How to choose a Business Name

• Posted onSeptember 10, 2018

Part 1 of the ‘Starting a Business’ series

Choosing the right business name is important, but it is not as easy as it sounds. Here are a few practical and strategic things to consider when making this all important decision. Below we discuss the rules relating to names used by companies and LLPs.

A good business name can be one of your most valuable assets. The name you choose at the outset can tell customers a lot about your business. Choose a name that accurately reflects what you do. Make sure that the name is distinctive and original. A memorable name can distinguish you in the market place and give you a competitive edge. Eventually your business name will be part of the goodwill of your business, be linked to your reputation and could ultimately become your brand.

What is a business name?

A business name is the legal, registered name of your company. You will use your business name on government forms and applications. In most cases it will also be the name by which people know your business, the name you use to advertise and sell your products and services. Some businesses choose to trade under a name other than their legal name. A company is said to be “Trading as” when the name under which they operate their business differs from its legal, registered name. This can often be referred to as their trade name.

Ensure your chosen name is available

It is vital to check at Companies House that your chosen name is not already in use. You cannot use a name that has already been registered by someone else. It is also wise to research within your sector of business for any unregistered names (names used by unregistered businesses such as partnerships and sole traders or trading names used by companies or LLPs). Business names are protected under the law of “passing off”. The principle underlying the tort of “passing off” is that “A man is not to sell his own goods under the pretence that they are the goods of another man” (the case of Perry v Truefitt (1842) 5 Beav. 66 at 73). You can also check names already in use, by visiting the Intellectual Property Office (IPO).

Why should I register my business name?

Registering your business name with Companies House gives you exclusive right to that name for your company or LLP. When registering your name, as well as the things we have already discussed, you need to consider sensitive or prohibited words. The use of certain words need prior approval to prevent the public being misled. Some examples are words such as “Royal” or “English”. These words have certain connotations which, unless used correctly, might give a false impression to the public. For further protection you should also consider registering your business name as a trademark with the IPO. This gives you wider protection.

Other things to consider

In this digital world it is important to secure the domain name which matches the name of your business. It is a good idea to check that a domain name is available whilst you are working through your shortlist of business names, as this could be the deciding factor. In order to look as professional as possible, it is also advisable to setup an official email address using your company name.

Finally you should bear in mind that there are various disclosure rules that apply to the use of business names. For example, if your company trades under another name which is not its business name you are still required to disclose your legal business name (as well as the registered office address, the part of the UK in which the company is registered and the company number).

There is quite a lot to think about before you register your business. Whilst it’s not necessary to retain the services of a solicitor, choosing to do so can make life less complicated.

Written by Shelley Bonney, Corporate Solicitor at WSP Solicitors

For further information please contact Shelley on 01452 429874, or via email: shelleybonney@wspsolicitors.com

Read the next article in the ‘Starting a Business’ series.