November 12, 2013

Red Tape Challenge: How The Government Is Loosening Business Name Restrictions

This post was written by: Aston Bond Law Firm

The Government is loosening its restriction on sensitive words in company names. From 2014, businesses may no longer require the approval of relevant authorities to use words such as ‘regulation’, ‘national’, ‘international’, ‘authority’ and ‘European’ in the names of their companies.

In the past the Companies House have been able to reject names that contain these sensitive words, and them which are offensive or suggest affiliation with a government authority. Approximately 30% of applications containing prescribed words are rejected by Companies House each month.

In order to cut the amount of red tape surrounding the incorporation of companies, the Government is proposing to remove the words ‘abortion’, ‘authority’, ‘banknote’, ‘board’, ‘data protection’, ‘disciplinary’, ‘discipline’, ‘European’, ‘Giro’, ‘group’, ‘holding’, ‘human rights’, ‘international’, ‘national’, ‘oversight’, ‘pregnancy termination’, ‘register’, ‘registered’, ‘registration’, ‘registry’, ‘regulation’, ‘rule committee’, ‘United Kingdom’ and ‘watchdog’ from this list of sensitive words.

At present, businesses need to obtain approval from relevant bodies or Companies House in order to use these sensitive words in their company names. This prevents businesses from misleading customers about their business’ activities or from using racially or religiously offensive words. This change, along with others proposed by the Government as part of their red tape challenge, will reduce the amount of administrative tasks for start-up businesses. However, businesses must still remain careful as to not mislead customers through their company names and obtain approval for names suggesting a connection with a Government authority.

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Dion McCarthy, Litigation & Employment Solicitor Advocate

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