Company Names

Opportunistic registrations are considered to be those made with the intention of:

• Asking for money or some other consideration in order to change the name;
• Selling the company with the name where the only real value of the company is the registered name’s similarity to the complainant’s existing brand name.

Action can also be taken against company names considered to be the “same” as existing registrations. The method and procedure for determining whether a company name is the same as a registered company name depends on whether elements should be disregarded, such as “UK”, “net”, “Group” and “Services”, and words, expressions, signs and symbols which are to be regarded as the same, such as % and “per cent”, @ and “at” and “plus” or +.

The complainant does not necessarily have to have a registered company name or registered trade mark; however, it will have to demonstrate goodwill/reputation in the name at the time it was adopted by the other party. Well-known foreign companies that do not necessarily supply products to customers in the UK directly can possess the necessary “goodwill”. Also, there is no need to show that the registrant is using your brand in relation to similar goods or services to yours or that you have suffered or are likely to suffer any damage.

Once an application is lodged and accepted by the adjudicator, the onus shifts to the registrant to establish one of the 5 available defences:

• The objectionable name was registered before the activities you are relying on to prove your goodwill; or
• The registrant is operating, or (after incurring substantial start up costs in preparation) is proposing to operate, or has previously operated, under the company name; or
• The name was registered as an off-the-shelf company and is available for sale on standard terms of business; or
• The offending name was adopted in good faith; or
• Your interests are “not adversely affected to any significant extent” by the offending name.

Given the potential defence to a complaint if the registrant has been operating under the name, it is important to act promptly to contact the registrant and file a complaint if the matter cannot be resolved amicably.

If the registrant cannot establish any of these defences, it will be required to change its name. If the registrant can only establish defence 1, 2 or 3, the onus shifts back to the complainant to show that the main purpose of the registrant was “opportunistic”.

The Official Fees for the Tribunal are currently as follows:

• Application £400
• Counter-statement £150
• Filing evidence £150
• Hearing request £100
• Extension of time request £100
• Request for security for costs £150

If D Young & Co are involved in the action, the whole process from filing an application through to the issuance of an order and a decision where the case is uncontested is likely to cost in the region of £900-1,200 (inclusive of the official fees).

If the applicant wins the case, the adjudicator will order the registration holder to pay a contribution towards the applicant’s costs, including the official fees. Usually this will consist of a refund of the application fee (£400) and a contribution for the preparation of the statement of case (£300). If the applicant loses the case, or decides not to proceed with it after starting it, the application will usually have to pay costs to the registration holder. However, if an application is made without reasonable notice to the registrant, usually you will not receive an award of costs.

If the registration holder does not defend its company name registration within the time allowed, the adjudicator will order it to change its company name registration to something which does not offend. If it fails to change the name by the date specified, the adjudicator may determine a new name for the company and order the Registrar of Companies to make the change without the holder’s consent. The adjudicator’s decision can be appealed to the High Court by either party although to date there have not been any appeals to CNT decisions.

At the time of writing, there is a near 90% success rate in CNT applications. The system is relatively inexpensive and seems to be working well.

One alternative or addition to filing a CNT application, if there is likely to be material and commercial harm to the UK business in the near future, is to commence proceedings for passing off and trade mark infringement at the High Court.

D Young & Co advises setting up a Company Names watching service to monitor similar company names. A company name watch for all new incorporations in the UK and changes of company names is available at the low annual cost of £85. Discounts are also available for combined trade mark and company name watches. Please contact your usual D Young & Co adviser for more information.