Red Tape Challenge – Company and Business Name

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Posted in:Corporate and Commercial|November 19, 2013 | Join the mailing list

Back in April 2011, the Government launched the Red Tape Challenge, which was intended to simplify the UK corporate regulatory framework.  One of the aims was to identify those existing regulations that could be scrapped, simplified, improved
or merged with other existing regulations.  One of the areas which came under review was company and business names.

The Companies Act 2006 regulates the use of company and business names.  The intention is to protect the public from harm or confusion which results from the use of corporate names which falsely convey authority, status or pre-eminence.  The
legislation also tries to ensure clarity of names sufficient to allow the general public to locate information on particular businesses.  By way of example:

•    The Secretary of State has power to specify letters, characters, signs or symbols that may or may not be used in a certain position within a name.

•    A company must end its name with a term indicating its status (such as “limited” or ”plc”), unless it qualifies for an exemption.

•    A company is not permitted to be registered with the same name as an existing company.

•    A company is not allowed to be registered with a name that is offensive or that would cause an offence.

On 4 October 2013, the Government published a response to its consultation process on reducing the red tape associated with company and business names.  The Government has decided to do the following:

•    Clarify the trading disclosure regulations, with the aim of making them easier to follow.

•    Reduce the list of so-called “sensitive” words and expressions by roughly 30%.

•    Proceed with proposals to merge the company and business names regulations with the existing trading disclosures regulations.

•    Retain “national” words in the list of sensitive words.

•    Reduce the number of words on the “same as” list.

Draft regulations, which will be subject to consultation, are likely to be published in the next few months.  We will report further when those regulations are in circulation.

Should you have any concerns regarding the topic of this article or require any guidance, please contact
Keith Kennedy, Corporate Partner
at or by telephoning 0161 833 9211.

The information and opinions contained in this article are not intended to be comprehensive or to provide legal advice.  No responsibility for article’s accuracy or correctness is assumed by Berg or any of its partners or employees.  Professional legal advice
should be obtained before taking, or refraining from taking, any action as a result of the contents of this article.

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