New national business name registration
All business owners are required to register the name of their business, unless they are trading under their own name. Currently, the business name must be registered in the State or Territory in which the business operates. This means that businesses which operate in more than one State or Territory are required to make multiple registration applications.
The Business Name Registration Bill 2010 proposes to create a national online registry of business names, which is expected to commence in April 2011. The new national registry will require registration of a business name nationally, irrespective of whether the business trades in one or more State or Territory. Only one application will be required to register a business name nationally, which will drastically reduce the administration for businesses trading in multiple States.
ASIC will administer and maintain the national online register and will enable businesses to make a joint application for a registered business name and an ABN. All new applicants for a registered business name will be required to have an ABN (or make a joint application for an ABN), however owners of existing business names will not be required to apply for, or have an ABN, upon renewal of the business name.
It will no longer be necessary to search for identical or similar company names before applying to register a business name on the new national register, as the national register will automatically check for existing similar or identical business and company names. This will streamline the registration process.
It is anticipated that existing registered business names will automatically transfer to the national register and that existing identical business names that are registered in more than one State or Territory will be identified on the national register with a geographical marker, such as (SA) or (VIC), but the business name will apply nationally.
What this means for your business
- You should ensure that your business name is currently and validly registered before the introduction of the new system, to ensure that your registered business name will apply nationally. If your business name lapses before the introduction of the new register, you may encounter difficulties in re-registering the name if it conflicts with existing business names that are transitioned across to the national register or are registered after the introduction of the new register.
- If you have not been able to register a business name in a particular State or Territory due to a conflict with an existing name in that State or Territory, you should consider whether you are able to register the name in a State or Territory where no current conflict exists. Your business name may then apply nationally once the new register is implemented. In this scenario, a geographical marker will apply to the business name but the registration will apply nationally.
- The new register does not change the fact that registration of a business name does not afford you the same protection as registration of a trade mark. If your business name is used in your corporate identity, brand and/or logo you should be registering your business name as a trade mark. Trade mark registrations currently apply nationally and they provide protection for the intellectual property and the value of the goodwill associated with your business name.
If you have any questions in relation to the above, please contact our Corporate Advisory Team.
Author: Fotini Kypraios