To characterize documents as legitimate, authorities use seals and stamps. Seals leave an embossed or elevated printout on paper in the form of a watermark to prevent falsification. They can also be generated by computer. The signature and originality of a document with an inked symbol or identification are validated by stamps. The type of document involved and any relevant laws determine whether a seal, stamp, both, or neither will be used.
A company seal is an official seal used by a company. It is often referred to as a corporate seal or a common seal. Traditionally, it was of certain legal importance because it implied the official actions of the company, whereas if the document was simply signed by the director, it was considered by the agents of a company to be an act on behalf of the company subject to restrictions or limitations applicable under the ordinary laws of the agency. Common seals come with different types of designs, colors, shapes, and sizes; they can also be customized. In Indonesia, it usually takes around three to five working days to collect the common seal. Seals with more complicated designs take approximately a week to be completed.
The company seal should be limited to a minimum of only very important transactions or documents. Thus, the use of the company seal should be reduced. For example, the company seal should not be used for all business activities such as approval of minutes of meetings, simple seller agreements, service level agreements, and the like.
Those who set up an Indonesian company must consider whether they genuinely need a company seal. Although company seals are optional, there will nevertheless be times when a company seal is required. Such instances include dealings related to government documents, utilities or telephone bills, and messaging companies which require an official firm stamp for authorization purposes.
The Power of The Seal
Although signatures have diminished the power of the seal, company seals remain an official element of many companies.
In Indonesia, a company is regarded as a separate entity, and the seal acts as the company’s signature. A company seal is required for legal or official documents derived from a company. Without the company seal affixed to certain documents, no individual could allow certain corporate acts.
The company seal had historically been important for the validation and authenticity of documents. The paper seal was the commitment of the company to the contract or act. Documents signed by the managers alone could have been legally interpreted as an act performed by the individual on behalf of the company.
However, corporate seals are losing the importance that they were once given. The importance of the seal has recently been reduced and limited to very few cases. For example, for board resolutions, the company seal is required. A board resolution is invalid without the company seal. However, instead of seals, laws are beginning to recognize as binding the signature of individuals with effective authority. Such individuals include managers and authorized signatories.
Although an Indonesian company is regarded as a legal entity of its own, the company must do what is stated in its articles of association through its managing director, board of directors, or any duly licensed person. If a company acts in its name and shows that the company is acting, the related document is to contain the seal of the company and be signed by a competent authority designated by the management board by means of a decision passed by the board of directors
The company is therefore bound by all acts under the company’s authorized signatures and a common seal. With regard to documents and contracts, the affixation of the common seal of the company binds the company. Certain documents and agreements are not valid and binding unless a company seal is attached.
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There are three varieties of rubber stamps which exist in Indonesia. The three varieties of rubber stamps are the traditional type, rubber self-inking, and pre-inking rubber stamps.
Rubber stamps have been used for over 100 years. However, in their earliest form, rubber stamps were made of wood. The self-incorporated rubber stamp of today is made of plastic as well as certain heavy–duty materials. Light burst technology and laser sculpture fabric have recently also been utilized to generate these official stamps which may generate over 50,000 imitations without the need to reinclude them. Most of these stamps are used to mark envelopes, company credentials, and letters of business. It is much simpler and less time-consuming to use these office supplies than it is to use other methods.