Names too similar to existing companies (Rule 8)

The draft rules under the Companies Act, 2013 provide clear guidelines for naming different types of companies, like Private Limited Companies, One Person Companies, and Limited Companies. For a company’s name to be approved for incorporation, it must meet two main criteria: it must be unique and desirable. Accordingly, the Companies Act, 2013 outlines these guidelines in three rules, one of which is described below:

Naming guidelines as per Rule 8 under the Companies Act, 2013;

This rule states that names that are too similar to the name of an existing company will not be approved. 

  • A name applied for shall be deemed to resemble too nearly with the name of an existing company, if, and only if, after comparing the name applied for with the name of an existing company by disregarding the matters set out in sub-rule (2), the names are the same.
  • The following matters are to be disregarded: 
  • the words like Private, Pvt, Pvt., (P), OPC Pvt. Ltd., IFSC Limited, IFSC Pvt. Limited, Producer Limited, Limited, Unlimited, Ltd, Ltd., LLP, Limited Liability Partnership, company, and company, & co, & co., co., co, corporation, corp, corpn, corp, group;
  • whether a word is in the plural or singular number in one or both names; 

Illustrations 

(i) Green Technology Ltd. is same as Greens Technology Ltd. and Greens Technologies Ltd. (ii) Pratap Technology Ltd. is the same as Prataps Technology Ltd. and Prataps Technologies Ltd. 

  • type and case of letters, spacing between letters, punctuation marks and special characters used in one or both names; 

Illustrations 

(i) ABC Ltd. is same as A.B.C. Ltd. and A B C Ltd. 

(ii) TeamWork Ltd. is same as Team@Work Ltd. and Team-Work Ltd. 

  • use of different tenses in the names;

Illustration 

Ascend Solutions Ltd. is same as Ascended Solutions Ltd. and Ascending Solutions Ltd. (e) using different phonetic spellings, including use of misspelled words of an expression;

  • using different phonetic spellings, including use of misspelled words of an expression; 

Illustrations 

(i) Chemtech Ltd. is same as Chemtec Ltd., Chemtek Ltd., Cemtech Ltd., Cemtek Ltd., Kemtech Ltd., and Kemtek Ltd. 

(ii) Bee Kay Ltd is same as BK Ltd, Be Kay Ltd., B Kay Ltd., Bee K Ltd., B.K. Ltd. and Beee Kay Ltd.

  • whether one or both names includes a host name such as ‘www’ or a domain extension such as ‘net’, ‘org’, ‘dot’ or ‘com’; 
  • the addition of commonly used prefixes, including salutations, before an existing name such as New, Modern, Nav, Shri, Sri, Shree, Sree, Om, Jai, Sai, Hari, Mr., Mrs., Ms., Dr., Prof. or any other such commonly used prefixes; 
  • the order of words in the names;

Illustrations 

(i) Ravi Builders and Contractors Ltd. is same as Ravi Contractors and Builders Ltd. 

(ii) Ravi Builders and Contractors Limited is not the same as Ravi Shankar Builders and Contractors limited 

  • the use of the definite or indefinite article in the names; 

Illustration 

Congenial Tours Ltd. is same as A Congenial Tours Ltd. and The Congenial Tours Ltd. 

  • a slight variation in the spelling of the two names, including a grammatical variation thereof; Illustration Color Technologies Ltd. is same as Colour Technologies Ltd as there is a slight variation in the spelling. 
  • complete translation or transliteration, and not part thereof, of an existing name, in Hindi or in English 

Illustrations 

(i) National Electricity Corporation Ltd. is same as Rashtriya Vidyut Nigam Ltd. 

(ii) Hike Construction Ltd. is not the same as Hike Nirman Ltd. 

  • Addition of the name of a place to an existing name which does not contain the name of any place; 

Illustrations 

(i) If Salvage Technologies Ltd. is an existing name, it is same as Salvage Technologies Delhi Ltd and Salvage Delhi Technologies Ltd.

(ii) Retro Pharmaceuticals Ranchi Ltd. is not the same as Retro Pharmaceuticals Chennai Ltd. 

  • addition or deletion of words like global, international or any other word which symbolizes the geographical reach of the company, in an existing name;

Illustration 

(i) If Hardnut Finance Ltd is an existing name, it is the same as Hardnut Finance Pan-India Ltd or Hardnut Finance International Ltd. 

(ii) If Glory Construction International Ltd. is an existing name, it is the same as Glory Construction Ltd. but not the same as Glory Construction Global Ltd.

  • addition or deletion of numerals in an existing name; 

Illustration 

(i) If Thunder Services Ltd is an existing name, it is same as Thunder11 Services Ltd. 

(ii) If Style Garments11 Ltd. is an existing name, it is same as Style Garments Ltd. 

Provided that clauses (f) to (h) and clauses (k) to (n) shall not be disregarded while comparing the names, if no objection by way of a board resolution has been provided by an existing company.

Conclusion:

The naming guidelines in the Companies Act, 2013 ensure that new company names are unique and desirable. These rules help avoid market confusion, protect trademarks, and maintain a professional image. By following these guidelines, businesses can create a strong and legal brand identity that reflects their values. Choosing the right name is an important first step in starting a company and sets the stage for future success.

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Disclaimer:

This document is intended for informational purposes and provides a general overview of the naming guidelines for company registration in India as per the Companies Act, 2013. It should not be construed as legal advice. Entities and individuals must consult legal experts to ensure compliance with the specific legal requirements and interpretations of the Act.

Prepared by
Mr. Smruti Ranjan Sahoo
(B. Com., LL.B)

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