Understanding Trading Names
A company can trade under a different name, known as a ‘trading name’. The trading name itself does not constitute a separate legal entity. Using a trading name allows a company to target specific customers or market separate areas of the business. However, the trading name cannot be an existing registered company name.
Legality and Registration
It’s important to comply with legal requirements and to understand the legal implications. Section 79-81 of the Consumer Protection Act states you cannot trade under names not similar to your registered name. Companies must disclose their company name and number on invoices and websites when using a trading name. Both limited companies and sole traders can use trading names, but they must act within the law, avoiding names that are too similar to existing entities, national brands, or registered trademarks.
Trademarks and Protection
If a business owner wants to operate under a different name, they can use a trade name, which does not need legal phrases. Registering your name as a trademark provides exclusive rights to use it, a legal presumption of ownership, and the ability to sue for infringement. You don’t have to trademark your business name to protect it, but it adds a layer of security.
Business Name Selection
While choosing a company name might seem trivial, it actually carries significant weight due to trademarks, brands, and service standards. Trademark disputes can involve expensive litigation, making it crucial to consider legal issues when selecting a name. Assistance from top lawyers can help navigate business name laws effectively.