One of the issues that continuously crops up is “how do I choose a name for my soon to be newly formed corporation?” This is a more complex matter than one would think.
The first legal concern is that you do not want a name that is the same or similar to that of another company, and you cannot name your business with exactly the same name as another registered company. When you incorporate your business, the lawyer you have chosen to assist you with the process will perform a name search — known as a N.U.A.N.S. search —which combs the registered names and provides the searcher with any name that is the same or similar in Canada (excluding Quebec). Your lawyer should then advise you whether it makes sense to go forward with the name or choose another.
Here is where the grey area develops: If there is a similar name registered in Calgary and the company is provincially registered, it may be quite sensible to go ahead with the name registration here in Toronto. However, if there is a similarly named company in Mississauga, you may have second thoughts about using the name.
In general business and marketing terms, a company name should be as unique and image provoking as possible. Although companies such as IBM (International Business Machines) and GM (General Motors) are relatively generically based names, the more original and remarkable a business name is, the better the branding possibilities and the more successful the consumer retention of your business name. Just think of the company Workbrain, and you immediately have an idea of the message the business is trying to suggest.
One other item: Company names are only designated in one jurisdiction — if you incorporate in Ontario, your name is not protected in Manitoba, let alone California. To protect it in each jurisdiction, you have to go through the process in each one.
Jeffrey D. Cowan, B.A., B.Comm, LL.B., M.B.A., is the principal of Cowan & Taylor, Barristers & Solicitors which practises in the areas of business and real-estate law. Cowan appears in Your Money every other week.
E-mail firstname.lastname@example.org call 416-363-5046 with questions for future columns. The information contained in this article should not be relied upon as legal advice.