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Choosing and Protecting a Business Name: General Guidelines
By Carlotta Roberts
New Business owners
are often concerned about choosing a business name. They want to
choose the best name for their business and one that nobody else is
using. After they make the choice, they want to protect the name
they have chosen so that other businesses cannot use the same name.
Business owners are smart to realize that the issues revolving
around naming your business are more complicated than simply picking
a clever name for your start-up. The issues surrounding the choice
of name generally fall into two categories: mandatory government
requirements for registration of business names and optional
registrations that provide more comprehensive name protection.
Required Registrations:
- Trade or
Fictitious Name
If you will be using a name for your business other than your
personal name, you will want to register it to ensure that other
businesses cannot use the name you have chosen. This
registration process will also help you avoid legal problems
with competitors by keeping you from choosing a name that is
confusingly similar to that of another business. This
registration of an assumed or fictitious name is also referred
to as a “doing business as” or DBA. This registration is done
through the office of the clerk of the superior court in the
county where your business will be located. You must fill out a
short form and paying a small fee. This requirement applies to
home based businesses, too. Usually, such a registration is
required by a sole proprietorship or a partnership, but it may
also be required of a corporation or LLC if the corporation or
LLC will be operating under both the corporate or LLC name and a
DBA. For example, if you have incorporated your business as the
XYZ corporation but will be operating as the Sunshine Bakery,
you will need to register the Sunshine Bakery as a DBA unless,
of course, your first name is Sunshine and your last name is
Bakery!
- Incorporating
As part of the process of incorporating, you will be registering
your corporate name with the Secretary of State. This
registration process will reveal whether any other business has
a confusingly similar corporate name, and following the filing
of your corporate papers, you have the right and the obligation
to use the corporate name throughout the state in which you
filed. However, you don’t have the exclusive right to the name,
since other unincorporated businesses may already be using it as
a trade name and other businesses may be using the name as a
trade or service mark. In other words, your registration has
provided you with the exclusive right to use XYZ, Inc. That is,
your corporate name with the corporate designation such as Inc.
or Incorporated, Corporation or Corp; Company or Co., Limited or
Ltd. is protected in all counties in Georgia following your
filing with the Georgia Secretary of State. However, depending
on the situation, prior use of the name as a DBA or trade or
service mark by another business may prevent your use of the
corporate name if use of the name would be likely to confuse
customers. Therefore, it is always wise to conduct a name search
using governmental and non-governmental sources such as
telephone books, city directories, and industry trade
publications for your industry. All of the above applies to LLCs
as well.
Optional
Registrations
Whether you seek additional name protection beyond what is required
for your business or your products or services depends for the most
part on the size of your business and whether you think you might
operate beyond your local geographic area. It’s a good idea to
conduct a wider name search before choosing a name for your business
if you anticipate operating regionally or even nationally at some
time in the not so distant future. To do so, you should conduct a
search of the federal register of trade and service marks. You may
refer to http://www.uspto.gov/
for the patent and trademark office information. If you conclude
that the name you have chosen is available, you should look into
registering the name as a business trademark or service mark.
Although there is a cost attached to these registrations, it is far
more costly to have to change a business, product, or service name
in “midstream” because you have infringed on someone else’s name.
One word of caution, however: before you spend money on trade or
service mark protections be sure that your product or service has
some proven sales record so that you can justify spending the money.
Attorney Carlotta Roberts has been a consultant to small
business owners since 1981. She served as the Area Director
of the Kennesaw State University Small
Business Development Center from 1986 to 2002 where
she oversaw the provision of consulting services to over
5800 small business owners. She has created programs that
have won local and regional acclaim including The Franchise
Institute, which assisted potential and existing
franchisees, The Investor’s Forum, which brought businesses
seeking equity capital together with small angel investors,
and a series co-sponsored with the local SBA district office
which specifically targeted women business owners and women
who were potential owners.
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