In the process of new company incorporation, the first and significant step is to select a name that is unique and which will give recognition to the company. A company name represents what your brand stands for. Names create an identity that people can associate with. A company being a legal entity, holds a distinct position in its own name. Hence, while incorporation of a company, special attention is to be given in choosing the name.
A unique name of company must be reserved with Ministry of Corporate Affairs (MCA). Rule 8 of Companies Incorporation Rules 2014 provides name approval/availability guidelines as per Companies Act 2013 while selecting the names for companies.
Any proposed name for reservation should comply with Company Act 2013 and the Rules framed thereunder and Trademark laws. The Trade Marks Act, 1999 provides for registration of marks that can be used to identify the source of goods, or services, or other articles of commerce and for differentiating them from those of competitors.
Points to be kept in mind for choosing Company Name:
i) Trademark Search
The proposed name, in any case, should not be identical to any existing registered trademark, or a trademark already in the process of registration. It is a mandate to comply with trademark laws, as a prerequisite of naming a company. If the proposed name clashes to an already registered trademark, then the same shall be rejected.
ii) Identical or Similar
If a Company is incorporated with similar name to the Name proposed to be applied. Then one should avoid applying for that name as same could come for resubmission / Rejection. Phonetically similar names are also to be avoided.
iii) Get mandatory regulators approval
A company name which includes the words like insurance, bank, stock exchange, venture capital, asset management, mutual fund, etc may require regulatory approvals from RBI, SEBI, IRDAI, etc.
iv) Use of titles
Do not add common words like New, Modern, Nav, Shri, Sri, Shree, Sree, Om, Jai, Sai, The, etc. to an existing company name. It will get rejected.
v) Use of ‘State’
Never use the word ‘State’ while naming your company. Only government companies have the authority to use the word ‘State’ in their names.
Process to check if the name is registered:
To check name availability, a due check has to be performed of all registered names of companies and LLPs, along with trademarks in any of the 45 classes.
The Fourth Schedule to the Trade Mark Rules, 2002 classifies goods and services into various classes. The first 34 classes group different categories of goods, while the remaining 11 classes categorise different services. It is an important step before filing the application through the RUN portal.
The subsequent steps should be followed by an applicant:
- Go to the website: www.mca.gov.in.
- To check the name availability on the MCA portal, open the check name tab on the website.
- Enter the proposed name with the first commercial activity of the firm to possess accurate results.
- The search results will show if there is an identical name. If the proposed name is not there in the MCA inventory, it will show a mistake as the Entered name doesn’t exist.
- While checking name availability, one should only enter the first two words of the proposed name.
- As per the principles, the applicant should check the Trademark portal to search the corporate name’s availability.
- The proposed name should not resemble any existing trademark, except in case the trademark owner has given NOC to use his/her trademark.
- To do Trademark research, visit www.ipindia.gov.in, and open the trademark search tab. Enter name and start searching.
- The applicant should also check similar phonetic names to avoid objections.
- If the name is not found in the results, the applicant can move ahead with using it.
- If the proposed name is absolutely unique, the applicant can directly apply by filing requisite forms on the MCA portal.
- If the probabilities of name availability matching are more, then the applicant can also file a separate name application. In the application, he can apply for a maximum of two maximum. If any of those names is not approved, then he can apply with the other name.
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Note: This Post was last updated on March 25, 2022
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