Guidelines for Selecting Company Name

Selecting your company name is one of the first and most important decisions you make when you venture into your business. After all, you want the company as well as its name to be part of your life for a long time to come. However the Companies Act, 2013 has detailed guidelines, restricting the words you could use as your company name, i.e. Private Limited, One Person Company or Limited Liability Partnership.

Basic Provisions as per Companies Act, 2013

The name of company shall end with the words “Limited (Ltd.)” in case of a Public Limited Company, “Private Limited (Pvt. Ltd.)” in case of a Private Limited Company, “Limited Liability Partnership (LLP)” or in case of a Limited Liability Partnership and “One Person Company (OPC)” in case of a One Person Company.

Requirement of Minimum Authorized Capital for use of Certain Words

The use of certain pre-determined words in the name of a company require the proposed company to mandatorily have a minimum amount of authorized capital for registration of company. The table details the words and the amount of minimum authorized capital required to incorporate those words in the name.

Your Company name can not be similar to another registered Company’s name

Your company needs to have a unique name. A proposed name for a company should not be same, identical or resemble too closely to the name of an existing corporate body. To determine whether a name is identical to that of an existing company, the following checks can be used:

• Use of Plurals: Simply using plural forms of words appearing in name of any already existing company shall not make name distinctive.

For Example: If there is a company with the name, “Opal Steel Private Limited”, then the name “Opal Steels Private Limited” shall not be allowed.

• Use of Different Letter Case, Spacing or Punctuation marks: Changes to upper or lower case of letters, spacing between letters, joining or separating words and punctuation marks does not make a name distinctive.

For Example: If there is a company with the name, “Opal Steel Private Limited”, then the name “OPAL Steel Private Limited” or “OpalSteel Private Limited” or “OP AL Steel Private Limited” or “Opal-Steel Private Limited” shall not be allowed.

• Use of Different tense or number instead of letters: Using different tenses or numbers instead of letters does not make a name distinctive.

For Example: If there is a company with the name, “Alpha One Steel Private Limited”, then the names “Alpha’s One Steel Private Limited” or “Alpha 1 Steel Private Limited” shall not be allowed.

• Use of spelling variations or misspelled words: Using different phonetic spellings or spelling variations, or if intentionally misspelled words are used as a name for the new company, it does not make a name distinctive.

For Example: If there is a company with the name, “RK Steel Private Limited”, then “R and K Steel Private Limited” or “Aar Kay Steel Private Limited” or “R n K Steel Private Limited or “R & K Steel Private Limited” shall not be allowed. If there is a company with the name, “Fox Star Private Limited”, then the name “Foxx Star Private Limited” shall not be allowed.

• Use of internet related designation: The use of internet related acronyms such as .com, .net, .edu, .gov, .org, .in does not make a name distinctive.

For Example: If there is a company with the name, “Fox Star Private Limited”, then the name “FoxStar.com Private Limited” or “FoxStar Dot Com Private Limited” shall not be allowed.

• Use of titles: Use of words like New, Modern, Navi, Shri, Om, Jai, Sai, etc. does not make name distinctive.

For Example: If there is a company with the name, “Fox Star Private Limited”, then the name “New Fox Star Private Limited” or “The Fox Star Private Limited” shall not be allowed.

• Jumbling or re-shuffling of words: Different combination of the same words by re-shuffling or jumbling them up, does not make a name distictive.

For Example: If there is a company with the name, “Fox Star Private Limited”, then the name “Star Fox Private Limited” shall not be allowed.

• Translation of words: If the new name is a literal translation or transliteration of the name of any existing corporate, then such name shall not be allowed.

For Example: If there is a company with the name, “Opal Steel Private Limited”, then the name “Opal Ispat Private Limited” shall not be allowed.

Your Company name should not be unacceptable

Under the following circumstances, the proposed name for your venture shall be considered legally unacceptable or prohibited by law.

• Violates Emblems and Names Act: The proposed company name should not violate Section 3 of the Emblems and Names (Prevention and Improper Use) Act, 1950.
• Violative of a Trademark: The proposed company name should not include the name of a registered trademark or a trademark which is subject to an application for registration, unless the consent of the owner or applicant for registration of trademark is obtained by the new company.
• Offensive Words: The proposed company name should not contain any profanity or words which are offensive to any section of the people. Name must not have words or phrases that are generally defamatory in nature for an ethnic group, religion or gender.
• Object of Company: If the proposed company name is not in conformity of the principal objects and business of the company you are incorporating, as stated in its memorandum of association. The name must be able to explain the activity you propose to undertake through such company.

If your Company name contains name of an Individual

In case the proposed company name includes a name of relatives, it needs to attach the proof of relation. If it includes the name of any person other than the name of owners/ shareholders/ promoters or their blood relatives, a No Objection Certificate must be taken from such person and attached with the application for name approval with Ministry of Corporate Affairs.

Words requiring approval from Central Government:

A proposed company name that includes any words and their combinations from the following list will require a prior approval from the Central Government.

(a) Board, (b) Commission, (c) Authority, (d) Undertaking, (e) National, (f) Union, (g) Central, (h) Federal, (i) Republic, (j) President, (k) Rashtrapati, (l) Small Scale Industries, (m) Khadi and Village Industries Corporation, (n) Financial Corporation and the like, (o) Forest Corporation, (p) Municipal, (q) Panchayat, (r) Development Authority, (s) Prime Minister or Chief Minister, (t) Minister, (u) Nation, (v) Development Authority, (w) Statute or Statutory, (x) Court or Judiciary, (y) Governor, (z) Development Scheme, (za) use of word Scheme with the name of Government(s), State, India, Bharat or any government authority or in any manner resembling with the schemes launched by Central, state or local Governments and authorities and (zb) Bureau.

Special conditions for Company Name

• Companies engaged in financial activities: If the Company’s main business is financing, leasing, chit fund, investments, securities or combination thereof, then a name indicative of such related financial activities, viz., Chit Fund/ Investment/ Loan, etc. should be a part of the name.
• Names indicative of business constitution not allowed: If any part of the proposed name includes the words indicative of a separate type of business constitution or legal person or any connotation thereof e.g. co-operative, sehkari, trust, LLP, partnership, society, proprietor, HUF, firm, Inc., PLC, GmbH, SA, PTE, Sdn, AG etc. then the name will NOT be allowed.
• Name that include British India: Any name that contains the word “British India” will not be allowed.
• Association with embassy or consulate or foreign government: If a proposed name implies association or connection with embassy or consulate or a foreign government then the name will not be allowed.
• Names implying patronage: If a proposed name includes or implies association or connection with or patronage of a national hero or any person held in high esteem or important personages who occupied or are occupying important positions in Government, then that name will not be allowed.
• Vague or abbreviated name: Vague or an abbreviated name such as ‘ABC limited’ or ‘23K limited’ or ‘DJMO’ Ltd or abbreviated name based on the name of the promoters will not be allowed.

Example:- BMCD Limited representing first alphabet of the name of the promoter like Bharat, Mahesh, Chandan and David will not be allowed.

• Names identical to a company dissolved as a result of liquidation: If the proposed name is identical to the name of a company dissolved as a result of liquidation proceeding. Then two years must have elapsed from the date of such dissolution for the name to be used again.
• If Names identical to a company which is struck off: If the proposed name is identical to the name of a company which in pursuance of action under section 248 of the Act was struck off, then the same shall not be allowed before the expiry of twenty years from the publication in the Official Gazette being so struck off.
• Names similar to Limited Liability Partnership: A name will not be allowed if it is identical with or too nearly resembles the name of an existing limited liability partnership or a limited liability partnership in liquidation or the name of a limited liability partnership which is struck off up to a period of five years.
• If Names that require Regulator approval: If the proposed name include words such as ‘Insurance’, ‘Bank’, ‘Stock Exchange’, ‘Venture Capital’, ‘Asset Management’, ‘Nidhi’, ‘Mutual fund’ etc., then a declaration must be submitted by the applicant that the requirements mandated by the respective regulator, such as IRDA, RBI, SEBI, MCA etc. have been complied with by the applicant.
• Names that include the word “State”: The word “State” will only be allowed in the case of a government company.
• Generic names will not be allowed: Names that only contain generic words like the name of a continent, country, state, city etc will not be allowed. For example Asia limited, Germany Limited, Haryana Limited, Mysore Limited or the name is a general one, like Cotton Textile Mills Ltd. or Silk Manufacturing Ltd. .
• Name that include another country name: If a proposed name includes name of any foreign country or any city in a foreign country, the same shall be allowed only if the applicant produces any proof of significance of business relations with such foreign country like MOU with a company of such country. No company can be incorporated using the name of an enemy country.

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