a Company Seal?
If your company chooses to use a seal (or is required to by its articles), the seal alone is not sufficient. Under the Companies Act, a document executed with a seal must also be signed by:
- two directors; or
- one director and the company secretary.
How Can I Execute a Document Without a Company Seal?
Most companies now execute documents without a seal. Under section 44 of the Companies Act, a company can validly execute a document if it is signed by:
- two directors; or
- one director and the company secretary.
Powers of Attorney
A company can also grant a power of attorney to authorise specific individuals to execute documents on its behalf. This is particularly useful for overseas transactions or when directors cannot personally sign documents.
Electronic Execution
Electronic signatures are now widely accepted for company documents. The Corporate Insolvency and Governance Act confirmed that documents can be executed electronically, provided the company’s articles permit this method. Electronic execution offers speed and convenience whilst maintaining legal validity.
When Might a Company Seal Still Be Used?
Whilst not legally required, some companies continue to use seals for:
- tradition or formality;
- international transactions where foreign jurisdictions expect or require a seal;
- share certificates; or
- documents where the articles of association require a seal.
If you operate internationally, check whether the other jurisdiction requires or expects a sealed document, as some countries still place significance on company seals.
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Key Takeaways
Company seals are no longer a legal requirement in England and Wales. Companies can execute documents without a seal, provided they follow the correct signing procedures under the Companies Act.
Most companies now execute documents by having them signed by two directors, or one director and the company secretary. Electronic execution is also increasingly common and legally valid. However, you must check your company’s articles of association. If your articles require a seal for certain documents, you must use one. Failing to follow your articles could render a document invalid.
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Frequently Asked Questions
When should a company seal be used?
A company seal should be used if your company’s articles of association require it. Otherwise, it is optional. Some companies use seals for international transactions or for traditional reasons.
Is a company seal a legal requirement?
No. Since the Companies Act, companies in England and Wales are not required to have or use a company seal.
Can I create my own company seal?
Yes. There are no legal restrictions on who can create a company seal. It should clearly display your company’s registered name and company number. Many companies use professional seal makers to ensure quality and durability.
What happens if I lose my company seal?
If you lose your company seal, create a replacement and update your company records. Consider informing key stakeholders. Review any recent documents to ensure they were properly executed and remain valid.
How do I execute a deed without a company seal?
A deed can be executed without a seal if it is signed by two directors, or one director and the company secretary, and is expressed to be executed as a deed. It must also be delivered as a deed.
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