Understanding Company Seals: Essential Guide For Australian Businesses

When you’re running a company in Australia, there’s a lot to take in - from setting up the right structure to signing documents the right way. One of the most common questions we hear is: what is a company seal, and do you still need one today?

You’ve probably seen an embossed stamp on a deed or a share certificate, or heard someone ask for the “corporate seal” at a signing meeting. Knowing what a seal does (and when it’s actually useful) will help you execute documents correctly and avoid avoidable delays with counterparties.

In this guide, we break down exactly how company seals work in Australia, what the Corporations Act says about execution with and without a seal, when a seal is practically helpful, and how to use and control one properly inside your business.

What Is A Company Seal (And What Does It Do)?

A company seal (also called a “common seal” or corporate seal) is a physical stamp or embosser that carries your company’s name and Australian Company Number (ACN). When you press it onto a document, it leaves a distinctive impression that indicates the company has “sealed” the document.

Historically, affixing the seal was how a company signed as a legal entity. Today, a seal is optional in most situations. The Corporations Act allows you to execute documents in other ways that don’t involve a seal - and those methods are just as legally effective when used correctly.

That said, seals still have a place. Some counterparties (like overseas banks or government bodies) may prefer or expect a sealed document. Some older company constitutions also include seal procedures for certain documents. And for particular instruments (for example, traditional share certificates), many companies still choose to use the seal for clarity and formality. If you do issue share certificates, consider how your constitution and processes align with modern practice and guidance on share certificates.

Do I Need A Company Seal In Australia?

Short answer: no, most Australian companies do not need a seal.

Under the Corporations Act 2001 (Cth), a company can execute documents either with or without a seal. Both approaches are valid if you follow the rules for who signs and how the document is executed.

Execution without a seal (the modern default)

• Most companies execute documents under section 127 without using a seal.
• For proprietary companies with a sole director, section 127 allows the sole director to sign (even if there is no company secretary).
• Electronic signing is permitted for companies, and counterparts are recognised - which makes signing across locations fast and efficient.

If you’re weighing up how to sign, it’s worth reading how section 127 works in practice, including electronic signing and split execution, in this handy overview of signing documents under section 127.

Execution with a seal (optional)

• You can choose to affix the company seal and have the required officers sign near the seal.
• However, if your company has a sole director and no company secretary, you generally cannot rely on the seal method unless that sole director is also appointed as the sole company secretary.

This distinction often trips people up. Put simply: a sole director company can execute without a seal under section 127; but if you want to use a seal, the sole director must also hold the secretary role (or you use two officers where relevant).

What about deeds and “wet ink”?

A common misconception is that deeds or ASIC forms always require a seal or “wet ink” signatures. For companies, that’s no longer the general rule. Many deeds can be executed electronically by companies under section 127 and do not require witnessing when signed in that way. Counterparties may still ask for wet ink or a seal by policy, so always check their requirements early.

If you’re deciding between “pen-and-paper” and digital signing, this comparison of wet ink and electronic signatures sets out how Australian law treats both methods for company execution.

How Do Company Documents Get Validly Executed?

There are two main pathways under Australian law for a company to execute documents. Understanding both will help you choose the right approach for each deal.

1) Section 127 (company execution by officers)

Section 127 of the Corporations Act lets a company execute a document by having the right officeholders sign. In practice, this usually means:

• Two directors; or
• One director and one company secretary; or
• For a proprietary company with a sole director - the sole director.

You can execute with a seal or without a seal under section 127. If you use a seal, ensure the correct officers are present and sign next to the seal impression.

When documents are signed in accordance with section 127, there’s a helpful assumption in the law that counterparties can rely on - they can assume the document has been validly executed. This is a key reason most businesses now default to section 127 execution. For a deeper dive on officer execution, read the explainer on section 127.

2) Section 126 (authority delegated to others)

Section 126 lets a company act through an agent or employee who has authority to enter into, vary or discharge contracts on its behalf. This is useful for day-to-day contracts where a director’s signature isn’t practical.

To use this pathway safely, make sure the person signing has clear authority - for example, a board-approved delegation or internal policy. It’s also smart to back up this process with a well-drafted signing procedure and a simple signing block that states the capacity in which they sign. If your business frequently delegates authority, it helps to understand the basics of section 126 and ensure your records reflect those delegations.

Electronic signing and counterparts

Electronic execution by companies is now broadly permitted under the Corporations Act. Companies can sign electronically (for example, using reputable e-signing platforms), and documents can be signed in counterparts.

Many cross-border or multi-party deals rely on these features. If you anticipate multiple signers in different places, consider using counterparts and include a clear clause to that effect. This primer on signed in counterpart explains how it works in Australia.

When Does Using A Company Seal Still Make Sense?

Even though seals are optional, there are practical scenarios where using one can smooth the path to signing - or even be required by the other side’s policy. Consider a seal where:

• Counterparty policy requires it: Some banks, government bodies, or overseas entities ask for sealed documents as a matter of policy or familiarity, even if not legally required.
• Your constitution still references a seal: Older constitutions sometimes include seal-use procedures for specific documents. If your constitution requires the seal for a class of documents, either use it or update the constitution to reflect your current practice. If you’re unsure what your constitution says, it may be time to review your Company Constitution.
• Formal company instruments: Some companies prefer to seal instruments like share certificates or appointment documents for consistency and authenticity across their corporate records.
• Cross-border comfort: If you’re dealing with jurisdictions where seals remain common, affixing your seal can avoid back-and-forth on formalities.

Note: Using a seal is not a substitute for correct execution. The required officeholders still need to sign near the seal in accordance with section 127 (or otherwise ensure the document is executed under valid company authority).

If you’re working with deeds and wondering whether to use a seal, remember that companies can usually execute deeds without a seal under section 127. If you’re new to deed formalities, this guide to what is a deed covers how they differ from standard contracts.

How To Obtain, Control And Use A Company Seal Properly

If you decide to maintain a seal, set it up with simple, sensible controls so it helps rather than hinders your process.

Getting a seal made

• Order from a reputable supplier and include your exact company name and ACN as registered with ASIC.
• Consider an embossing seal (for originals) and a rubber stamp (for copies), depending on your document workflows.

Storing the seal and internal controls

• Keep it secure: Store the seal in a locked cabinet or safe, typically under the control of the company secretary or another trusted officer.
• Define who can use it: Adopt a simple internal policy or board minute that states who may authorise and witness use of the seal, consistent with your constitution.
• Use a seal register: Record each time the seal is affixed (date, document name, signatories, location). This supports good governance and creates an auditable trail.

Using the seal: step-by-step

1. Confirm the document type and that seal use is appropriate or required by the counterparty or your policies.
2. Arrange for the correct officers to be present (for example, two directors; one director and the company secretary; or the sole director who is also the sole company secretary if using the seal in a sole-director company).
3. Affix the seal where indicated and have the officers sign their names and titles near the seal impression.
4. Enter the details in the seal register and retain a certified copy in your corporate records.

Tip: If third parties will rely on a sealed document (e.g. banks), consider whether an accompanying authority to act or a short board minute confirming approval would make downstream processes faster.

Common Pitfalls To Avoid (And How To Stay Compliant)

1) Assuming a seal is needed for deeds or ASIC lodgements

For companies, a seal is generally not required. Many deeds can be executed electronically under section 127, and ASIC submissions are typically lodged electronically without any seal. If a counterparty requires a seal by policy, plan for that early rather than at the eleventh hour.

2) Using a seal with a sole director who isn’t also secretary

If you have a sole director and no company secretary, don’t use the seal unless that person is also appointed as the company secretary. Instead, sign without a seal under section 127 (which a sole director can do). This is a subtle but important distinction.

3) Forgetting your own constitution

Some constitutions still reference seal-use or internal approval steps. Make sure your processes match your constitution - or update your Company Constitution so your documentation reflects how you operate today.

4) Overlooking authority and record-keeping

Whether you use section 127 or section 126, keep clear authority frameworks and records. That could include a delegations schedule, board minutes, signing policies, and a seal register if you maintain a seal. Clean records make it easy to prove proper execution if questions arise later.

5) Not planning for electronic execution and counterparts

Multi-party transactions often close faster with e-signing and counterparts. Build this into your standard document templates and check your counterpart’s preferences upfront. If your agreement contemplates multi-jurisdiction signers, ensure the execution clause supports counterpart signing robustly.

Key Takeaways

• A company seal is optional for Australian companies - most documents can be validly executed without a seal under section 127 of the Corporations Act.
• When executing without a seal, two officers (or a sole director for a proprietary company with only one director) can sign, including via electronic execution and counterparts.
• If you choose to use a seal, make sure the right officers sign near the seal and remember the special rule for sole director companies: the sole director must also be the sole company secretary to execute with a seal.
• Deeds don’t generally require a seal or wet ink when executed by a company in accordance with section 127, although counterparties may have their own policy requirements.
• Good governance matters: store the seal securely, control who can use it, and keep a simple seal register - and make sure your Company Constitution aligns with how you execute documents.
• If you rely on delegated authority (section 126), support it with clear policies, minutes and signing blocks, and consider whether an internal signing procedure is needed.

If you’d like a consultation on company seals, updating your Company Constitution, or setting up a practical execution policy, reach out to our team at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.