Company Names Tribunal: significant changes to available defences

The Company Names Tribunal (the “Tribunal”) offers a relatively quick and inexpensive way for a brand owner to secure the change of a company name that includes its trade mark without authorisation. Most applications to the Tribunal are uncontested, meaning that a brand owner typically secures a name change by default. When applications are contested, a number of possible defences are available to respondent companies. Several of these were found in section 69(4)(b) of the Companies Act 2006 (“CA 2006”), which provided that an application will fail if the company: i) operates under the name; ii) proposes to operate under the name and has incurred substantial start-up costs; or iii) was formerly operating under the name and is now dormant.

The Economic Crime and Corporate Transparency Act 2023 (“ECCTA 2023”) introduces a variety of changes to the Companies Act 2006. Broadly, the legislation aims to fight economic crime (including money laundering, fraud and financing of terrorist activities) and improve transparency over corporate entities.

In line with this purpose, the implementation of ECCTA 2023 has resulted in the following changes to the CA 2006 which affect applications to the Tribunal:

1. Section 69(1)(b) is amended so that when comparing the similarity between the brand owner’s name in which they have goodwill and the registered company’s name to determine if it would mislead consumers, this assessment will no longer be carried out solely by reference to UK consumers. In Parliamentary debate concerning this change^[1], it was noted that this recognises the potential for company names to mislead consumers outside the UK.
2. Section 69(3) is amended so that individuals who were directors at the time the company name was registered may be joined as respondents. This change aims to plug a current loophole which allows individuals to avoid being joined as co-respondents by resigning their role as director.
3. Most significantly, section 69(4)(b) has been repealed. Although the notes of the parliamentary debate do not clearly indicate the purpose behind removing the substantial start-up costs / operating under the name defences, it appears to be linked to two high-profile scams in which: i) fraudsters attempted to solicit investment by using the name of a well-known drinks company to present themselves as an arm of that company; and ii) similar attempts by scammers to establish a link between themselves and a well-known bank. There may have been a concern that those fraudulent companies could potentially have relied on these defences.

(3) is a significant change in practice at the Tribunal. It will be very much welcomed by brand owners, in particular in circumstances where some time has passed since the incorporation of an objectionable company such that it is more likely to have incurred substantial start-up costs or to be trading under the name.

The changes came into effect on 4 March 2024^[2] and will apply to all active applications as at that date.

Please contact us if you would like to discuss these changes or, more generally, the suitability of the Tribunal as a forum to enforce your rights.

^[1]https://hansard.parliament.uk/commons/2022-11-01/debates/a0e9be16-7cd1-4a6e-ba4b-4ab54a38597a/EconomicCrimeAndCorporateTransparencyBill(SixthSitting)

^[2]Regulation 2(k) of UK SI 2024/269