How do I choose a business name?
When choosing a business name it is important to consider what kind of business you are.
A business name if successful can become a valuable asset; it can be included to balance sheets, mortgage to raise funds, and licensed to others to use it.
Are you a creative business?
If so, distinctive names could work for you. Having a quirky name means your business will always be memorable amongst competitors. Another benefit of a distinctive business name means it is easier to protect.
You could register it as a trademark, giving you significant rights against others using the name. Business names can be made even more memorable if you incorporate them into designs, logos, straplines and graphics.
‘The Ice Cream Makers’
If your business name just describes what you do, e.g. the ice cream makers- it means people establish & remember what you do immediately. However this tactic has a downfall. If you decide to change your business or venture out into new areas, you may have to change your name.
There are certain words you cannot use in a business name; words which constitute a criminal offence, or are offensive words themselves.
There are also words you cannot use unless you can justify them. These include: international, English, British, group or association. There are also words you cannot use unless you have permission from a specific body. This includes words like royal, king or queen.
Use of particular words like Solicitor or Patent Agent, is an offence if you do not have the permission in place to do so.
How do I find out whether the name is in use?
Check the Companies House Register, and the Intellectual Property Office IPO Register. You can also check the European Trade Mark Registry.
It is worth noting however that many businesses and brand names in use are not registered, for example unincorporated businesses. You can check trade directories and associations, but it is best to take legal advice.
What can happen if you use a business name that is in use by another business?
Business names are protected under the passing off law. The courts will order you to stop and compensate the owner of the same or similar business name for any loss they may have suffered, if:
- They are already using the name, or one like it
- The name has developed a reputation in the market place – goodwill may be attached
- Consumers are being or have been misled that you are the same business
If both businesses of similar names are within the same industry or sector, or trade within the same area, there is a greater risk of a passing off action.
Registering a name as a trade mark
When getting to this stage, you must seek the relevant business advice. Legal advice is highly recommended- there are advantages and disadvantages of registering your name as a trade mark at the official registry, the Intellectual Property Office.
For all new business related matters, contact our partner and head of corporate law Richard Coultard.
Richard brings a wealth of experience across legal issues such as corporate and commercial law, litigation and dispute resolution and associated employment related issues. Richard is more than happy to speak to any business owners who would like some informal guidance.