More flexibility on the way for company and business names?

Debbie King, partner at Farleys Solicitors, picks apart the red tape regarding names.

As part of the government’s commitment under the Red Tape Challenge to reduce unnecessary regulatory burdens, the Department for Business, Innovation & Skills (BIS) has launched a consultation to determine whether the regulations relating to company and business names should be repealed or reduced in scope.

Regulation of company and business names requires that each company name to be easily distinguishable from another, so as to ensure that the general public are not misled. However, the regulations are often complex and overly restrictive and have therefore proved to be a real source of frustration for many companies.

The current regulations limit the words and expressions that companies can use in their company name. Words and expressions that are deemed to be “sensitive” words (e.g. words that suggest a business pre-eminence, or a particular status, or a specific function), or that are deemed to be the “same as” another name appearing on the registrar’s index of company names, can not be used without obtaining express consent from Companies House.

The consultation proposes to simplify, reduce or even remove some regulations entirely. It is also suggested that the number of “sensitive” and “same as” words will be significantly reduced.

The news is likely to be welcomed by business owners and those wanting to start up a new business as they will be afforded greater flexibility in choosing their business name.

For those wanting to comment on the consultation can do so at any time before 22nd May 2013 via the www.gov.uk website. If you would like to discuss how any of these changes might affect you and your business, or indeed need any legal advice on setting up a business, please do not hesitate to contact our team of business solicitors.