If you own and operate a company, ensuring that your paperwork is finished, filed, and official is essential. However, amid the numerous hats that a business owner wears while running a company, there are many pieces of documentation that may be overlooked. One of those essential pieces of paperwork is known as a Certificate of Incumbency.
In short, a Certificate of Incumbency lists all of the individuals who are involved with the operations and financing of a business, and their roles in the corporation. This document is beneficial for helping ensure that everyone is legally present and accounted for, and can be essential as your company grows and expands.
In this article, we will take a look at the specifics surrounding a Certificate of Incumbency, and why it is essential that you obtain one for your business operations.
What You Will Learn:
1. What Is A Certificate of Incumbency?
Also referred to as an “incumbency certificate”, a Certificate of Incumbency is a legally-binding document that designates the names, titles, and roles of key individuals of a corporation or Limited Liability Company (LLC). Among the many roles that can be listed in a Certificate of Incumbency are the company directors, key officers, and financial stakeholders.
The document will often list out the individuals and the positions that they hold in the company. Legally, this listing can act as a validation document to allow those listed to act as a company’s legal signatories. Without being listed on a Certificate of Incumbency, these key leaders will find it difficult to initiate or implement legally binding agreements for the company as a whole.
2. Who Should My Company List On A Certificate Of Incumbency?
If you are wondering who to list on your Certificate of Incumbency, a legal counselor can guide you through which members of your organization should be included. For the average company, those listed on the Certificate of Incumbency may include:
- Company President
- Company CEO
- Company CFO
- Company COO
In essence, those who should be listed in the incumbency document are those who need the legal authorization to sign documents on behalf of your business or organization.
Those who are listed are also held to a higher standard, as they will be held legally responsible for any wrongdoing or missteps in the process. This is why it is important that you work with legal counsel and your company leadership to determine who is listed on the Certificate of Incumbency.
3. How To Issue A Certificate of Incumbency
In order for your Certificate of Incumbency to be legally active, your company must issue the document. Typically, the company secretary will draft the Certificate of Incumbency and affix the corporate seal or insignia to the document.
A public notary can be utilized to notarize the document. Certificate of Incumbency legal laws vary from location to location, so you will need to research your specific area’s requirements prior to drafting the document. When in doubt, a legal expert such as those at FastLane can help walk you and your team through the process from start to finish to avoid error.
When listing the names of the company officers and their titles, it is important to include whether or not those listed on the document were appointed to their position or elected. You may also include how long the terms for each position are, and have each member listed affix their signature to the document for validity.
The type of business you own or operate may require various elements to be added to the Certificate of Incumbency. If you are not sure what should be included, speak with an experienced law expert at FastLane to learn more.
4. What Can I Do With A Certificate of Incumbency?
Having a Certificate of Incumbency on file can be beneficial in several instances for a company. For example, when starting up your company and seeking financial services, many banks and lenders will request a copy of the Certificate of Incumbency to include with their records for future financial activity such as opening bank accounts or lines of credit.
Similarly, if your company is wishing to hire legal counsel, a Certificate of Incumbency can help them verify the identity of an individual who is seeking their services so as to avoid improper communication. The same is true if your business wishes to do business overseas, as foreign nations and liaisons may request an incumbency certificate to better designate who they should work with moving forward.
5. How Can FastLane Help?
If you are ready to draw up and implement a Certificate of Incumbency for your corporation or organization, the team at FastLane can help you through the process quickly.
With the help of the legal advisors at FastLane, your company can develop a thorough Certificate of Incumbency that includes all necessary roles and parties. Learn more from FastLane online today, and take the first steps to draw up your Certificate of Incumbency quickly.