What’s in a (company) name?

Introduction

A company’s name and trading style serves as more than a label, it is an integral component of its identity and brand.

Many entrepreneurs incorporate companies without considering company name regulations – this can sometimes be opportunistically (with a view to capitalising on the goodwill of an existing company) or naively (due to a lack of awareness of the proper procedure). This oversight can result in a company name dispute, especially where existing companies already have the same or similar names, or when there are pre-existing trademarks in the same or similar name. Early awareness can help businesses avoid a company name dispute and the associated legal and commercial risks.

Company Name vs Trading Name: What Is The Difference?

Understanding the distinction between a company name vs trading name is essential. A company name is the official name registered at Companies House and is used for legal and administrative purposes. A trading name is the name under which a company conducts its business and is often used in marketing, branding and domain names. A trading name can be different to the official registered name and  a company can adopt multiple trading names.

Trading names are often registered as trade marks to provide protection and exclusive rights to use the trading name. Our Intellectual Property Team can assist in this regard.

Legal Regulation of Company Names

The company name rules in England and Wales are designed to prevent confusion and protect existing businesses. Crucially, under the Companies Act 2006, a company name must not be the same as an existing registered name. Additionally, names that are offensive, contain computer code, or suggest a connection with the government, crown, or local authorities are prohibited. Companies House also provides guidance on choosing a company name, helping businesses identify potential issues before registration.

It is crucial for directors to conduct thorough checks – including running searches on the intended name(s) on Companies House company name availability checker, the UK Intellectual Property Office trade marks register, and taking appropriate legal advice – to ensure compliance with these rules before incorporation.

Objections to a name: options

When faced with a potential dispute over a company name, businesses have several options – these are summarised below. We recommend taking legal advice before proceeding with one of the following options:

1) “Too Like” Objection (Companies Act 2006)

Section 67 of the Companies Act 2006 provides the Secretary of State the power to direct a company to change its name within a specified period of time if it is the same or considered “too like” the name of an existing company.

For instance, this would apply to names which differ by only one or two characters (e.g. ‘Red Box Limited’ and ‘Red Boxes Limited’), different punctuation or spacing between the words (e.g. ‘Blue-House Limited’ and ‘Blue.House Limited’), or if the names look and sound the same. However, names which differ by the inclusion of additional words (as opposed to a few characters – e.g. ‘Green Car Limited’ and ‘Green Fast Car Limited’) will not be treated as “too like”.

Such objections must be raised promptly as the Secretary of State can only issue directions to change a “too like” name within 12 months of the company’s registration. If the company does not change its name following the Secretary of State’s directions, Companies House will determine a new name for the company (often the company registration number).

2) Company Names Tribunal

The Tribunal is a platform that provides a streamlined and cost-effective means of resolving disputes over company names. It offers a forum for parties to present their cases and receive a binding decision. It is important to be aware that the Tribunal is not to be used as a substitute for passing off or trademark infringement proceedings – see the court applications section below.

Section 69 of the Companies Act 2006 provides a mechanism for addressing disputes over registered company names. This section allows an existing company (i.e. the ‘applicant’) to object to the registration of a name on following grounds:

a.    that the registered name is the same as a name associated with the applicant in which they have goodwill, including reputation (e.g. the applicant’s existing trading style); or

b.    that the name is “sufficiently similar” to such a name, that its use in the UK or elsewhere would be likely to mislead members of the public by suggesting a connection between the companies.

The potential defences to an objection include the following:

• the name was registered before the commencement of the activities on which the applicant relies to show goodwill;
• the name was registered in the ordinary course of a company formation and the company is available for sale to the applicant on the standard terms of that business;
• the name was registered in good faith (with contemporaneous evidence of the same); and/or
• the interests of the applicant are not adversely affected to any significant extent.

These defences can be crucial in protecting a company’s right to its chosen name, although it is worth noting that many Tribunal matters hinge on what evidence is available in each particular matter.

3) Court Proceedings

Court proceedings are appropriate for passing off or trademark infringement situations, where claims can involve impacts to goodwill and reputation, misrepresentation, and/or loss of revenue.

Remedies for such actions can be separated into interim remedies and final remedies:

Costs

The costs involved in resolving a company name dispute can vary significantly depending on the chosen method.

A “too like” objection is relatively inexpensive and can be a reasonably fast process but has incredibly strict time limits meaning that if an infringing company name is not discovered until after 12 months of incorporation, this option is not available.

Court proceedings tend to be more expensive due to legal fees and the potential for prolonged litigation.

The Company Names Tribunal offers a more cost-effective solution, with lower fees and a quicker resolution process.

FAQs on Company Naming & Disputes

1. How can I check to see if a company’s name is available? How can I avoid reusing an existing company’s name?

To check the availability of a company name before incorporation, you can use the free Companies House name availability checker and search the UK Intellectual Property Office trade marks register, also free to use. It is also advisable to seek legal advice to ensure compliance with naming rules. This helps you avoid company name conflicts and trade mark infringement.

2. What is the process for changing a company name if a dispute arises?

If a dispute arises regarding your company name, you may be required to change it. The process involves a shareholder resolution and submitting documentation to Companies House. It is advisable to consult with a legal professional to ensure compliance with all legal requirements and to avoid potential conflicts with existing company names.

3. What role do trademarks play in protecting company names?

This distinction is important in assessing trade mark vs company name rights. Trade marks are crucial in protecting company names as they provide legal recognition and exclusive rights to use the name in commerce. Registering a trade mark can prevent others from using a similar name that could cause confusion among consumers. It is important to conduct a thorough trade mark search before selecting a company name to ensure it is not already in use. Conducting a trade mark search in addition to a company name search on Companies House is essential because a company name registration does not provide trade mark protection. A trade mark search helps identify existing trade marks that may conflict with your proposed company name, reducing the risk of legal disputes and ensuring your brand is protected.

4. Can I incorporate a new company using a similar name to my own existing company? 

Provided that you do not incorporate two companies with the exact same name and/or with one or two characters different, yes.

5. Can I reuse my company’s name after liquidation?

People who have, at any time in the year prior to the liquidation of a limited company, been a director or shadow director of that company before its entry into insolvent liquidation are restricted for 5 years following liquidation from being a director of, being directly or indirectly concerned in or taking part in the promotion, formation or management of a business, and being directly or indirectly involved with the carrying on of any business (whether or not through a limited company itself), where the continuing business has the same name as, or a similar name to, any name by which the liquidated company was known.

Notwithstanding the above, there are three statutory exceptions on which a director or shadow director may be able to rely as a legal foundation to lawfully re-use what would otherwise be a prohibited name. We refer to our recent article setting this out in further detail.

6. How should I handle a situation where another company is using a similar name?

If another company is using a name similar to yours, it is important to assess whether there is a likelihood of confusion among your customers. You may need to gather evidence of the similarity of the company name and its impact on your business. Consulting with a legal professional can help you determine the best course of action, which may include sending a cease-and-desist letter or filing a complaint with the Company Names Tribunal.

7. What impact can a company name dispute have on business operations?

A company name dispute can have significant impacts on business operations, including potential rebranding costs, loss of customer trust, and legal expenses. It may also affect your marketing strategies and online presence. It is crucial to address disputes promptly to minimise disruption to your business.

8. How can I appeal a decision made by the Company Names Tribunal?

If you disagree with a decision made by the Company Names Tribunal, you may have the right to appeal. It is advisable to seek legal advice to ensure your appeal is properly prepared and submitted within the required timeframe.

Key Takeaways

• A company’s registered name and its trading name serve different legal and commercial functions, and both should be chosen with care.
• The rules governing company names in England and Wales aim to prevent confusion and protect existing businesses; conducting checks at Companies House and the UK Intellectual Property Office trade marks register linked above are essential before incorporation and/or launching a new trading style.
• Several mechanisms exist to object to the use of an existing company name, including “too like” objections, applications to the Company Names Tribunal, and court proceedings for passing off or trade mark infringement.
• Early detection of potentially conflicting names and prompt action is vital, given strict statutory time limits and the risk of reputational and financial consequences.
• Trade marks provide a different and often stronger layer of protection than company name registration alone, helping businesses secure exclusive rights and reduce the risk of disputes.
• Company name disputes can lead to operational disruption, rebranding costs and legal expenses, making proactive management and legal guidance valuable at every stage.

If you would like to discuss a proposed or existing company name, discover another entity is using the same or similar name as your existing company, or potential trade mark infringement, our Corporate, Commercial and Intellectual Property teams are well placed to assist. We can advise on availability checks, trade mark strategy, objection routes, Tribunal applications and enforcement options. Please contact Lucy Andrews, Aman Basra, Helen Brown or another of our team for tailored advice on safeguarding your business and its brand.

We publish blogs and social media posts to give a general overview of legal and commercial issues, relevant at the time of publication, which we hope you will find interesting. Please note that legal rules often change depending on the specific facts of a situation. The law also changes over time following changes in legislation or new court cases. We do not actively update our blogs or posts once they are published to reflect changes in the law.