The basics
For many foreigners encountering company seals for the first time, the act of stamping may seem unfamiliar. In Western practices, documents and letters are typically signed by individuals to confirm responsibility or ownership. In today’s Chinese business environment, the company seal represents the entire company and is crucial for both internal management and external dealings.
Once a document is stamped with the company seal, it signifies the company’s endorsement, granting the document legal validity. Therefore, the proper use of company seals is vital for the survival of a business, as improper use can lead to serious consequences.
For more insights into company seals, you can explore our previous blog post: The Importance of Company Seals in China.
Authorization
Hongda helps your company designate an authorized contact person responsible for managing and using company seals and certificates.
Hongda assigns professional seal and certificate management specialists (keepers) to ensure the usage process is secure and well-organized.
Scope
Hongda’s chop management services include:
Through these services, Hongda helps you manage seals securely and efficiently.
How it works
Quick answer: the service runs in three processes: authorization confirmation, seal usage and seal borrowing. Select a process for detail.
Stage 1 of 3
Hongda assists your company in preparing and establishing an authorization matrix document to clarify the authority for seal management.
Stage 2 of 3
Your company’s employees submit a seal usage request, attaching a copy of the document to be stamped.
Stage 3 of 3
Your team fills in a borrowing request form, specifying the purpose, borrowing duration and other details.
Through these services, Hongda helps your business manage seals securely, efficiently, and in line with relevant regulations.
Common questions
The legal effect of the seal and the responsibility for its use are the points most often raised.
The company seal and the signature of the legal representative differ in legal effect. The company seal represents the will of the company itself and usually requires authorization from the board of directors or shareholders, whereas the legal representative’s signature represents their personal will and has a different legal effect.
If the misuse or mistakes involving the company seal cause the company to suffer losses or violate laws and regulations, the responsible individuals (such as the seal manager or legal representative) may bear legal liability. If misuse results in an invalid contract or financial losses, civil compensation liability may apply, and in serious cases, criminal responsibility may be involved.
Hongda documents every instance of seal or certificate usage and provides long-term storage of usage records to ensure the integrity and traceability of your documents.
Lost or replaced seals
If the company seal is lost, the following actions should be taken as soon as possible:
The company seal does not need to be updated regularly, but it needs to be replaced under the following circumstances:
Why Hongda
Coordinate seal control with the company administration around it, with one China-based service team.
Serving foreign companies in China since 2007, with client relationships that go back to 2008.
Company setup, banking, tax, payroll and work permits coordinated by one team.
English-language project management with a China-based team in seven locations.
We confirm the scope before work begins and say which decisions rest with authorities or banks.
Client voices
Travis Perkins
David Finch BA ACMA CMIIA CAMA
Director of Group Business Risk & Assurance, Travis Perkins PLC
With Hongda since 2008
Travis Perkins PLC (a leading builders merchant in the UK) has been using Hongda Business Services since 2008 for accounting and professional services. Throughout this time, we have found the team at Hongda to be very helpful and professional in their dealings with us. We look forward to working with the company in the future.
Sound United
Jack Peng
Vice President, Asia Pacific, Sound United
With Hongda since 2013
Sound United (a leading designer and manufacturer of consumer audio products in the US) has been using Hongda Business Services since 2013. Moving one’s operations to China is not a small task, but Hongda’s expert services helped us set up a company and deal with tax issues so we could get on with growing our business in no time at all, and that’s why we continue to use them today.
Tulip Pacific Ltd.
Erik de Waard
Director, Tulip Pacific Ltd.
With Hongda since 2012
Tulip Pacific Ltd. (Business planning and interim financial management services) has been using Hongda Business Services since 2012. Hongda has helped us set up legal entities in China/HK and takes care of our annual company audits. They are the most efficient business service provider I have worked with to-date, and their professional advice has helped me better advise my own clients and provide greater value to my overall business.
Your team
Meet the three chief consultants at Hongda, including founder Angel Ho and co-founder Bobby Lee.
Chief Consultant, CEO
Founder of Hongda in 2007. Holds Chinese Tax Agent, IPA (Australia) and IFA (UK) certificates. Provides one-stop services covering market access, company establishment, financial settlement, financial and tax consultation, and human resources management.
Chief Consultant
Co-founder of Hongda. Many years of corporate legal consultancy and involvement in managing client enterprises. Familiar with tax, personnel and project management work across Guangdong, Hong Kong and Macau. Excellent English communication skills.
Chief Consultant
24 years in enterprise management, business development, and financial and tax compliance. Has provided financial and tax advisory services for hundreds of companies. In-depth learning and practical experience in IFRS (International Financial Reporting Standards), Generally Accepted Auditing Standards and International Taxation.
The company seal and the signature of the legal representative differ in legal effect. The company seal represents the will of the company itself and usually requires authorization from the board of directors or shareholders, whereas the legal representative’s signature represents their personal will and has a different legal effect. In most cases, formal company documents and contracts should use the company seal, rather than just the legal representative’s signature.
Yes, if the misuse or mistakes involving the company seal cause the company to suffer losses or violate laws and regulations, the responsible individuals (such as the seal manager or legal representative) may bear legal liability. If the misuse of the seal results in an invalid contract or financial losses, civil compensation liability may apply, and in serious cases, criminal responsibility may be involved.
The company seal does not need to be updated regularly, but it needs to be replaced when the company name changes, when the legal representative changes, if the seal becomes damaged or ineffective, or if the company decides to update the seal for security purposes.
Report the loss to the police and obtain a report of loss. Replace the seal with a new one and invalidate the lost one to prevent unauthorized use. Investigate the loss and report it to the company’s senior management.
Contact our team
Share your plans, structure and timing. We confirm the scope with you before any work starts.
