What is a Trade Name?
A trade name is the official name under which a company does business. It is also known as a “doing business as” name or fictitious name. Sometimes trade name registration is required to get a DBA certificate, which allows for easy customer identification and brand promotion.
Trade Names vs. Trademarks
A trade name is a company’s formal name under which it performs business activities, while a trademark legally protects and distinguishes products and services from competitors. Applying for a trademark simplifies international reach as it can extend as a European Union or international brand, unlike a trade name. Registering a trade name has disadvantages for international expansion due to this limitation.
Registration Processes
- Trade names register under state provisions based on the business form.
- Trademarks register under the Trademark Act with a different approval process.
Legal Protections and Rights
Trade names:
- Provide notice that you are using that name
- Do not prevent others from using the same name
- Register with states for tax purposes and to track companies
- Do not provide exclusive use rights
Trademarks:
- Secure brand names legally, offering brand protection
Selection and Usage
A unique trade name is important, but understanding the differences between trade names and trademarks is crucial for legal protection and use rights. Legal protection for trade names varies by state, and companies should choose carefully when selecting a name for their business. The rules and procedures for selection and usage follow jurisdiction guidelines. Misunderstandings regarding the difference between trade names and trademarks could lead to costly problems.
For example, in Washington D.C., trade names file with the DCRA and typically exclude owners’ real names, offering no brand protection or unlimited use rights. Sole proprietors using the owner’s names may not need a trade name, but even slight changes might require filing. There are few restrictions when filing.