One of the most important steps in forming a new company is choosing the name. The company name may hold personal significance, reflect a renowned history or be pivotal to what you are selling. But what if another business set itself up with a similar name to yours, or worse still, used your chosen company name before you had the chance to protect it yourself?
Being able to guard your company name from the competition is extremely important, but putting in place a few simple measures can help shield your business identity:
1. Register the company
It is not possible to reserve a company name with the intention of incorporating it later, therefore it is best to register your company as early as possible to avoid any disappointment. Once a company name has been incorporated, no one else can try to lay claim to it.
The first steps to securing your business name should be to legally register the company. A quick company name search can be performed to check that your chosen business name is not already in use.
Once you have confirmed your company name is available you should also check if it contains any “sensitive words”, such as King or Architect, which might require third party justification.
2. Register a domain
Domain registration is not directly linked with company formations, so even if you have legally registered your company, competitors would still be free to register a domain in this name.
Unless ordered through our Digital company formation package, you will need to register the domain name separately. While the benefits of having an online presence are well publicised and evidenced, you may not be planning on setting up a website for various reasons. None the less, it is worth considering simply to protect yourself from any negative consequences, reputational or otherwise, of others registering under your company name.
3. Consider similar names
Once your company has been registered, you may wish to consider protecting yourself against other businesses registering with similar names. One way of doing this would be to incorporate similar company names yourself to keep the companies dormant. The usual legal obligations still apply to dormant companies and dormant accounts will need to be filed each year, but the company does not need to be trading.
There is still some protection in place to prevent “Passing Off”, where one party may try to use the goodwill associated with a different company to their own advantage. Common law action covers the goodwill associated with a trademark, domain names, signs, and other descriptive materials. If this situation arises, the company that is already in existence must show that:
- That they are well-established and have a good reputation
- That the name in question does relate to your business
- That there is misrepresentation by the other company
- That you (the existing company) have suffered because of the new company
4. Business information tracking
There are subscription services available from business information providers, who offer essential reports for any business that wants to protect its company and brand names.
NameGuard is a service provided by our Business Information team. With this service you would receive weekly updates on relevant new company formations, name changes and variations of your company name. This way you can keep a steady eye on the name and reputation of your business.
Author: Karen Bowley
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