From 28 May 2012, the regulation and administration of business names throughout Australia will shift from the current state and territory based system to a national system regulated by the Australian Securities and Investments Commission.
The new national scheme will introduce a number of efficiencies into the business name regime in Australia, including:
This article explores the effect of the new legislation on existing business names, how to register new business names and the rights and obligations of business name holders.Jeff Holowaychuk
The new national business names registration system is set out in the Business Names Registration Act 2011. It is expected to start on 28 May 2012. The Australian Securities and Investments Commission (ASIC) has announced that each of the state and territory governments has passed the necessary legislation to enable the new system to begin.
The objectives of the new national business name system are:
The new legislation will create a single system for the registration and administration of business names in Australia. From when the system starts, anyone with a registered business name will deal only with the ASIC for the registration, administration and renewal of business names.
Under the new system, a business name registration will be valid for use anywhere in Australia.
One state or territory If you currently have a business name registered in a state or territory, then you will not be required to register it again with ASIC. Instead, ASIC will automatically transfer all current business names registered in any state or territory to the national register. The registration details from the previously registered business name, including the principal place of business and expiry date, will be transferred to the new register.
More than one state or territory If you have a business name registered in more than one state or territory, then each of those registrations will be transferred to the new register. You may then decide:
However, ASIC has said that if it is able to reliably determine that the business names are identical and registered to the same holder then it may act on its own to combine multiple identical registrations.
Identical business names in different jurisdictions owned by different people When the business names are transferred to the new register, there may be two or more identical or nearly identical business names registered in different states or territories to different people. To reduce confusion, ASIC has said that it will provide additional information on the new register to assist people to differentiate between identical, or nearly identical, business names – for example:
If these identifiers are not sufficient to reduce confusion, then ASIC may add a distinguishing word as an additional identifier – for example, the name of the relevant state or territory. Although this identifier will not form part of the business name, it will help people distinguish between identical registered business names. ASIC will notify the people who own the relevant business names before making any changes.
After 28 May 2012, if you apply to register a business name, then you must apply to ASIC through its online application form. Your application must include the following information:
Before you apply to register the name, you should check to see that the business name is available for registration. You can do this by conducting business name, trade mark and domain name searches to ensure that a name that is identical or nearly identical to your proposed business name is not already in use.
If ASIC rejects your application for a business name, then you will not be required to pay the registration fee.
The new business name legislation imposes the following obligations on businesses and business name holders:
If you wish to transfer your business name registration to another person, then you must follow the process, within certain time periods, that ASIC has set.
Process The process is as follows:
Timing The transferee:
Owning a business name registration under the Business Names Registration Act 2011 does not give the holder ownership or intellectual property rights in the name. In fact, the registration merely gives the owner:
Even though the holder of a business name has that narrow protection, it does not enable them to sue anyone else for using the name.
If you wish to acquire a legally enforceable right to your business name, then you should consider applying to register the name as a trade mark with IP Australia, which is the government body that regulates intellectual property in Australia. You can also apply to register your business’s logo, product names etc. as a trade mark, see below.
Owning a registered trade mark gives the owner:
Having a registered business name does not give the owner any of these rights (though they can sell the business name).
For more information, contact Maddocks on (03) 9288 0555 and ask for a member of the Maddocks Commercial Team.
If you would like to register a trade mark, you can prepare the application using Cleardocs' Trademark Application product.
You can find more information about the trade mark application process here.
Paul is a Senior Associate in the Maddocks Commercial team with particular expertise in commercial agreements for the supply of goods and/or services, the Personal Property Securities Act 2009, the National Consumer Credit Protection Act 2009 and the National Credit Code and the Australian Consumer Law.
Paul's key areas of practice include:
Before joining Maddocks, Paul was employed for 13 years with the Victorian Department of Justice, principally as a Deputy Registrar in the Victorian Magistrate's Court, but also as a legislation, policy and project officer for the Department.
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For more information, contact Maddocks on (03) 9258 3555 and ask to speak to a member of their team.