Legal Considerations When Naming Your Business
Consider this scenario - you’ve spent hours brainstorming a business name, bounced ideas off friends and family, weeded out the duds and have, finally, settled on the perfect name, with a joy-sparking logo and branding to boot. However, whilst you’re in the middle of this design process (or worse, after you’ve started trading), you find out that your name is taken, in the legal sense or otherwise.
To avoid this conundrum, consider three safeguards to ensure that you will be able to take advantage of, and use, your chosen name to its full potential.
1. Consider Trade Marks
What is a trade mark?
Before we launch in, you may be wondering what a trade mark actually is. A trade mark is exactly what it sounds like: the mark that you trade under (we lawyers aren’t the most inventive when naming terms). It can be words, a logo, images, colours… the list goes on.
Is it important to register a trade mark?
In Australia, we have a system of registration for trade marks. Whilst you do not have to register your trade mark (unregistered trade mark owners do have certain rights), a registered trade mark will pretty much always trump an unregistered trade mark and most other claims to the name.
Why should I be considering trade marks?
Firstly (and very importantly), you need to check whether another similar business already has a registered trade mark of your business name.
If another similar business has already registered a trade mark of your chosen name, they could try to stop you from using it altogether by getting their lawyer to send you a (scarily-written) cease and desist notice. Obviously this could be catastrophic for your business, especially if you’ve been trading for some time and have already accrued goodwill in relation to that name (let’s not forget the ‘Tsubi’ trade mark case a few years ago, where the owner of the registered trade mark for ‘Tsubo’ was successful, ultimately resulting in Tsubi rebranding as ‘Ksubi’).
Better to save yourself the heartache and choose a name straight off the bat that hasn’t been registered as a trade mark by anyone else in your industry. You can use IP Australia’s search tool to search existing registered trade marks here: https://search.ipaustralia.gov.au/trademarks/search/quick). (It’s always a good idea to chat to an intellectual property lawyer about this, as the search engine can be utilised in different ways and there are a few technical things you need to be looking for, including deceptively similar marks and 'classes', which we'll come back to later).
Secondly, you should be considering trade marks to ascertain whether you will be able to register your mark yourself, either now or later down the track (FYI, there are numerous requirements to register a trade mark; certain marks will be harder to register than others and some trade marks may actually be impossible to register altogether). For example, "best law firm" is an example of a generic phrase that would be difficult to register as a trade mark.
How do I find out more or apply for a trade mark?
You guessed it – chat to an intellectual property lawyer!
Whilst you certainly don’t have to use a lawyer to apply for a trade mark and could choose to do so yourself, there are a few key benefits of using a qualified lawyer to apply for your trade mark, as:
they should be able to ensure that you’re applying for the right mark and in the right classes (there are different ‘classes’ for different goods and services, so it’s important to choose the right classes for your specific business);
they should proactively try to address any hurdles you might have with your application (we mentioned one example of a hurdle earlier); and
they should advise you on your prospects of registration so that you hopefully don’t throw money away by applying for something that a lawyer would know is unlikely to be accepted for registration.
2. Register your Business Name
Do I need to register my business name?
All businesses must register their business name (which is the name that they trade under).
Some people assume that they might not need to register a business name if their name (or the name of their entity) is the business name (eg if “Styled Solutions Pty Ltd” trades as “Styled Solutions”). Whilst this was once the case, those rules relating to trading names are on the way out (and will be transitioned out altogether from 1 November 2023). As such, it’s important to actually register your business name in all circumstances.
Why is it important to check the business name before naming my business?
ASIC, who is responsible for registering business names, will not register a business name if it is ‘identical or nearly identical’ to another existing registered business name.
So, you’ll need to check that your business name (or a nearly identical business name) isn’t taken first!
So what’s the point of a trade mark if I have a registered business name?
Registering the business name in itself does not give you exclusive trading rights or ownership of that name.
As we mentioned earlier, a registered trade mark will trump most other forms of name rights. This means that if someone has a registered trade mark, in your industry, of your business name, they could theoretically try to stop you from using that name (queue scary cease and desist notice again).
3. Purchase a Domain Name
This is important mainly from a commercial point-of-view, as most businesses would want to have a domain name that contains their business name. Legally, registering a domain name doesn’t necessarily give you rights over that name (other than the fact that you own the domain name).
Unfortunately, domain squatting is really common and the domains of many commonly used phrases or terms are already taken. If you want to have a domain name easily linked to your business name (eg www.jaidelaw.com.au), you should check first to see what variations of that name are available to purchase as a domain name.
This last safeguard isn’t necessarily a ‘legal protection’, but we do like to talk commercially with our clients and we know that having the right domain name can be valuable to a business and can help drive traffic to the website, so it’s an important consideration (and certainly sounds a lot better than www.jaide-law.legal.web).
Want to know more?
If you’d like to chat further about how we might be able to help you and your business, feel free to email us (or take a look around the website, to find out more about the firm).
*Disclaimer - We know most of you would realise this, but we wanted to reiterate that the above information is general in nature and does not take into account your personal circumstances. Legal, and other, information should not be relied upon in lieu of seeking appropriate professional advice, which we encourage you to do.