Why do I need to Register my Business Name?

This is a question we often get asked and the answer can be surprisingly simple:

"Registering your business name generally means nobody else can trade with that business name"

but....

It does not necessarily give you automatic rights to use that name where, for example, the name may be trademark protected. Look at this search which shows I could register the business name "Microsoft Windows".

So while ASIC have some similar names registered as can be seen from the search result, you would be able to pay and register this name for your new window cleaning business.

The Microsoft Corporation may have objections to you using this name as it is likely they have it Trademark protected so you may receive a legal letter from the corporation demanding you change the name.

The point I am trying to make is that in some situations having the business name registered is not the only consideration when deciding on your business name.

One example where a business name does provide rights though is if it does not infringe on the intellectual property rights of another person. This will generally be the case if you are the first person to come up with the name.

The Burger King Fable

The Burger King story is one that is often misquoted but it does make a valid point, albeit an historically inaccurate one. The popular story goes that a fish and chip shop owner in Adelaide had traded under the name Burger King for years when the US corporate decided to expand into the Australian market. Despite millions of dollars of legal resources the typical aussie battler forced the US giant to establish its operations in Australia as Hungry Jacks because his business name predated any interest in the name by the US company.

The reality was the name had been trademarked by an Adelaide business and it wasn't so much the name that had provided the protection but the registered trademark. Still, had the name only been registered there would have been some record and therefore some argument that the Burger King name was not available. Whether that argument held up though would have ultimately been a matter for the courts to determine.

So Why Do You Need to Register your Business Name?

The short answer remains because it will generally prevent anybody else from using the name in Australia.

The Name Register is managed by ASIC and in 2012 became a national register. Prior to that there were individual state registers so it is still possible for businesses with the same name to be registered in different states but any new name registrations will need to be unique.

What if You Have a Pty Ltd Company?

Company names have always been unique and it was never permitted to have duplicate company names. Registering a company name automatically confers on that company the right to use the company name as a business name. So a company called "Microw Soft Windows Pty Ltd" will allow the business to trade as "Microw Soft Windows " without paying for an additional business name registration. Therefore if you are planning to trade as a company think about naming your company the same as your business name and save the name registration fee.

How do Trusts Work with Business Names?

Trusts are a popular trading structure because of the potential risk and tax benefits. Unlike company's there is no national trust name register so you can call your trust pretty much anything you want. Importantly, naming your trust the "Microw Soft trust" will not confer upon you any name rights so you will have to consider establishing a trustee company called Microw Soft Windows Pty Ltd or registering the business name Microw Soft Windows.

How do You Register a Business Name and What Does it Cost?

Registering a business name is a simple online process (CLICK HERE for a link to the ASIC site).

The fees to register a name are $34 for a single year or you can register a name for three years for $80 (fees current at the time of this post).

What Else Should You Know?

Starting a business can be complicated and getting the key decisions wrong at the beginning can be expensive to unravel. If you have not already spoken to us then give us a call on (07) 5439 1600 or CLICK HERE to make an appointment with one of our qualified staff and let us ease your burden. It may not cost much but could save you a lot of heartache and unnecessary expense down the track.