The Government has announced a review of company names legislation as part of its ongoing drive to simplify company law and remove “red tape”. Since the Companies Act 2006 came into force, the company names legislation has been criticised as having become more difficult to navigate, in particular with detailed provisions in regulations with regards to companies swapping names or using a name similar to another company. Companies are often involved in lengthy debates with Companies House before a name can be agreed and registration can take place.
Three options are proposed by the Government:
- Removing all company names regulations. This would mean that a company could be registered with any name, so long as the chosen name was not already in use and was not prohibited by Companies Act legislation (for being offensive or misleading). On the making of an objection, a company could be required to change its name if it was too similar to another already on the register.
- Possible repeal or revision of the current list of “sensitive words” contained in regulations, which require specified bodies to confirm they have no objection to the use of such a word.
- Possible repeal or reduction of the list set out by regulations setting out words or symbols which are to be disregarded when determining whether proposed names are the “same as” an existing name. Businesses have told the Government that the rules are causing difficulties for both start-up companies and established companies wishing to change their names or swap names within their group, causing increased costs and delays in the system.
A copy of the consultation can be found at:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/94535/bis-13-648-company-business-names-consultation-red-tape-challenge.pdf
Responses are invited by 22 May 2013.