November 19, 2007
Without doubt, one of the key decisions that you will have to take when forming your new business is what to name it. The name that you choose will convey the first impression that potential customers will have of your company, and will need to catch their attention, and stand out in the crowd so that they will remember it. A successful name will distinguish your business from your competitors, and will establish your identity and reputation in the marketplace. You could spend hours seeking inspiration from the internet, trade press, colleagues and friends for a name that gives the right impression and reflects the products and services that you are offering.
The important question that arises, once the all important naming decision has been made (but before any money is invested in designing logos, producing stationery, or websites), is “How do I make sure that the name I have selected is available?”. The general rule is that the more distinctive your name, the more likely you are to be able to register it as both a company name, and as a trade mark. However, there are certain searches that can be made, before any time and money is expended in developing a company name which will help to confirm whether the name selected is available for use, or not.
1) Companies House Register.
The current position is straightforward in that any name can be registered as a company name as long as it is not identical to a name that already exists on the register, and is inoffensive. It must also have the words “limited” or “public limited company” or “plc” at the end of the name. A search of the Companies House Register, to check availability, can be done online at www.companieshouse.gov.uk.
2) Trade Mark.
A trade mark search provides an excellent indication of whether your selected name is likely to infringe the registered rights of any other company, or individual. It provides a detailed list of all identical or similar trade marks that are registered for classes of products similar to those which you intend to provide. If you plan to trade within the UK, then it will usually be sufficient to obtain a trade mark search of the UK, Community Trade Mark and International registers. Such a search will cost approximately £100. If you intend to focus on a particular territory, e.g. the USA, then searches of individual national trade mark registers can be carried out. The owner of a trade mark has a monopoly right to use the mark in connection with the particular classes of products for which it is registered, which means, in practice, that you could be forced by the owner of a trade mark to cease using your selected name if it is identical, or too similar to the trade mark. It will also prevent you from registering your name as a trade mark, leaving you without the protection that such registration provides.
Although the trade mark search is a valuable tool insofar as registered trade marks go, it should not be taken as a clear green light because there may well be companies out there who have acquired rights in a name, or a sign by using it in connection with their business, despite the fact that such name or sign has not been registered as a trade mark. It is important to do undertake some due diligence to establish, as far as possible, whether or not any companies are using a name, or a sign that is identical, or similar, to your selected name, as described below.
3) Further due diligence
There is no way to obtain 100% confirmation of whether or not there are companies out there with unregistered rights that could prevent you from using your selected name, but there are ways in which you can obtain some comfort. Internet search engines, domain name searches (such as a Whois search), trade journals, and directories, such as Yellow Pages, are all sources that can provide you will a good indication of whether or not the name is in use by anyone else. In today’s business environment, most businesses with an interest in their brand name, or trade mark, will have a presence on the internet, or in one of the alternative sources listed above. It follows that it is these businesses that are the ones that are likely to want to enforce their rights. If no evidence of any use of your company name is found within those sources, and the Companies House and Trade Mark Searches are clear, it is usually considered safe to proceed in adopting your selected name.
Introduction of Company Names Adjudicator
In October 2008, the straightforward position with regard to the registration of a company name, as described above, is due to change. The proposed changes, which are set out in Part 5 of the Companies Act 2006, will leave the company name registration procedure more in line with trade mark law, and will provide significant advantages to brand owners in enforcing their brand. As of October 2008, the Secretary of State will have the discretionary power to direct that a company’s name be changed if it is “too similar” to an existing name on the register. In addition, under the proposed Company Names and Adjudicator Rules 2007, which are also due to be implemented in October 2008, any person who feels that a newly registered company name is identical, or too similar to their trade mark (whether it is registered, or unregistered) can file objections to the newly appointed Company Names Adjudicator. If the Company Names Adjudicator is satisfied that the objection is justified, he will have the power to order the new company name to be changed. This development will mean that a company can be ordered to change its name even if there is no existing identical name on the register.
As of October 2008, it will therefore be even more important for new businesses to conduct thorough searches, including trade mark searches before adopting a name.
For further information, please contact Emma Streets on EStreets@faegre.com.