New rights to object to confusing company names

Company Names and Section 69 of the Companies Act 2006

The Companies Act 2006 allows a trade mark proprietor to object to any application to register a company name that is the same as or similar to his trade mark.

Part 5 of the Companies Act 2006 (the Act) governs the choice of company name and will come into force on 1 October 2008. Section 69 of the Act is particularly important from an intellectual property perspective. When in force, section 69 will provide a new mechanism for objecting to a company name that is the same or similar to a trade mark and this mechanism will be completely independent from any claim for trade mark infringement.

Under section 69(1) a person may object to a company names adjudicator if:

(a) a company name is the same as a name associated with the objector in which he has goodwill, or

(b) where the name is sufficiently similar to such a name that its use in the United Kingdom would be likely to mislead by suggesting a connection between the company and the objector.

The objection will be upheld if either of elements 1(a) or 1(b) are established unless the company can raise a presumption that the name was adopted legitimately apply by showing that one of the following circumstances from section 69(4) has arisen:

(a) the name was registered before the commencement of the activities on which the applicant relies to show goodwill; or

(b) the company

i. is operating under the name, or
ii. is proposing to do so and has incurred substantial start-up costs in preparation, or
iii. was formerly operating under the name and is now dormant; or

(c) the name was registered in the ordinary course of a company formation business and the company is available for sale to the applicant on the standard terms of that business; or

(d) the name was adopted in good faith; or

(e) the interests of the applicant are not adversely affected to any significant extent.

Where a), b) or c) are established, the objection may still be upheld if the applicant can show that the main purpose of the company was to obtain money (or other consideration) from the applicant or to prevent him from registering the name.

Section 70 permits the Secretary of State to appoint company names adjudicators and section 71 provides power to make regulations for the proceedings before a company names adjudicator. The Company Names Adjudicator Rules 2007 under section 71 will regulate the proceedings before a Company Names Adjudicator where a person makes an application under section 69.

If an objection is upheld, section 73 of the Act provides that the adjudicator may order the company to change its name to one that is not an offending name by a date specified by the order. If the name is not changed by the specified date, the adjudicator may choose a new name for the company. The decision of the adjudicator must be made public according to section 72, and this decision may be appealed under section 74.