April 20, 2020

How to choose the right name for your Private Limited Company?

Choose the right name for your Private Limited Company is not an easy task. Selecting an appropriate and insightful name plays a huge role in future prosperity for any new business or startup. The name of a company creates the first impression on potential customers. Therefore, choosing a well-suited name becomes extremely vital, which has to be done with all efforts.

Naming a company doesn’t just involve the technical aspect but also has certain legalities involved.

Ignoring the Companies Act 2013 rules while choosing the private limited company name may attract unwanted litigation. That’s why we’re here to help you choose the perfect name for your upcoming endeavor.

Your consumers will remember and associate brands with the name of your company. So the procedures for naming a private limited company are quite similar to laying the base of a building. Hence, the name has to be well-aligned and strong; otherwise, it can be remembered for all the wrong reasons.

1. What is Company Name Registration and How does it Differ from a Brand Name?

The brand name is for products, and the registered company name is the actual name of a company that owns the brand. While a brand name is inclined towards luring potential customers, a company name acts as the official name by which the company is registered under the Companies Act.

Most of the time brand names and company names have some sort of similarities. For example, Amazon, the world’s largest e-commerce site, has been registered as Amazon.com Inc.

However, some companies choose to have a completely different brand name against its registered name. Snapdeal, another e-commerce site, is registered as Jasper Infotech Pvt Ltd.

2. MCA Rules You Need to Follow While Choosing The Name Of Your Private Limited Company

Ministry of Corporate Affairs (MCA) has constituted specific rules under the Companies Act of 2013 for naming a Private limited company. To get a name approved as per the Companies Act, the name has to be desirable, descriptive, and unique.

The uniqueness of a company’s name entirely depends on the owner’s creativity.

Depending on the Companies Act 2013, and Companies Incorporation Rules 2014, the guidelines for naming a company are as follows:

Don’t use an adjective or generic words while naming a company. For instance, names like Best Mobile or India Mobile won’t be accepted by MCA because of using adjective and generic words.

Do extensive research on already existing names. Proposing an already existing name to MCA is a complete waste of time. Make sure you check out MCA’s official website for the list of company names before deciding on a name

Ensure no registered trademarks are already existing by the same name as your proposed company name. This can be done by visiting IP India’s official website.

Write a decent objective note to the MCA behind the reason for naming your company. Every name has a future vision behind it. Explaining that vision to the MCA increases your possibility of getting the name.

The chosen name should not have words like ‘State’ or ‘Central’ in it. Only Government-run companies can include those words in their name. Also don’t insert any country, city, or state’s name. Only foreign companies with Indian subsidiaries can add the word ‘India’ after its actual name.

Do not attach any word like trust, co-operative, and society which indicates your Pvt Ltd company as a different type of entity.

All identical names of a recently dissolved company are preserved for a period of two years from the day of dissolution. Before that, no one can use such names.

The company who is dealing with financial stuff needs to have a name related to financial aspects.

All the companies, which are established as Nidhi, may include Nidhi Limited at the end of the company name.

A few names are there, which need approval from the Central Government. These are- A company name which holds, Prime Minister, Union, Scheme, Statutory, National, Federal, and Small Scale.

The naming should be done in resonance with the principal object of the company

Company names which include Insurance, Bank, Venture Capital, Mutual Fund need to get regulatory compliance from the regulatory bodies- IRDA, SEBI, and RBI.

3. Tips to follow while finalising Company name

If you don’t want to mess up with your company’s name, these points into consideration before registering your private limited company. Here you go!

Select a name, which is easy to remember, impactful, easy to pronounce, short and thoughtful enough to communicate your brand with your customers. Say no to complex words.

If you select a name, which is quite similar to any existing company, it’s a bad idea. There are a number of cases where brands were compelled to change the name later because of striking similarities to other companies, and you won’t ever like to do that, right? Ultimately you have spent hefty amount on marketing your brand.

The name must convey what the mission of your business is. Let the name of your company showcase what it is all about and which product you’re selling. End of the day, you won’t ever like people to think of cars when you are into the food business.

Check whether the domain name is available or not. In this era of digitalization, when the domain is not available after your brand’s name, it doesn’t make any sense to choose that name for your company.

Alongside the domain name, you have to make sure it’s available with the proper domain extension. If you are doing business in India, .in or .com is preferred. For global businesses or country-specific businesses, you have to select the extension accordingly.

4. Time required to register company Name

You can easily get your company registered within only seven days. Even, the process is so seamless that you can get the registration done without being physically present to the government offices.

This might seem impossible even a few decades ago, but now India has gone digital, so online company registration is made easier. You can fill every document electronically, and no need to visit the place of business registration in India.

5. Conclusion

Having a unique and eye-catching name boosts a company by a fair margin. Clever names with intelligent wordplay create a good impression of the founders as well as the company. Consumers are more inclined to such companies. Read to know more about Type of companies in India

So, think twice before making up your mind. Do you need professional assistance to choose the right name for your business? Well, post your queries in the comment section. Our experts will surely resolve those!

DISCLAIMER: The views expressed are strictly of the author and VJM & Associates LLP. The contents of this article are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon.

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