Apparently naming a child is so stressful that you can now pay one of several companies to help you avoid choosing a less than ideal moniker. While we aren’t in the business of coming up with a name for your corporate baby (you may want to consult someone with branding experience there), we can provide guidance to help save some headaches in the incorporation process and beyond.
Consider these tips in choosing a name and avoid the stress and that could come along with rushing or settling for a problematic business name.
Choose a Name that is Available
When you incorporate your company (or change its name) the registrar must to approve your name reservation choice. In an effort to prevent confusion, the registrar will not accept a name that is confusingly similar to an existing company name in the same jurisdiction. You may search the registrar’s database for free to determine if your chosen name will be available.
If your corporate name is available through the registrar, we suggest conducting a Google search and a domain name search to see what is out there both in your chosen jurisdiction and elsewhere. Most companies will want to ensure they have a website with an easy-to-find domain name and while you may be okay with a .ca domain, would a .com be more preferable in your space? Picking a name that is available in several respects will ensure you do not have to settle when it comes to your website or corporate branding. Also consider availability on social media sites such as Facebook, Instagram and Twitter if your company is one that could benefit from social media marketing.
Choose a Name that is Timeless
Think about your long-term goals in terms of an appropriate geographic and industry scope of where you’d like your company to be now and five years from now. Don’t limit yourself to a certain product that you create or sell now but would be inappropriate if your company expands. Consider a name that could grow with your company as it expands or evolves.
While it may make sense for companies serving a fixed locale to include a geographic area in its name, if you are a software company or intend to expand, this may not be the best approach. If, in your due diligence, you find a company located half way across the world with a similar name to the one you are targeting, consider whether that will limit your company now or in the future. For example, a flooring company located in Calgary may not be concerned if a company in London holds the same or similar name, but two similar e-commerce shops may rightly be more concerned.
Choose a Name that You Can Protect
An approved corporate name registration will provide limited protection in that the registrar will not allow another company in the same industry to incorporate under the same name. The goal of the registrar’s approval process is to protect the public from becoming confused. This is markedly different from trademark protection, which offers an exclusive right to use your business name in connection with goods or services and prevent others from doing so. A registered trademark is enforceable and provides protection at a federal level.
Registering your company name will not, however, prevent others from selling or marketing goods or services under the same or a similar name. If your business name is used in your branding or important to the business, you may wish to consider filing to register a trademark on your (distinguishable) name, logo, or combination to obtain the exclusive right to use your trademark.
Filing a trademark does require a filing fee and application by a trademark agent; however, if your company’s name is important to your brand, filing sooner is better than later or never. See more on trademarks and other forms of IP protection here.
Choose a Name that Won’t Cost You Down the Road
If you register a company name and intend to use any part of this name in relation to your products or services, you will want to ensure that no other companies have registered a similar trademark in relation to the same goods or services that could lead to infringement claims by the trademark holder. Even if not found liable, claims arising out of trademark infringement or claims of passing off will cost companies time and funds to handle. To avoid this, you may conduct a proper trademark search of your top choice through a trademark agent. If you have plans to expand into other countries, consider searching trademarks in those jurisdictions as well.
You should aim to name your company distinctly from other companies not only so that you are not infringing other’s rights, but also to ensure that your customers are not mistaken or confused when searching for your services or trying to get into contact with you. Accordingly, we feel the time and diligence spent now (and even targeted legal help) are a wise investment.
In short, take your time registering a corporate name. Consider it. Bounce your ideas off of people. Do your diligence, and don’t settle on picking a name because you’re in a hurry. Having well thought-out a corporate name will not alone make your company soar, but it could save a few headaches (and money) down the road.
by Morgan T. McDonald
For more information on this topic, please contact:
Morgan T. McDonald
a cautionary note
The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.
© McMillan LLP 2017