Corporate Seal

Generally, a company has its own stamp affixed to documents issued by such company or on its behalf. If a contract is made by company, is it necessary to have company seal be affixed on such a contract in order for the contract to be valid?

Article 115 of the 2005 Law on Commercial Enterprises in Cambodia states: “An instrument or agreement executed on behalf of a company by a director, an officer or an agent of the company is not invalid merely because a corporate seal is not affixed thereto.” Therefore, a contract entered into (signed) by a person appointed by the company, even if no company seal is attached to the contract, the contract is valid and mandatory for the company.

But in practice, we always see a company seal stamped on the documents to mark the fact that they belong to the company. This practice may be due to the fact that the company seal is kept properly and used for official documents on behalf of the company. This can convince that a letter or contract affixed with a company seal is truly made by authorized person or representative of the company.

(*Businesss Law, Cambodia)

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