After setting up your business or company, a common question most new business owners ask is: “Do I need a company stamp?”.
Company stamps and company seals are some of the stationery you are likely to come across in the offices of almost all companies in Singapore. They are useful for legitimizing company documents. But you may be wondering whether do you need a company stamp? What does the law state about it?
What is a company stamp?
Also known as a company chop or a rubber stamp, it is an item used to authenticate official documents for the company. It may be made of wood, rubber, plastic, etc., or a combination of various materials.
A company stamp, is almost as similar as an individual’s own unique signature.
The stamp usually includes crucial company information such as the company’s registration number or unique entity number (UEN), its official business name, and may also include contact details, address, date, logo, etc. These details are specially engraved on one side of the stamp, then using ink, they are transferred on to the document through the act of stamping.
A company is free to use any of its details on the stamp.
What is a company seal?
Though commonly used and almost similar, a company seal is different from a company stamp. Also known as a common seal, a company seal is a metallic stamp that embosses company details on official documents.
A company seal may contain the company’s name and sometimes also it’s registration or UEN number. In Singapore, it is used for purposes such as;
- Authenticating documents such as share certificates.
- Validating and executing documents such as contracts or deeds.
- Communicating government and other legal information as stipulated by the law.
However, with effect from 31 Mar 2017, companies and limited liability partnerships (LLPs) are no longer required to use the common seal in the execution of documents as a deed, or other documents such as share certificates. Companies and LLPs can execute documents by having them signed by authorised persons.
Uses of a company stamp
- Used for the authentication of company documents for legal reasons. This is necessary for documents communicating government or other legal information as stipulated in the law. These documents are such as;
– Invoices and purchase orders
– Business contracts
– Grant applications
– Rental agreements
– Bills of exchange or promissory notes - In the prevention of forging. When a stamp is used on a company’s document, it makes it hard for forgers to create a fake copy as it will not have the authentication provided by an original stamp.
- It increases efficiency by saving company executives or business owners from having to separately sign individual company documents.
- Used for the authentication of company documents for legal reasons. This is necessary for documents communicating government or other legal information as stipulated in the law. These documents are such as;
Requirements for a stamp in Singapore
For you to have an authentic company stamp in Singapore, you must first meet all the requirements of the Accounting and Corporate Regulatory Authority of Singapore (ACRA). This is the official; government body that is responsible for company formation including regulation and cessation. Moreover, the body provides a legal framework that your business or company has to comply with.
ACRA is responsible for;
- Registration of new companies
- Provision of UENs
- Administration of the Companies Act
- Collecting and keeping of all corporate data such as directors, shareholders, corporate secretaries, etc.
Having met these ACRA requirements, then you can make a stamp for your business as you like. Sourcing for one should not be a difficult task as there are many sellers and providers of stamps who can create a customized one for your company.
Price ranges from $10, upwards to $35. The process may take anywhere from a few hours to a few days depending on the company and the stamp should be ready to be used immediately after.
If within your means, it is recommended to create a custom design for your company stamp, that is unique to your company. This would be useful if you are using your stamp to authenticate documents, and having a custom design would be harder to forge (fake).
Do you need a company stamp?
After getting everything else ready for your company, you may still ask yourself the question, “do I need a company stamp really?”.
Although it is not a mandatory requirement, in most cases the answer is yes.
This is because, it is a good item to have for the sake of convenience, and may be required in certain business dealings when specifically requested. In addition, the cost of owning a company stamp is low, and if you have one, you typically would be able to use it for a couple years as least.
Even if you are in the B2C (business to consumer) business, having a company stamp would be useful in officiating any documents such as invoices, or agreements with both clients or suppliers.
According to the Companies Act, section 144(1A), only a company’s UEN is mandatory on all official documents of a company. The section states that “the registration number of a company shall appear in a legible form on all business letters, statements of account, invoices, official notices and publications of or purporting to be issued or signed by or on behalf of the company”.
This is interpreted to mean that a company stamp, just like the company seal, is not mandatory to determine the authenticity of a company’s documents. The company’s official documents should, however, contain among other details, the company’s UEN. This, when coupled with the signature of the authorized company official validates the documents.
Nonetheless, if you are primarily focused in dealing with other businesses, it is not uncommon for your suppliers or customers (businesses) to request for your documents to be authenticated with your company stamp.
