There have long been restrictions on the use of certain words in company and business names. There are some obvious restrictions, such as that company names cannot be the same or substantially similar as an existing company, which are fairly self-explanatory, but there is also a list of "sensitive" words that cannot be used in business names. As part of its Red Tape Challenge Programme, the Government is attempting to consolidate regulations and remove unnecessary and onerous administrative hurdles for businesses.
As part of this consolidation two sets of regulations have been published, which both came into force on 31 January 2015 and have brought important changes to restrictions on business names and trading disclosures:
• The Company, Limited Liability Partnership and Business Names (Sensitive Words and Expressions) Regulations 2014 (SI 2014/3140) ("2014 Regulations").
• The Company, Limited Liability Partnership and Business (Names and Trading Disclosures) Regulations 2015 (SI 2015/17) ("2015 Regulations") (together, the "Regulations").
The Regulations will apply to new businesses on incorporation and to those existing businesses who wish to change their current name in the future.
The 2014 Regulations supersede and revoke the existing regulations regarding sensitive words and expressions and reduce the list of sensitive words and expressions that require the consent of the Secretary of State for use. Some examples of the 26 words which are no longer considered sensitive are:
• Data protection
• United Kingdom.
The removal of "holding" and "group" from the list should help alleviate the administrative burden on those companies wishing to form a group and "European" and "International" for those companies who operate across more than one jurisdiction.
The 2015 Regulations consolidate and replace all previous regulations relating to business names and trading disclosures and extends the list of permitted characters which can be used in a company name. For example, ligatures, accents and diacritical marks can all now be used, whereas previously only letters from the Roman alphabet and a few limited characters were permitted. However, letters with accents attached will still be considered as the same letter without an accent, for the purposes of preventing registration of companies with a similar or same name.
In co-ordination with the 2014 Regulations, companies that have words such as "Group" and "Holdings" in its name will not be treated as having the same name as an existing company with these or alternate words in its name. The other changes brought by the 2015 Regulations seek to address unintended gaps left from previous regulations to clarify the position regarding similar or same names.
Regarding trading disclosures, a location that is the registered office for six or more companies is no longer required to display a full list of all companies at all times. This information is now only required to be presented on request and should prove useful for firms of accountants, lawyers or other companies offering secretarial services and acting as a company's or companies' registered offices.
The Regulations appear to relieve a degree of the administrative burden on businesses in relation to names and trading disclosures, and accordingly should alleviate pressure on Companies House to a degree.
A businesses name is more than just a name. You should always consider protecting the name of your business by registering it as a trademark if you want to avoid other businesses taking advantage of your accumulated goodwill, reputation and brand.