Company Seal that Deal – Literally!
Company Seal that Deal – Literally!
A company seal is a device commonly supplied by Company Formation Agents when registering new companies for clients. The company seal offers a way of embossing documents with the company name and number as a way of sealing the document. This seal is often used in place of signatures of the authorised representatives of the company.
In the UK, Prior to the Companies Act 1985, a company seal was legally binding on a company when a document such as a contract or share certificate was embossed by the seal. Since the Companies Act 1985 (and subsequent amendments) were introduced the company seal was no longer a legal requirement of a limited company. Instead a company can effectively seal a document with the signature of two company officers, typically a director and secretary of the company.
Although this change in law in the UK would appear to make the company seal a redundant item they are still widely used today. The company seal still has great importance in other countries and many UK companies doing business overseas will often need to seal a document to complete a contract or agreement.
How does it work
The company seal is actually an embosser as opposed to a stamp that would contain ink of some form. When the seal is pressed onto paper it creates a raised impression of the information contained within the two dies.
The company seal has two dies containing the information to be embossed on to paperwork. One die will have a raised impression and the other die will have the inverted image of this information. You simply insert a piece of paper between the two dies and press the lever, or squeeze the plier, and the two dies come together creating a raised impression on the paper of the information contained on the dies.
This embossing process is a simpler alternative to more traditional seals which involve using wax and a stamp. Wax would be heated and melted onto a document which is then impressed with the stamp containing engraved information. The engraved information would create an impression in the wax and therefore seal the document. As it is not practical to heat wax in many situations the company seal offers a simple alternative by impressing directly into paper.
If you wish to obtain a wax effect from a company seal you can use self adhesive wafers which are designed to look like wax. The wafer is simply placed on the paper before embossing, then emboss in the centre of the wafer and the raised image is more defined as would occur with a wax seal. Company seal wafers are typically supplied in red (to look like wax) or gold.
Various types of company seal
Company seals are available in two formats.
The cheapest seal is a plier type seal which has two dies, one on each side of the plier. As the plier is squeezed, with paper between the pincers, the two dies come together and emboss the paper. This plier type company seal offers an economical and portable way of sealing documents but is limited in its reach from the edge of paperwork and is unable to emboss a satisfactory image into thicker paper.
The more robust option is the lever type company seal. This seal has one die on its base and a second attached to lever above the base. Paper is inserted over the base and the lever is compressed thus embossing the paper. As the force created by the lever is much greater than the plier type seal the lever company seal can emboss thick paper and card. Lever company seals are available in various finishes so can be kept on a desk adding a professional look to your work environment.
Who uses company seals
Company seals are still widely used by limited companies in the UK to emboss the company name and number on important documents. Although not legally required they do give a professional finish to important contracts and certificates.
Professionals such as Notary Publics and solicitors also use them to seal documents they have signed with their name and often a unique logo.
Anyone can use a company seal and it does not have to contain information relevant to a company, this is just the most common use.
Where to obtain a company seal
The most common supplier of company seals in the UK are company formation agents as it goes hand in hand with company formation services. A plier type company seal containing just text (no logo) can be obtained for less than £20.
Steve Harris works within the company formation and business advice industry and has a wide knowledge of this sector. Simple Formations is part of the SFS Group of Companies providing Company Seals
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