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SFS News

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Companies House relax restrictions on company names

When starting a new company or changing a company name you cannot simply choose any name. There is a list of sensitive words or expressions that are protected from general use. The governments drive to ‘cut red tape’ and reduce the impact of regulation on business will see the list of ‘sensitive words’ reduced by around a third.

Certain words and expressions are protected when used within a company name. Examples of this include Group, Holdings, International, Bank, and British. Whilst there is a good argument to protect some words like Charity and Institute, other words should be allowed to be used more freely by companies. .

In October 2014 Business Minister Jo Swinson announced that the regulations protecting company names is to be relaxed. Many popular words that were previously deemed to be ‘sensitive’ are now being removed from the list.

There are currently more than 150 words or expressions that are classed as ‘sensitive’. This means that business owners need to provide supporting evidence or seek approval to include sensitive words within a company name.

Jo Swinson said that “making life easier for startup businesses will help to create a stronger economy. Rules on certain types of words shouldn't be an additional hurdle, so reducing the list of company names needing approval makes sense”. This is likely to be welcomed by some new businesses that want greater flexibility with company names.

However, it may be argued that reducing the number of sensitive words that are protected in company names will have a limited impact on creating a stronger economy. Many businesses operate under trading styles that are different to their actual registered name. Businesses are not successful because their preferred company name is easily registered and the administration involved registering a protected company name can be easily completed in some circumstances.

Small Firms Services welcome the reduction in the number of sensitive words. These changes should make forming a company easier for start-ups as they will encounter less problems choosing an available name. There are many occasions when the list of protected words has caused accountants and company directors delays with the registration process.

If you need any assistance registering a company with a sensitive word included in the company name please contact us for friendly advice. We can assist with the registration of many sensitive company names.

The legislation is currently being drafted for implementation next year. There is currently no set date when the new reduced list of sensitive words will be introduced. Until the new regulations are implemented the current list of sensitive words is still in force.

About the Author Mike Harris:
I have been providing advice and support to companies for over 15 years through my company Small Firms Services Ltd. You can follow me on Google+ and also twitter