The State Administration for Industry and Commerce (SAIC) had published two regulations aiming at standardizing examination and approval of enterprise names: “Rules on the Prohibited and Restricted Enterprise Names” and “Rules on Comparison of Identical and Similar Enterprise Names”.
Both documents set more precise yet restrictive requirements concerning the legal denomination of companies. This is very important because company name registration is the first step in incorporation procedure.
Rules on the Prohibited and Restricted Enterprise Names
This regulation mainly specifies which features are forbidden for official company names. The list of restrictions is rather long.
For example, wordings which are harmful to national interests are forbidden (for instance, if they echo terrorism or extremism or names that contains ethnic, racial and gender discrimination or names involving drugs, pornography, obscenity, violence, gambling etc). Also names of party leaders or religious organizations are not allowed.
Moreover, an enterprise name shall not state explicitly or implicitly that the enterprise is a non-profit organization; company name cannot begin with words like “China”, “Nation” or “International” (which are allowed only in the middle of the name); finally, an enterprise name shall not contain misleading contests and words such as “State level” or “best”, with some exceptions.
Rules on Comparison of Identical and Similar Enterprise Names
An enterprise name shall not be identical to an enterprise name in the same industry which has been registered and approved by the same enterprise registration authority.
An enterprise name is considered identical to an existing one if the words of the enterprise name and industry description in the enterprise name are identical, even if there is a difference in the geographical region, sequence of elements in the name or type of legal entity. For example: Hong Guang Winery Co Ltd is considered identical to Beijing Hong Guang Winery Co Ltd and to Beijing Hong Guang Wine Factory.
An enterprise name is similar to an existing one in several cases, including - for example - if the pronunciation (even if the Chinese characters are different) of the name is identical to the pronunciation of an enterprise name in the same industry registered and approved by the same enterprise registration authority.