New national business name laws
17 April 2012
The new national business name registration system to commence on 28 May 2012 is expected to make business name registration cheaper and more efficient.
Under the current system, businesses must register a business name in each State or Territory that the business trades. With the introduction of the national scheme, a business will only need to make one business name application regardless of where the business trades.
The new national register, to be administered by the Australian Securities and Investment Commission (ASIC), will be publicly accessible at www.asic.gov.au without charge. For each business name, the public will be able to view the name of the entity holding the business name, its principal place of business and its address for service. The Government believes this transparency will provide greater protection for consumers by enabling them to identify and contact the person(s) or company responsible for a business.
The fees for registration under the new scheme are:
- $30 for registration or renewal for one year; or
- $70 for registration or renewal for three years.
What you need to do
All existing registered business names will automatically transfer to the new business names register maintained by ASIC, and will retain their current expiry date. For business names that are registered in multiple States and Territories by the same owner, the latest expiry date will be reflected on the Register.
If your registered business name is set to expire before 28 May 2012 you will need to renew the registration under the relevant State or Territory law prior to this date. Your business name will then automatically transfer to the new business names register on 28 May 2012.
For identical business names that are registered by different owners in different States or Territories, ASIC may note a mark or expression on the Register to distinguish the names. For example ‘John Doe Plumbing’ may be registered in both Sydney and Melbourne. Under the new system, ASIC may add identifying marks - ‘Sydney’ and ‘Melbourne’ - to the respective business names on the Register. However, new applicants would not be able to register ‘John Doe Plumbing’; ‘John Doe Plumbing Sydney; ‘John Doe Plumbing Melbourne’ or any business name that is nearly identical to those names.
New businesses will need to obtain an ABN before they can register a national business name. A business will be able to make a joint online application for an ABN and business name at www.abr.gov.au.
There are obvious administrative benefits of a single business names registration system. Costs will also be considerably lower than the current system where businesses are required to register in each State/Territory in which the business operates.
The new national system may mean that a business has a similar or identical name to another business that currently operates in another State or Territory. Whilst existing identical names will be permitted on the Register, businesses in other States/Territories offering similar goods or services with an identical or confusingly similar name could have a negative impact on goodwill.
The new system may also highlight potential trade mark infringements and in some instances lead to disputes. It is advisable for a business, prior to registering a business name, to seek advice as to whether the use of the business name may constitute trade mark infringement or passing-off. IP Australia provides general information on trademarks and a free, public trade mark database at www.ipaustralia.gov.au.
If you would like more information about the new national business names registration scheme visit http://www.asic.gov.au/asic/asic.nsf/byheadline/Business+names?openDocument or contact your local Boyce Accountant.