If you are considering running your restaurant or bar or other business in the hospitality sector through a private company, then choosing its name will be something you will take a lot of time and care over. Whilst there is technically no need for your company name to be the same as your business name, most people tend to make these names one and the same to enhance the recognition of their brand. The name you choose will need to stand out and quickly and easily represent your business, but there are also legal requirements to consider when choosing a “sweet” name for your company.
Most companies in the hospitality sector will be incorporated as private companies limited by shares, meaning that the liability of such a company’s shareholders is limited to the amount they are required to pay in relation to the shares that they hold. Any such company’s name is required to end in “Limited” or “Ltd” (or the Welsh equivalents if relevant).
When choosing the remainder of your company’s name, there are certain restrictions which will need to be complied with. The Registrar of Companies, who is responsible for the incorporation of companies and the records at Companies House, will not register any proposed company name if such name would, in the opinion of the Secretary of State, constitute a criminal offence under English law or be offensive.
It is also not possible to register a name which is deemed to be “the same as” the name of an existing company. When comparing proposed names with existing names, the Registrar will ignore any punctuation, the “Limited” or “Ltd” used by private companies or the “Plc” or “public limited company” used by public companies limited by shares, as well as the word “company” itself. It will also ignore “the” and “www” at the beginning of a name. This means that the proposed name “WWW.Sparkles Limited” will be regarded as the same as “The Sparkles Plc”.
It should be noted that the words and symbols “and” and “&”, “3” and “three”, “two”, “too” and “to”, and “£” and “Pound” will be treated as the same when comparing names. The use of accents and diacritical marks will also be disregarded when the Registrar is considering the similarity of proposed names and existing names, precluding the use of “Zöe’s Café Limited” where a company already exists with the name “Zoe’s Cafe Limited”.
There is an exception to the above restrictions where a proposed name which would otherwise be deemed to be the same as that of another company is to be used in relation to a new company which is to be part of the same group of companies as the existing company with the similar name. An example of this is incorporating a new company with the name “Painting Company Limited” within the same group of companies as a company called “Painting Limited”. In order to make use of this exception, the existing company will need to consent to the use of any such similar name in writing, which consent must be provided to the Registrar with confirmation of the fact that the new company will form part of the same group as the existing company.
It is also not possible to use certain names without the prior approval of the Secretary of State (operating through the Registrar of Companies), in order to avoid misleading the public. Any name which implies a connection between your company and the government, a local authority or specified public authorities must be approved in advance. The use of sensitive words such as “British”, “English” and “King” also requires prior approval.
It should be noted that the above restrictions also apply to any change of name of an existing company, not just to the names of new companies, and that once chosen a company’s name can be open to challenge by a third party if such party can satisfy certain criteria before a tribunal.
In light of the above and before finalising your choice of company name (and especially before you move to print any letter headed paper or business cards bearing your long thought over name) you should carry out a search of the companies index online through WebCHeck at Companies House to ensure your proposed name is available. The service is free and easy to use and can prevent unnecessary expenses due to your proposed new name being unavailable. We would also suggest making a search of the Trade Marks Register of the UK Intellectual Property Office to ensure that you are not infringing anyone’s trade marks by using your proposed name. As an added precaution it is also advisable to search the internet and press relating to your area of activity to ensure that someone is not already out there using your proposed name, as, in such circumstances, your use of such name could leave you open to claim against you for passing off.
As Juliet said, “that which we call a rose by any other name would smell as sweet”, but hopefully you can pick the name which sums up your company and business and sets it apart, leading to great success!