Companies House are running stronger checks on company names using new powers given to it in the first set of measures introduced in March 2024 under the Economic Crime and Corporate Transparency Act 2023 ("ECCTA"). The ability to carry out extra checks on company names provides Companies House with extra powers to help clean and improve the integrity of the register of companies.
The measures
Prior to the introduction of the new measures, Companies House had the power to reject names which were the either the same or too similar to existing company names and also reject names containing certain terms which are restricted. The extra measures that are in place now allow Companies House to reject company names which may give a false or misleading impression to members of the public:
- Where the name is intended to facilitate fraud;
- If the name is comprised of or contains a computer code; or
- Where the name is likely to give a false impression that the Company is connected to foreign governments or international organisations.
When can Companies House enforce these measures
Any applications sent to Companies House to incorporate a company from March 2024 can be rejected if the name infringes the existing or further measures. It is therefore important that you carefully consider the proposed company name that you are intending to use before submitting your application.
As well as having the ability to reject applications to incorporate new companies or to change a company name, Companies House have the power to clean up existing companies on the register which breach these measures and can therefore direct companies to change its name within 28 days. If you fail to change the company name when required by Companies House within this timeframe, your company could be given a new name by Companies House, such as changing the company name to the company's registered number.
Companies House can also supress your company from the register until you have responded to the direction to change your company name.
Failure to comply with a direction from Companies House to change a company name or continue to use a company name which Companies House have required you to change is a criminal offence.
It is therefore important that you comply with directions given by Companies House to avoid committing any offence.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.