"There's a lot in a Name for Business in British Columbia", Vancouver Sun

by Janice and George Mucalov

What’s in a name? Plenty, especially when it comes to choosing a name for your business. Large companies often spend millions of dollars trying to pick a company name or sponsor contests for that just-right name; fortunes are made on the reputation associated with a business name. Think Coca Cola Ltd. and its tradename “Coke”. The stakes are high, and beware the competitor who attempts to horn in on the name.

Consider the legal muscle flexed when two related American companies and a Canadian group of companies, both in the car rental business, sued each other for the wrong of “passing off” – using deception to cash in on the goodwill and reputation already established by another.

The American companies, “Enterprise Rent-A-Car Company” and “Enterprise Rent-A-Car Limited” had used the “Enterprise” name in the U.S. since the early 1970s. They were well established in the “sun belt” states where Canadians often vacation. Then in 1980, along came the Discount car rental companies in Canada, which started using the name “Enterprise Car and Truck Rentals Ltd.” in 1992 – which Canada’s Federal Court concluded was done to thwart competition from the American companies in Canada. The court ultimately barred the Canadian companies from using the “Enterprise” name in association with their car and truck rental business.

Choosing the right corporate name isn’t easy. The name must ring a chord not only with you (and all those potential customers and clients, you hope). It must also be acceptable to BC’s Registrar of Companies if you’re looking to incorporate a provincial company. For a British Columbia company, you need a name that is both distinctive and also describes the type of business your company will carry on.

In general terms, the Registrar will usually approve a company name so long as it isn’t the same as or closely resembles any existing company names. Similiar names will be rejected because they may cause confusion. For example, “Matryx Technology Corporation” was rejected because another company already had the name “Matrix Technologies Inc.”. But the applicant’s third choice, “Matryx Modular Systems Inc.” (for a company developing a patent-pending modular technology for pre-fabricated building construction based upon a 3-D matrix) was accepted for registration.

Registration in British Columbia entitles your company to the exclusive registration of that name, and generally prohibits other similiar company names from being registered in British Columbia. But provincial registration doesn’t give you national name protection. In fact, a company with the same name may already be registered and carrying on business in another province. (If you incorporate federally, however, and have the name approved, you have the right to use that name across the country.)

Also, having a corporate name doesn’t automatically give you trademark rights. Provincial registration of your corporate name doesn’t bar an owner of a registered trademark with the same or similiar name from protesting your use of the name.

A trade name is the name under which a business is carried on. It can be the registered name of the corporation (“Joe’s Juicy Burgers Ltd.”) or a shortened or other version of it (“Joe’s Juicy Burgers”). A trade name can be registered as a trademark under the federal Trade-Marks Act.

The best way to protect against others using your carefully chosen name is to register your corporate or trade name as a trademark with the federal Canadian Intellectual Property Office. To stop someone from infringing on a registered trademark, you generally only need to prove ownership of that trademark – easier than bringing a court action for “passing off”.

Trademark registration of your corporate or trade name isn’t necessary in every business. But it’s worth considering if you have a significant investment through goodwill carefully built up in your business.

© Copyright by Janice and George Mucalov

A version of this column was first published in the Vancouver Sun. The column provides information only and must not be relied on for legal advice. Consult your lawyer if you need legal advice.