What’s in a name?

A short while ago, I had a right palaver trying to form a company on behalf of a client as the company name the client wanted included the words ‘Dental’ and ‘Royal’ (‘Dental’ because that was the client’s trade and ‘Royal’ was part of the address).

If you want to form a company, you can’t just give it any old name you fancy.  There are what are known as ‘sensitive’ words which can only be used with the permission of various bodies.  In the case of ‘Dental’ you need permission of the General Dental Council and in the case of Royal you need permission of the grandly titled “Constitutional Policy Team” of the Cabinet Office and so I had to write to both bodies to explain to the first that the client was indeed involved in the Dental trade and to the latter that the client wasn’t trying to pretend to have any Royal connections!

The list of ‘sensitive’ words is available on the Companies House website and is very long and has some surprises (for example you need permission of the “Company of Cutlers in Hallamshire” if you want a company with “Sheffield” in its name!).

This illustrates how something as seemingly simple as naming a company can be tricky so it makes sense to investigate the legal background and to seek advice before setting your heart on a company name!

The rules on naming a business are in Part 41 of the Companies Act 2006 and cover all types of business: sole traders, partnerships, LLPs and companies.  In fact, the rules apply to anyone trading under a name which is not their real name and contravening the rules is a criminal offence.

Unsurprisingly, trying to use the same or very similar name for a company would be rejected automatically but it is possible to override the rejection if the existing company gives Companies House their consent and the proposed company is in the same group as the existing company. If there are companies with the same name, which are not in the same group, it will not be possible to register the name, even with the consent of those in the group.

And finally, even if Companies House rules don’t stop you forming a company under a particular name, another company (and only another company) could object under s67 Companies Act 2006 on the grounds that the new name is too like an existing one, particularly where “Goodwill” might be at risk and a company thinks that a new company has registered a name which is so similar it might be regarded as opportunistic thus breaching the goodwill of the existing company.

So it’s worth a quick call to your Barnes Roffe LLP contact before getting your new stationary printed up!

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