It’s all in the name. Implications of the new business name registration rules

By Marian Ngo, Lawyer, MST Lawyers

Many business owners mistakenly believe that registering a business name grants them the rights and ownership of that name. Similarly, trade mark owners such as Franchisors may believe that third parties will not be able to register business names or company names which contain their trademarked name. In both of these cases, this is simply not true.

The objective of the business names’ registration process is to assist people who deal with businesses to identify them and tell them apart from other businesses. ASIC will register a business name provided that it is not identical or near identical to a business name registered to another entity, identical or near identical to a name that is reserved or registered under the Corporations Act, undesirable, comprised of non-dictionary words or comprised of a restricted word or expression. ASIC does not take trade marks into consideration when determining whether or not a business name is to be registered.

In July 2015, the Federal Government introduced the Business Names Registration (Availability of Names) Determination 2015 (“Determination”) setting out tests to determine, for business name registration purposes, whether a name is identical to or near identical to another business name and providing guidance regarding names that are undesirable or which contain restricted words and expressions. The Determination will only apply to business names registered from 20 July 2015.

The Determination directs ASIC to ignore certain differences between names which has the effect of deeming the names identical or near identical. The second name would then be declined in order to avoid confusion with the registered name. Examples of differences which ASIC are to ignore include:

• the use of ‘Association’, ‘Co-operative’, ‘Incorporated’, ‘Limited’, ‘Ltd’, ‘No Liability’, ‘NL’, ‘Proprietary’ or ‘Pty’ in one or both names;
• whether a word is in the plural or singular number in one or both names;
• the size of characters, and the type and case of letters, any accents, spaces between characters and whether one or both names include a host name such as ‘www’ or a domain extension such as ‘net’, ‘org’, or ‘com’.

A comprehensive schedule of words and expressions which are considered identical is set out in the Determination. For example, “florist” is taken to be the same as “blooms” and “recruitment” is taken to be the same as “employment services”. As a practical illustration, if the business name “Endeavour Employment Services” had already been registered, the business name “Endeavour Recruitment” could not be registered.

The Determination provides that a business name is identical or nearly identical to another name, if despite the characters used in the name, it may be pronounced the same as the other name. For example, ‘Creative@Work’ would be considered to be the same as ‘Kre8tive at Work’ and therefore could not be registered.

The Determination has the effect of offering greater protection to business names that are already registered. People attempting to register new business names may find the task more difficult. Although business name availability can be checked on the Business Names Register, it may not be immediately apparent that the proposed business name is identical or near identical to another business name without checking the Determination. Before registering a business name, business owners should always check the Trade Marks Register on the Intellectual Property Australia website to ensure that the proposed business name does not infringe another entity’s registered trade mark.

For more information or assistance with trade marks or business names queries, please contact our Corporate Advisory team by email corporate@mst.com.au or by telephone +61 38540 0200.