Choosing a name
When you apply to incorporate a company under the Canada Business Corporations Act, you may choose to use a corporate name or have a numbered name assigned to you. Although incorporating under a name involves additional effort and expense, there are advantages to doing so.
A corporate name is an important part of corporate communication and advertising today and can be a very valuable asset. It tells people who you are and will often represent the goodwill that you have built up with your customers and suppliers.
An approved federal corporate name offers an extra degree of protection of your rights to that name. Specifically, federal incorporation allows your business to operate using its corporate name right across Canada, which is important if you decide to expand your business to other provinces or territories.
- Applying for a corporate name
- Keeping your good name
- Not-for-profit corporations
- Frequently asked questions
Your name must meet certain requirements before it is approved by Corporations Canada:
- The name must be distinctive.
- The name must not cause confusion with any existing name or trade-mark.
- The name must include a legal element.
- The name must not include unacceptable terms.
It must be easy to distinguish your proposed name from the names of other businesses that carry on the same activities. Your name will not be distinctive if it merely describes those activities. The name "Car Manufacturer Inc." lacks distinctiveness since it describes the activities of all car manufacturers.
You can achieve distinctiveness in a number ways. One of the most common is to include an element that makes it distinctive. "Carwash Incorporated," for example, is too general, but "East Side Carwash Incorporated" is distinctive.
Made-up words also give a name distinctiveness. They can be a combination of two dictionary words such as "Infotech" or something completely new such as "Xerxos." Unusual names are highly distinctive and are given greater protection because they are unique.
Confusion with other names or trade-marks
It is to your advantage to learn about potential name conflicts as soon as possible. If your name is too close to an existing corporate name or trade-mark, the owner of that name or trade-mark could launch a court action to compel you to stop using your name and perhaps even to pay damages.
For many people, the prospect of discovering that their business name may be confused with another is intimidating. This is particularly true if you have invested considerable time and effort in coming up with a name or have been operating under the proposed name for some time before incorporating. The federal name approval process helps you to avoid this problem by identifying potentially confusing names or trade-marks in a federal database of names and ensuring that you satisfy yourself that confusion is not likely.
In assessing possible confusion, Corporations Canada looks at all circumstances, including a comparison of the goods, services and operating area of your proposed business with those of existing businesses. While name approval from Corporations Canada does not guarantee that you are not violating the rights of another firm or individual, it significantly reduces your risks.
You must submit a Nuans Name Search Report as part of your application to use your corporate name. A Nuans search compares your proposed name with a federal database of names that includes trade-marks, provincial and federal corporate names and most provincially registered business names (except corporate and business names in Quebec).
The accepted way to include a legal element in a corporate name is to add a term to the end of the name such as Limited, Incorporated or Corporation, or contractions of these such as Ltd., Inc. or Corp.
Unacceptable terms fall into three categories. First, there are terms that imply connections that do not exist. Your corporate name cannot suggest, for example, that you are a branch of the government or that you offer services or products governed by financial legislation, such as trusts, loans, insurance and banking.
The second type of unacceptable term is one that falsely describes your business. You cannot, for example, include terms that suggest that your company is selling cars when it is really selling only tires.
Finally, obscene terms or terms that suggest that your business provides obscene, scandalous or immoral services are not allowed.
Applying for a corporate name
The most important part of your name application is a Nuans Name Search Report. There are several types of Nuans reports and the one you need for federal incorporation is a Canada-biased report. A Canada-biased report means that the proposed name was searched against all the names found in the database, not just names registered in a particular province.
A Nuans Name Search Report may be obtained in two ways. First, you can order a Nuans Name Search Report online. The system provides direct access to the Nuans search service. You will have to ensure that you understand the regulations and policies which have to be met before the name will be approved by Corporations Canada. The Name Granting Compendium features more information about the requirements for corporate names.
A Nuans Name Search Report may also be requested from a private company known as a search house. A search house is an independent, private sector business that can provide advice on the availability of your corporate name choice.
The Nuans Name Search Report is valid for 90 days. If you do not submit your application for incorporation within that period, you must get a new report.
You may submit your proposed name along with your application for incorporation or you may ask for pre-approval of your proposed name. If you choose to submit your name along with your complete application, please be aware that if Corporations Canada rejects your proposed name, the entire application will be refused. A pre-approved name can prevent this situation from happening. There is no fee for this service. Send your application through the Corporations Canada Online Filing Centre.
Your application for pre-approval or for incorporation should be as complete as possible. If your first application is rejected, you may reapply with additional information later, but it is easier, and less expensive, to include all the relevant information the first time. Information considered relevant includes descriptions of your product or service, your customers and where your business will operate.
Keeping your good name
The name approval process does not guarantee protection against names or trade-marks existing at the time the name is approved. While the Nuans Name Search Report is usually very reliable, the Nuans system is not foolproof. The responsibility for ensuring your business name does not infringe on the rights of others is yours alone. It is also up to you to make sure that no new business names or registered trade-marks infringe on your rights.
Generally, names for federal not-for-profit corporations must meet the same requirements as for federal business corporations except the legal element requirement. However, not-for-profit names may receive a slightly more liberal interpretation with regard to distinctiveness since they are typically more general and descriptive than business names.
Frequently asked questions
Can I use my own name in the corporate name?
Yes, personal names are sufficiently distinctive and are acceptable in a corporation's name. Generally, however, you cannot use your name alone as the name of the corporation. For example, "Jill Jones Ltd." is not acceptable but "Jill Jones Consulting Ltd." is. No consent is required if you are signing the incorporating documents. Otherwise, you will have to provide consent.
My business already has a name but is not incorporated. Can I continue to use this name if I apply for federal incorporation?
All corporate names must satisfy the federal corporate name requirements. However, this does not prevent your corporation from carrying on business using the present name in the province where the name is registered.
No information issued by Corporations Canada is intended to replace professional advice.
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